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HomeMy WebLinkAbout08901RESOLUTION NO. 8901 A RESOLUTION APPROVING AN AGREEMENT BETWEEN COLORADO BLUESKY ENTERPRISES, INC., AND THE CITY OF PUEBLO, A MUNICIPAL CORPORATION, FOR THE CONSTRUCTION OF 12 UNITS OF MULTIFAMILY HOUSING IN ACCORDANCE WITH THE CITY OF PUEBLO HOME /CDBG CONSOLIDATED PLAN DESCRIBING PROJECTS THAT MEET AN AFFORDABLE HOUSING STRATEGY FOR LOW AND MODERATE INCOME HOUSEHOLDS BELOW 80% AREA MEDIAN INCOME UNDER THE 1999 HOME INVESTMENT PARTNERSHIP PROGRAM WHEREAS, the City of Pueblo, pursuant to the HOME Investment Partnerships Act, the Cranston - Gonzales National Affordable Housing Act; 42 U.S.0 12701 et seq; and implementing regulations under 24 CFR 92, has been a recipient of HOME federal funds under the program since 1992; and WHEREAS, in accordance with the provisions of the Act and 24 CFR 92 92:200 a portion of such financial assistance, subject to appropriation by the City Council, may be made available to non -profit organizations for the purpose of carrying out specific elements of the City of Pueblo housing strategy including the expansion of the availability of affordable housing for low and moderate income Pueblo residents; and WHEREAS, at the council work session held on October 25, 1999, City Council listened to a request for funding from Colorado Bluesky Enterprises, Inc., in the amount of $139,000 in HOME federal funds for the purpose of carrying out the construction of 12 new multi - family units more fully described in "Exhibit A"; and in accordance with the provisions of the Act and 24 CFR 92 92:200 a portion of such HOME funds are encouraged to be under a partnership with other low income housing non-profits; NOW THEREFOR BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PUEBLO, COLORADO, that: SECTION I. The City of Pueblo Affordable Housing Agreement dated January 24, 2000 between the City and Colorado Bluesky Enterprises, Inc., a copy of which is attached hereto and incorporated herein, having been approved as to form by the City Attorney, is hereby approved, and $139,000 in HOME federal dollars is appriopriated to Colorado Bluesky Enterprises, Inc., to be expended and used subject to the terms and conditions of the attached City of Pueblo Affordable Housing Agreement. SECTION II. The President of the City Council is authorized to execute the City of Pueblo Affordable Housing Agreement in the name of the City and the City Clerk is directed to affix the seal of the City thereto and attest same. INTRODUCED: January 24 , 2000 By Robe Schilling Councilperson ATTEST: City Cle APP ED: Z : l�l.�/� President of the City Council COUNCILAGENDA A RESOLUTION APPROVING AN AGREEMENT BETWEEN COLORADO BLUESKY ENTERPRISES, INC., AND THE CITY OF PUEBLO, A MUNICIPAL CORPORATION, FOR AFFORDABLE HOUSING DEVELOPMENT SERVICES IN FURTHERANCE OF THE CITY'S HOUSING STRATEGY, AND AUTHORIZING THE PRESIDENT OF THE COUNCIL TO EXECUTE SAME Department: Housing & Community Development SUMMARY A. ISSUE: Agenda Item # 7 Date: January 24 2000 A resolution authorizing ($139,000) of HOME funds to be provided to Colorado Bluesky Enterprises, Inc., for 12 new townhome units, known as Baltimore Court Phase II, on vacant land located on Baltimore in Pueblo, CO. Concern was expressed during a previous Work Session, as regards the amount of the non - profits' developer's fee. B. RECOMMENDATION: Approve the resolution, thus approving a contract with Colorado Bluesky Enterprises, Inc., for 1999 HOME funds. The project meets the HOME eligibility program in that it provides affordable housing to families within the City of Pueblo whose household income falls below 80% of the area median income (AMI). All of the proposed units (12), will be affordable to families making 40% of the area median income. As a response to Council's concern, included in the agreement is an article which requires the non- profit to remit its developer's fee to a separate and distinct interest bearing account. These funds may be used by the non -profit for the sole purpose of constructing the Infant - Toddler Family Center. The fiends in said account will be remitted to the City of Pueblo, if the Center is not built within the specified period set out in the Agreement. Additionally, the original request for funding was for the amount of $115,000. Colorado Division of Housing provided less funding than requested, therefore, an increased request came to us and Pueblo County. IL BACKGROUND The City of Pueblo has been the recipient of HOME fiends since 1992. The City is in the 5th year of the CDBG/HOME Consolidated Plan. As part of that Plan the City must implement an affordable housing strategy using HOME fiends. This project will assist the City in meeting the goals and objectives of that Plan by entering into a partnership with Colorado Bluesky Enterprises, Inc., for multi - family units. See attached agreement and exhibits, including project narrative and pro formas. II IV FINANCIAL IMPACT The $139,000 in Federal HOME fiends will be used in conjunction with the following funding sources: Pueblo County $154,185 Colorado Division of Housing $135,000 Low Income Housing Tax Credit (LIHTC) $652,369 Colorado Bluesky Enterprises 106 047 $1,186,601. ALTERNATIVES A. The City could elect to not partner with Colorado Bluesky Enterprises, Inc., and let Colorado Bluesky Enterprises, Inc., proceed without City assistance B. The City could approve this resolution PUEBLO Rev. 1/7/2000 CITY OF PUEBLO AFFORDABLE HOUSING DEVELOPMENT AGREEMENT This Agreement is made and entered into this 24th day of Janes 2000 by and between the City of Pueblo, a Municipal Corporation (hereinafter referred to as "City ") and Colorado Bluesky Enterprises, Inc. (hereinafter referred to as "Bluesky "). WITNESSETH, that: WHEREAS, the City has, under date of March 1, 1999, entered into an agreement with the U.S. Department of Housing and Urban Development ( "HUD "), whereby federal financial assistance may be made available to City as a participating jurisdiction for the purpose of expanding the availability of affordable housing pursuant to the Home Investment Partnerships Act ( "the Act ") (42 U.S.C. 12701 et. se .), the Cranston - Gonzales National Affordable Housing Act and implementing regulations, including but not limited to those at 24 CFR Part 92; and WHEREAS, in accordance with the provisions of the Act and 24 CFR Sections 92.200 and 92.205, a portion of such financial assistance, subject to deobligation (and subject to appropriation with respect to any assistance payable out of future fiscal year allotments), may be made available to qualifying non - profit entities for the purpose of carrying out specific elements of the participating jurisdiction's housing strategy including new construction of affordable rental housing; and WHEREAS, Bluesky has represented to City that it is a duly qualified non - profit entity which is eligible and willing to undertake certain approved elements of City's housing strategy identified herein and in the Scope of Services attached hereto; and WHEREAS, based upon Bluesky's representations, the City believes Bluesky is capable or can reasonably be expected to become capable of carrying out said approved elements of City's housing strategy, and City is willing to allocate federal funds to Bluesky for investment in housing to be developed, sponsored or assisted by Bluesky which will comply with and fulfill said approved elements of City's housing strategy; NOW, THEREFORE, in consideration of the foregoing recitals and the covenants, terms and conditions set forth herein, the parties agree as follows: BLUESKY SERVICES (a) Bluesky shall assist, in accordance with all applicable federal, state and local laws and regulations, in the development of a project, to be known as the Baltimore Apartments Project, Phase II (hereafter referred to as "the Project ") in furtherance of City's housing strategy and approved by the City by providing necessary loan financing therefor using federal HOME fiends provided under this Agreement. Bluesky shall also undertake and perform the tasks and functions described in the Scope of Services attached hereto as Exhibit "A" and incorporated herein by reference, in hill compliance with all provisions of this Agreement. Before proceeding with such financing for the Project, Bluesky shall furnish City with all information which City may reasonably request concerning the Project, demonstrate eligibility of the Project for assistance under this Agreement, and obtain the written approval of City's authorized representative as to the Project, which approval will not be unreasonably withheld. Upon and after such approval, Bluesky shall enter into a written loan agreement with the Owner /Developer of the Project setting forth the terms and conditions of the loan assistance to be provided by Bluesky, which loan agreement shall comply with all requirements of this Agreement and the regulations incorporated by reference. (b) Bluesky warrants