HomeMy WebLinkAbout10-06-20 City Commission Packet Materials - C6. Grant w GMD Dev and HRDC for Arrowleaf and Perennial Parks
Commission Memorandum
REPORT TO: Mayor and City Commission FROM: Tanya Andreasen, Community Housing Program Manager Marty Matsen, Community Development Director
SUBJECT: Authorize the City Manager to sign a grant agreement with GMD Development and Human Resource Development Council IX for $500,000 to offset City of Bozeman impact fees, building permit fees, and approved construction costs for the Arrowleaf and Perennial Parks project.
MEETING DATE: October 6, 2020
AGENDA ITEM TYPE: Consent
RECOMMENDATION: Staff recommends the City Commission approve a grant of $500,000
for the Arrowleaf Park and Perennial Park project to GMD Development (GMD) and HRDC IX
from the Community Housing Fund. Approval of this Consent item is contingent on the City Commission’s approval of Resolution 5222, Budget Amendment for the Community Housing Fund, which will be considered as an Action item at this same meeting.
BACKGROUND: Arrowleaf Park and Perennial Park is a mixed-use project that will provide 232
affordable homes for families and seniors, as well as family housing services, early childhood education, and onsite health services. All 232 homes will be 1, 2, and 3 bedroom rentals, made available to households earning between 50% - 70% of Area Median Income. Ninety-six (96) of the homes will be for seniors, and one hundred thirty-six (136) homes will be available to families.
Community Health Partners will have a clinic in the development to provide medical, dental,
pharmacy and behavioral health services to lower income residents. Family Promise will also have a learning center in the development and will provide early childhood development services in conjunction with Montana State University’s Health and Human Development program.
GMD Development initially presented its funding request and conceptual project proposal to the
City’s Community Affordable Housing Advisory Board (CAHAB) on February 13, 2019. The
CAHAB made a positive recommendation. Once the project advanced to the preliminary plat application stage, CAHAB reviewed a renewed funding request from GMD Development and HRDC, a recently added nonprofit partner on the project, on August 12, 2020. The board confirmed its original recommendation by voting to recommend City Commission approval of
$500,000 to GMD Development’s Arrowleaf and Perennial Parks project. The presentation to
CAHAB and renewed funding request are attachments to the proposed grant agreement.
The proposed grant agreement is structured so that both GMD Development and HRDC are named as Grantee. GMD Development has partnered with HRDC as its non-profit partner. This relationship allows project management before and during construction. Further, having a non-
profit partner fulfills federal requirements for Low Income Housing Tax Credit investment. In
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order to best leverage grant funds for the project, the granted funds will be used to offset City of
Bozeman building permit and impact fees as they are calculated and invoiced throughout the
construction process. Any remaining funds may be used to reimburse the developer for approved construction costs.
ALTERNATIVES: Use this section to call out alternatives to the Unresolved Issues listed
above. If there are viable alternatives to the Recommendation, those should also be included.
FISCAL EFFECTS: The full payment of $500,000 will reduce the balance of the Community Housing Fund. The budget for Community Housing Fund grants for FY21 is $515,000, so in combination with another grant request for $240,000, a budget amendment of $225,000 is
required and will further reduce fund balance.
Attachments: Grant Agreement
Report compiled on: 09/24/2020
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GRANT AGREEMENT
Arrowleaf Park and Perennial Park
THIS AGREEMENT is made and entered into this ____ day of __________, 20__ by and between
the City of Bozeman, Montana, a self-governing municipal corporation located at 121 N. Rouse
Ave., Bozeman MT 59771 (“City”) as GRANTOR and GMD Development LLC, a for profit limited
liability corporation located at 520 Pike Street, Suite 1010, Seattle, Washington 98101 and
Human Resource Development Council of District IX, Inc., a Montana nonprofit corporation
located at 32 South Tracy Avenue, Bozeman, Montana 59715 as GRANTEES.
