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HomeMy WebLinkAbout21- Affordable Rental Housing Restrictive Covenant & Agreement - Bangtail Partners, LLC When Recorded Return to: City of Bozeman City Clerk PO Box 1230 Bozeman, MT 59771-1230 2720370 EE= Page: 1 of 16 02/11/2021 12:04.36 PM Fee: $112.00un j Eric Semerad - Gallatin Coty, MT mist 11111111 IIIIII III IIIII III IIIIIII IIIIII IIII IIII IIIII IIIII IIIII IIIIIII III IIIII IIIII IIII IIII AFFORDABLE RENTAL HOUSING RESTRICTIVE COVENANT AND AGREEMENT THIS AFFORDABLE RENTAL HOUSING RESTRICTIVE COVENANT AND AGREEMENT ("Restrictive Covenant") made and entered into this 2th day of \)MU" . 202�, by and between the CITY OF BOZEMAN, a self-governing municipal corporation organized and existing under its Charter and the laws of the State of Montana with offices at 121 N. Rouse Avenue, Bozeman, Montana 59771-0640, hereinafter referred to as "City", and BANGTAIL PARTNERS LLC, located at P.O. Box 2652,Dept. 25, Menlo Park, CA 94026, hereinafter referred to as "Landowner" and together with the City referred to as the "Parties." This Restrictive Covenant applies to the real property("Property")the legal description of which follows: Lot A of the Amended Plan of Lots 5-28, Block 105 and adjoining vacated alley within the Northern Pacific Addition to the City of Bozeman, according to the official plat thereof on file and of record in the Gallatin County Clerk and Recorder's Office, Gallatin County, Montana. Affordable Rental Housing Restrictive Covenant and Agreement Page 1 of 8 WHEREAS,it is the intent and purpose of the Landowner to meet the conditions of preliminary planned unit development(PUD)approval (Application No. 18516) and Modification to the Preliminary PUD (Application No. 20029) in connection with the Final PUD application for Tinworks Planned Unit Development (Application No. 20221); and WHEREAS, in its applications for preliminary PUD approval, Landowner proposed to provide affordable housing in order to meet PUD performance points; and WHEREAS,paragraph 38.430.090.E of the Bozeman Municipal Code(BMC)requires,in order to achieve PUD points, affordable dwellings be "provided by long term contractual obligation to an affordable housing agency for a period of not less than 20 years, with a written plan assuring ongoing affordability pricing and eligibility monitoring, and annual re-certification"; and WHEREAS, the City's approval of the preliminary PUD Application No. 18516 included a condition requiring Landowner to place a deed restriction on Lot A, requiring affordable housing as defined in BMC 38.700.020 in the applicable amount proposed for PUD performance ("Condition 14; and WHEREAS,the parties have determined that it is in the best interests of the City and Landowner, and in furtherance of the public health, safety and welfare of the community to enter into and implement this Agreement. IN CONSIDERATION of the mutual covenants and agreements herein contained, the parties hereto agree as follows: 1. Recitals Incorporated by Reference. The above recitals are true and correct, and are incorporated by reference herein and made a part hereof. Affordable Rental Housing Restrictive Covenant and Agreement Page 2 of 8 2. Affordable Housing Plan. The Landowner has proposed and the City has approved an affordable housing plan providing at a minimum seven(7) affordable rental units as described in the attached as Exhibit A (the "Affordable Housing Plan") to this Restrictive Covenant, and is hereby incorporated herein by this reference. 3. Enforcement. Landowner agrees this Restrictive Covenant is a binding agreement between Landowner and the City, and that the City may enforce this Restrictive Covenant against the Landowner or its successors in interest to any parcel subject to this Restrictive Covenant. The City shall not be liable in the event the Landowner or Landowner's agent terminates the tenancy of or refuses to renew the lease of a tenant of an affordable rental unit or in the event the Owner fails to comply with the Montana Residential Landlord and Tenant Act or other applicable laws or regulations. 4. Satisfaction of Condition of Approval. The City agrees that execution, recordation, performance of, and compliance with this Restrictive Covenant shall constitute performance of Condition No. 14 of Preliminary PUD,Application 18516, approved by the City Commission on May 6, 2019. 5. Term. This Restrictive Covenant shall remain in place and be enforceable for twenty(20)years from the date of the filing of this notice with the Gallatin County Clerk and Recorder. This Restrictive Covenant may not be removed prior to its natural expiration without the prior written consent of the Bozeman City Commission. 