HomeMy WebLinkAboutContract 43117-A1 (2)CITY SECRETARY
CONTRACT N09
FIRST AMENDMENT TO CITY SECRETARY
CONTRACT NO. 43117 •
WHEREAS, on April 13, 201.2 the City of Fort Worth ("City") and Hillside Public
Facility Corporation ("Developer") made and entered into City Secretary Contract No. 43117
(the "Contract") as authorized by the City Council in M&C C-24974 adopted on June 14, 2011;
WHEREAS, the purpose of the Contract was to provide $700,000.00 in the form of a
subordinate forgivable loan for acquisition expenses, as well as soft costs and rehabilitation
expenses for the renovation of the historic Knights of Pythias Lodge building, as part of the
development of an 18 unit multifamily, mixed income housing development in downtown Fort
Worth to be known as the Knights of Pythias Lofts;
WHEREAS, the funding provided to Developer in the Contract was from grant monies
received by City from the United States Department of Housing and Urban Development
("HUD") through the Community Development Block Grant ("CDBG"), Program No. B -05-
MC-48-0010, Catalog of Federal Domestic Assistance No. 14.218 ("CDBG funds");
WHEREAS, a reevaluation of development costs and financing sources showed a
funding gap and the City Council in M&C C-25644 adopted on June 12, 2012 authorized the
award of an additional $250,000.00 of CDBG funds for the project increasing the total grant
award in the Contract to $950,000.00 of CDBG funds;
WHEREAS, the Contract provided for 10 Affordable Units to be rented to CDBG-
eligible tenants for a 15 year Affordability Period with repayment of the $750,000.00 loan to be
forgiven at the end of the Affordability Period provided all Contract terms and CDBG
requirements were fulfilled;
WHEREAS, the additional $250,000.00 of CDBG funds is in the form of a second lien
subordinate loan which must be repaid with accrued interest at the end of the Affordability
Period;
WHEREAS, it is the mutual desire of City and Developer to amend the Contract to meet
Contract objectives.
NOW, THEREFORE, City, whose address is 1000 Throckmorton St., Fort Worth TX
76102, acting by and through Fernando Costa, its duly authorized Assistant City Manager, and
Developer, whose address is 1201 E. 13th Street, Fort Worth, TX 76102, acting by and through
Terri Attaway, its duly authorized President, do hereby agree as follows:
I.
Section 2. DEFINITIONS is amended to be and read as follows by adding the
following definitions:
CDBG CONSTRUCTION CONTRACT CSC No. 43117 A - 1
Hillside Public Facility Corporation — Knights of Pythias Lofts
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OFFICIAL RECORD
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"Accessible Units means units accessible to handicapped tenants. Developer must
comply with the requirements of Section 504of the Rehabilitation Act of 1973 and other
applicable Federal accessibility requirements.
The Development must contain 2 Accessible Units. Of these 2 units, 1 must be
accessible to individuals with mobility impairments, and 1 must be accessible to
individuals with visual or hearing impairments."
"Business Diversity Enterprise Ordinance or BDE means the City's Business
Diversity Ordinance, Ordinance No. 20020-12-2011."
"DBE means disadvantaged business enterprise."
"Loan means collectively, (i) the second lien repayment loan of $250 000.00 of Funds
from City to Developer, and (ii) the third lien forgivable deferred payment loan of
$700,000.00 of Funds from City to Developer. '
The definition of Complete Documentation is amended to be and read as follows by
substituting the following for Other documentation (iii):
"(iii) documentation to show compliance with BDE or DBE bidding process for
procurement or Contract activities, if applicable;'
The definition of Deed of Trust is amended to be and read as follows by substituting the
following:
"Deed of Trust means any deed of trust from Developer in favor of City covering the
Property and securing the indebtedness evidenced therein and Developer's performance
of the requirements of this Contract and the of the CDBG Regulations. The forms of the
Deeds of Trust are attached as Exhibit E — $700,000 Loan Documents and E-1 —
$250,000 Loan Documents."
The definition of Loan Documents is amended to be and read as follows by substituting
the following:
'Loan Documents means security instruments, including without limitation any
Promissory Note and Deed of Trust, securing or guaranteeing City's interest in the
Development and further evidencing, securing, or guaranteeing Developer's performance
during the Affordability Period, as the same may from time to time be extended,
amended, restated, supplemented or otherwise modified."
The definition of Promissory Note is amended to be and read as follows by substituting
the following:
CDBG CONSTRUCTION CONTRACT CSC No. 43117 A - 1 Page 2
Hillside Public Facility Corporation — Knights of Pythias Lofts
"Promissory Note means any note in the amount of the Funds executed by Developer
payable to the order of City. The forms of the Promissory Notes are attached as Exhibit
E — $700,000 Loan Documents and E-1 $250,000 Loan Documents."
The definition of Tenant Documentation is amended to be and read as follows by
substituting the following:
"Tenant Documentation means any documentation allowed under the definition of
annual income in 24 CFR Part 5.609 sufficient to show that a tenant is a CDBG Eligible
Household. Documentation may include but is not limited to pay check stubs, Social
Security statements, W-2 forms, and/or payments in lieu of earnings (unemployment)."
II.
Section 4 1 Provide Funds is amended to be and read as follows by substituting the
following:
"4.1 Provide Funds.
4.1.1 City shall provide up to Seven Hundred Thousand and No/100
($700,000.00) of Funds in the form of a third lien forgivable deferred payment loan to
Developer for the Project (the "$700,000.00 Loan"). The Funds shall be provided to
Developer on a reimbursement basis, upon City's approval of Developer's
Reimbursement Requests.
4.1.2 City shall provide up to Two Hundred Fifty Thousand and No/100
($250,000.00) of Funds in the form of a second lien loan to Developer for the Project (the
`$250,000.00 Loan"). The Funds shall be provided to Developer on a reimbursement
basis, upon City's approval of Developer's Reimbursement Requests.
4.1.3 The Funds may only be used for acquisition of the Property, rehabilitation
costs for the historic Knights of Pythias Lodge building and soft costs attributable to the
rehabilitation of the existing building, as approved by City in accordance with the CDBG
Regulations and this Contract. No funds may be spent on construction or soft costs
attributable to the new building to be constructed.'
Section 5.6 Security for Citv's Interest and Developer's Performance is amended
to be and read as follows by substituting the following:
5.6 Security for Citv's Interest and Developer's Performance.
To secure City's interest in the Project and the performance of Developer's
obligations hereunder, Developer shall (i) execute the Loan Documents and record the
Deed of Trust for the $700,000.00 Loan at the closing of the acquisition of the Property,
CDBG CONSTRUCTION CONTRACT CSC No. 43117 A - 1 Page 3
Hillside Public Facility Corporation — Knights of Pythias Lofts
and (ii) execute the Loan Documents and record the Deed of Trust for the $250,000.00
Loan at the closing of the construction and permanent loan financing. No Funds will be
reimbursed until the Loan Documents are executed and the related Deed of Trust is
recorded.
Subsection 5.6.1 Loan Terms and Conditions is amended to be and read as
follows by substituting the following:
"5.6.1.2
Pay all costs associated with closing the Loan. Provide
City with a Mortgagee s Policy of title insurance in the
amount of the Loan.
5.6.1.3 At least 1 business day before closing, provide City with an
estimated settlement statement.