WHEREAS, on October 17, 2005 the Bozeman City Commission adopted Resolution No. 3866
establishing policies for the granting of funds from the City of Bozeman to a requesting entity;
and
WHEREAS, GRANTEES submitted a proposal to the City Commission for a grant of $500,000 for
general construction costs of the Arrowleaf Park and Perennial Park affordable housing
development (the “Project”) that would benefit from the City funding; and
WHEREAS, on August 12, 2020 the Community Affordable Housing Advisory Board (CAHAB)
reviewed the grant request and recommended the City Commission approve the Grant; and
WHEREAS, on August 25, 2020 the City Commission approved GRANTEES’ Preliminary Planned
Unit Development (PUD) application number 20153; and
WHEREAS, on October 6, 2020, the Commission appropriated $500,000 for the Project.
THE PARTIES AGREE:
1. The Grant. The City will grant and release to GRANTEES a sum of up to five hundred
thousand dollars ($500,000) from its Community Housing Fund (the “Grant”) pursuant
to the payment terms in Section 4.
2. Use of Grant Funds. Grant funds in the amount of up to five hundred thousand dollars
($500,000) will be used by GRANTEES for the sole purpose of offsetting City building
permit and impact fees. Any remaining funds may be used to pay for a portion of City
approved construction expenses of the Project, which will provide 96 affordable
apartment rentals for senior citizens and 136 affordable rentals for families, with half of
the units in each project available for renters at less than fifty percent of area median
income and the other half of the units available for renters between sixty and seventy
percent of median income, as described in the proposal submitted by GRANTEES to the
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City Commission, attached hereto as Exhibit A and by this reference incorporated
herein.
3. Term. The term of this Agreement will commence on the Effective Date and expire
three (3) years after the Effective Date unless earlier terminated as provided herein.
4. Payment of Grant Funds
a. Payment of Grant funds is contingent on the City Commission’s final approval of
GRANTEES’ PUD, and GRANTEES’ compliance with the approved final PUD.
b. GRANTEES may request the Grant funds upon receiving invoice(s) from the City
for building permit and impact fees for the Project. If Grant funds remain after all
impact and building permit fees have been paid before the end of the term,
GRANTEES may request reimbursement of City approved construction expenses
paid by GRANTEES. A request for Grant funds must be submitted in writing with
a City generated invoice showing impact and permit fees, and/or proof of
construction expenses paid. Acceptable forms of proof of payment shall be as
determined in the sole discretion of the City’s Director of Finance.
c. Any funds from the Grant not requested during the fiscal year ending June 30,
2023will remain in the City’s Community Housing Fund and will be available for
other appropriation.
d. The City will have no obligation to pay any Grant funds unless at the time of the
reimbursement request (i) all of GRANTEES’ representations as set forth in
Section 5 are true and correct, and (ii) neither GRANTEE is in breach of any term
of this Agreement. If any of the above conditions are not satisfied in the
determination of the City, the City shall have no obligation to pay any Grant
funds and the City’s determination to refrain from paying, or its inability to pay,
any Grant funds shall not be or result in a default of this Agreement.
5. Grantees’ Representations
a. GRANTEES have familiarized themselves with the nature and extent of this
Agreement and with all local conditions and federal, state and local laws,
ordinances, rules, and regulations that in any manner may affect GRANTEES’
performance under this Agreement.
b. GRANTEES represent and warrant to City that they have the experience and
ability to perform its obligations under this Agreement; that they will perform
said obligations in a professional, competent and timely manner and with
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diligence and skill; that they have the power to enter into and perform this
Agreement and grant the rights granted in it; and that its performance of this
Agreement shall not infringe upon or violate the rights of any third party,
whether rights of copyright, trademark, privacy, publicity, libel, slander or any
other rights of any nature whatsoever, or violate any federal, state and
municipal laws. The City will not determine or exercise control as to general
procedures or formats necessary for GRANTEES to meet this warranty.
c. GRANTEEs represent and warrant to City that the Grant funds are necessary to
accomplish the financial requirements of the Project.