6. Monitoring and Reporting. Pursuant to 38.430.090.E,BMC,during the term of this Restrictive Covenant Landowner will separately contract with an affordable housing agency to provide Affordable Rental Housing Restrictive Covenant and Agreement Page 3 of 8 initial and annual income qualification of tenants, ongoing compliance monitoring, and annual reporting to the Landowner and City demonstrating compliance with this Restrictive Covenant. If such separate contract terminates for any reason during the term of this Restrictive Covenant, Landowner agrees to inform the Community Development Director in writing within ten (10) days of termination, informing the Director of Landowner's plan for renewed compliance with this requirement of 38.430.090.E, BMC. 7. Recording. This Restrictive Covenant must be filed and recorded with the Gallatin County Clerk and Recorder concurrent with recording of the Tinworks final PUD plan. 8. Governing Law and Venue. This Restrictive Covenant shall be construed under and governed by the laws of the state of Montana. In the event of litigation,venue is in the Eighteenth Judicial District Court, in and for County of Gallatin, State of Montana. 9. Compliance with Laws. The Landowner shall comply with all applicable federal, state and City laws and regulations,including the Montana Residential Landlord and Tenant Act, §§ 70-24-101 et seq., MCA. 10. Attorney's Fees. In the event it becomes necessary for either party to this Restrictive Covenant to retain an attorney to enforce any of its terms or conditions, then the prevailing party shall be entitled to reasonable attorney's fees and costs,to include the salary and costs of in-house counsel including City Attorney. 11. Waiver. No waiver by either party of any breach of any term, covenant or agreement shall be deemed a waiver of the same or any subsequent breach of this same or any other term, covenant or agreement. No covenant, term or agreement shall be deemed waived by either party unless Affordable Rental Housing Restrictive Covenant and Agreement Page 4 of 8 waived in writing. 12. Nondiscrimination. The Landowner shall not discriminate on the basis of race, color, religion, creed, political ideas, sex, age, marital status, national origin, actual or perceived sexual orientation, gender identity, physical or mental disability in the lease, use or occupancy of the Property or in connection with the employment of persons for the operation and management of the Property. 13. Invalid Provision. The invalidity or unenforceability of any provision of this agreement shall not affect the other provisions hereof, and this Restrictive Covenant shall be construed in all respects as if such invalid or unenforceable provision were omitted. 14. No Agency. Nothing in this Restrictive Covenant shall be deemed to create an agency, partnership,joint venture or employment relationship between the City and the Landowner. 15. Modifications. No modifications or amendment of this Restrictive Covenant shall be valid unless evidenced by a writing signed by the parties hereto. 16. No Assignment. It is expressly agreed that the Landowner shall not assign this Restrictive Covenant in whole or in part without prior written consent of the City. 17. Entire Agreement. This Restrictive Covenant constitutes the entire agreement of the Parties relating to the subject matter addressed in this Restrictive Covenant. This Restrictive Covenant supersedes all prior communications, contracts, or agreements between the Parties with respect to the subject matter addressed in this Restrictive Covenant, whether oral or written. 18. Successors. This Restrictive Covenant shall be binding upon, inure to the benefit of and be enforceable by the parties hereto and their respective heirs, successors and assigns and Affordable Rental Housing Restrictive Covenant and Agreement Page 5 of 8 specifically to any subsequent purchaser of the Property. 19. Covenants to Run with the Land. The Parties intend that the terms of this Restrictive Covenant shall benefit the Tinworks PUD and shall be covenants running with the land. 20. No Third Party Beneficiary. The terms and provisions of this Restrictive Covenant 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. The undersigned Landowner affirms that they have authority to enter into this Restrictive Covenant and to bind themselves to the terms herein. **END OF AGREEMENT EXCEPT FOR SIGNATURES** Affordable Rental Housing Restrictive Covenant and Agreement Page 6 of 8 IN WITNESS WHEREOF, the parties hereto have caused this agreement to be executed the day and year first above written. LANDOWNER BANGTAIK, PARTNERS LLC By: 6keco4oy m. try tS Title: M t4 ftG(% PRRTNM STATE OF MONTANA ) :ss COUNTY OF GALLATIN ) On this day of ,20 ,before me,the ersigned, a Notary Public for the State of Montana, personally appeared known to me to be the of Bangtail Partners LLC, and acknow ged to me that s/he executed the same for and on behalf of Bangtail Partners LLC. IN WITNESS WHEREOF,I have hereunto set hand and affixed my official seal the day and year first above written. (SEAL) (Printed Name Here) Notary Public for the State of Residing at My