and represents that (i) it has the requisite authority and capacity to perform all terms and conditions on Bluesky's part to be performed hereunder; (ii) that it is duly organized as a non - profit corporation under state law and is in good standing with the Secretary of State of Colorado; (iii) that it is aware of and understands its duty to perform all functions and services in accordance with the regulatory requirements of 24 CFR Part 92 and those identified in Exhibit "C" hereto; and (iv) that it is accepting federal financial assistance hereunder subject to certain mandatory repayment provisions. (c) Time is of the essence hereof. Bluesky agrees that it shall meet the following deadlines with respect to the Project: (i) Bluesky shall obtain satisfactory evidence that the Owner /Developer of the Project has the financial ability to undertake and construct the Project, including proof that it has secured loan commitments for a construction loan and the primary loan permanent financing for the Project, and furnish such evidence to City, on or before February 1, 1999; Bluesky shall thereafter provide to the Owner/Developer a loan commitment which sets forth the terms and conditions of the loan. (ii) Bluesky shall enter into a loan agreement with the Owner /Developer of the Project consistent with the terms of this Agreement on or before March 1, 2000; (iii) Bluesky shall require the Owner/Developer to commence constriction of the Project not later than April 1, 2000; and (iv) Bluesky shall require the Owner /Developer to substantially complete construction of the Project not later than April 1, 2001. (d) Bluesky acknowledges that because the Project contemplated by this agreement concerns the construction of affordable housing consisting of 12 units, Bluesky shall require in the loan agreement that in all contracts for the constriction of the Project (i) prevailing wages shall be paid to all laborers and mechanics performing work on the Project pursuant to 24 CFR §92.354 and the Davis -Bacon Act [40 U.S.C. 276a -5] and (ii) the contract shall be subject to applicable requirements of the Contract Work Hours and Safety Standards Act [40 U.S.C. 327 -332]. -2- 2. RESPONSIBILITIES OF THE CITY The City shall designate a representative of the City who will be authorized to make all necessary decisions required of the City on behalf of the City in connection with the performance of this Agreement, approval of the Project to be undertaken by Bluesky hereunder and the disbursement of hinds in connection with the program. In the absence of such a designation, the City Manager shall be deemed as City's authorized representative. FINANCIAL ASSISTANCE AND METHOD OF PAYMENT (a) Upon execution of all documents required by City, the City will grant to Bluesky an amount up to that specified in subparagraph (c) of this paragraph as the public investment in the Project assisted under this Agreement. Disbursement of fiends to Bluesky is subject to all of the following requirements, which shall be conditions precedent to payment: (i) that the Owner /Developer of the Project has expended funds after January 24, 2000 for eligible approved expenditures with respect to the Project, (ii) that neither Bluesky nor the Owner /Developer is in default of any material provision of this Agreement nor applicable law or regulation, (iii) that Bluesky has timely submitted requests for loan disbursement detailing the eligible loan draw -down items in a format approved by City, (iv) that Bluesky has certified with each payment or loan draw - down request compliance with the requirements identified in Exhibit "C" and that all expenditures for which draw -down is sought were made for and in furtherance of the Project and are an eligible use of federal assistance under the Act, and (v) that City has timely received from HUD sufficient federal assistance under the Act to pay the disbursement hereunder. (b) Payment hereunder is also subject to and may only be disbursed in accordance with HUD regulations including but not limited to those at 24 CFR Part 92, as presently promulgated and as same may be revised from time to time in the future. All payments received by Bluesky hereunder are subject to repayment by Bluesky as provided in 24 CFR Part 92. Funds provided hereunder for Project may only be used for development hard costs and acquisition costs, as provided in 24 CFR § §92.205(d) and 92.206(a) and (c). (c) The aggregate of all payments made hereunder shall not exceed One Hundred Thirty- Nine Thousand Dollars (U.S. $139,000). (d) Upon expiration of the term of this agreement or upon any prior termination, Bluesky shall transfer to City any fiends provided hereunder which are on hand at the time of expiration or termination together with any accounts receivable attributable to the use of fiords provided hereunder. 4. TERM OF AGREEMENT (a) Unless sooner terminated, the term of this Agreement, for purposes of undertaking the loan and construction and completion of the project, shall be from the date of execution hereof until December 1, 2001; provided however, that with the respect to the Project for which Bluesky has received financial assistance under and during the term of this Agreement, Bluesky and the Owner /Developer of the Project shall have continuing responsibility to comply with the performance, certifications, repayment, affirmative marketing, housing affordability compliance and recordkeeping requirements of this Agreement, and 24 CFR Part 92 (including, without limitation 24 CFR Sections 92.252, 92.254, 92.301, 92.351 and 92.508) which shall survive expiration or termination and remain in effect throughout the required full period of affordability, notwithstanding termination or expiration of this Agreement. As used herein, "period of affordability" shall mean 20 years from the completion of the Project except that if the assistance provided hereunder is used in connection with other financing insured by HUD under Chapter II of Title 24, Code of Federal Regulations, the period of affordability shall be the full original term of said mortgage or 20 years, whichever is longer. (b) (i) The frill amount of loan assistance provided to the Project pursuant to this Agreement shall constitute an indebtedness of the Owner /Developer to Bluesky which shall be evidenced by a promissory note (hereinafter referred to as the "Promissory Note" or "Note ") which shall be due and payable with interest as provided therein and which shall be secured by the following real property located in Pueblo County, Colorado (the "Property "): Lot 5 EXCEPT the Northerly 55 feet and all of Lot 7, Block 2, Baltimore Plaza, County of Pueblo, State of Colorado AND A parcel of land being a portion of Lots 1, 2 and 3, and all of Lot 6, Block 2, Baltimore Plaza, County of Pueblo, State of Colorado, according to the recorded plat thereof recorded in Book 1833 at Page 222, being more particularly described as follows: BEGINNING at the Southeast corner of said Lot 1; thence North 78 deg. 10 min. 00 sec. West, along the South line of said Lots 1, 2, 3 and 6, a distance of 529.45 feet (529.51 - plat) to the Southwest corner of said Lot 6 said point also being on the East right -of -way line of Baltimore Avenue; thence along the West line of said Lot 6 and said East right -of -way line the following three (3) courses: 1) North 01 deg. 50 min. 42 sec. East, a distance of 7.50 feet; 2) North 00 deg. 00 min. 00 sec. West, a distance of 118.30 feet, 3) Northerly along the arc of a curve to the right whose radius is 1324.00 feet and a central angle of 01 deg. 28 min. 56 sec., a distance of 34.25 feet to the Northwest corner of said Lot 6; thence South 78 deg. 17 min. 33 sec. East (South 78 deg. 10 min. 00 sec. East - plat), a distance of 561.50 feet to a point on the East line of said Lot 1; thence South 11 deg. 47 min. 44 sec. West (South 11 deg. 48 min. 14 sec. West - plat) along the East line of said Lot 1, a distance of 158.02 feet to the POINT OF BEGINNING M AKA Parcel C of Lot Line Rearrangement recorded March 6, 1990 in Book 2487 at Page 184. , as evidenced by a Deed of Trust to be executed contemporaneously with said Promissory Note. The loan instruments shall require the Owner /Developer to pay to Bluesky or holder the indebtedness as and to the extent same becomes due under the provisions of the Promissory Note and this Agreement. Bluesky shall include terms in said Promissory Note or Deed of Trust stating that the amount of the assistance shall continue as an indebtedness until paid in frill, and notwithstanding such payment in full, the affordability restrictions described in this Agreement shall continue in effect and be enforceable for the full period of affordability without regard to the term of the Note or Deed of Trust. (ii) In order to secure Bluesky's repayment obligations hereunder to City, City may, at any time, require an assignment and transfer of said Note and Deed of Trust to City. (c) During the full Term of this Agreement and for the period of affordability, (i) any failure by the Owner/Developer or Bluesky to perform any obligation, covenant or provision of the Note or this Agreement required to be performed by the Owner /Developer or Bluesky, or (ii) any breach of any warranty made by Bluesky in this Agreement, or (iii) any other violation of any material term of this Agreement or the Deed of Trust given to secure the Note, shall constitute a default under this Agreement. Upon any such default, the City may demand that Bluesky repay to City the full amount of assistance provided hereunder, plus interest at the rate of 12% per annum from and after the date of such default. Bluesky further agrees that no release of any security for the indebtedness or extension of time for payment of same, or any installment thereof, and no alteration, amendment or waiver of any provision of the Note or the Deed of Trust securing same shall in any manner, release, discharge, modify or affect the obligations of Bluesky under this Agreement. 