6. Reports/Accountability/Public Information. If Grant funds are paid to GRANTEES,
GRANTEES will provide to the City a formal written report that includes, at a minimum,
the proof of expenses paid. GRANTEES agree to develop and/or provide such other
documentation as requested by the City demonstrating GRANTEES’ compliance with the
requirements of this Agreement. GRANTEES must allow the City, its auditors, and other
persons authorized by the City to inspect and copy its books and records for the purpose
of verifying that monies provided to GRANTEES pursuant to this Agreement were used
in compliance with this Agreement and all applicable provisions of federal, state, and
local law. GRANTEES will retain such records for seven years after receipt of final
payment under this Agreement unless permission to destroy them is granted by the
City. GRANTEES shall not issue any statements, releases or information for public
dissemination without prior approval of the City.
7. Independent Contractor Status. The parties agree that GRANTEES, their agents,
employees, contractors, or subcontractors, are independent contractors for purposes of
this Agreement and are not to be considered employees or agents of the City for any
purpose. GRANTEES and their agents, employees, contractors, or subcontractors, are
not subject to the terms and provisions of the City’s personnel policies handbook and
may not be considered a City employee for workers’ compensation or any other
purpose. GRANTEES, their agents, employees, contractors, or subcontractors, are not
authorized to represent the City or otherwise bind the City in any way.
8. Default and Termination. If GRANTEES fail to comply with any condition of this
Agreement at the time or in the manner provided for, the City may terminate this
Agreement if the default is not cured within fifteen (15) days after written notice is
provided to GRANTEES. The notice will set forth the items to be cured. If this
Agreement is terminated pursuant to this Section, GRANTEES will repay to the City any
Grant funds already delivered to GRANTEES for the Project.
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9. Limitation on GRANTEES’ Damages; Time for Asserting Claim
a. In the event of a claim for damages by GRANTEES under this Agreement,
GRANTEES’ damages shall be limited to contract damages and GRANTEES hereby
expressly waives any right to claim or recover consequential, special, punitive,
lost business opportunity, lost productivity, field office overhead, general
conditions costs, or lost profits damages of any nature or kind.
b. In the event GRANTEES want to assert a claim for damages of any kind or nature,
GRANTEES must first provide City with written notice of its claim, the facts and
circumstances surrounding and giving rise to the claim, and the total amount of
damages sought by the claim, within ninety (90) days of the facts and
circumstances giving rise to the claim. In the event GRANTEES fail to provide
such notice, GRANTEES shall waive all rights to assert such claim.
10. Representatives
a. City’s Representative. The City’s Representative for the purpose of this
Agreement shall be the City of Bozeman Finance Director or such other
individual as City shall designate in writing. Whenever approval or authorization
from or communication or submission to City is required by this Agreement, such
communication or submission shall be directed to the City’s Representative and
approvals or authorizations shall be issued only by such Representative;
provided, however, that in exigent circumstances when City’s Representative is
not available, GRANTEES may direct its communication or submission to other
designated City personnel or agents and may receive approvals or authorization
from such persons.
b. GRANTEES’ Representative. GRANTEES’ Representative for the purpose of this
Agreement shall be Steve Dymoke of GMD Development, LLC and the Executive
Director of the Human Resources Development Council of District IX, Inc. or such
other individual as GRANTEES shall designate in writing. Whenever direction to
or communication with GRANTEES is required by this Agreement, such direction
or communication shall be directed to GRANTEES’ Representative; provided,
however, that in exigent circumstances when GRANTEES’ Representative is not
available, City may direct its direction or communication to other designated
GRANTEE personnel or agents.
11. Permits and Compliance With Laws. GRANTEES will obtain, in a timely manner, all
required permits, licenses and approvals, and will meet all requirements of all local,
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state and federal laws, rules and regulations which must be obtained or met in
connection with construction of the Project.
12. Indemnity/Waiver of Claims/Insurance. To the fullest extent permitted by law,
GRANTEES agrees to defend, indemnify and hold the City and its agents,
representatives, employees, and officers (collectively referred to for purposes of this
Section as the City) harmless against all third party claims, demands, suits, damages,
losses, and expenses, including reasonable defense attorney fees, which arise out of,
relate to or result from GRANTEES’ (i) negligence, or (ii) willful or reckless misconduct.
Such obligations shall not be construed to negate, abridge, or reduce other rights or
obligations of indemnity that would otherwise exist. The indemnification obligations of
this Section must not be construed to negate, abridge, or reduce any common-law or
statutory rights of the indemnitee(s) which would otherwise exist as to such
indemnitee(s). GRANTEES’ indemnification obligations under this Section shall be
without regard to and without any right to contribution from any insurance maintained
by City.