Commission Expires: (Use 4 digits for expiration year) rtemt r- ve e -**0ch-ed Affordable Rental Housing Restrictive Covenant and Agreement Page 7 of 8 CALIFORNIA ACKNOWLEDGMENT CIVIL CODE § 1189 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached,and not the truthfulness,accuracy,or validity of that document. State of California 1 County of Santa Clara J} On 15 December 2020 before me, G. Morabito Urrutia, Notary Public Date Here Insert Name and Title of the Officer personally appeared Gregory M. Avis Nome(s) of Signer(s) who proved to me on the basis of satisfactory evidence to be the person(s)whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. G.MORABITO URRUTIA WITNESS my hand and official seal. Notary Public-California San Mateo County Commission#2272319 My Comm.Expires Dec 21,2021 Signature Place Notary Seal and/or Stamp Above i ignature of Notary Public OPTIONAL L Completing this information can deter alteration of the document or fraudulent reattachment of this form to an unintended document. Description of Attached Document Title or Type of Document:Affordable Rental Housing Restrictive Covenant and Agreemer t Document Date: Number of Pages: 8 Signer(s) Other Than Named Above: Capacity(ies) Claimed by Signer(s) Signer's Name: Signer's Name: ❑ Corporate Officer—Title(s): ❑ Corporate Officer— Title(s): ❑ Partner— ❑ Limited ❑ General ❑ Partner— ❑ Limited ❑ General ❑ Individual ❑ Attorney in Fact ❑ Individual ❑ Attorney in Fact ❑ Trustee ❑ Guardian or Conservator ❑ Trustee ❑ Guardian or Conservator ❑ Other: ❑ Other: Signer is Representing: Signer is Representing: ©2018 National Notary Association THE CITV OF BOZEMAN -- - L)1"L BY. MARTIN NATSEN, DIRECTOR OF COMMUNITY DEVELOPMENT CITY OF BOZEMAN STATE OF MONTANA ) :ss County of Gallatin ) On this day of 20R before me, a Notary Public for the State of Montana, personally appeared Martin Matsen, known to me to be the person described in and who executed the foregoing instrument as Director of Community Development for the City of Bozeman, whose name is subscribed to the within instrument and acknowledged to me that he executed the same for and on behalf of said City. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my seal on the day and year first written above. (SEAL) (Printed Name Here) TAYLOR CHAMBERS Notary Public for the State of Montana Q mF= Notary Public Residing at �j��,l�p�.11 ti No raRiq<;9N=_for the State of Montana *' SEAL.•'* Residing at: My Commission Expires: '► '. Bozeman, Montana (Use 4 digits for expiration year) 0*F' 10 My Commission Expires: January 12,2025 Affordable Rental Housing Restrictive Covenant and Agreement Page 8 of 8 EXHIBIT A - TO RESTRICTIVE COVENANT T \ W L J FINWORK` COTTONWOOD AND IDA "TINWORKS"AFFORDABLE HOUSING PLAN Introduction This affordable housing plan is submitted as part of a Final Planned Unit Development (FPUD) for Cottonwood and Ida (the project). Cottonwood and Ida, also known as "Tinworks" is a mixed use project located in the heart of the Northeast Neighborhood of Bozeman which seeks to provide a broad range of housing types servicing a variety of demographics and income levels. The intention of the project is to provide a minimum of seven affordable rental units in the project. The project addresses the current code PUD requirements to obtain affordable points, currently the code provides for 1 point per percentage point of affordable rental units within a development. There is a total of 73 residential units located in the project 24 of the units are for sale units and not included as part of the affordable housing plan. The remaining 49 units are a mix of 1 bedroom and studio units all available for rent. The project intends to provide 7 of these units at affordable rates for twenty years. The maximum rate for the affordable units is based on a person(s) qualifying at or below 60% Area Median Income (AM[). 1. Number of residential units in project and type. a. Total residential units 73 b. Market rate units for sale 24 (not included in the affordable housing plan) i. (3) one bedrooms ii. (18) two bedroom units iii. (3) three bedroom units c. Rental units 49 (7 of these units are included in the affordable housing plan) i. (27) one bedroom units ii. (22) studio units (includes Jr one bedrooms) 2. Affordable units The rental unit building is identified in FPUD plans as building B and is located on Lot A of Amended Plat #xxxxxx. There are seven (7) units of the forty-nine rentals that will be offered at affordable rates. All of the rentals are either one bedroom or studio and each of the affordable units will either be a one bedroom or a studio. The specific units will be determined by the property owner over the course of time based on availability. At no time will there be less than 7 units of the 49 provided as affordable to households earning 60% of AMI. 12 / 21 / 2020 Page113 COTTONWOOD AND IDA "TINWORKS" AFFORDABLE HOUSING PLAN ==Now 3. Anticipated pricing restrictions. Affordability for the rental units is determined from Federal Housing and Urban Development standards for households who earn no more than 60% AMI. The actual rents will be set by this standard for one bedroom and efficiency units depending on which type of unit is being rented. The Human Resource Development of District IX, Inc (HRDC) will validate these rents annually and prequalify the tenants for the units. 