HomeMy Public PortalAboutC-92-002 - Avalon Courtyard, OPA 22127 S. Avalon Blvd. Amendment No.2+ - L
SECOND A MEN MMENT TO DISPOSITION AND DEVELOPMENT AGREEMENT
THIS SECOND AMENDMENT TO DISPOSITION AND DEVELOPMENT
AGREEMENT (this "Second Amendment") is made and entered into as of December,
1994, by and between the CARSON REDEVELOPMENT AGENCY, a public body,
corporate and politic (the "Agency"), and AVALON COURTYARD, a California limited
partnership (the "Developer").
RECITALS
A. The Agency and. Thomas L. Safran d.b.a. Thomas Safran & Associates
("Safran"), are parties to a Disposition and Development Agreement dated as of July 9,
1992 (the "Original DDA").
B. The Original DDA was amended by that certain First Amendment to
Disposition and Development Agreement dated as of December 7, 1993 (the "First
Amendment"). The Original DDA, as modified by the First Amendment, is referred to
herein as "the DDA."
C. The Developer is the successor in interest to Safran with respect to the DDA.
D. The Original DDA anticipated that the Projectwould contain 87 rentable units
and 1 manager's unit, but the Project as finally improved will contain 91 rentable units and
1 manager ' s unit.
E. The Developer has represented to the Agency that the Developer has received
an allocation of federal income tax credits from the State of California Tax Credit
Allocation Committee, on the condition that 51% of the Units be leased to moons or
f_amilj:es whose-im,ome-doges not exceed 50of the area median income, and that 49% of
the Units. be. leased to persons or families whose income does not exceed 60% of the area
median income.. This would mean that there wouidnot he any moderate income Units in
the Project.
F. The Developer and the Agency wish to further the DDA as herein provided
to reflect changes necessitated by the matters described in the foregoing recitals.
NOW, THEREFORE, the parties hereto agree as follows:
1. Capitalized Terms. All capitalized terms in this Second Amendment
shall have the meanings ascribed to them in the Original DDA and the First Amendment.
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2_ Modification and Restatement of Section 8.2.1.8.2.2 8.23,8.25.8.2.6.
8.2.1 and 8.2.$. The parties agree that all the DDA shall be modified to provide that all
Units (except the manager, s Unit), shall be rented exclusively to senior citizens of very low
and lower income. Therefore, Sections 8.2.1, 8.2.2, 8.23, 8.2.5, 8.2.6, 8.2.7, 8.2.8 and 8.43
of the DDA are modified as follows:
8.2.1 units Restricted to Senior Citizert Rentals.. All (except the
manager's Unit) of the Units in the Project ("rentable Units") shall be rented
exclusively to senior citizens of very low and lower income and only such persons
shall be entitled to occupy the Units.
8.2.2 Restrictions on Rental of Very Low Income i`tnits. Forty-six (46)
of the rentable Units shall be rented exclusively to senior citizens of very low income
(as defined in Subsection 8.2.4) and onlysuch persons steal[ be entitled o occupy
such Units. The maximum number of persons who may reside in a Unit is two.
8.23 Restrictions on Rental of Lower Income Units. The remaining
forty-five (45) rentable Units shall be rented exclusively to senior citizens of lower
income (as defined in Subsection 8.2.4) and only such persons shall be entitle to
occupy such Units. The maximum number of persons who may reside in a Unit is
TWO.