5.6.1.4 Interest shall accrue on the $250,000.00 Loan at the rate of
1% per annum. Principal and accrued but unpaid interest
shall be paid in full at the expiration of the Affordability
Period.
5.6.1.5 Ensure the City's lien for the $250,000 00 Loan is in
second hen position and the City's lien for the $700,000.00
Loan is in third lien position. The Loan shall be subordinate
only to Developer's construction and permanent financing
unless otherwise approved in writing by City
Additionally, City must approve in writing any secured
financing that is subordinate to the Loan."
Section 5.7 Affordability Requirements is amended to be and read as follows by
substituting the following:
"5.7 `Affordability Requirements.
Developer shall ensure that the Affordable Units remain occupied by CDBG
Eligible Households throughout the Affordability Period. Developer must notify the City
in writing within 30 days of either of the following occurrences (i) an Affordable Unit is
occupied by a tenant who is not a CDBG Eligible Household or (ii) an Affordable Unit
remains vacant for more than 90 days In the event that an Affordable Unit is occupied
by a tenant who is not a CDBG Eligible Household Developer shall have 30 days to
determine if a market rate tenant qualifies as a CDBG Eligible Household or fill an empty
market rate unit with a CDBG Eligible Household. If either (i) or (ii) takes place and is
not cured within the time limits described in this Section, then Developer shall pay to
City 10% of the Loan amount as liquidated damages. The Parties agree that City's actual
damages in the event of either (i) or (ii) happening and remaining uncured are uncertain
and would be difficult to ascertain and may include a finding by HUD a repayment of
funds to HUD by City or otherwise impact the City's CDBG grant or other federal grant
CDBG CONSTRUCTION CONTRACT CSC No. 43117 A -1 Page 4
Hillside Public Facility Corporation — Knights of Pythias Lofts
funds. Therefore, the Parties agree that payment under this Section of 10% of the Loan
amount by Developer to City is liquidated damages and not a penalty."
Section 5.8 Affordability Requirements Survive Transfer is amended to be and read as
follows by substituting the following:
"5.8 Affordability Reuuirements Survive Transfer of Ownership.
Any sale or transfer of the Development during the Affordability Period,
excluding a transfer due to condemnation or to obtain utility services, will require that the
new owner or transferee must assume in writing the obligations established hereunder for
the Affordable Units. Failure of the transferee to assume the obligations under this
Contract will result in termination of the Contract and any Funds already paid to
Developer must be repaid to City within 30 days of termination under this Section. In the
event of termination under this Section5.7, all Funds awarded but unpaid to Developer
pursuant to this Contract shall be immediately rescinded and Developer shall have no
further right to such funds, and any Funds already paid to Developer must be repaid to
City within 30 days of the termination. Failure to repay such Funds will result in City
exercising all legal remedies available to City under this Contract and the Loan
Documents.
Section 5 DUTIES AND RESPONSIBILITIES OF DEVELOPER is amended to
be and read as follows by adding the following new section
"5.9 Meet National Objective.
Developer certifies that the activities carried out under the Project and this
Contract will meet the National Objective of benefitting low- and moderate- income
persons."
IV.
Section 7.2.1 is amended to be and read as follows by substituting the following
"7.2.1 Developer must verify that all tenants of Affordable Units are CDBG
Eligible Households with Tenant Documentation at the time that each lease for an
Affordable Unit is signed. Tenants must certify the number of people in their household
along with names and ages. Developer shall obtain financial information on all members
of a tenant's household. Developer must maintain copies of such Tenant Documentation
as required under this Contract Thereafter, Developer must annually verify the income
of all tenants and members of their households occupying the Affordable Units, but may
use the Certification of Income Statement attached as Exhibit I — Tenant Self
Certification Form rather than Tenant Documentation. '
CDBG CONSTRUCTION CONTRACT CSC No. 43117 A - 1 Page 5
Hillside Public Facility Corporation — Knights of Pythias Lofts
Section 7.3 Tenant Lease is amended to be and read as follows by substituting the
following:
"7.3 Tenant Selection: Tenant Lease.
Developer shall not discriminate against any person because of race, color, sex,
gender religion, national origin, familial status, disability or perceived disability, sexual
orientation, gender identity, gender expression, or transgender in the selection of tenants,
nor will Developer permit its officers, members, agents, employees, or Project
participants to engage in such discrimination. Prior to leasing any unit in the
Development, Developer shall submit the form of its lease to City for its approval."
V.
Section 8.1 Environmental Review is amended to be and read as follows by
substituting the following:
"8.1 Environmental Review.
8.1.1 Funds will not be paid, and costs cannot be incurred until City has
conducted and completed an environmental review as required by 24 CFR Part 58. The
environmental review may result in a decision to proceed with, modify, or cancel the
Project. Further, Developer will not undertake or commit any funds to physical or choice
limiting actions including if applicable property acquisition, demolition, movement,
rehabilitation, conversion, repair or construction prior to the environmental clearance.
Any violation of this provision will (i) cause this Contract to terminate immediately; (ii)
require Developer to repay the Funds to City and forfeit any future payments of Funds;
and (iii) Developer must pay 20% of the Fund amount to City as liquidated damages.
The Parties agree that City's actual damages in the event of a violation of this provision
are uncertain and would be difficult to ascertain and may include a finding by HUD, a
repayment of funds to HUD by City or otherwise impact the City's CDBG grant or other
federal grant funds Therefore, the Parties agree that payment under this Section of 20%
of the Loan amount by Developer to City is liquidated damages and not a penalty.
8.1.2 Developer must take the mitigation actions outlined in Exhibit A-2 Environmental Mitigation Action. Failure to complete the required mitigation action is
an event of default under this Contract."
Section 8 ADDITIONAL REOUIREMENTS is amended to be and read as follows
by adding the following new section:
"8.11 Payment and Performance Bonds.
Subject to the requirements of 24 CFR Part 85.36, Developer shall furnish City
with payment and performance bonds in a form acceptable to City in the amount of the
construction cost for the Development but not less than $1,837,500.
CDBG CONSTRUCTION CONTRACT CSC No. 43117 A -1 Page 6
Hillside Public Facility Corporation — Knights of Pythias Lofts
VI.
Section 12. REPAYMENT OF FUNDS is amended to be and read as follows by
substituting the following:
"12. REPAYMENT OF FUNDS.
All Funds are subject to repayment by Developer in the event the Project or the
Development does not meet the requirements as set out in this Contract or in the CDBG
Regulations, including but not limited to meeting the National Objective. If Developer
takes any action that (i) results in City receiving a finding from HUD about the
Project or (ii) results in the City being required to repay all or any portion of the
Funds to HUD, Developer agrees it will reimburse City for such repayment. In the
event of a finding or a request for repayment from HUD, whether or not repayment
to HUD is required of City, Developer agrees it will pay City 10% of the Funds as
liquidated damages. The Parties agree that City's damages in the event of either (i) or
(ii) happening are uncertain and would be difficult to ascertain and may include an
impact on City's CDBG grant or other federal grant funds, in addition to a finding by
HUD or a repayment of funds to HUD by City. Therefore, the Parties agree that payment
under this Section of 10% of the Loan amount by Developer to City is liquidated
damages and not a penalty."
VII.
Section 14.10 Paragraph Headings for Reference Only. No Legal
Significance is amended to be and read as follows by substituting the following:
"14.10. Paragraph Headings for Reference Only: Number.
