HomeMy WebLinkAbout14- HRDC, Down Payment Assistance for Buyers at West Edge GRANT AGREEMENT
HUMAN RESOURCES DEVELOPMENT COUNCIL—DOWN PAYMENT ASSISTANCE FOR
BUYERS AT WEST EDGE CONDOMINIMUM DEVELOPMENT, PHASE 3
THIS AGREEMENT is made and entered into this day D/ 1 , 2014 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 the Human Resources Development Council of
District IX, Inc. ("HRDC"), a non-profit corporation located at 32 South Tracy Ave., Bozeman MT
59715 as grantee.
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, the City approved a 2012-2016 Affordable Housing Action Plan on May 21, 2012
which identified home purchase assistance funding of up to $10,000 per qualified homebuyer
as an activity eligible for City funding; and
WHEREAS, HRDC is the developer of the West Edge Condominium development at 210 South
Cottonwood Road, Bozeman MT; and
WHEREAS, HRDC presented a request for a grant of up to $160,000 from the City's Community
Housing Fund to be used for down payment assistance for qualifying buyers at the West Edge
Condominium development, Phase 3; and
WHEREAS, State of Montana HOME and CDBG funds are not available for this purpose; and
WHEREAS the City's Community Affordable Housing Advisory Board ("CAHAB") reviewed
HRDC's request and recommended that the City approve the request; and
WHEREAS, on May 19, 2014,the City Commission unanimously approved HRDC's grant request.
THE PARTIES AGREE:
1. The Grant. The City will grant and release to HRDC a sum of up to one-hundred and
sixty thousand dollars ($160,000) from its Community Housing Fund (the "Grant")
pursuant to the payment terms in Section 3.
2. Use of Grant Funds. Grant funds will be administered by HRDC (the "Lender") and used
by HRDC for the sole purpose of providing down payment assistance loans of up to
$10,000 per household (the "Loans")to up to sixteen households seeking to purchase
Grant Agreement—HRDC Down Payment Assistance Page 1
units within Phase 3 of the West Edge Condominium development. As used in this
agreement, "Grant funds" will include funds recaptured by HRDC as described in Section
5 of this Agreement.
3. Payment of Grant Funds
a. Once HRDC qualifies and closes on a 2nd mortgage for a homebuyer(s), HRDC will
submit an invoice to the City requesting payment of Grant funds used to fund
the Loan(s).
b. Per Bozeman Commission Resolution No. 3866, all Grant funds must be awarded
within a one-year period from the date of the first payment by the City to HRDC.
Any funds from the Grant not awarded during the one-year period will remain in
the City's Community Housing Fund. The City Manager may authorize in writing
a 6 month extension in the event that extenuating circumstances arise
preventing sales of all 24 units within a one year time period.
4. Grantee Representations
a. HRDC has familiarized itself with this Agreement and with all local conditions and
federal, state and local laws, ordinances, rules, and regulations that in any
manner may affect HRDC's performance under this Agreement.
b. HRDC represents and warrants to City that it has the experience and ability to
perform its obligations under this Agreement;that it will perform said
obligations in a professional, competent and timely manner and with diligence
and skill; that it has 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 HRDC to meet this warranty.
5. Homebuyer Eligibility Criteria
a. HRDC will prequalify each homebuyer prior to making a Loan, using the criteria
in this Agreement and such additional criteria as HRDC deems appropriate.
b. Each homebuyer's total household income may not exceed 60 percent of area
median income ("AMI") for the size of that homebuyer's household.
c. Homes purchased with Grant funds must be the primary residence of the
homebuyer.
Grant Agreement—HRDC Down Payment Assistance Page 2
d. Rental of the whole or any part of a home purchased with Grant funds is
prohibited,
6. Recapture of Grant Funds
a. HRDC will execute loan agreements with each qualifying homebuyer including a
restriction agreement and subordinate deed of trust recorded with the Gallatin
County Clerk and Recorder and a promissory note, which provide for the
recapture of Loan funds by HRDC if the home is sold, refinanced, is no longer
owner-occupied, or is rented (in whole or in part) for a period of at least 30 days
during the thirty-year affordability period.
b. The recapture provisions of the homebuyer loan agreements will not expire or
be forgiven during the affordability period.
c. Funds recaptured pursuant to the homebuyer loan agreements may be used by
HRDC only to provide additional down payment assistance loans meeting the
homebuyer and loan agreement criteria of this Agreement.