Should any indemnitee described herein be required to bring an action against
GRANTEES to assert its right to defense or indemnification under this Agreement or
under GRANTEES’ applicable insurance policies required below the indemnitee shall be
entitled to recover reasonable costs and attorney fees incurred in asserting its right to
indemnification or defense but only if a court of competent jurisdiction determines
GRANTEES was obligated to defend the claim(s) or was obligated to indemnify the
indemnitee for a claim(s) or any portion(s) thereof.
In the event of an action filed against City resulting from the City’s performance under
this Agreement, the City may elect to represent itself and incur all costs and expenses of
suit.
GRANTEES also waive any and all claims and recourse against the City or its officers,
agents or employees, including the right of contribution for loss or damage to person or
property arising from, growing out of, or in any way connected with or incident to the
performance of this Agreement except “responsibility for his own fraud, for willful injury
to the person or property of another, or for violation of law, whether willful or
negligent” as per 28-2-702, MCA.
These obligations shall survive termination of this Agreement.
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In addition to and independent from the above, GRANTEES shall at GRANTEES’ expense
secure insurance coverage through an insurance company or companies duly licensed
and authorized to conduct insurance business in Montana which insures the liabilities
and obligations specifically assumed by GRANTEES in this Section. The insurance
coverage shall not contain any exclusion for liabilities specifically assumed by GRANTEES
in this Section unless and to the extent coverage for such liability is not reasonably
available.
The insurance shall cover and apply to all claims, demands, suits, damages, losses, and
expenses that may be asserted or claimed against, recovered from, or suffered by the
City without limit and without regard to the cause therefore and which is acceptable to
the City and GRANTEES shall furnish to the City an accompanying certificate of insurance
and accompanying endorsements in amounts not less than as follows:
Workers’ Compensation – statutory;
Employers’ Liability - $1,000,000 per occurrence; $2,000,000 annual aggregate;
Commercial General Liability - $1,000,000 per occurrence; $2,000,000 annual
aggregate
The City of Bozeman, its officers, agents, and employees, shall be endorsed as an
additional or named insured on a primary non-contributory basis on the Commercial
General Liability policy. The insurance and required endorsements must be in a form
suitable to City and shall include no less than a thirty (30) day notice of cancellation or
non-renewal. The City must approve all insurance coverage and endorsements prior to
delivery of Grant funds to GRANTEES. GRANTEES shall notify City within two (2) business
days of GRANTEES’ receipt of notice that any required insurance coverage will be
terminated or GRANTEES’ decision to terminate any required insurance coverage for any
reason.
13. Nondiscrimination and Equal Pay. GRANTEES agree that all hiring by Grantees of
persons performing this Grant Agreement shall be on the basis of merit and
qualifications. GRANTEES will have a policy to provide equal employment opportunity in
accordance with all applicable state and federal anti-discrimination laws, regulations,
and contracts. GRANTEES will not refuse employment to a person, bar a person from
employment, or discriminate against a person in compensation or in a term, condition,
or privilege of employment because of race, color, religion, creed, political ideas, sex,
age, marital status, national origin, actual or perceived sexual orientation, gender
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identity, physical or mental disability, except when the reasonable demands of the
position require an age, physical or mental disability, marital status or sex distinction.
GRANTEES represent it is, and for the term of this Agreement will be, in compliance with
the requirements of the Equal Pay Act of 1963 and Section 39-3-104, MCA (the Montana
Equal Pay Act). GRANTEES must report to the City any violations of the Montana Equal
Pay Act that Contractor has been found guilty of within 60 days of such finding for
violations occurring during the term of this Agreement.
GRANTEES shall require these nondiscrimination terms of its subcontractors providing
services under this Grant Agreement.