The paragraph headings contained herein are for convenience in reference to this
Contract and are not intended to define or to limit the scope of any provision of this
Contract. When the context requires, singular nouns and pronouns include the plural."
Section 14.15 Subcontracting with Small and Minority Firms, Women's
Business Enterprises and Labor Surplus Areas is amended to be and read as follows by
substituting the following:
"14.15 Subcontracting with Small and Minority Firms. Women's
Business Enterprises and Labor Surplus Areas.
14.15.1 For procurement contracts $50,000.00 or larger, Developer agrees
to abide by City's policy to involve Minority Business Enterprises and Small Business
Enterprises and to provide them equal opportunity to compete for contracts for
construction, provision of professional services, purchase of equipment and supplies and
provision of other services required by City. Developer agrees to incorporate the City's
CDBG CONSTRUCTION CONTRACT CSC No. 43117 A - 1 Page 7
Hillside Public Facility Corporation — Knights of Pythias Lofts
BDE Ordinance and all amendments or successor policies or ordinances thereto, into all
contracts and subcontracts for procurement $50,000.00 or larger, and will further require
all persons or entities with which it so contracts to comply with said ordinance.
14.15.2 It is national policy to award a fair share of contracts to
disadvantaged business enterprises ("DBEs"), small business enterprises (`SBEs"),
minority business enterprises ("MBEs"), and women's business enterprises ("WBEs").
Accordingly, affiunative steps must be taken to assure that DBEs, SBEs, MBEs, and
WBEs are utilized when possible as sources of supplies, equipment, construction and
services."
VIII.
Section 17 INSURANCE AND BONDING is amended to be and read as follows by
substituting the following:
"17. INSURANCE AND BONDING.
Developer will maintain blanket fiduciary coverage in the form of insurance or bond in
the amount of $50,000.00 to reimburse City for any and all loss of CDBG Funds. To
effectuate such reimbursement, such fiduciary coverage shall include a rider stating that
reimbursement for any loss or losses thereunder shall be made directly to City. In
addition, Developer shall maintain an Employee Dishonesty policy to cover it for
employee theft of money, securities or property.
Developer shall carry insurance in the types and amounts for the duration of this Contract
as listed below, and furnish certificates of insurance along with copies of policy
declaration pages and policy endorsements as evidence thereof.
Commercial General Liability ("CGL") Insurance
$1,000,000 Each Occurrence
$2,000,000 Aggregate Limit
The CGL policy shall be the primary insurance with respect to any other
insurance afforded the City. It shall have no exclusions or endorsements that
would alter or nullify premises/operations, products/completed operations,
contractual, personal injury or advertising injury which are normally contained
within the policy unless City approves such exclusions in writing.
Professional Liability (Errors and Omissions)
$1,000,000 Each Claim Limit
$1,000,000 Aggregate Limit
Professional Liability coverage may be provided through an endorsement to the
Commercial General Liability policy, or a separate policy specific to Professional
Error and Omissions. Either is acceptable if coverage meets all other
CDBG CONSTRUCTION CONTRACT CSC No. 43117 A - 1 Page 8
Hillside Public Facility Corporation — Knights of Pythias Lofts
requirements. Coverage shall be on an occurrence basis or claims -made basis,
and maintained for the duration of the Contract and for 2 years following
completion of services provided. An annual certificate of insurance shall be
submitted to the City to evidence coverage.
Automobile Liability
$1 000,000 each accident on a combined single -limit basis, or
$100,000 Property Damage
$250,000 Bodily injury per person
$500,000 Bodily Injury per person per occurrence
Coverage shall be a commercial business policy which provides coverage on "Any
Auto", defined as any vehicle owned, hired or non -owned. Specifically, this means
coverage on any vehicle used by the Developer's employees, agents, or representatives
in the course of the providing services under this Contract.
Workers Compensation Insurance
Statutory Limits
Employer s Liability
$100,000 Each accident/occurrence
$100,000 Disease - each employee
$500,000 Disease - policy limit
This coverage may be written as follows:
Workers' Compensation and Employers' Liability coverage with limits consistent
with statutory benefits outlined in the Texas Workers' Compensation Act (Art.
8308 — 1.01 et seq. Tex. Rev. Civ. Stat.) and minimum policy limits for
Employers Liability of $100,000 each accident/occurrence, $500,000 bodily
injury disease policy limit and $100,000 per disease per employee.
Note: Such insurance shall cover employees performing work on any and all
Programs including but not limited to construction, demolition, and rehabilitation.
Developer or its contractors shall maintain coverages, if applicable. In the event
the respective contractors do not maintain coverage, Developer shall maintain the
coverage on such contractor, if applicable, for each contract.
Additional Requirements
Developer is responsible for providing City a 30 day notice of cancellation or non -
renewal of any insurance policy and may not change the terms and conditions of any
policy that would limit the scope or coverage, or otherwise alter or disallow coverage as
required herein.
Such insurance amounts may be revised upward at City's option no more frequently than
once every 12 months City shall give 90 days' notice to Developer of any such
adjustments.
CDBG CONSTRUCTION CONTRACT CSC No. 43117 A - 1 Page 9
Hillside Public Facility Corporation — Knights of Pythias Lofts
Where applicable, insurance policies required herein shall be endorsed to include City as
an additional insured as its interest may appear. Additional insured parties shall include
City' s employees, officers, agents, and volunteers. This requirement does not include
Workers' Compensation or Automobile policies.
The Workers' Compensation Insurance policy shall be endorsed to include a
waiver of subrogation, also referred to as a waiver of rights of recovery, in favor of
City
Certificates of Insurance shall be signed by an agent authorized to bind coverage on
behalf of on the insured, be complete in its entirety, and show complete insurance carrier
names as listed in the current A.M. Best Property & Casualty Guide.
Unless otherwise stated, all required insurance shall be written on an `occurrence basis".
If coverage is underwritten on a claims -made basis, the retroactive date shall be
coincident with or prior to the date of the Contract and the certificate of insurance shall
state the coverage is claims -made and the retroactive date.
City shall be entitled, upon written request and without expense, to receive copies of
policies and endorsements thereto and may make any reasonable requests for deletion or
revision or modifications of particular policy terms, conditions, limitations or exclusions
necessary to conform the policy and endorsements to the requirements of this Contract.
Deletions, revisions or modifications shall not be required where policy provisions are
established by law or regulations binding upon either Party or the underwriter of any such
policies.
Any failure on part of City to request certificate(s) of insurance shall not be construed as
a waiver of such requirement or as a waiver of the insurance requirements themselves.
Insurers of Developer's insurance policies shall be licensed to do business in the state of
Texas by the Department of Insurance or be otherwise eligible and authorized to do
business in the state of Texas. Insurers shall be acceptable to City insofar as their
financial strength and solvency and each such company shall have a current minimum
A.M Best Key Rating Guide rating of A: VII or other equivalent insurance industry
standard rating otherwise approved by City.
Deductible limits on insurance policies shall not exceed $5,000 per occurrence unless
otherwise approved by City.
In the event there are any local, federal or other regulatory insurance or bonding
requirements for the Program, and such requirements exceed those specified herein, the
former shall prevail.