7. Reports/Accountability/Public Information. By the end of January of each year after
the effective date of this Agreement, HRDC will provide to the City a written financial
report that includes, at a minimum,the following:
a. Total number of Loans granted to date using Grant funds,
b. The total dollar amount of funds granted to date using Grant funds,
c. The date and amount of each Loan made during the reporting period,
d. Information regarding each qualifying homebuyer sufficient to show the
homebuyer met the household income restrictions set out in this Agreement,
e. Number of Loans repaid to HRDC pursuant to the recapture provisions in the
homebuyer loan agreements,
f. The amount of money recaptured during the annual reporting period,
g. Details on the use of recaptured funds to provide down payment assistance
loans to qualifying homebuyer(s), including dates and amounts of such loans,
and income qualification of each homebuyer,
h. The total balance of recaptured funds remaining in HRDC's account at the end of
the reporting period, and
i. Such other information as requested by the City.
HRDC agrees to develop and/or provide such other documentation as requested by the
City demonstrating HRDC's compliance with the requirements of this Agreement. HRDC
shall 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 HRDC
Grant Agreement—HRDC Down Payment Assistance Page 3
pursuant to this Agreement were used in compliance with this Agreement and all
applicable provisions of federal, state, and local law. HRDC will retain such records for
three years after receipt of final payment for the services rendered under this
Agreement unless permission to destroy them is granted by the City. HRDC shall not
issue any statements, releases or information for public dissemination without prior
approval of the City.
8. Repayment of Grant Funds to City
a. HRDC agrees to repay to the City any Grant funds expended by HRDC in violation
of the terms of this Agreement.
b. If for any reason HRDC ceases to manage the Grant funds and/or the Loans,
HRDC will assign all its interest in the Loans and any recaptured funds to the City.
HRDC will record an Assignment of Beneficial Interest on the City's behalf with
the Gallatin County Clerk and Recorder's office for each outstanding Loan. Any
remaining Grant funds in HRDC's account will be promptly refunded to the City.
9. Independent Contractor Status. The parties agree that HRDC, its 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. HRDC and its 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.
HRDC, its agents, employees, contractors, or subcontractors, are not authorized to
represent the City or otherwise bind the City in any way.
10. Default and Termination. If HRDC fails 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 HRDC.
The notice will set forth the items to be cured. If this Agreement is terminated pursuant
to this Section, any Grant funds in HRDC's account (i.e., Grant funds that have been
transferred to HRDC by the City and not yet loaned to a qualifying homebuyer, or that
have been recaptured by HRDC and not yet loaned again) will be returned to the City.
11. Limitation on HRDC's Damages;Time for Asserting Claim
a. In the event of a claim for damages by HRDC under this Agreement, HRDC's damages
shall be limited to contract damages and HRDC hereby expressly waives any right to
claim or recover consequential,special, punitive, lost opportunity, lost productivity,field
office overhead, or general conditions costs.
Grant Agreement—HRDC Down Payment Assistance Page 4
b. In the event HRDC wants to assert a claim for damages of any kind or nature, HRDC shall
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 ten (10) days of the facts and circumstances giving rise to the claim. In the event
HRDC fails to provide such notice, HRDC shall waive all rights to assert such claim.
12. Representatives
a. City's Representative. The City's Representative for the purpose of this
Agreement shall be Anna Rosenberry (Administrative Services 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 Anna
Rosenberry as 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, HRDC may direct its
communication or submission to other designated City personnel or agents and
may receive approvals or authorization from such persons.
b. HRDC's Representative. HRDC's Representative for the purpose of this
Agreement shall be Jeffrey Rupp (CEO and President) or such other individual as
HRDC shall designate in writing. Whenever direction to or communication with
HRDC is required by this Agreement, such direction or communication shall be
directed to HRDC's Representative; provided, however, that in exigent
circumstances when HRDC's Representative is not available, City may direct its
direction or communication to other designated HRDC personnel or agents.
13. Indemnity/Waiver of Claims/Insurance. To the fullest extent permitted by law, HRDC
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
HRDC's (i) negligence, (ii) willful or reckless misconduct, or (iii) making or refusing to
make a Loan of Grant Funds.
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). HRDC's indemnification obligations under this Section shall be without
regard to and without any right to contribution from any insurance maintained by City.
Grant Agreement—HRDC Down Payment Assistance Page 5
Should any indemnitee described herein be required to bring an action against HRDC to
assert its right to defense or indemnification under this Agreement or under HRDC's
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 HRDC 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.