14. Public Meetings and Access to Public Records
a. Meetings of GRANTEES that pertain to the receipt or expenditure of Grant funds
from the City are subject to the open meeting requirements of Montana law,
including those set forth in Title 7, Chapter 1, Part 41, MCA and Title 2, Chapter 3,
MCA. To ensure compliance, GRANTEES will provide agendas for meetings that
pertain to the receipt or expenditure of Grant funds covered by this Agreement to
the City Clerk’s office no later than 72 working hours prior to meeting for notice on
the City’s official posting board and any other sites deemed reasonable by the
Clerk’s office. In addition, meeting minutes will be kept by GRANTEES and provided
to the City Clerk’s office no later than 90 days after the meeting. These minutes
shall be posted and made available to the public by the City Clerk’s office except for
those minutes taken during a closed meeting in accordance with 2-3-203, MCA.
Minutes taken during a closed meeting shall also be provided to the City Clerk’s
office but shall be handled in accordance with the City Clerk’s regular executive
session protocol and kept private in a secured cabinet.
b. In accordance with 7-1-4144, MCA and subject to any applicable legal obligation to
protect and preserve individual confidential or private information, upon reasonable
request and at reasonable times during normal business hours, GRANTEES shall
make such records available for inspection and copying by members of the public.
GRANTEES may charge for such copying in accordance with the policies of the City,
which GRANTEES hereby adopt for such purposes.
c. To determine whether a meeting or part of a meeting may be closed to the public
and to determine whether information contained in GRANTEES’ documents is
protected by law from disclosure, GRANTEES may seek a determination of the City
Attorney at no cost to GRANTEES. Such request and determination shall not create
an attorney-client relationship between GRANTEES and the City.
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15. Attorney’s Fees and Costs. In the event it becomes necessary for a party to this
Agreement to retain an attorney to enforce any of the terms or conditions of this
Agreement or to give any notice required herein, then the prevailing party shall be
entitled to reasonable attorney’s fees and costs, including fees, salary, and costs of in-
house counsel to include City Attorney.
16. Integration and Modification. This document contains the entire agreement between
the parties and no statements, promises or inducements made by either party or agents
of either party not contained in this written Agreement may be considered valid or
binding. This Agreement may not be modified except by written agreement signed by
both parties.
17. Dispute Resolution
a. Any claim, controversy, or dispute between the parties, their agents, employees,
or representatives shall be resolved first by negotiation between senior-level
personnel from each party duly authorized to execute settlement agreements.
Upon mutual agreement of the parties, the parties may invite an independent,
disinterested mediator to assist in the negotiated settlement discussions.
b. If the parties are unable to resolve the dispute within thirty (30) days from the
date the dispute was first raised, then such dispute may only be resolved in a
court of competent jurisdiction in compliance with the Applicable Law provisions
of this Agreement.
18. No Assignment. GRANTEES may not subcontract or assign GRANTEES’ rights, including
the right to Grant payments, or any other rights or duties arising hereunder, without the
prior written consent of City.
19. No Third Party Beneficiary. The terms and provisions of this Agreement are intended
solely for the benefit of each party and their respective successors and assigns. It is not
the parties’ intent to confer third party beneficiary rights upon any other person or
entity.
20. Choice of Law. This Agreement shall be governed and construed in accordance with the
laws of the State of Montana without regard to conflict of law provisions. The Parties
agree to submit to the personal and exclusive jurisdiction of the courts located within
Gallatin County, Montana.
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21. Non-Waiver. A waiver by either party of any default or breach by the other party of any
terms or conditions of this Agreement does not limit the other party’s right to enforce
such term or conditions or to pursue any available legal or equitable rights in the event
of any subsequent default or breach.
22. Severability. If any portion of this Agreement is held to be void or unenforceable, the
balance of the Agreement shall continue in effect.
23. Counterparts. This Agreement may be executed in counterparts, which together
constitute one instrument.
IN WITNESS WHEREOF, the parties hereto have executed this instrument the day and year
indicated below.