CDBG CONSTRUCTION CONTRACT CSC No. 43117 A - 1 Page 10
Hillside Public Facility Corporation — Knights of Pythias Lofts
Developer shall require its contractors to maintain applicable insurance coverages, limits,
and other requirements as those specified herein; and, Developer shall require its
contractors to provide Developer with certificate(s) of insurance documenting such
coverage. Also, Developer shall require its contractors to have City and Developer
endorsed as additional insureds (as their interest may appear) on their respective
insurance policies.
Developer shall require its general contractor to maintain builders risk insurance at the
value of the construction."
PC.
Exhibits A, B and C attached to the Contract are hereby replaced with Exhibits A, B and
C attached hereto. Exhibit A-2 — Environmental Mitigation Actions, Exhibit E-1 - $250,000
Loan Documents and Exhibit I — Tenant Self Certification Form are added to the Contract.
X.
All other terms and conditions of City Secretary Contract No. 43117 not amended herein
remain unaffected and in full force and effect, are binding upon the Parties, and are hereby
ratified by the Parties.
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CDBG CONSTRUCTION CONTRACT CSC No. 43117 A - 1 Page 11
Hillside Public Facility Corporation -- Knights of Pythias Lofts
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mtecu.
A-s-\--h City Secretary
M&C C-24974
M&C C-25644
CUTED as of the last date indicated below by the Parties' signatures.
Date: June 14, 2011
Date: June 12, 2012
CITY OF FORT WORTH
BY: 4Leera44.4444
Fernando Costa, Assistant City Manager
APPROVED AS TO FO ' ,I AND LEGALITY:
Assistant City Attorney
DEVELOPER:
HILLSIDE PUBLIC FACILITY
CORPORATION
By:
Terri Attaway, President
STATE OF TEXAS
COUNTY OF TARRANT
This instrument was acknowledged before me on
Fernando Costa, Assistant City Manager of the City of Vort Worth, on behalf the City of
Fort Worth.
EVONIA DANIELS
MY COMMISSION EXPIRES
July 10, 2013
STATE OF TEXAS
COUNTY OF TARRANT
02.3 , 2012 by
d.Lti
Notary Public, State of Texas
This instrument was acknowledged before me on , 2012 by
Terri Attaway, the President of Hillside Public Facility Corporation, a Texas public
facility corporation, on behalf of said corporation.
Notary Public, State of Texas
CDBG CONSTRUCTION CONTRACT CSC No. 43117 A - 1
Hillside Public Facility Corporation — Knights of Pythias Lodge Lofts
OFFICIAL RECO D
CITY SECRET
Ft IN.rat M fl , TN
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EXECUTED as of the last date indicated below by the Parties' signatures.
ATTEST:
City Secretary
M&C C-24974
M&C C-25644
Date: June 14, 2011
Date: June 12, 2012
CITY OF FORT WORTH
By:
Fernando Costa, Assistant City Manager
APPROVED AS TO.FORM A D LEGALITY:
(kJ aztattA
Assistant City Attorney
DEVELOPER:
HILLSIDE PUBLIC FACILITY
CORPORATION
By:
Terri Attaway, President
STATE OF TEXAS
COUNTY OF TARRANT
This instrument was acknowledged before me on , 2012 by
Fernando Costa, Assistant City Manager of the City of Fort Worth, on behalf the City of
Fort Worth.
Notary Public, State of Texas
STATE OF TEXAS §
COUNTY OF TARRANT §
This instrument was acknowledged before me on A—u@i) set- a , 2012 by
Terri Attaway, the President of Hillside Public Facility Corporation, a Texas public
facility corporation, on behalf of said corporation.
•
ro��.• •.�, ELAINE AIBARRAN
Notary Public
• , State of Texas
•• ••-
�^,:•. ..may; My Commission Expires
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- November 1 7, 2015
Notary Public, State of Texas
CDBG CONSTRUCITON CONTRACT -1ST Amendment
Hillside Public Facility Corporation — Knights of Pythias Lodge Lofts
EXHIBIT "A"
PROJECT SUMMARY - SCOPE OF WORK - Revised 08/2012
HILLSIDE PUBLIC FACILITY CORPORATION
DESCRIPTION:
The Hillside Public Facility Corporation ("Developer") will use Community Development Block
Grant ( CDBG') funds for a portion of the costs to develop the Knights of Pythias Lofts, an 18
unit mixed income multifamily development to be located in downtown Fort Worth
("Development"). Developer will acquire 3 lots, rehabilitate an existing historic structure, and
construct a new architecturally compatible structure along with adequate surface parking. The
Development will be located at 303-307 Crump Street with an entrance to the parking lot on East
2nd Street, Fort Worth, Texas 76102.
Developer will be entitled to make Reimbursement Requests as defined in the Contract until 30
days after the Completion Deadline.
In consideration for CDBG funds provided through this Contract, Developer agrees to provide
the following information and meet the following requirements:
• Designate 10 floating units in the Development as Affordable Units as defined in the
Contract. All of the Affordable Units will be affordable to low and moderate income
tenants whose incomes are 80% or less of Area Median Income.
• Affordable Rents will be charged in accordance with the rents set forth in Exhibit A-1
attached hereto, as published annually by HUD, and shall not exceed the High HOME
Rent Limit.
• Developer will provide the following Accessible Units: 1 unit will be accessible for the
mobile impaired and 1 unit will be accessible for the hearing or visually impaired.
• At the initial lease -up of any Affordable Unit submit Exhibit G - Tenant Household
Characteristics regarding the household income, size race, ethnicity, gender of head of
household, disability status, and rental assistance type for the initial tenant of the
Affordable Unit. THE CITY WILL WITHHOLD $10,000 OF THE FUNDS UNTIL
CITY VERIFIES THAT AT LEAST 1 AFFORDABLE UNIT IS LEASED TO A
CDBG ELIGIBLE HOUSEHOLD.
• If the 10 Affordable Units do not qualify as affordable rental housing immediately upon
lease -up or at any time during the Affordability Period, the City may invoke any remedies
provided in the Contract or the Loan Documents.
• During the Affordability Period, submit to City a copy of its annual audit.
SPECIFIC PURPOSE:
The specific purpose of this Project is to increase the availability of quality, accessible,
affordable housing for low and moderate income City residents in downtown Fort Worth.
PROJECT OBJECTIVES•
The Development will restore a historically significant structure and continue to revitalize an area
of downtown Fort Worth.
CONTRACT AMENDMENT CSC 43117 A-1
Hillside Public Facility Corporation - Knights of Pythias Lofts
EXHIBIT "A-2"
ENVIRONMENTAL MITIGATION ACTIONS
HILLSIDE PUBLIC FACILITY CORPORATION
Development Name: Knights of Pythias Lofts
Mitigation Actions:
1. The project architect/engineer shall provide a letter stating that they will meet the interior
noise level of 45dB.
a. A hold will be place on all permits until this letter is received and placed in the
Environmental Review Record.
2. The project architect/engineer shall measure noise in each dwelling unit and certify that
the interior noise level meets the minimal federal standard of 45dB.
3. Certificate of Occupancy will not be issued until the architect/engineer attests and
certifies that the interior noise level meets the minimal federal standard of 45dB.