5. TERMINATION OF AGREEMENT (a) For Cause This Agreement may be terminated by City for cause, including any nonperformance by Bluesky, upon ten (10) days written notice to Bluesky including a statement of the reasons therefor, and after an opportunity for a hearing has been afforded. If a hearing is requested, it shall be held before the City's Director of Housing and Community Development whose decision as to both the grounds for termination and the appropriateness thereof shall be final and binding upon both City and Bluesky. In accordance with 24 CFR 85.43, cause for termination shall include any material failure by Bluesky to comply with any term of this Agreement. (b) For Convenience This Agreement may be terminated for convenience in accordance with the provisions of 24 CFR 85.44. This Agreement shall terminate immediately upon any non - appropriation of fiinds, or upon any suspension or non - receipt of federal assistance provided to City under the Act, regardless of cause. (c) Post Termination Procedures In the event of termination, Bluesky shall continue to -5- be responsible for those matters which survive termination identified in paragraph 4 above, unless City takes over the Project and, in connection therewith, prospectively releases Bhiesky from one or more specific responsibilities in writing. Additionally, at City's sole option, all property acquired by Bluesky with grant fields, all grant funds, program income, and mortgage loans originated with grant fiends or by payments therefrom and payments received under such mortgage loans, held, owned or retained by Bluesky shall immediately become the sole and separate property of the City and Bluesky shall perform all acts and execute all instruments necessary to transfer and assign such property, funds, income, and mortgage loans to City. All finished or unfinished documents, data, studies reports and work product prepared by Bluesky under this Agreement or with grant funds shall, at the option of the City, become its property and Bluesky shall be entitled to received just and equitable compensation only for satisfactory work completed and eligible costs for which compensation has not previously been paid nor reimbursement made. 6. ASSIGNABILITY This Agreement shall not be assigned or transferred by Bluesky without the prior written consent of the City. Any assignment or attempted assignment made in violation of this provision shall, at City's election, be deemed void and of no effect whatsoever. CONFLICT OF INTEREST HOME Regulation 24 CFR, Part 92.356 is incorporated herein by reference, and sets forth applicable laws and regulations that apply to Conflict of Interest. Bluesky shall avoid all conflicts prohibited by applicable regulations, including but not limited to those set forth in 24 CFR Part 92 as presently promulgated and as same may be revised from time to time in the future. BLUESKY RECORDKEEPING Bluesky shall maintain, and shall require the Owner/Developer to maintain, records as to the Project work and activities undertaken with assistance hereunder, services provided, reimbursable expenses incurred in connection with the Project and complete accounting records. Accounting records shall be kept on a generally recognized accounting basis and as requested by the City's auditor. Bluesky agrees to comply with all applicable uniform administrative requirements described or referenced in 24 CFR Part 92. The compliance provisions attached as Exhibit "B" hereto are made a part of this Agreement, and Bluesky agrees to perform and comply with same, and shall require the Owner /Developer to do likewise. The City, HUD, the Comptroller General of the United States, the Inspector General of HUD, and any of their authorized representatives, shall have the right to inspect and copy, during reasonable business hours, all books, documents, papers and records of Bluesky and the Owner/Developer which relate to this Agreement for the purpose of making an audit or examination. Upon completion of the work and end of the term of this Agreement, the City may, at any time during the period of affordability or within 5 years thereafter, require all of Bluesky's and the Owner /Developer's financial records relating to this Agreement to be turned over to the City. -6- 9. MONITORING AND EVALUATION The City shall have the right to monitor and evaluate the progress and performance of Bluesky to assure that the terms of this Agreement are being satisfactorily fulfilled in accordance with HUD's, City's and other applicable monitoring and evaluation criteria and standards. The City shall at least quarterly review Bluesky's performance using on -site visits, progress reports required to be submitted by Bluesky, audit findings, disbursement transactions and contact with Bluesky as necessary. Bluesky shall furnish to the City monthly or quarterly program and financial reports of its activities in such form and manner as may be requested by the City. Bluesky shall fully cooperate with City relating to such monitoring and evaluation. 10. BLUESKY FILES AND INFORMATION REPORTS Bluesky shall maintain files containing information which shall clearly document all activities performed in conjunction with this Agreement, including, but not limited to, financial transactions, conformance with assurances, activity reports, and program income. These records shall be retained by Bluesky for a period of five years, except that with respect to the Project undertaken with assistance provided hereunder, such records shall be maintained for the full required period of affordability. Activity reports shall be submitted monthly or quarterly no later than the ninth day of the month following the end of month or quarter for which the report is submitted. 11. INDEPENDENCE OF BLUESKY Nothing herein contained nor the relationship of Bluesky to the City, which relationship is expressly declared to be that of an independent contractor, shall make or be construed to make Bluesky or any of Bluesky's agents or employees, or the Owner/Developer, the agents or employees of the City. Bluesky shall be solely and entirely responsible for its acts and the acts of its agents, employees and subcontractors. 12. LIABILITY & INSURANCE (a) As to the City, Bluesky agrees to assume the risk of all personal injury, including death and bodily injury, and damage to and destruction of property, including loss of use therefrom, caused by or sustained, in whole or in part, in conjunction with or arising out of the performance or nonperformance of this Agreement by Bluesky or by the conditions created thereby. Bluesky further agrees to indernnify and save harmless the City, its officers, agents and employees, from and against any and all claims, liabilities, costs, expenses, penalties and attorney fees arising from such injuries to persons or damages to property or based upon or arising out of the performance or nonperformance of this Agreement by Bluesky or out of any violation by Bluesky of any statute, ordinance, rule or regulation. (b) Bluesky agrees that it shall procure and will maintain during the term of this Agreement, such insurance as will protect it from claims under workers' compensation acts, claims -7- for damages because of personal injury including bodily injury, sickness or disease or death of any of its employees or of any person other than its employees, and from claims or damages because of injury to or destruction of property including loss of use resulting therefrom; and such insurance will provide for coverage in such amounts as set forth in subparagraph (c). (c) The minimum insurance coverage which Bluesky shall obtain and keep in force is as follows: (i) Workers' Compensation Insurance complying with statutory requirements in Colorado. (ii) Comprehensive General and Automobile Liability Insurance with limits not less than Six Hundred Thousand and No/ 100 Dollars ($600,000.00) per person and occurrence for personal injury, including but not limited to death and bodily injury, and Six Hundred Thousand and No/ 100 Dollars ($600,000.00) per occurrence for property damage. (d) Bluesky further agrees that it shall require the Owner /Developer of the Project to procure and maintain, at the Owner/Developer's expense, hazard and fire insurance upon the property described in the Deed of Trust on an "all risk" form in such amounts as City's Department of Housing and Community Development may require, but in any event, for not less than the amount of all liens against the property and the amount of hinds provided to Bluesky by City pursuant to this Agreement. Bluesky shall furnish a certificate of insurance certifying such coverage to City's Director of Finance prior to disbursement of any funds to Bluesky. Both said certificate of insurance and the policy procured by the Owner /Developer shall name the City as an additional loss payee. 