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HomeMy WebLinkAbout026239 RES - 04/26/2005 1 RESOLUTION AUTHORIZING THE EXECUTION OF AN AFFORDABLE HOUSING PROGRAM AGREEMENT BETWEEN THE CORPUS CHRISTI BUSINESS AND JOB DEVELOPMENT CORPORATION ("CORPORATION"), THE CITY OF CORPUS CHRISTI ("CITY"), AND RANDY FARRAR DBA MIRAMAR HOMES TO ALLOW THE CORPORATION TO PROVIDE $100,000 OF AFFORDABLE HOUSING FUNDS FOR BUY-DOWN MORTGAGE LOAN PROGRAM, AND AUTHORIZING THE CITY MANAGER TO EXECUTE THE PROGRAM AGREEMENT ON BEHALF OF THE CITY WHEREAS, the Texas Legislature in Section 4A of Article 5190,6, Vernon's Texas Revised Civil Statutes (Development Corporation Act of 1979) empowered local communities with the ability to adopt an optional local sales and use tax as a means of improving the economic health and prosperity of their citizens; WHEREAS, on November 5, 2002, residents of the City of Corpus Christi passed Proposition 2, New and Expanded Business Enterprises, which authorized the adoption of a sales and use tax for the promotion and development of new and expanded business enterprises at the rate of one-eighth of one percent to be imposed for 15 years; WHEREAS, in the same election, the residents of the City passed Proposition 2B, Affordable Housing, which authorized the use of a portion of the sales and use tax approved under Proposition 2 for affordable housing, up to $500,000 annually, so long as there are projects for which the amount can reasonably be used; WHEREAS, the 1/8 cent sales tax authorized by passage of Proposition 2 and allocated under Proposition 2B for affordable housing was subsequently enacted by the City's City Council ("City Council") and filed with the State Comptroller of Texas, effective April 1, 2003, to be administered by the Corporation's Board of Directors ("Board"); WHEREAS, the Board issued a request for proposals for affordable housing projects as that term is defined in Title 42 of the United States Code, Section 12745, in accordance with the requirement in the Texas Development Corporation Act of 1979; WHEREAS, Randy Farrar dba Miramar Homes submitted a proposal to the Board to request $100,000 for a buy-down mortgage and closing cost loan program to assist eligible families in purchase of new affordable housing to be constructed by Miramar Homes, with loan to be repaid upon sale or transfer of the home; WHEREAS, eligible homeowner of homes with total price of less than $90,000 may qualify for a maximum $15,000 loan and eligible homeowner of home with total price between $90,000 to $93,500 may qualify for a maximum $20,000 loan, Affordable Housing Miramar Homes.DOC f. ') L' ') J' 9 -''-U-.. " 2 WHEREAS, the Board has determined that it is in the best interests of the residents of the City of Corpus Christi that project presented by Randy Farrar dba Miramar Homes be awarded affordable housing funds; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF CORPUS CHRISTI, TEXAS: SECTION 1. That the City Council authorizes the execution of an affordable housing program agreement ("Program Agreement") between the Corporation and the City and Randy Farrar dba Miramar Homes to allow the Corporation to provide $100,000 for a mortgage buy-down loan program, A copy of the Program Agreement in substantial form is attached as Exhibit A. The executed Program Agreement will be filed in the Office of the Secretary, SECTION 2. That the City Manager is authorized to execute the Program Agreement referenced above on behalf of the City, ATTEST' Arma~ City Secretary APPROVED: ~ daYOf~'~ By: i .A'~"'l. h~t<-{ Lisa Aguilar Assistant City Attorney for City Attorney Hen Mayor ,2005, Affordable Housing Miramar Homes.DOC Corpus Christi, Texas : ,).fa \ 1\ Day of ("tiP L \..X , 2005 The above resolution was passed by the following vote: LV~f OCr CUt. OJ ;. (~~ CVy (v], o,~ Q1; )t~ Henry Garrett Brent Chesney Melody Cooper Jerry Garcia Bill Kelly Rex Kinnison John E. Marez Jesse Noyola Mark Scott CJ2b2~j9 [Y-('I lQ,(1 A AFFORDABLE HOUSING PROGRAM AGREEMENT RANDY FARRAR DBA MIRAMAR HOMES This Affordable Housing Program Agreement ("Program Agreement") is entered into between the Corpus Christi Business and Job Development Corporation ("Corporation"), the City of Corpus Christi ("City"), and Randy Farrar dba Miramar Homes ("Miramar"), WHEREAS, the Texas Legislature in Section 4A of Article 5190,6, Vernon's Texas Revised Civil Statutes (Development Corporation Act of 1979) empowered local communities with the ability to adopt an optional local sales and use tax as a means of im-proving the economic health and prosperity of their citizens; WHEREAS, on November 5, 2002, residents of the City of Corpus Christi passed Proposition 2, New and Expanded Business Enterprises, which authorized the adoption of a sales and use tax for the promotion and development of new and expanded business enterprises at the rate of one-eighth of one percent to