CONTRACT AMENDMENT CSC 43117 A-1
Hillside Public Facility Corporation - Knights of Pythias Lofts
Source #
1
2
3
4
5
6
EXHIBIT "B"
BUDGET
HILLSIDE PUBLIC FACILITY CORPORATION
SOURCES AND USES - Revised 08/2012,
Development Name: I Knights of Pythias Lofts
Funding Description
Conventional Loan
Conventional Loan/FHA
Conventional Loan/Letter of
Credit
HOME
Housing Trust Fund
CDBG
Mortgage Revenue Bonds
Construction or
Priority Rehab. Loan
of Lien Stage Amt.
1 $1,525,000
Historic Tax Credit Syndication
8 Proceeds
9 USDA/ TXRD Loan(s)
10 Other Federal Loan or Grant
11 Other State Loan or Grant
12 Local Government Loan or Grant 2
13 Local Government Loan or Grant 3
14 Private Loan or Grant
15 Cash Eauity
In -Kind Equity/Deferred
16 Developer Fee
TOTAL SOURCES OF FUNDS
TOTAL USES OF FUNDS
Permanent Loan
Stage Amount
$1,525,000
Financing Participants
CommunityBank of Texas
$250,000 $250,000 City of Fort Worth
$700,000 $700,000 City of Fort Worth
$2,475,000.00 $2,475,000.00
$2,475,000.00 $2,475,000.00
CDBG Funds Budget — Revised 08/2012
Acquisition
Soft Costs
Framing/S iding/Mechanicals
Sheet Rock/Brick/Interior Trim/Paint
*Other Rehabilitation Costs Approved
by City
TOTAL
* The City will withhold $10,000 of its CDBG Funds until the City
leased to a CDBG Eligible Household.
$400,000
$50,000
$100 000
$80,000
$320,000
$950,000
verifies 1 Affordable Unit is
CONTRACT AMENDMENT CSC 43117 A-1
Hillside Public Facility Corporation - Knights of Pythias Lofts
PHASE I ACTIVITTES:
April 2012
PHASE I COMPLETE by: November, 2012
PHASE II ACTIVIITES:
PHASE II COMPLETE by: January 2013
PHASE III ACTIVIITES:
PHASE III COMPLETED by: March 2013
PHASE IV ACTIVIITES:
EXHIBIT "C"
CONSTRUCTION SCHEDULE Revised 08/2012
HILLSIDE PUBLIC FACILITY CORPORATION
Activity
Contract signed
Acquisition
Soft Costs
Lot Preparation (Grading)
Plumbing
Foundation
Framing / TPW
Mechanicals / Siding / Paint
Inspections / Insulation
Sheetrock / Brick
Interior Trim / Paint
$400,000.00
$ 50,000.00
$450,000.00
$100,000.00
$80,000.00
Flooring
Mechanical Trim / Grading / Landscaping
Final Trim / Appliances and Fixtures / Fencing
Final Inspections
Punch List $320,000.00
PHASE IV COMPLETED by: May 2013 Initial Lease -up of Affordable Units
TOTAL $950,000.00
CONTRACT AMENDMENT CSC 43117 A-1
Hillside Public Facility Corporation - Knights of Pythias Lofts
EXHIBIT "E-1"
$250,000 CDBG LOAN DOCUMENTS
HILLSIDE PUBLIC FACILITY CORPORATION
CONTRACT AMENDMENT CSC 43117 A-1
Hillside Public Facility Corporation - Knights of Pythias Lofts
PROMISSORY NOTE
Date: August_, 2012
Borrower: Hillside Public Facility Corporation, a Texas public facility corporation
Borrower's Mailing Address:
1201 E 13th Street, Fort Worth, Tarrant County, TX 76102
Lender: City of Fort Worth, Texas, a Texas municipal corporation
Place for Payment:
C/O Director of Housing and Economic Development Department
1000 Throckmorton St.
Fort Worth, Tarrant County, TX 76102
or at any other place that Lender may designate in writing
Principal Amount: TWO HUNDRED FIFTY THOUSAND AND NO/100 DOLLARS
($250,000.00)
Loan Authority:
The loan evidenced by this Note (the "Loan") is being made pursuant to grant monies
from the United States Department of Housing and Urban Development ("HUD") under
Title I of the Housing and Community Development Act of 1974, as amended, 42 USC
5301 et seq. for utilization in connection with its Community Development Block Grant
("CDBG Program") and the Community Development Block Grant Entitlement Program
Regulations, as amended, 24 CFR Part 570 et seq. (the "CDBG Regulations") with
CDBG funds.
Annual Interest Rate: One Percent (1 %)
Maturity Date: The expiration of the Affordability Period as described in City Secretary
Contract No 43117 dated April 13, 2012 between Borrower and Lender
for the CDBG funds (the "Contract"), as amended from time to time,
subject to the Subordination Agreement described below.
Annual Interest Rate on Matured, Unpaid Amounts: Six Percent (6%)
Terms of Payment (principal and interest):
Interest will accrue on any advance of Loan proceeds under this Note at the Annual
Interest Rate. Interest will be calculated based on a 360 day per year factor applied to the
actual days on which there exists an unpaid principal balance The Principal Amount and
accrued, unpaid interest will be payable in full on the Maturity Date. Any payments will
be applied first to accrued interest and the remainder to reduction of the Principal
Amount.
PROMISSORY NOTE — CDBG FUNDS 2" Lien .
Hillside Public Facility Corp — Knights of Pythias Lodge Lofts
Page 1
Rev. 08--27 -12
This Note is the Note required in the Contract and has been executed and delivered in
accordance with its terms. The funds advanced by Lender are CDBG funds and the
Contract requires that (i) the 10 Affordable Units must be rented to CDBG Eligible
Households for the 15 year Affordability Period, and (ii) the Borrower must meet the
National Objective, all as more particularly defined and described in the Contract. The
Loan evidenced by this Note and the obligations described in the Contract pertaining to
the CDBG Program and the CDBG Regulations will be in default and the Principal
Amount and any other sums due hereunder may be declared immediately payable if the
10 Affordable Units located on the Property are not rented to CDBG Eligible Households
for the duration of the Affordability Period and the Borrower does not meet the National
Objective In the event of such default, Lender may invoke any remedies provided in the
Contract or the Deed of Trust for default.
Security for Payment:
This Note is secured by a Deed of Trust of even date from Borrower to Vicki S. Ganske,
Trustee, or Leann D. Guzman, Trustee, which covers the following real property:
Tract 1:
Lots 1 and 2, Block 2 GILLON &CRUMP SUBDIVISION of Block 32, ORIGINAL
TOWN OF FORT WORTH, an unrecorded addition to the City of Fort Worth, Tarrant
County, Texas,
Tract 2:
Part of Block BR HILLSIDE ADDITION, an Addition to the City of Fort Worth, Tarrant
County, Texas According to plat recorded in Cabinet A, Slide 3283 of the Deed Records
of Tarrant County, Texas
Tract 1 and Tract 2 are more particularly described in the attached Exhibit "A",
incorporated herein by reference for all purposes (the "Property")
Other Security for Payment: None
Borrower promises to pay to the order of Lender the Principal Amount plus interest. This
Note is payable at the Place for Payment and according to the Terms of Payment. All unpaid
amounts are due by the Maturity Date. After maturity, Borrower promises to pay any unpaid
principal balance plus interest at the Annual Interest Rate on Matured, Unpaid Amounts.