13. CERTIFICATIONS Bluesky agrees to execute and abide by the certifications contained in Exhibit "C" hereto, which are hereby expressly made a part of this Agreement. 14. PROGRAM INCOME, REVERSION OF ASSETS (a) (I) Unless otherwise authorized by City in writing in a separate instrument executed after date of this Agreement, all program income shall be returned to City within 30 days of receipt by Bluesky. In the event City authorizes Bluesky to retain any portion of program income, it shall only be used to accomplish the work set forth in the Scope of Services, and the amount of grant funds payable by City to Bluesky shall be adjusted as provided by 24 CFR 92.503 and the applicable requirements of 24 CFR 85. (II) Additionally, all developer fees received by Bluesky, including any such fees paid from or out of rental income for the Project, or from or out of rental income from any prior phase of the Baltimore Court housing development funded in part with HOME funds provided by City to Bluesky or Bluesky's corporate predecessor, regardless of when received, shall within 30 days of receipt be deposited by Bluesky in a restricted account with a regulated financial institution. The restricted account and such fees shall be used only for construction by Bluesky, within six years of the date of this Agreement, of an Infant - Toddler Family Center ( "ITFC ") capable of use for clinical evaluation of children, adult education for parents of young children, developmental skills training and offices which serve such functions. The ITFC shall also contain a child -care or pre - school room for young children. Bluesky shall file with the City's Director of Housing, not less than quarterly, a certified report indicating the name and address of the financial institution where such fees have been deposited, the account number, the amount of all deposits made therein together with interest earned thereon, and an explanation of any expenditures therefrom. In the event such funds are not fully expended for an ITFC within six (6) years of the date of this Agreement, Bluesky shall return to the City all such funds remaining in the restricted account to be used by City for any purpose otherwise authorized by law for such funds. (b) Upon expiration of the term of this Agreement, or upon any prior termination, Bluesky shall transfer to City any funds provided hereunder which are on hand at the time of expiration or termination together with any accounts receivable attributable to the use of funds provided hereunder. (c) The Project, the Property, and any other real property acquired, constructed or improved in whole or in part with funds provided pursuant to this Agreement shall be used as affordable rental housing within the meaning of 24 CFR § 92.252 for the full period of affordability as defined in paragraph 4 hereof. In the event the Project, the Property or such other property ceases to be so used, Bluesky shall immediately pay to City the greater of (i) an amount equal to the current market value of the Project and property less any portion of the value attributable to expenditures of funds not provided under this Agreement for the construction of the Project or acquisition of, or improvement to, the Property (that is, the calculation of the portion of value attributable to expenditures not provided by City under this agreement shall be the market value multiplied by a fraction whose numerator is the total Project cost or costs of acquisition determined as of the date of Project completion less the amount of assistance provided by City and whose denominator is the total Project cost or cost of acquisition determined as of the date of Project completion) or, (ii) the remaining principal balance and accrued interest owing under the Note. The use restriction and repayment obligation set forth in this subparagraph shall survive termination or expiration of this Agreement and shall be fully enforceable and subject to collection by City or HUD in accordance with applicable laws. Bluesky shall require the Owner /Developer to comply with the requirements of this paragraph and to execute a Deed of Trust which shall be and constitute a lien upon the Property and all other real property acquired or improved with funds provided hereunder, and which shall secure the affordability requirements hereunder. (d) In the event City incurs any cost or expense in enforcing the requirements of this Agreement, including but not limited to the requirements of this paragraph 14, or in bringing any action to recover the amount of any repayment obligation, or, upon assignment of the Note and the Deed of Trust to City, to foreclose or obtain sale under the Deed of Trust or mortgage instrument, City shall be entitled to recover its costs and expenses, including reasonable attorneys fees. (e) To further ensure that the fiends provided hereunder do not constitute an investment of more HOME funds than are necessary to provide affordable housing (as required by 24 CFR §92.250(b)), Bluesky shall require the Owner /Developer to retain ownership of the Project for a period of not less than 20 years from and after the completion of the Project. Consequemly, in the event the Owner /Developer should sell or transfer title to the Project, the Property or other real -9- property or improvements constructed or improved with finds provided pursuant to this Agreement, within 20 years after substantial completion of the Project or said improvements, the Loan Agreement, Note and Deed of Trust shall provide that the entire indebtedness under the Note shall immediately become due and payable and shall be collected by Bluesky and repaid to City, together with interest thereon at the rate of 12% per annum from the time of substantial completion until said repayment is made. If Owner /Developer is a limited partnership, nothing in this subparagraph (e), nor in subparagraph (f) of this paragraph 14, is intended to prohibit a transfer of ownership from Owner /Developer to any general partner or limited partner in Owner /Developer. (f) It is the intent of the parties that §38 -30 -165, C.R.S. and any similar statute hereafter enacted, be preempted under federal law and regulations in order to maintain affordability of the rental units within the Property. Consequently, the Loan Agreement between Bluesky and the Owner /Developer and the Note and Deed of Trust executed by the Owner /Developer shall not be assumable, and the indebtedness shall be due and payable upon sale, transfer or assignment, or any attempted sale or transfer of the Property by the Owner /Developer, unless all of the following circumstances are demonstrated to exist: (i) more than 20 years have elapsed since the substantial completion of the Project, (ii) the Primary Lender also consents to assumption of the mortgage or obligation to which the Deed of Trust is subordinate, (iii) the sale of the Property is to a subsequent purchaser who agrees in writing to comply with the affordability requirements of this Agreement and applicable requirements, including those set forth at 24 CFR, §92.252, (iv) the sale price and payment of principal, interest, property taxes and insurance by the subsequent purchaser must permit the rental units to remain affordable for the remaining period of affordability specified in this Agreement, with affordability determined by applicable regulations and requirements, and (v) both the City and the holder of the Note expressly consent to assumption of the Owner /Developer's obligations under the loan agreement and the Note by the subsequent purchaser prior to sale or transfer, which consent shall be granted only upon the Owner /Developer's showing circumstances (i) through (iv) have or will be satisfied. 