_______________________ Date: __________
Jeff Mihelich, City Manager
City of Bozeman
_______________________ Date: __________
Greg Dunfield, President/Owner
GRANTEE GMD Development, LLC
_______________________ Date: __________
Heather Grenier, CEO
GRANTEE HRDC
Approved as to form:
_______________________ Date: __________
Greg Sullivan, City Attorney
City of Bozeman
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9/24/2020
9/24/2020
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FY 2021 Grant Agreement – Arrowleaf Park and Perennial Park
Exhibit A
Exhibit A
Grant Proposal
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Bozeman Affordable Housing OpportunityTschache Lane - Bozeman, MTCommunity Affordable Housing Advisory Board – Funding RequestGreg Dunfield & Steve Dymoke520 Pike StreetSeattle, WA 98101206-745-6464Steve@gmddevelopment.comDocuSign Envelope ID: 4FA502EF-F3B8-48AD-8892-577D24867CF3
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OPPORTUNITY 15.75 acre site could support 240-280 units of affordable rental housing, plus significant community commercial space and amenities. •About 100 units of Senior Independent Living housing•One 3-story elevator building, plus 5 unit, two-story walkup cottages•About 150 units of Family Housing •12 / 20 / 24 3-story walkup garden buildings, plus 3BD townhome units Rockcress CommonsDocuSign Envelope ID: 4FA502EF-F3B8-48AD-8892-577D24867CF3
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The proposed development site is 15 acres of land, 12 of which are developable. Hugging the north and east sides of the lot are wetlands, a small pond, stream, and a biking/walking trail. To the south and west are the Bozeman Lowes, and Tschache Lane, which terminates at the aforementioned wetlands. The lots east of the property have been approved to be developed into commercial and office space, expanding the 19th Ave retail district.Green Space and Wetlands Buildable AreaCurrent trail systemsApproved Adjacent DevelopmentsNE ViewEast ViewSouth ViewCONDITIONSDocuSign Envelope ID: 4FA502EF-F3B8-48AD-8892-577D24867CF3
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Along the main access road, Tschache Lane, the proposed development would provide commercial space frontage. The intent of this space would be to provide supportive service such as child care, senior activity/support, outward bound, YMCA, boys and girls club, Bozeman Parks and Recreation, etc. to the residents of the apartment community and of greater Bozeman.All residential units would sit behind the main commercial space fronting TschacheLane. The proposed residential development would be comparable to Larkspur Commons, a property in Bozeman completed in 2017; Invoking similar material and feel of that project. Conceptual Site PlanCONCEPTUAL DESIGNLarkspur CommonsDocuSign Envelope ID: 4FA502EF-F3B8-48AD-8892-577D24867CF3
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Given the close proximity of goods and services, and the natural features that abut the site, this location would be ideal for a mix of senior and multifamily apartment housing. The walkability of this location would reduce the number of car trips for groceries, shopping, and to work for parents employed in this retail district. Other possible improvements and amenities in addition to the housing could include:LIVABILITY •Green and open space •Community playground•Community garden•Bike parking and storage •Wetlands trails and trail access•On site activity room for residents•Improved walking paths•Possible on site childcare•Possible on site medical/dental clinicThe proposed development would likely serve families and individuals with household income between 50-70% of the area median income. Additionally GMD is looking into other sustainable ways to reach a broader range of households, allowing the possibility to serve lower income families. DocuSign Envelope ID: 4FA502EF-F3B8-48AD-8892-577D24867CF3
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RESIDENT AFFORDABILITY •Half the units in each project would target households at less than 50% AMI (income and rent).•Remaining half would accept households up to 70% of AMI income, with rents set from 60-70% of AMI.•Communities will be sustainably designed and built with high quality materials and solar photovoltaic and solar thermal to reduce both owner and resident utility cost. Starner GardensDocuSign Envelope ID: 4FA502EF-F3B8-48AD-8892-577D24867CF3
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•Local political and financial support•B2 zoning and conditional use permitFinancial feasibility Title reviewSurveyEnvironmental reviewPreliminary site plan Soils and wetland review Qualified Census Tract INITIAL 90 DAY DUE DILIGENCE PERIOD – “GO OR NO GO”
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CURRENT RENT SUMMARY - 2018 Area Median Incomes
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Funding Request: $500,000 (approximately $1,850 / per unit)•Would provide critical funding gap that will leverage approximately $32 million in Tax Exempt Bonds + $20 million in Tax Credit Equity.•Funding to be used to offset general construction costs.Estimated time of closing = Fall 2019CAHAB – CITY OF BOZEMAN - Funding Request
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