If Borrower defaults in the payment of this Note or in the perfouuance of its obligations
under the Contract or the CDBG Program or the CDBG Regulations or any other obligation in
any instrument securing or collateral to this Note, Lender may declare the unpaid principal
balance, earned interest, and any other amounts owed on the Note immediately due and payable.
Borrower and each surety, endorser, and guarantor waive all demand for payment, presentation
for payment, notice of intention to accelerate maturity, notice of acceleration of maturity, protest,
and notice of protest, to the extent permitted by law.
Notwithstanding anything to the contrary, if a monetary event of default occurs under the
PROMISSORY NOTE — CDBG FUNDS 2nd Lien Page 2
Hillside Public Facility Corp — Knights of Pythias Lodge Lofts Rev. 08--27 -12
terms of any of the Loan documents, prior to exercising any remedies Lender shall give Borrower
written notice of such default. Borrower shall have a period of 7 days after such notice is given
within which to cure the default prior to exercise of remedies by Lender under the Loan documents.
Notwithstanding anything to the contrary, if a non -monetary event of default occurs under the terms
of any of the Loan documents prior to exercising any remedies, Lender shall give Borrower written
notice of such default. If the default is reasonably capable of being cured within 30 days, Borrower
shall have such period to effect a cure prior to exercise of remedies by Lender under the Loan
documents If the default is such that it is not reasonably capable of being cured within 30 days, and
if Borrower (a) initiates corrective action within said period, and (b) diligently, continually, and in
good faith works to effect a cure as soon as possible, then Borrower shall have such additional time
as is reasonably necessary to cure the default prior to exercise of any remedies by Lender. In no
event shall Lender be precluded from exercising remedies if its security becomes or is about to
become materially jeopardized by any failure to cure a default or the default is not cured within 180
days after the first notice of default is given.
Borrower also promises to pay reasonable attorney's fees and court and other costs if this
Note is placed in the hands of an attorney to collect or enforce the Note. These expenses will
bear interest from the date of advance at the Annual Interest Rate on Matured, Unpaid Amounts.
Borrower will pay Lender these expenses and interest on demand at the Place for Payment.
These expenses and interest will become part of the debt evidenced by the Note and will be
secured by any security for payment.
Interest on the debt evidenced by this Note will not exceed the maximum rate or amount
of nonusurious interest that may be contracted for, taken, reserved, charged, or received under
law. Any interest in excess of that maximum amount will be credited on the Principal Amount
or, if the Principal Amount has been paid, refunded. On any acceleration or required or permitted
prepayment, any excess interest will be canceled automatically as of the acceleration or
prepayment or, if the excess interest has already been paid, credited on the Principal Amount or,
if the Principal Amount has been paid, refunded. This provision overrides any conflicting
provisions in this Note and all other instruments concerning the debt.
Each Borrower is responsible for all obligations represented by this Note.
When the context requires, singular nouns and pronouns include the plural.
The indebtedness evidenced by this Note is and shall be subordinate in right of payment to
the prior payment in full of the indebtedness evidenced by a promissory note of even date herewith
in the original principal sum of $1,525,000.00 made by Borrower payable to CommunityBank of
Texas, N.A. ( the "Senior Indebtedness ) as more particularly described in an Intercreditor and
Subordination Agreement between Lender, Borrower and CommunityBank of Texas N.A. (the
"Subordination Agreement '), to the extent and in the manner provided in the Subordination
Agreement. The Deed of Trust securing this Note is and shall be subject and subordinate in all
respects to the liens, terms, covenants and conditions of the mortgage securing the Senior
Indebtedness as more fully set forth in the Subordination Agreement. The rights and remedies of the
payee and each subsequent holder of this Note under the Deed of Trust securing this Note are subject
PROMISSORY NOTE — CDBG FUNDS 2" Lien .
Hillside Public Facility Corp — Knights of Pythias Lodge Lofts
Page 3
Rev. 08--27 -12
to the restrictions and limitations set forth in the Subordination Agreement. Each subsequent holder
of this Note shall be deemed, by virtue of such holder s acquisition of the Note, to have agreed to
perform and observe all of the terms, covenants and conditions to be performed or observed by the
Subordinate Lender under the Subordination Agreement.
Subject to the terms of the Subordination Agreement and any cure periods provided in the
documents evidencing the Senior Indebtedness, if there is a default in payment of any part of
principal or interest of the Senior Indebtedness or a breach of any covenants contained in any
instruments securing it, the debt evidenced by this Note will immediately become payable at the
option of Lender. If Borrower fails to perfouu any of Borrower's obligations in the promissory
notes evidencing the Senior Indebtedness or in any instruments securing same, and to the extent
allowed by the Subordination Agreement, Lender may perfoiui those obligations and be
reimbursed by Borrower, on demand, at the Place for Payment for any amounts advanced,
including attorney s fees plus interest on those amounts from the date of payment at the Annual
Interest Rate on Matured, Unpaid Amounts. The amount to be reimbursed will be secured by all
instruments securing this Note.
A default exists under this Note if (1) (a) Borrower or (b) any other person liable on any
part of this Note (an "Other Obligated Party") fails to timely pay or perform any obligation or
covenant in any written agreement between Lender and Borrower or such Other Obligated Party*
(2) any warranty, covenant, or representation in this Note or in any other written agreement
between Lender and Borrower or any Other Obligated Party is materially false when made; (3) a
receiver is appointed for Borrower, any Other Obligated Party, or any property on which a lien or
security interest is created as security (the 'Collateral Security") for any part of this Note; (4) any
Collateral Security is assigned for the benefit of creditors other than the holder(s) of the Senior
Indebtedness; (5) a bankruptcy or insolvency proceeding is commenced by Borrower or an Other
Obligated Party; (6) (a) a bankruptcy or insolvency proceeding is commenced against Borrower
or an Other Obligated Party and (b) the proceeding continues without dismissal for 90 days, the
party against whom the proceeding is commenced admits the material allegations of the petition
against it, or an order for relief is entered; (7) any of the following parties is dissolved, begins to
wind up its affairs, is authorized to dissolve or wind up its affairs by its governing body or
persons, or any event occurs or condition exists that permits the dissolution or winding up of the
affairs of any of the following parties (i) Borrower, or (ii) an Other Obligated Party; and (8) any
Collateral Security is materially impaired by loss, theft, damage, levy and execution, issuance of
an official writ or order of seizure, or destruction, unless it is promptly replaced with insurance
proceeds, collateral security of like kind and quality or restored to its former condition.
The execution and delivery of this Note are required under the Contract.
If any provision of this Note conflicts with any provision of the Contract, the Deed of
Trust or any other document evidencing the same transaction between Lender and Borrower, the
provisions of the Contract will govern to the extent of the conflict.
This Note will be construed under the laws of the state of Texas without regard to
PROMISSORY NOTE — CDBG FUNDS 2nd Lien Page 4
Hillside Public Facility Corp — Knights of Pythias Lodge Lofts Rev. 08--27 -12
choice -of -law rules of any jurisdiction.
This Note is a nonrecourse obligation of Borrower. Neither Borrower nor any other party
shall have any personal liability for repayment of the Loan described in the Contract. The sole
recourse of Lender under the Loan documents for repayment of the Loan shall be the exercise of
its rights against the Security for Payment.
THE CONTRACT, THE NOTE AND THE DEED OF TRUST CONSTITUTE THE
FINAL AGREEMENT OF THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
HILLSIDE PUBLIC FACILITY CORPORATION
Terri Attaway, President
PROMISSORY NOTE — CDBG FUNDS 2nd Lien .