15. SPECIAL REQUIREMENTS APPLICABLE TO IMPROVEMENTS TO PROPERTY (a) In addition to all procurement requirements otherwise applicable to the Project pursuant to any other provision of this Agreement or pursuant to any requirement of law or regulation incorporated in this Agreement by reference, Bluesky shall comply with all requirements of this Paragraph 15. (b) No improvements shall be undertaken to the Property or other real property with funds (or reimbursement) provided hereunder unless and until: (i) plans and specifications therefor have been prepared by either a registered Professional Engineer in good standing and duly licensed to practice in the State of Colorado or an Architect duly licensed and authorized to conduct a practice of architecture in the state of Colorado; (ii) such plans and specifications have been filed with the City and approved by both the City's designated representative and the City's Director of Public Works; and (iii) all construction contracts for improvements for which funds are provided from City shall have been awarded only after an open, competitive bidding process which has been approved -10- by City's Director of Purchasing and which allows qualified contractors to reasonably participate in the competitive bidding procedures; provided, however, that this subparagraph 15(b)(iii) shall not prohibit Owner /Developer from negotiating the selection of a construction manager to act as the Owner /Developer's agent during construction of the improvements upon the Property. (c) No disbursement of funds to Bluesky shall be made by City hereunder unless and until all conditions precedent to payment specified elsewhere in this Agreement have been satisfied and Bluesky files with City's Director of Housing and Community Development a written request for payment signed by an officer of Bluesky that certifies (i) that the amounts included in the request for payment have not been included in any prior request for payment, (ii) that the improvements listed therein for which payment is sought have been completed in accordance with the approved plans and specifications therefor, and (iii) that the improvements for which payment is sought have been constricted so as to comply with City of Pueblo building codes and Section 8 Housing Quality Standards. (d) In every contract for construction of improvements for which payment or reimbursement from City is to be provided under this Agreement, Bluesky shall include a contract clause or clauses, approved by City's Director of Purchasing, requiring the Owner/Developer, the contractor, and all of the contractor's subcontractors of all tiers, to comply with the requirements of the Davis -Bacon Act and implementing regulations, and to pay all laborers and mechanics engaged in work upon the improvements at the prevailing wage rates for such work as determined by the U.S. Department of Labor. (e) Every contract for construction of improvements, and all lower tier covered transactions, shall include a requirement that the contractor, subcontractor or vendor certify that neither it nor its principal is debarred, suspended, proposed for debarment, declared ineligible or voluntarily excluded from participation in any federally funded project. 16. RECOGNITION OF HUD, CITY In all printed materials, project descriptions and other activities undertaken with funds provided under this Agreement, Bluesky shall either provide recognition that finds have been provided by the U.S. Department of Housing and Urban Development and the City of Pueblo or shall cause the Owner /Developer to do so. Recognition shall be accomplished by prominent disclosure of the role of HUD and the City in all such printed materials and project signage, if any. 17. ENTIRE AGREEMENT; AMENDMENTS The provisions set forth in this Agreement, and all Exhibits and attachments to this Agreement, constitute the entire and complete agreement of the parties hereto with respect to Phase II of the Project and supersede all prior written and oral agreements, understandings or representations related thereto. No amendment or modification of this Agreement, and no waiver of any provision of this Agreement, shall be binding unless made in writing and executed by the duly authorized officers of both the Bluesky and City. Nothing in this Agreement shall be construed to affect or modify the Affordable Housing Development Agreement dated March 23, 1998 entered into between the City and Bluesky's corporate predecessor (the "prior -phase agreement "), except for paragraph 14(a)(II) of this Agreement which shall be and is intended to be made applicable to the prior phase agreement. 18. SIGNATURES The persons signing this Agreement on behalf of Bluesky represent and warrant that such persons and Bluesky have the requisite power and authority to enter into, execute and deliver this Agreement and that this Agreement is a valid and legally binding obligation of Bluesky enforceable against Bluesky in accordance with its terms. IN WITNESS WHEREOF, Bluesky and the City have executed this Agreement as of the date first above written and under the laws of the State of Colorado. ATTEST: City C fAk [SEAL] ATT EST: Title: rrnrh , V l0-M CITY PUEBLO, A n ipal Corp ion By: P esident of City Council COLORADO BLUESKY ENTERPRISES, INC., a Colorado Non - Profit Corporation Name: Loa rence A. Title: (_� E a Rev. 1/7/2000 TJF -12- EXHIBIT A SCOPE OF SERVICES I . Bluesky shall undertake the services and activities and provide a loan in compliance with all requirements and conditions stated in the Affordable Housing Development Agreement to which this Exhibit is attached. 2. The Baltimore Apartments Project is described in more detail in the attachments to this Exhibit, and incorporated herein by reference. EXHIBIT A SCOPE OF SERVICES COLORADO BLUESKY ENTERPRISES, INC. — HOME Project #00 -018 1. PROJECT DESCRIPTION, OBJECTIVES, AND REQUIREMENTS. Colorado Bluesky Enterprises, Inc. is developing and constructing an additional 12 units at the Baltimore Court Apartments, 3600 Baltimore Avenue, Units 29 - 40, Pueblo, CO 81003. These 2- bedroom units are affordable to families whose income is equal to or less than 40 percent of the area median income (AMI). This project is also financed with construction and first position loans from the Minnequa Bank. The National Development Council Equity Fund (NDC) is providing equity investment capital utilizing the low income housing tax credit (LIHTC) program. Additional land at the site will be used for the construction of a family center that is funded through separate fund - raising activities. A. Form of Subsidy. $135,000.00 in HOME grant funds for the construction of the project will be administered according to the requirements of this contract, and the performance goals and timelines outlined in Exhibit B, Project Performance Plan. B. Minimum and Maximum Subsidy Limits. 1) The minimum amount of HOME funds invested in this project must be $1,000 times the number of HOME - assisted units in the project. 2) The maximum amount of per -unit subsidy is established periodically by the U.S. Department of Housing and Urban Development (HUD). Effective April 1999 the maximum per -unit HOME subsidy for two- bedroom units is $87,832. 3) The HOME - subsidy per unit cannot exceed the average per unit development cost for the unit. 4) Due to the City of Pueblo's criteria, this project's maximum subsidy is established at approximately $35,685 per HOME unit. 2. ADMINISTRATIVE REQUIREMENTS. The Contractor will be responsible for the administration of the project according to the applicable uniform administrative requirements, as described in Paragraph 14. within the main body of this Contract. The Contractor may subcontract all or part of the administration duties. A. Affirmative Marketing Plan. This project requires an Affirmative Marketing Plan because there are more than five unit housing units contained in the project. This plan must be approved by the Department of Local Affairs, Division of Housing, before the release of funds. The plan must be written according to Paragraph 10. of the main body of this Contract. B. Program Income, Repayment, and Recaptures. All revenues received by the Contractor or designated sub - grantee which result directly from a HOME - assisted activity will be considered program income. Program income includes but is not limited to, principal and interest payments, -and proceeds from the sale of acquired assets. All program income will be retained by the Contractor or designated sub - grantee, and will be used for HOME eligible activities. A minimum of 90 percent of the program income funds will be expended on HOME - eligible housing assistance activities, and up to 10 percent may be applied toward general administrative program costs of the HOME - eligible activity. C. Interest. The Contractorwill expend the HOME funds within 15 days of receipt, and will not earn interest on the funds before expenditures. D. Section 3 Requirements. This project is subject to Section 3 Requirements because there.is more than $200,000 in HOME funding in the project. Section 3 requirements, to the greatest extent feasible, provides that opportunities for training and employment that arise through HUD - financed projects will be given to lower- income persons in the project area, and that contracts are Page 1 of 5 Pages awarded to businesses in the project area or to businesses owned in substantial part, by residents of the project area. Reporting requirements are set forth in Paragraph 12. within the main body of this Contract. E. Davis -Bacon Requirements. The Contractor will comply with all the requirements of the Davis Bacon Fair Labor Standards according to the provisions set forth in Paragraph 24. o) within the main body of this Contract because all 12 units have been designated as HOME units per the City of Pueblo funding criteria. TIME OF PERFORMANCE. The Project shall commence upon the full and proper execution of this Contract and the completion of the appropriate environmental review, and shall be completed on or before December 31, 2000. However, the project time of performance may be extended by letter, subject to mutual agreement of the State and Contractor. To initiate the extension process, the Contractor shall submit a written request to the State at least 60 days prior to December 31, 2000, and shall include a full justification for the extension. 