4. Location of affordable units within the development. The unit that have been set aside for this affordable rental program are located in the heart of the project in what is known on the FPUD plans as Building B. Building B is a 49 unit apartment building with a mix of one bedroom and studio units all of which are substantially similar in size and amenity. The building provides roof top amenities, a dog wash, bike lounge, mail room and other general amenities, which are available to all residents and tenants including the affordable units. The units themselves are responsible for their own utilities. Additionally, Parking is provided on site and on street for the units, the parking that is located on site will have an additional charge above the rent should a tenant need a parking space. 5. Timing of delivery of the affordable units. The phasing of the project is to happen in one phase so all units will be brought to market at the same time. 6. Marketing plan describing how the affordable units will be offered to the public. The owner/developer plans to work with a rental management company that will manage the overall project and provide general marketing and advertising services. Additionally, the owner/developer will be working HRDC to screen and certify the income of potential end users and income qualified tenants that the rental management company brings. 7. Contractual obligations and other references. The owner/developer will have a contract with a Community Housing Development Organization (CHDO) to oversee the qualifications of tenants and certify annually the compliance with the HUD standards. 8. Additional information that is reasonably necessary to evaluate the compliance of the affordable housing plan with requirements of the PUD. The PUD obtained points exceeding the minimum requirement of 20 points through various ways. The PUD points associated with affordable housing are calculated as being 1 2 / z i / z u 2 u I' age 213 COTTONWOOD AND IDA "TINWORKS" AFFORDABLE HOUSING PLAN 10% of the total housing provided. There is a total of 73 residential units in the PUD the for sale units(24) are not included in the Affordable housing plan and the rental units (49) have 7 units provided for the Affordable housing component of the PUD. 12 / 21 / 2020 Page313 Agreement for Contracted Services This Agreement is made and entered into December 30 2020 by and between Bangtail Partners, LLC 33 North Black, Bozeman, Montana (hereinafter referred to as Bangtail) and Human Resource Development Council of District IX, Inc., 32 South Tracy, Bozeman, Montana (hereinafter referred to as "Contractor"). Section 1. Purpose. As part of the Cottonwood and Ida PUD, Bangtail commits to provide 7 rental units affordable to households earning 60%Area Median Income or less for a minimum term of 20 years.To ensure that the Cottonwood and Ida PUD meets the requirements of 38.430.090.E7.a.ii of the Bozeman Municipal Code and definition of affordable rentals outlined in 38.700.020"Affordable Housing Definitions" and the recorded Affordable Housing Plan for the Cottonwood and Ida PUD, Bangtail and HRDC agree as follows: SECTION 2. Services. The Contractor shall, in a satisfactory and proper manner as determined by the Agency, perform the duties and services as set forth below: L Provide initial income eligibility verification for prospective tenants before initial lease signing ii. Provide income eligibility recertification for renewing tenant prior to lease renewal. iii. Annual Auditing to ensure that the Cottonwood and Ida PUD meet the requirements of 38.430.090.E7.a.ii of the Bozeman municipal code and meeting the definition of affordable rentals outlined in 38.700.020"Affordable Housing Definitions and the recorded Affordable Housing Plan for the Cottonwood and Ida PUD. iv. Update and provide Developer with maximum rents as released by HUD/MBOH annually within 30 days of HUD update. V. Provide an Annual report to Developer and City of Bozeman outlining compliance of rent structure for designated units and verification of income eligibility. To ensure that Contractor can complete this work in a timely manner, Bangtail will be responsible for: vi. Solicitation and screening of prospective tenants for referral to HRDC vii. Referral of tenants to HRDC for income eligibility verification before entering into a lease agreement with a tenant of an affordable home viii. Providing Copies of lease agreements to HRDC annually for verification of rent structure compliance for affordable