Hillside Public Facility Corp -- Knights of Pythias Lodge Lofts
Page 5
Rev. 08--27 -12
Exhibit "A"
Legal Descrintion
PROMISSORY NOTE — CDBG FUNDS 2nd Lien
Hillside Public Facility Corp — Knights of Pythias Lodge Lofts
Page 6
Rev. 08--27 -12
EXHIBIT "I"
TENANT SELF CERTIFICATION FORM
HILLSIDE PUBLIC FACILITY CORPORATION
CONTRACT AMENDMENT CSC 43117 A-1
Hillside Public Facility Corporation - Knights of Pythias Lofts
CITY OF FORT WORTH
CERTIFICATION OF INCOME STATEMENT - Revised 08/2012
Applicant Name:
Current Address:
City and Zip:
Phone:
Household Members and Income (including Applicant)
Last Name First Name Age Monthly Source of Income
Income $$
TOTAL NUMBER OF FAMILY MEMBERS
Total Gross Annual Household Income:
(Include Yourself, Spouse, Children, etc.)
PERSONAL INFORMATION: (Check one in each item. This Information is Required for Federal Reporting Purposes)
a. ■ MALE b. ❑ WHITE 0 BLACK/AFRICAN AMERICAN ❑ BLACK/AFRICAN AMERICAN & WHI I'h
0 FEMALE 0 AMERICAN INDIAN/ALASKAN NATIVE 0 ASIAN
AMERICAN INDIAN/ALASKAN NATIVE & WHI It 0 ASIAN & WHI I
NATIVE HAWAIIAN/OTHER PACIFIC ISLANDER 0 BALANCE/OTHER
AMERICAN INDIAN/ALASKAN NATIVE & BLACK/AFRICAN AMERICAN
■
c. ETHNICITY
❑ HISPANIC
NON -HISPANIC
■
d. DISABLED e. IS HEAD OF HOUSEHOLD FEMALE?
YES ■ YES
NO ❑ NO
■
Certification:
I certify that the information I am providing is true and could be subject to verification at any time by a third
party. I also acknowledge that the provision of false information could leave me subject to the penalties of
Federal, State and local law.
Signature of Applicant Date
WARNING: TITLE 18, SECTION 1001 OF THE U.S. CODE STATES THAT A PERSON IS GUILTY OF A FELONY
FOR KNOWINGLY AND WILLINGLY MAKING FALSE OR FRAUDULENT STATEMENTS TO ANY DEPARTMENT OF
THE UNITED STATES GOVERNMENT.
For use by agency staff:
Household Size: Gross Annual Income:
Applicable Income Limit: Is Applicant Eligible?
Person Making Determination: Date:
NOTE: Address, income amounts and sources for ALL household members are required.
CONTRACT AMENDMENT CSC 43117 A-1
Hillside Public Facility Corporation - Knights of Pythias Lofts
CIUDAD DE FORT WORTH
CERTIFICACION DE DECLARACION DE INGRESOS - Revised 08/2012
Nombre del Solicitante:
Direccion de Actualidad: Telefono:
Ciudad y Codigo Postal
Miembros Del Hogar e Ingresos (Incluvendo el/la Solicitante)
Apellido Nombre Edad Ingreso Orfgen de Ingresos
Mensual
* TOTAL NUMERO DE MIEMBROS DEL HOGAR (Incluyase Usted.)
Total Anual de Ingresos del hogar:
**INFORMACION PERSONAL: (Seleccione uno en cada articulo Esta informacion es requerida por el Gobierno federal.)
a. 0 MASCULINO b. ❑ BLANCO ❑ NEGRO/AFRICANO AMERICANO ❑ NEGRO/AFRICANO AMERICANO & BLANCO
I —I FEMININO ❑ INDIO AMERICANO/NATIVO DE ALASKA ■ ASIATICO
INDIO AMERICANO/NATIVO DE ALASKA & BLANCO ■ ASIATICO & BLANCO
BALANCE/OTRO
■
❑ NATIVO HAWAIANO/OTRO DE LAS ISLAS PACIFICAS
INDIO AMERICANO / NATIVO DE ALASKA & NEGRO/AFRICANO AMERICANO
■
c. ETHNICIDAD d. INCAPACITADO e. /,ES LA CABEZA DEL HOGAR MUJER?
❑ HISPANO ❑ SI 0 SI
❑ NO-HISPANO ■ NO ■ NO
Certificacion:
Yo certifico que la informacion que yo estoy proporcionando es verdadera y puedo ser sujeto a verificacion a
cualquiera hora por tercera parte. Yo tambien reconozco que la provision de informacion falsa puede dejarme
sujeto a penalidades Federales, Estatales, y a ley local.
Firma del Solicitante Fecha
ADVERTENCIA: TITULO 18, SECCION 1001 DEL CODIGO DE LOS ESTADOS UNIDOS INDICA QUE UNA
PERSONA ES CULPABLE DE UN DELITO POR SABER Y VOLUNTARIAMENTE HACER DECLARACIONES FALSOS 0
FRAUDALENTAS A CUALQUIER DEPARTAMENTO DE GOVIERNO DE LOS ESTADOS UNIDOS.
Para use de empleos de la agenda:
# De Miembros de Familia: Ingreso Anual:
Lfmite de Ingreso: 1Es solicitante elegible? :
Persona haciendo la determinacion: Fecha:
Note: La direccion de la casa y los ingresos (y sus origenes) para todos miembros del hogar son requeridos.
CONTRACT AMENDMENT CSC 43117 A-1
Hillside Public Facility Corporation - Knights of Pythias Lofts
M&C Review
Page 1 of 2
ITY
DUNCIL ' GENDA
DATE:
CODE:
SUBJECT:
Q-
COUNCIL ACTION: Approved on 6/12/2012
Official site of the City of Fort Worth, Texas
FORT WORTII
6/12/2012 REFERENCE C-25644 kjjE:
17KNIGHTSOFPYTHIASLOFTSADD250K
C TYPE: CONSENT PUBLIC NO
HEARING:
Authorize Expenditure of an Additional $250,000.00 of Community Development Block
Grant Funds to the Hillside Public Facility Corporation an Affiliate of the Fort Worth
Housing Authority, for a Subordinate Loan in the Total Amount of $950,000.00 for the
Knights of Pythias Lodge Lofts Located in the 300 Block of Crump Street and Authorize
Substantial Amendment to the City's 2010-2011 Action Plan (COUNCIL DISTRICT 9)
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize a Substantial Amendment to the City's 2010-2011 Action Plan;
2. Authorize the City Manager, or his designee, to substitute funding years in order to meet United
States Department of Housing and Urban Development commitment, disbursement and expenditure
deadlines and
3. Authorize an expenditure of an additional $250,000.00 of Community Development Block Grant
funds to the Hillside Public Facility Corporation, an affiliate of the Fort Worth Housing Authority, in the
form of a subordinate loan in the total amount of $950,000.00 for the development of the Knights of
Pythias Lodge Lofts located in the 300 block of Crump Street in downtown Fort Worth
DISCUSSION:
On June 14, 2011, (M&C C-24974) the City Council approved an award of $700,000.00 of
Community Development Block Grant (CDBG) funds to the Fort Worth Housing Authority (FWHA), or
its designated affiliate to develop the Knights of Pythias Lodge Lofts, a multifamily mixed income
housing development in downtown Fort Worth. FWHA formed the Hillside Public Facility Corporation
(HPFC), a single asset entity, to serve as the developer and owner On April 12, 2012, HPFC and the
City entered into City Secretary Contract No. 43117 for the original $700,000.00 of CDBG funds to be
used for acquisition, rehabilitation and soft costs for the 18-unit development The CDBG funds were
in the form of a deferred payment loan which would be forgiven at the end of the 15 Year Affordability
Period. HPFC acquired the property and will rehabilitate and convert the Knights of Pythias Lodge,
which will contain eight units, and construct an adjacent, architecturally compatible structure which
will contain ten units.