4. ELIGIBLE BENEFICIARIES. The contractor will insure that all 12 of the HOME - assisted units will be occupied by persons whose household income is equal to or less than 40 percent of the area median income. The following chart shows income limits effective January 27, 1999 for one to eight person households. 1 2 3 4 5 6 7 8 11,320 12,920 14,560 16,160 17,440 18,760 20,040 21,320 5. INCOME ELIGIBILITY DETERMINATION. For the initial lease up the Contractor must determine annual income of the Project beneficiaries using "Annual income" as defined under the public housing and Section 8 programs in 24 CFR 5, Subpart F. Contractor may: 1. Continue to use the income qualifying method above for subsequent income determinations during the period of affordability; or 2. Use "Annual income" as reported under the Census long -form for the most recent available decennial Census; or 3. Use "Adjusted gross income" as defined under Internal Revenue Service (IRS) Form 1040 series for individual Federal annual income tax purposes. Once the subsequent income determination is chosen, that method must be used for all households during the affordability period. AFFORDABILITY REQUIREMENTS. This project must meet the affordability requirements for the specified period outlined below or all HOME funds shall be repaid to the State. A. In this project there are 12 HOME - assisted units. The units designated as HOME - assisted are 12 two bedrooms. The HOME - assisted units are located at 3600 Baltimore Avenue, consecutive unit numbers 29 through 40, Pueblo, CO 81008. The Contractor must reexamine the rents upon receipt of new HOME rents, which are recalculated on a periodic basis by the U.S. Department of Housing and Urban Development, and adjust the rents of the HOME - assisted units to reflect the changes. Regardless of changes in fair market rents and in median income over time, the HOME rents for a project are not required to be lower than the HOME rent limits for the project in effect at the time of project commitment as designated in Paragraph B. below. Page 2 of 5 Pages B. Rent Restrictions. To insure the housing is affordable to very low and low income persons, all of the HOME - assisted rental units must have rents that are the lesser of the Section 8 Fair Market Rents periodically established by U.S. Department of Housing and Urban Development, or rents which are 30 percent of adjusted income for households at 40 percent of area median income minus tenant paid utilities. Pueblo County 1- Bedroom 2- Bedrooms 3- Bedrooms 4- Bedrooms Fair Market Rent eff. 10199 40% Rent Limit eff. 1/99 440 303 550 364 740 420 883 469 C. Affordability Period. The Contractor shall ensure that the HOME - assisted units continue to be used to provide housing for very low and low income families for 40 years beginning after project completion. This affordability period is based upon the LIHTC affordability restriction. D. Affordability Enforcement. Rent and beneficiary income requirements must be enforced by deed restriction or covenants running with the land. Affordability restrictions apply without regard to the term of any loan or mortgage or transfer of ownership and may terminate only upon foreclosure or transfer in lieu or foreclosure. The affordability restrictions shall be revived according to the original terms if, during the original affordability period, the owner of record before the foreclosure, or deed in lieu of foreclosure, or any entity that includes the former owner of those with whom the former owner has, or had, family or business ties; obtains an ownership interest in the project or oroperty. 7. PROJECT BUDGET. Project Activities Total Costs HOME Funds Other Funds Other Funds Source Market Study $4,000.00 $4,000.00 NDC Equity Fund Appraisal/Survey S3,000.00 53,000.00 NDC Equity Fund Architect/Engineering 530,000.00 530,000.00 NDC Equity Fund Attorney Fees 542,500.00 S42,500.00 NDC Equity Fund Land 581,000.00 S81,000.00 Colorado Bluesky Ent. On -site Infrastructure $153,500.00 $153,500.00 NDC Equity Fund Construction $717,860.00 $135,000.00 $183,628.00 NDC Equity Fund 154,185.00 County of Pueblo 139,000.00 City of Pueblo 106,047.00 Minnequa Bank Contingency $39,500.00 $39,500.00 NDC Equity Fund Construction Loan Fees S27,000.00 S27,000.00 NDC Equity Fund Permanent Loan Fees $8,000.00 $8,000.00 NDC Equity Fund LIHTC Fees $12,500.00 $12,500.00 NDC Equity Fund Developers Fee $134,921.00 5134,921.00 NDC Equity Fund Operating Reserve $ 13,820.00 S13,820.00 NDC Equity Fund TOTAL $1,267,601.00 $135,000.00 $1,132,601.00 Page 3 of 5 Pages PROPERTY STANDARDS. A. Code Requirements. All construction and rehabilitation projects assisted with HOME funds must meet all applicable local codes, ordinances, and zoning ordinances at the time of project completion. If no local codes have been adopted, at a minimum the project must meet the HUD Section 8 Housing Quality Standards for Existing Housing. B. Fair Housing Act and Section 504. HOME - assisted construction must also meet the accessibility standards of the Fair Housing Act and Section 504. For housing projects which include any new construction or substantial rehabilitation of multi - family housing units, Section 504 requires that at least five percent of those units (or at least one, whichever is greater), be made handicap accessible according to the uniform Federal Accessibility Standards. An additional two percent of the units in such a project shall be accessible for persons with hearing or vision impairments. To the maximum extent feasible, these units are to be evenly distributed throughout the project site and be sufficient range of size when compared to other units. The owner or manager of the housing units must make available information regarding the availability of handicap accessible units to eligible individuals. PAYMENT SCHEDULE. Payments will be paid upon receipt and approval of written request from the Contractor for funds to meet immediate cash needs. All HOME funds must be disbursed to a payee, contractor, sub - contractor within 15 days of receipt from the Division of Housing. 10. USE RESTRICTION. The Contractor shall ensure that a use restriction is recorded in the land records identifying the project property. A copy of the recorded use restriction must be provided to the DOH at the time of recording, and before any request for payment. A. Eligible Beneficiaries. Colorado Bluesky Enterprises, Inc., its successors, assignees, heirs, grantees, or lessees shall insure that all 12 units are affordable to households whose incomes are equal to or less than 40 percent of the Area Median Income (AMI) at the time the household initially occupies their rental unit_ Income eligibility requirements are defined by the Department of Housing and Urban Development in 24 CFR 5.609. B. Rent Restrictions. To insure the housing is affordable to households between the extremely low, and very low income limits, the assisted rental units must have rents that are the lesser of the Section 8 FMR, as periodically established by HUD, or rents which are 30 percent of adjusted income for households whose incomes are at 40 percent of area median income, less tenant paid utilities. Pueblo County 1- Bedroom 2- Bedroom 3- Bedroom 4- Bedroom Fair Market Rent Eff. 10/99 40% of AMI Rents Eff. 1/99 440 303 550 364 740 420 883 469 C. Long Term Affordability. Colorado Bluesky Enterprises, Inc., its successors, assignees, heirs, grantees, or lessees shall ensure that this property remains affordable, without regard to the term of any loan or mortgage of transfer of ownership, for a period of not less than 40 years following the date of project close -out. Project close -out is expected to be December 31, 2000. This affordability restrictions shall be revived according to the original terms if, during the affordability period the owner of record, or any entity that includes the former owner or those with whom the former owner has, or had, family or business ties before the foreclosure or deed in lieu of foreclosure obtains an ownership interest in the project or property. - D. Change in Use. If this property is not used for housing the above described beneficiaries, at the above described rents for 40 years following the date of project close -out, Colorado Bluesky' c f Page 4 of 5 Pages � -• . 