HRDC also waives 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 for acts by the City which constitute its "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 or except for the City's failure to
perform hereunder.
These obligations shall survive termination of this Agreement and the services
performed hereunder.
In addition to and independent from the above, HRDC shall at HRDC's 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 HRDC in this Section. The insurance coverage shall
not contain any exclusion for liabilities specifically assumed by HRDC in this Section.
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 HRDC 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;
• Professional Liability- $1,000,000 per claim; $2,000,000 annual aggregate.
Grant Agreement—HRDC Down Payment Assistance Page 6
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 policy. The insurance and required endorsements must be in a form suitable to
City and shall include no less than a sixty (60) day notice of cancellation or non-renewal.
The City must approve all insurance coverage and endorsements prior to
commencement of loan activities by HRDC. HRDC shall notify City within two (2)
business days of HRDC's receipt of notice that any required insurance coverage will be
terminated or HRDC's decision to terminate any required insurance coverage for any
reason.
14, Non-Discrimination. HRDC will have a policy to provide equal employment opportunity
in accordance with all applicable state and federal anti-discrimination laws, regulations,
and contracts. HRDC 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
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.
HRDC shall be subject to and comply with Title VI of the Civil Rights Act of 1964; Section
140,Title 2, United States Code, and all regulations promulgated thereunder. HRDC
shall require these nondiscrimination terms of its sub-Contractors providing services
under this agreement.
15. Public Meetings and Access to Public Records
a. Meetings of HRDC that pertain to the receipt or expenditure of Grant funds 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, HRDC will provide agendas for meetings that pertain to Grant funds 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 HRDC and provided to
the City Clerk's office no later than 45 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 7-1-4144, 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.
Grant Agreement—HRDC Down Payment Assistance Page 7
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, HRDC shall make
such loan documents and records available for inspection and copying by members
of the public. HRDC may charge for such copying in accordance with the policies of
the City, which HRDC hereby adopts 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 HRDC loan documents is
protected by law from disclosure, HRDC may seek a determination of the City
Attorney at no cost to HRDC. Such request and determination shall not create an
attorney-client relationship between HRDC and the City.
16. 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.
17. 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.
18. 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.
19. No Assignment. HRDC may not subcontract or assign HRDC's rights, including the right
to Grant payments, right to recapture of Loan funds, or any other rights or duties arising
hereunder, without the prior written consent of City.
Grant Agreement—HRDC Down Payment Assistance Page 8
20. 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.
21. Choice of Law. This Agreement shall be governed and construed in accordance with the
laws of the State of Montana.
22. 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.
23. Severability. If any portion of this Agreement is held to be void or unenforceable,the
balance of the Agreement shall continue in effect.
24. Counterparts. This Agreement may be executed in counterparts,which together
constitute one instrument.
**** END OF AGREEMENT EXCEPT FOR SIGNATURES ****
Grant Agreement—HRDC Down Payment Assistance Page 9
IN WITNESS WHEREOF, the parties hereto have executed this instrument the day and year
ind9).1:4:\A-
cated elow.
C . , 1 1 ` Date: I v 'Z0!1
Chris Kukulski, City Manager
City of Bozeman
STATE OF MONTANA )
. ss.
County of Gallatin )
On this 00 day of 0L�-c010¢�� , 2014, this instrument was acknowledged
before me by Chris A. Kukulski as City Manager of the City of Bozeman, a self-governing
municipal government.
,•Oµ,,Nc>t AIMEE BRUNCKHORST o�
;:'4..\ -1.. NOTARY PUBLIC for the
State of Montana Nota Public for the State of Montar4a
SEAL 4 Residing at Belgrade, Montana
;, . _,: Printed Name:
`-9'FoF,µo `r,„. My Commission E sires
December04 x11, Residing at: , Montana
My commission expires:
Date:a4 o t L
iZJeff 31IL President and CEO
Hum n Resources Development Council
STATE OF MONTANA )
. ss.
County of Gallatin )
On this 7 day of 067?SAE , 2014, this instrument was acknowledged
before me by Jeff Rupp, as President and 0 of Human Reso ces Development Council.
Mary A. Martin
°p?• 9r� Notary Public Notary1Publitfor the State of Montana
4".•�01Aa'q -_for the State of Montana Printed Name: /"
aesid ng at:
*�;.SEAL.* Belgrade, Montana Residing at: . Montana
'�'fi • My Commission Expires:
OFrn°`�P``\ April 12,2015 My commission expires:
Grant Agreement—HRDC Down Payment Assistance Page 10