Since the original CDBG award, Staff has re-evaluated project development costs in addition to
financing sources and identified a funding gap. Because the project will provide quality, affordable,
accessible housing and restore a historically significant structure, Staff recommends the award of an
additional $250,000.00 in CDBG funds for a total of $950,000.00 of CDBG funds, subject to the
following terms:
Designate 51 percent of units to be affordable for a 15 Year Affordability Period;
li. Secure performance and repayment of CDBG funds with a deed of trust on land and all
improvements;
Ili, One percent interest
iv. Repayment of $700 000.00 of the CDBG funds shall be deferred and forgiven at the end of the
Affordability Period and
Repayment of $250,000.00 of the CDBG funds and accrued interest shall be due at the end of the
http://apps.cfwnet.org/council packet/me_review.asp?ID=16933&councildate=6/12/2012 8/16/2012
Md&C Review
Affordability Period.
Page 2 of 2
Total project costs are estimated to be $2,200,000.00 including the CDBG award of $950,000.00.
Staff recommends the change in use and expenditure of an additional $250,000.00 in CDBG funds
for the development which is to benefit low and very low income citizens by providing them with
affordable housing. The Action Plan funding years selected may vary and be substituted based on
the Principle of First In, First Out in order to expend oldest grant funds first. A public comment period
on the change in use of these additional CDBG funds was held from May 11, 2012 to June 11, 2012
Any comments are maintained by the Housing and Economic Development Department in
accordance with federal regulations
This project is located in COUNCIL DISTRICT 9.
FISCAL INFORMATION/CERTIFICATION:
The Financial Management Services Director certifies that funds are available in the current operating
budget, as appropriated, of the Grants Fund,
TO Fund/Account/Centers
GR76 539120 017206460910 $250.000.00
Submitted for City Manager's Office by:
Originating Department Head:
Additional Information Contact:
ATTACHMENTS
KOPM&CMap.pdf
FROM Fund/Account/Centers
GR91 538070 005206066010 $149.255.17
GR76 539120 017206460990 $100.744.83
Fernando Costa (6122)
Jay Chapa (5804)
Cynthia Garcia (8187)
Avis F. Chaisson (6342)
http://apps.cfwnet.org/council_packet/mc_review.asp?ID=16933&councildate=6/12/2012 8/16/2012
City of Fort Worth, Texas
Mayor and Council Communication
•
COUNCIL ACTION: Approved on 6/14/2011
DATE: Tuesday, June 14, 2011 REFERENCE NO.: C 24974
LOG NAME: 17FWHA— KNIGHTS OFPYTHIASLODGELOFTS
SUBJECT:
Authorize Expenditure of $700,000.00 of Community Development Block Grant Funds to the Fort Worth
Housing Authority, or its Designated Affiliate, in the Form of a Subordinate Forgivable Loan for the Knights
of Pythias Lodge Lofts Development, Authorize Execution of a Contract and Authorize a Substantial
Amendment to the City's 2005-2006 Action Plan (COUNCIL DISTRICT 9)
RECOMMENDATION:
It is recommended that the City Council:
1. Authorize a substantial amendment to the City's 2005-2006 Action Plan;
2. Authorize the City Manager, or his designee, to substitute funding years in order to meet United States
Department of Housing and Urban Development commitment, disbursement and expenditure deadlines;
3. Authorize an expenditure of $700,000.00 of Community Development Block Grant funds to the Fort
Worth Housing Authority, or its designated affiliate, in the form of a subordinate forgivable loan for the
development of the Knights of Pythias Lodge Lofts located in the 300 block of Crump Street in downtown
Fort Worth;
4. Authorize the City Manager, or his designee, to execute a contract with the Fort Worth Housing Authority,
or its designated affiliate, for the development for a term beginning on the date of execution of the Contract
and expiring at the end of the 15 year Affordability Period; and
5. Authorize the City Manager, or his designee, to amend the Contract if necessary to achieve project goals
provided that the amendment is within the scope of the project and in compliance with City policies and
applicable laws and regulations governing the use of federal grant funds.
DISCUSSION:
The Fort Worth Housing Authority (Developer) proposes to develop the Knights of Pythias Lodge Lofts in
downtown Fort Worth. Project partners include the City and Downtown Fort Worth, Inc. (DFWI). The
Developer will acquire two lots located at 303 and 307 Crump Street and lease or purchase a portion of a lot
for parking located at East 2nd Street owned by DFWI. The development will consist of the rehabilitation of
the Knights of Pythias Lodge which will contain ten units and the new construction of an adjacent structure
that will contain eight units for a total of eighteen units.
Total development costs are approximately $1,900,000.00. Community Development Block Grant funds will
provide for acquisition costs up to $400,000.00 with the remaining funds being used for soft and hard costs
related to the rehabilitation of the Knights of Pythias Lodge.
Ou--31-1 2 A09 : 0 "I IN
Staff recommends the following. loan terns:
i. Designate 51 percent of units to be affordable for a 15 Year Affordability period;
ii. Secure performance and repayment of CDBG funds with a recorded deed of trust on land and all
improvements;
iii Zero percent interest rate; and
iv Loan is forgiven once the 15 Year Affordability period expires and contract terms are met.
The expenditure of CDBG funds is conditioned anon the following.:
i. Satisfactory completion of an environmental review per 24 CFR Part 58,and
ii Authorization to use grant funds from the United States Department of Housing and Urban Development.
Staff recommends the change in use and expenditure of $700,000.00 in CDBG funds for the development,
which is to benefit low and very low income citizens by providing them with affordable housing The Action
Plan funding years selected may vary and be substituted based on the Principle of First In, First Out (FIFO)
in order to expend oldest grant funds first A public comment period on the change in use of these CDBG
funds was held from May 6, 2011, to June 6, 2011 Any comments are maintained by the Housing and
Economic Development Department in accordance with federal regulations.
This project is located in COUNCIL DISTRICT 9.
FISCAL INFORMATION:
The Financial Management Services Director certifies that funds are available in the current operating
budget, as appropriated, of the Grants Fund.
FUND CENTERS:
TO Fund/Account/Centers
GR76 539120 005206005910
FROM Fund/Account/Centers
$700.000.00 GR76 539120 003206005700
GR76 538070 003206005700
CERTIFICATIONS:
Submitted for City Manager's Office bv:
Originating Department Head:
Additional Information Contact:
ATTACHMENTS
1. available funds ndf
2. KOPM&CMan.ndf
Thomas Higgins (6192)
Jay Chapa (5804)
Cynthia Garcia (8187)
Avis F. Chaisson (6342)
$185.953.00
$514.047.00