2' � Jir Enterprises, Inc., its successors and assignees, heirs, grantees, or lessees shall be required to repay the State the grant funds attributed to this property, unless the State authorizes the transfer of repaid funds to one or more public housing entities, or private nonprofit corporations. If the property is used for housing the above described beneficiaries, at the above described rents for 40 years following the date of project close -out, Colorado Bluesky Enterprises, Inc., its successors and assignees, heirs, grantees, or lessees shall be absolved of this requirement. 11. REPORTING SCHEDULE. The Contractor shall provide the following reports to the Department of Local Affairs, Division of Housing: A. Financial Reports One copy of the quarterly Financial Status Report must be submitted within 20 calendar days after the end of the calendar quarter. This report must be submitted on forms provided by the Division of Housing. No requests for payments shall be processed if the Contractor has not submitted this quarterly report; B. Performance Reports. Two copies of the quarterly Summary Beneficiary Report must be submitted within 20 calendar days after the end of the calendar quarter. These reports must be submitted on forms provided by the Division of Housing. No requests for payments shall be processed if the Contractor has not submitted these quarterly reports; C. Narrative Reports. One copy of the quarterly Narrative Performance Report shall be submitted within 20 calendar days after the end of the calendar quarter. This report may be submitted on forms provided by the Division of Housing. No requests for payments shall be processed if the Contractor has not submitted this quarterly report; D. Project Completion Report. Within 90 days after the completion of the Project or the final draw whichever is later, the Contractor shall submit 1 copy the Project Completion Report, two copies of the Final Financial Status Report, and two copies of the consolidated Summary Beneficiary Report on forms provided by the Division of Housing. E. Rent and Income Qualification Reports. Annually, on the project close out date, for 40 years, the term of affordability, the Contractor must submitto the Division of Housing information on rents and occupancy of HOME - assisted units to demonstrate compliance with the affordability requirements. These reports must be submitted on forms provided by the Division of Housing. F. Project Photographs. At the time of Project Close Out the Contractor must send before and after photographs of the project along with either the 35mm slides or negatives. 12. CONTRACT MONITORING. The Department of Local Affairs, Division of Housing, shall monitor this Contract in accordance with the provisions set forth in Paragraph 25. within the main body of this Contract. This project is subject to 20 years of HOME long -term monitoring, for 12 housing units, every two years beginning after the project close -out date. G:\DOHCOM\ HOME \CONTRACT\00- 018\SOSRental.wpd Page 5 of 5 Pages EXHIBIT B ACCOUNTING SYSTEM COMPLIANCE PROVISIONS As used in this Exhibit, the term "Sponsor" shall mean the entity entering into the Agreement with the City of Pueblo, a Municipal Corporation to which this Exhibit is attached. 2. Sponsor is subject to and shall comply with the requirements of OMB Circular A -133 applicable to a Nonprofit Institution as defined in 01\113 Circular A -133. Sponsor agrees to maintain (and require the Developer to maintain) Project and accounting records in accordance with generally accepted accounting principles which accurately reflect all costs chargeable to the Project, utilize adequate internal controls, and maintain source documentation for all costs incurred. The City shall have the right to review and approve Sponsor's account system and internal controls prior to the release of any funds under the Agreement. 4. During the preconstruction and construction phases of the Project, the Sponsor shall not allow there to be any material deviation from any approved Project budget unless any proposed major revision thereto has been submitted to City and approved in writing. Change orders of less than $10,000 each or $50,000 in the aggregate shall not be deemed to be material deviations or major revisions to the Project budget. 5. Nothing in the Agreement or the Exhibits thereto shall obligate City to any third parties nor to any Developer, contractors, subcontractors, consultants, suppliers or workmen who have contracted with Sponsor or provided any materials or services to Sponsor. 6. The City has the right to periodically perform interim audits and a final audit of the Project and funds provided under the Agreement. Sponsor shall fully cooperate (and shall require the Developer to cooperate) with City in undertaking any such audit and shall provide a suitable work area for City's audit personnel to inspect and copy records. E�1i18' ©E� ca :�:t C I TY OF PJE9LO - HIDUS I ' -� 7195460577 in. 6' ?5 9 i EXHIRIT C c�1? Tl�rc>ulorrs Sponsor hereby certi es that the project will be conducted and adminis`ered in compliance with all of the following requireuient�,: (1) Title VI of e Civil Rights Act of 1964 (Pub, L. 88 -352; 42 U,S.C. 2000d, e. se ) and implementing regulations iss ed at 24 CFR Part 1; (2) Title VIII of he Civil Rights Act of 1968 (Pub. L. 90 -284; 42 U.S.C. 3601, St =,), as amended; and that the grantee vial administer all programs and activities related to housing and community development in a manner to a in further fair housing; (3) Section 149 o the Housing and Community Development Act of 1974, as amended; and the regulations issued pursuant th reto; (4) Section. 3 of thy Housing and Urban Development Act of 1965, as amended; (5) Executive Or�cr 11246, as amended by Executive Orders 11375 and 12086, and ulations issu d implementing reg at 41 CFR Chapter 60; (6) Executivo Or cr 11063, as amended by Executive Orders 12259, and implementing regulations at 24 CFR Part 107 (7) Section 504 q the Rehabilitatior. Act of 1973 (Pub. L. 93 -112), as amended, and implementing regulations who published for effect; (8) The Age Discr mination Act of 1975 (Pub. L, 94 -135), as amended, and implementing regulations when published for ffect; (9) The relocation equirernents of Title 1I and the acquisition requirements of Title III of tae Unifoml Relocation AssistanO and Real Property Acquisition Policies Act of 1970, and the KM implementing regulations set fa h in 24 CFR Part 42; (10) Executive Orde 11988 releting to the evaluation of flood hazards and Executive Order 11288 relating to the prevention control and abatement of water pollution; (11) The flood insr. ante purchase requirements of Section 102(a) of the Flood Disaster Protection Act of 1973 (Pub, L. 3 -234); (12) The applicable egulations, policies, giidelines and requirements of OMI3 Circular Nos- A-102, Revised, 24 CFR 85 and JSubparl ? of 24 CFR 570, A - 87, A -11.0, A -122, A -128 and A -133 as they relate to the acceptance and use O f federal funds under this federally- assis.ed program; (13) The Clean Air ct (42 U.S.C. 7401 et. seq.) as amended; particularly section 176 (c) and (d) [42 U.S.C. 7506 (c) and (d) }; (14) MUD environm ntal criteria and standards ( .24 CFR Part 51, Environmental Criteria and Standards]; 01"'18/00 01: 24 CITY OF PUEBLO - HOUSING 4 7195460577 NO.699 ` r (15) The Safe Drinking Water Act of 1974 (42 U.S.C. 2G1, 300(f) et. seq„ and 21 U.S-C. 349) as amended; particularly sect on 1.424 (e) (42 U.S.C. 300 (h).303(c)); (16) The Cndange ed Species Act of 1973 (1.6 U.S,C, 1 S31 et, seq_) as amended; including but not limited to section 7 (16 U S.C. 1536) thereof; (17) The Wild and Scenic Rivers Act of 1968 (16 U,S.C. 1272 et. seq) as amended; partie;alariy section 7 (b) and (c) [ 16 U.S. , 1278 (b) and (c)]; (18) The Reservoi Salvage Act of 1964 916 U.S.C, 469 et, sect.); particularly section 3 (16 U.S.C. 469a -1); as amended b the Archeological and Historical Preservation Act of 1974; (19) Flood Disaste Protection Act of 1973 (42 U.S.C. 4001 et seq.) as amended; particularly sections 102(x) and 202(a) [42 U.S.C. 4012a(a) and 4106(a)]; (20) Executive ord °r 11990, protection of Wetlands, May 24, 1977 . (42 FR 26961 et. seq,); particularly sections 2 and 5; (2 1) It will comply ithtlie Lcad-Based Paint Poisoning Prevention requirements of 25 CFR Part 35 issued pursuant to the Lead- ascd Paint Poisoning Prevention Act (42 U.S.C, 4821 et. sett.); (22) The National istoric Preservation Act of 1966 (16 U.S.C. 470 et seq.) as amended; particularly section 106 (16 U. .C. 4701); and (23) Executive Orde 11593, Protection and Enhancement of the Cultural