8.2.5 Initial Rent. The initial Tenant Rent (as defined in Attachment
16, "Senior Citizen Rental Assistance Program") for the Units of the Project shall
be as follows:
(a) Theminitial Tenant Rent rental r e for each of the
by agreement of the parties hereto to comply with the requirements of other
financing sources contemplated and permitted by Sections 2.2 and 3.1 of this
Agreement; and
(b) The iniliaLTeriant Rent rental rate for each of the 45 lower
income Units shall be $446 per month_
8.2.6 Annual Rent Increases. Developer shall submit a request for
an increase in Tenant Rents to the Housing Committee of the Human Relations
Commission of the City of Carson (the "Housing Committee") for review and
approval sixty (60) days prior to each yearly anniversary of the initial occupancy of
the Project ("the Anniversary") and each year thereafter. The Housing Committee
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shall review the Developer - s request and notify Developer of either of the following
actions within thirty (30) days after submission: (i) Developer shall be allowed to
increase the then current rate of Tenant Rents of the Units by 2% each year, or (ii)
Annual increases in the then current Tenant Rents of the Units in excess of 2% per
year shall be allowed if the percentage increase in the sum of the 11CP1 Adjusted
Tenant Rent" and the "HUD Factor Adjusted Tenant Rent" (each as defined
below), divided by two, exceeds 2% per year in accordance with the following
computations:
(a) As used herein, the "CPI Adjusted Tenant Rent" shall mean
the then existing rate of Tenant Rents for any Unit, plus an amount equal to the
product of (A) the then existing rate of Tenant Rents for such Unit, multiplied by
(B) the percentage increase, if any, of the Consumer Price Index - All Items (1982-
1984=100) - All Urban Consumers - Los Angeles -Anaheim -Riverside, California, as
published by the United States Department of Labor, Department of Labor Statistics
("the Index"). Such percentage increase shall be determined by (i) subtracting the
Index for the month which is 15 months prior to the month in which such calculation
is to be made, from the Index for the month which is three months prior to the
month in which such calculation is to be made, and (ii) dividing the remainder by the
Index for the month which is 15 months prior to the month in which such calculation
is to be made. An example of the calculation provided for above is as follows:
Assume that the Tenant Rent for a Unit is to be adjusted as of April 1, 1992, and
prior to April 1, 1992, the Tenant Rent for such Unit was $390.00. Further assume
that the Index for January, 1991 (15 months prior to the month in which such
calculation is to be made) was 139.9 and the Index for January, 1992 (three months
prior to the month in which such calculation is to be made) was 1443. Based upon
these assumptions the percentage increase in the Index would be calculated by (i)
subtracting the Index for the month of January, 1991 from the Index for the month
of January 1992 i.e. 1443-139.9=4.4, and (ii) dividing 4.4 by 139.9=0.031. The CPI
Adjusted Tenant Rent would be calculated by multiplying (A) the then existing
Tenant Rent rate ($390.00) by (B) the percentage increase in the Index (.03101o), and
adding the result to the then effective Tenant Rent rate ($390.00), i.e., $390.00
multiplied by .031%=$12.09 and $12.09 + $390.00=$402.09; and
(b) As used herein, the "HUD Factor Adjusted Tenant Rent" shall
mean the product of (i) the then existing Tenant Rent rate for such Unit, multiplied
by (ii) the Automatic Annual Adjustment Factor in effect on the date on which such
calculation is to be made for the Los Angeles -Long Beach, California areas,
calculated as if the Tenant Rent for such apartment unit excluded the highest cost
utility for such Unit. The Automatic Annual Adjustment Factor shall mean the
Annual Adjustment Factors established pursuant to Section 8(c)(ii)(A) of the United
States Housing Act of 1937 (42 U.S.C. 1437f(c)(ii)(A)), as published annually in the
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Federal Register (24 CFR 888.202). An example of the calculation provided for
above is as follows: Assume that the Automatic Annual Adjustment Factor in effect
on April 1, 1992 is 1.058. The HUD Factor Adjusted Tenant Rent would be
calculated by multiplying (i) the then existing Tenant Rent rate ($390.00) by (ii) the
Automatic Annual Adjustment Factor (1.058), i.e., $390.00 multiplied by
1.058=$412.62.
Based upon the examples set forth in (a) and (b) above, the CPI Adjusted Tenant
Rent ($402.09), added to the HUD Factor Adjusted Tenant Rent ($412.62), and the
sum then divided by 2, equals $40736. The increase in Tenant Rent from $390.00
to $407.36 would be an increase of $1736, which exceeds 2% of $390.00 ($7.80).
Accordingly, in this example of the calculation to be used in determining annual
Tenant Rent increases pursuant to this Subsection 8.2.6, Developer would be allowed
to raise the then applicable Tenant Rent for the subject Unit to $40736, despite the
fact that such increase is in excess of 2%.