homes ix. Receiving affirmative income eligibility recertification from HRDC before renewing existing tenant leases for affordable homes X. Providing any requested reports to the City of Bozeman SECTION 3.Term. The Agreement is effective upon signing and shall annually renew until termination by either party or release of the deed restriction on the property. This contract may be cancelled or terminated by either of the parties with or without cause; however, the parties seeking to terminate or cancel this contract must give written notice of its intention to do so to the other party and the City of Bozeman at least thirty (30) days prior to the effective date of cancellation or termination. If contract is cancelled by either party, Bangtail must pay contractor for services rendered through the date of cancellation. SECTION 4. Changes. Any changes to this Agreement must be presented in writing and agreed upon by both parties. Notification of any changes must be provided to the City of Bozeman Director of Planning and Community Development thirty (30)days prior to the effective date of said changes. SECTION 5. Records and Accounts. The contractor shall maintain such records and accounts, including property, personnel, financial records, passwords, and usernames as are deemed necessary by Bangtail and the City of Bozeman to assure a proper accounting for all contract activities. Bangtail and the City of Bozeman shall have access to any books, documents, papers and records of the Contractor which are directly pertinent to services provided under the contract for the purpose of making audits, examination, excerpts and transcriptions. SECTION 5. Compensation. Bangtail agrees to pay the Contractor$50 per income eligibility verification. Bangtail agrees to pay Contractor$100 per unit per year for compliance reporting. SECTION 6. Billing and Payment. Contractor will submit an invoice for services with the annual compliance report. Bangtail agrees to pay the compensation provided within 30 days of receipt of annual billing from Contractor. SECTION 7. Reporting. HRDC shall provide Bangtail with a quarterly report summarizing income eligibility verification for both prospective and lease renewal tenants.Within 30 days of HUD notice, HRDC will provide updated maximum rent structures for covered units to Bangtail.Annually, HRDC will provide Bangtail and the City of Bozeman with a compliance review outlining income eligibility activities and rent structure compliance. SECTION 8. Assignments. The parties mutually agree that there will be no assignment, transfer, or subcontracting of the work to the performed under this Agreement, unless agreed to by both parties in writing as provided in Section 4, Changes. SECTION 9. Limits of Agreement.This instrument contains the entire agreement between parties, and no statement, promises, or inducements made by either party or agent of either party that is not contained in this written Agreement shall be valid or binding. This Agreement may not be enlarged, modified, or altered except as provided in Section 4, Changes. SECTION 10. Invalidity of a Provision. In the event that any clause, section, provision or part of this Agreement is determined, by a court of law, to be invalid or void, the remaining provisions of this Agreement shall remain in full force and effect. SECTION 11. Default. In the event either party fails to comply with the terms, conditions, or covenants contained in the Contract, the other party shall be entitled to any and all remedies available in law or in equity, including but not limited to specific performance, termination, injunction relief and monetary damages. It is understood and agree that time is of the essence in this contract. SECTION 12. Notice. Contacts for purposes of upholding, amending, and implementing this Agreement shall be designated as follows: HRDC Heather Grenier 32 South Tracy Avenue Bozeman, MT 59715 hgrenier@thehrdc.org 406.587.4486 Bangtail Partners, LLC Erik Nelson 33 N Black Ave Bozeman, MT 59715 erikCcDthinktankarchitects.com 406.539.1176 Witness Whereof,the parties have executed this Agreement on the above date: Heather Grenier, President/CEO Human Resource Development Council of District IX, Inc. Gam, Greg Avis Bangtail Partners, LLC equity, including but not limited to specific performance, termination, injunction relief and monetary damages. It is understood and agree that time is of the essence in this contract. SECTION 12. Notice. Contacts for purposes of upholding, amending, and implementing this Agreement shall be designated as follows: HRDC Heather Grenier 32 South Tracy Avenue Bozeman, MT 59715 hgrenier@thehrdc.org 406.587.4486 Bangtail Partners, LLC c/o Erik Nelson 33 N Black Ave Bozeman, MT 59715 erik@thinktankarchitects.com 406.539.1176 Witness Whereof,the parties have executed this Agreement on the above date: <T�L—�� Tracy Menuez Associate Director, HRDC IX Greg Avis Bangtail Partners, LLC