Environment, May 13, 1971 (36 Fk 8921 et. seq.); pa i.cuiarly section 2(c). (24) Construction w rk financed in whole or in part with federal funds is subject to the prevailing wage requirements of the Davis ncon Act (29 CFR, Parts 3 and 5), the Copeland Act (29 CFR Part 3), and the Contract Work Hours and Sa ety Standards Act (Public Law 91 -54, 83 Stat. 96). When a project meets this applicability requirement, th labor standards provisions of the PTUD 40 i 0 and the Davis Bacon Wage Decision issued for the project ill be incorporated into this contract document and shall be incorporated into all construction contracts a d subcontracts of any tier thereunder. (25) No CD8CJ fund may be expended for lobbying purposes and paynntnts from other sources for lobbying must be disclosed A4 CFR Part 87, 9C (26) Where asbestos s present in property undergoing rehabilitation, Federal requirements apply regarding worker exposure, abat ment procedures and disposal. CP'D -90 -44 EPAJOSHA. (27) When HOME I vestment Partnership Act funds are used, the Sponsor will comply with implementing regulations and r uirements under 24 CFR 92. Si nature COLORADO DIVISION OF HOUSING * HOUSING DEVELOPMENT ANALYSIS SPREADSHEET Version 1.1 Project Name: Baltimore Court Phase II PAGE #1 Spreadsheet directions are to the right - - -> Date: 13- Jan -00 Operating Proforma Developer: Colorado Bluesky Enterprises, Inc Spreadsheet Version Number 1 STABILIZED FIRST YEAR INCOME EXPENSES Incomes #of units S . Ft. Monthly Rent Total Annual Rent Administrative Expenses 0 Bdrm 0 0 0 0 Management Fee 4,320 1 Bdrm 0 0 0 0 On -site Personnel Payroll 0 1 Bdrm 0 0 0 0 Health Ins. & Benefits 0 2 Bdrm 12 976 317 45,648 Legal & Accounting 600 2 Bdrm 0 0 0 0 Advertising 500 3 Bdrm 0 0 0 0 Office Supplies 500 3 Bdrm 0 0 0 0 Telephone 500 4 Bdrm 0 0 0 0 Audit 5,000 4 Bdrm 10 0 0 0 Other 0 Total unity 12 tal Rent Income 45,648 Total Administrative Expenses 11,420 Total sq ft 11712 Operating Expenses Parking Income 0 Utilities owner aid 2,880 Laundry Income 0 Trash Removal 576 Other Income 0 Fire & Liability Insurance 3,000 Total Income 45,648 Other 0 Vac. Rate 0. 071 Less Vacancy 3,195 Other 0 Effective Gross Income 42,453 Total Operating Expenses 6,456 Maintenance DEBT SERVICE Maintenance 3,041 1st Mortgage -9,785 Repairs 4,283 2nd Mortgage 0 rounds include snow removal 1,200 3rd Mortgage 0 Other 0 TOTA DEB SERVICE -9,785 Total Maintenance 8,524 BEP 1 89.78%1 Poss D/S 1.1 DCR 10 Real Estate Taxes 2,400 Project Debt Coverage Ratio BEP = Break Even Point Poss D/S @ 1.1 DCR = Possible Debt Service at a 1.1 Debt Coverage Ratio Operating Reserve 0 i Replacement Reserve 2,400 1 TOTAL ANNUAL EXPENSES 31,200 NET OPERATING INCOME 11,253 P.U.P.A. Expenses * 2 * P.U.P.A = Per Unit Per Annum Expenses 0.09464 0.25018 snit avg.= 0 snit avg.= 200 BALTI.XLS COLORADO DIVISION OF HOUSING * HOUSING DEVELOPMENT ANALYSIS VERSION 1.1 Spreadsheet directions are to the right - - -> Project Name: Baltimore Court Phase II PAGE #2 Date: 13- Jan -00 Development Costs Developer: Colorado Bluesky Enterprises, Inc Spreadsheet Version Number 1 Total Square Feet in Units 11,712 Non Living Square Footage 0 Total Project Square Feet 11,712 Number of Units 12 BALTI.XLS Total Cost Cost/Unit CosUSq Ft ACQUISITION COSTS 22,978 Hard Cost Per Square Foot Land ' 0 0 0.00 Existing Structures 0 0 0.00 Appraisals 3,500 292 0.30 Soils Tests 0 0 0.00 Surveys 0 0 0.00 Other 0 0 0.00 3,500 292 0.30 CONSTRUCTION COSTS Building Permit Fees' 0 0 0.00 Tap Fees . 0 0 0.00 Off Site Infrastructure ' 0 0 0.00 On Site Infrastructure' 153,500 12,792 13.11 Construction ` 632,860 52,738 54.04 Landscaping ' 0 0 0.00 Contingency ` 39,500 3,292 3.37 Other` 85,000 7,083 7.26 910,860 75,905 77.77 DESIGN FEES Architect Fees 30,000 2,500 2.56 Engineering Fees 0 0 0.00 Other 0 0 0.00 30,000 2,500 2.56 INTERIM COSTS Construction Insurance 0 0 0.00 Construction Loan Ong. Fee 3,000 250 0.26 Construction Interest 15,000 1,250 1.28 Consultants 8,500 708 0.73 Taxes During Construction 1,000 83 0.09 Other 0 0 0.00 27,500 2,292 2.35 PERMANENT FINANCING FEES/DEPOSITS Loan Fees & Expenses 6,000 500 0.51 Attorney Fees 40,000 3,333 3.42 LIHTC Fees 8,000 667 0.68 Developer's Fee 134,921 11,243 11.52 Operating Reserve 13,820 1,152 1.18 Other 12,000 1,000 1.02 214,741 17,895 18.34 TENANT RELOCATION Temporary Relocation 0 0 0.00 Permanent Relocation 0 0 0.00 0 0 0.00 PROJECT MANAGEMENT Marketing 0 0 0.00 Project Management 0 0 0.00 Consultants 0 0 0.00 Other 0 0 0.00 0 0 0.00 TOTAL DEVELOPMENT EXPENS 1,186,601 98,883 98.97 BALTI.XLS 75,905 Hard Costs Hard Cost Per Unit Soft Cost Per Unit 22,978 Hard Cost Per Square Foot 77.77 Soft Cost Per S ware Foot 23.54 BALTI.XLS COLORADO DIVISION OF HOUSING * HOUSING DEVELOPMENT ANALYSIS SPREADSHEET Project Name: Baltimore Court Phase I Page #3 Spreadsheet directions are to the right - - -> Date: 13- Jan -00 Permanent Financing Sources Developer: Colorado Bluesky Enterprises, Inc Spreadsheet Version Number: 1 TOTAL DEVELOPMENT COSTS: $1,186,601 Sources of Funds l Type of Loan C FIRST MORTGAGE ventional 106,047 Lender Minne ua Bank 0 Principal 106,047 0 Interest Rate 8.500 °6 0 Term 30 YRS Annual Payment -9,785 SECOND MORTGAGE Lender 0 Principal 0 Interest Rate 0.000% 24% Term 0 YRS ter Equity Annual Payment 0 139,000 THIRD MORTGAGE Lender 0 Principal 0 Interest Rate 0.000% Term 0 YRS Annual Payment 0 TAX CREDITS 4% Low Income Proceed 0 9% Low Income Proceed 0 Historic Housing 0 Historic Commercial 0 GOVMT GRANTS Source State DOH Amount 135,000 Pueblo Count Amount 154,185 OTHER GRANTS Source LIHTC Amount 652,369 Amount 0 OWNER EQUITY Source Amount 0 Amount 0 TOTAL SOURCES 1,047,601 GAP 139,000 BEP 0.9 Poss D/S 1.1 10,230 DCR 0.00 Ca Rate 0.00 Types of Loans: C = Conventional T = Tax - Exempt F = Federal Financing al of Sources by Type l incing Sources: Total Percent of Total ventional 106,047 9% Exempt 0 0% :ral Financing 0 0% Credits 0 0% eminent Grants 289,185 24% ar Grants 652,369 55% ter Equity 0 0% 139,000 12% QUICK CALCULATION OF MORTGAGE PRINCIPLE NOI 11,253 Cap Rate 0.00 Value at Cap Rate #DIV /0! LVR 90% Max Loan Amount #DIV /0! BEP = Break Even Point Poss D/S @ 1.1 OCR = Possible Debt Service at a 1.1 Debt Coverage Ratio DCR = Debt Coverage Ratio Cap Rate = Capitalization Rate BALTI.XLS COLORADO DIVISION OF HOUSING * HOUSING DEVELOPMENT ANALYSIS SPREADSHEET PAGE #5 Project Name: Baltimore Court Pha Developer: Colorado Bluesky Enterprises, Inc 10 Year Proforma Date: 13- Jan -00 Spreadsheet Version Numbe! 1 TEN YEAR OPERATING PROFORMA Spreadsheet Directions are to the right - - - - -> BALTI.XLS YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 YEAR 8 YEAR 9 YEAR 10 Rent Income $45,648 $47,474 $49,373 $51,348 $53,402 $55,538 $57,759 $60,070 $62,472 $64,971 Less Vacancy $3,195 $3,323 $3,456 $3,594 $3,738 $3,888 $4,043 $4,205 $4,373 $4,548 Other Income $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Eff. Gross Income $42,453 $44,151 $45,917 $47,753 $49,664 $51,650 $53,716 $55,865 $58,099 $60,423 Total Annual Expenses $31,200 $32,526 $33,908 $35,349 $36,852 $38,418 $40,051 $41,753 $43,527 $45,377 NET OPERATING INCOME $11,253 $11,625 $12,008 $12,404 $12,812 $13,232 $13,665 $14,112 $14,572 $15,046 Total Debt Service ($9,785) ($9,785) ($9,785) ($9,785) ($9,785) ($9,785 ($9,785) ($9,785) ($9,785) ($9,785) Bridge Loan Debt Service $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Cash flow Available $1,468 $1,840 $2,224 $2,619 $3,027 $3,447 $3,880 $4,327 $4,787 $5,261 Debt Coverage Ratio 1.15 1.19 1.23 1.27 1.31 1.35 1.40 1.44 1.49 1.54 Cash -On -Cash ROI 146772% 183983% 222350% 261907% 302686% 344720% 388044% 432692% 478702% 526107% Developer Fees $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Partnership Management Fees $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Tax Credit Org. Costs $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Cash Flow After Tx Cr Costs $1 $1 $2 2 619 $3,027 $3,447 $3 $4 $4 $5 TAX ANALYSIS Taxable Cash Flow $1,468 $1,840 $2,224 $2,619 $3,027 $3,447 $3,880 $4,327 $4,787 $5,261 Depreciation Expense $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Principal Payments $854 $926 $1,005 $1,090 $1,183 $1,284 $1,393 $1,511 $1,640 $1,779 Unexpended Reserves $2,400 $2,400 $2,400 $2,400 $2,400 $2,400 $2,400 $2,400 $2,400 $2,400 EARNINGS BEFORE TAX $4,721 $5,166 $5,629 $6,110 $6,610 $7,131 $7,673 $8,238 $8,827 $9,440 Tax Rate 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% Tax Liability or (Operating Loss) $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 CASH FLOW AFTER TAX $1 $1 $2,224 $2 619 $3 027 3 447 $3 880 $4 $4 $5,261 TOTAL BENEFIT ANALYSIS - TAX CREDIT INVESTORS Cash Flow After Tx (add °/ 99% $1,453 $1,821 $2,201 $2,593 $2,997 $3,413 $3,842 $4,284 $4,739 $5,208 Historic Tax Credits $0 LIHTC $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 Net Sales Proceeds $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 TOTAL BENEFITS AFTER TAX $1 453 $1 $2,201 $2,593 $2,997 $3,4 $3 842 $4,284 $4 $5 208 BALTI.XLS