-`. Notwithstanding the foregoing, Developer may not increase the annual
Tenant Rent for any unit by more than six percent (6%) in any single year. Annual
increases approved by the Housing Committee may be implemented in full or in part
at the Developer ' s sole discretion and option. Nothing contained herein shall
obligate Developer to make annual increases in Tenant Rent, to the extent that
Developer, at Developer I s sole and absolute discretion, believes that such increases
may be detrimental to the operation of the Project. Permitted Tenant Rent increases
shall be effective on the Anniversary or on the expiration of any rental increase
notice period required by law, whichever is later.
8.2.7 Limitation_on Tenant Rent Increases. Notwithstanding the
provisions of Subsection 8.2.6, any rental increase permitted by Subsection 8.2.6 shall
not be made if, and to the extent, the Tenant Rent to be charged any person who is
in occupancy of a Unit at the time of a rent increase permitted by Subsection 8.2.6
exceeds the current affordable rent (including a reasonable allowance for utilities)
that may be charged for very low or lower income persons under Health & Safety
Code Section 50053. The rental cate i.e. ver)LIow oLlower income). under which
to-r—d-a
occu ant ofth_ a Unit originally qualified to rent the Unit shall govem theble ren#" has i e med in Subsection 8:Z.4) tole charged far rental of the
Unit ... _ ...
8.2.8 Successor Tenants Rents. The Tenant Rent for qualified
successor tenants (applicants approved for occupancy) upon the vacancy of a Unit
shall be equal to the Tenant Rent paid for such Unit by the tenant immediately prior
to the vacancy, provided, however, that if the vacant Unit is to be rented to a senior
citizen in a different income category (e.g., from a very low income former tenant to
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a lower income successor tenant or vice versa) then the Tenant Rent to be paid for
such Unit by the successor tenant shall be equal to the current Tenant Rent being
paid for Units in the same income category (i.e. very low or lower income) at the
time the vacancy is filled.
8.43 Accounting__for Subsidy Pa, ents. Developer shall provide
Agency an accounting report showing the rents and periods of time each unit was
rented. The report shall include a reconciliation of the total subsidy drawn during
the applicable period and the amount of any subsidy to be rebated for such period.
The first accounting period for which a report shall be made shall end on the last day
of the month in which all of the Units have been initially rented to the first
occupants. An accounting shall be made to Agency within 30 days of such date.
Thereafter, an annual accounting shall be made within 30 -days of the yearly
anniversary of the end of the month for which the first accounting report was made.
Developer shall maintain a complete and accurate rent roll listing all
rental units, with the forty-six (46) very low income Units and the forty-five (45)
lower income Units listed separately, the names of all tenants, the dates of their
tenancies and the amounts of rents charged and collected. Such records shall be
subject to examination by Agency, through its authorized designee, from time to time
at reasonable times during business hours.
3. Rental Subsidy. The rental subsidy to be provided by the Agency to
the Project, pursuant to Section 83 ("Rental Subsidy") of the DDA, is hereby increased
from $155,760 per annum to the sum of $160,524 per. annum.
4. Modification of Section 8.5. Subsections (d) and (e) of Section 8.5 of
the DDA are deemed deleted. Subsections (b) and (c) of Section M are modified to read
as follows:
".... (b) that senior citizens who have resided in the City of Carson for
at least one (1) year prior to occupancy at the Project shall be given a
preference in renting the Units, and
11(c) that senior citizens who have resided in the City of Carson and who are
determined by the Housing Commission to be displaced shall be given a
preference in renting the Units."
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5. Modification of Attachment H. Section lI ("Eligibility Requirements)
of Attachment 16 ("Senior Citizen Rental Assistance Program") is modified in the following
respects:
(a) Paragraph 1 is restated to read in full as follows. "Applicants
who are residents of the City of Carson shall receive a preference for occupancy in the
Avalon Courtyard Senior Housing Project."
(b) Paragraph 3 is restated to read in full as follows: "The Tenant
applicant's income shall not exceed the amounts set forth in the California Health and
Safety Code for persons in the very low and lower income categories."
b. Conforming Changes to Re ulatory A eemen . The parties hereto
shall make conforming changes to the Regulatory Agreement and shall record such
modifications.
7. Except as herein provided, the DDA (as amended by the First
Amendment) shall remain in full force and effect as originally written.
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