be imposed for 15 years; WHEREAS, in the same election, the residents of the City passed Proposition 2B, Affordable Housing, which authorized the use of a portion of the sales and use tax ap-proved under Proposition 2 for affordable housing, up to $500,000 annually, so long as there are projects for which the amount can reasonably be used; WHEREAS, the 1/8 cent sales tax authorized by passage of Proposition 2 and allocated under Proposition 2B for affordable housing was subsequently enacted by the City's City Council ("City Council") and filed with the State Comptroller of Texas, effective April 1 , 2003, to be administered by the Corporation's Board of Directors ("Board"); WHEREAS, the Board issued a request for proposals for affordable housing projects; WHEREAS, Miramar submitted a proposal to the Board to request funds to loan to families for mortgage buy-down assistance of new Miramar constructed homes; WHEREAS, the Board has determined that it is in the best interests of the residents of the City of Corpus Christi that affordable housing funds be awarded, by execution of this Program Agreement, to accomplish the affordable housing project described in this agreement and in Miramar's proposal In consideration of the covenants, promises, and conditions stated in this Program Agreement, the Corporation, Miramar and the City agree as follows: 1. Program Agreement to Implement Affordable Housing Project. This Program Agreement between the Corporation, the City, and Miramar is executed to implement the promotion and development of an affordable housing project proposed by Miramar in response to the Board's request for proposals ("Project Response"), The Project Response submitted by Miramar, entitled "Miramar Homes Proposal Number Two 4A Board 2004 Affordable Housing Program" ("Project") is attached to this Program Agreement as Exhibit C and is incorporated in this Program Agreement by reference, 2. Effective Date. The effective date of this Program Agreement is the date on which the City Council grants approval to the Corporation for this Project, so long as all parties have executed this Program Agreement. 3. Term. The term of this Program Agreement extends twelve (12) months from the date the last party executes this document. ("Effective Date") 4. Services to be Provided by City. a. The City, through the City's City Manager or his designee ("City Manager"), shall administer funding and perform contract administration responsibilities, as outlined in this Program Agreement, for the Corporation, 5. Services to be Provided by Miramar. a. Miramar shall complete construction of between five (5) to seven (7) new single-family, owner occupied homes in Corpus Christi, Texas and offer said homes for sale as affordable housing, as the term is defined in Title 42 of the United States Code, Section 12745, in accordance with the requirement in the Texas Development Corporation Act of 1979. Each home shall comply with the Corporation's Affordable Housing Request for Proposals, Each home shall contain three bedrooms, two baths, one-car garage, with 1050 to 1374 square feet, and sell for $81,500 to $93,500, inclusive of all closing costs, and including cost of lot. Miramar shall provide market appraisal of each home, b. Eligible homeowner ("Homeowner") shall receive a loan of $15,000 to $20,000 of the funds provided under this Program Agreement to buy-down the mortgage and closing costs of a home described in this section, The mortgage buy-down funds shall be repaid to Corporation upon sale or transfer of home, Miramar shall require Homeowners who receive the buy-down funds provided under this Program Agreement to execute the Real Estate Note and Deed of Trust attached as Exhibits A and B to secure repayment to Corporation of the buy-down funds. Miramar shall file the original executed documents in the official public records of Nueces County, After recording, Miramar must ensure that the original executed and filed documents are returned to the Corporation. c. Prior to the distribution of funds provided under this Program Agreement, Miramar must coordinate with the Director of the City's Neighborhood Services Department or the Director's designee ("Director") to review the anticipated purchase transaction as it pertains to eligibility, location and amount. The Director shall confirm execution of the documents attached as Exhibits A and B prior to release of loan funds, The Director may authorize modifications to Exhibits A and B to accomplish purpose of this Program Agreement. d. Miramar shall recruit potential homebuyers for housing ownership to be constructed as affordable housing pursuant to this Program Agreement. Miramar shall ensure that each potential homebuyer's family qualifies as a low-to-moderate income family in accordance with Federal, State and City housing laws, rules, and regulations, 6. Loan of Funds. a. The Corporation authorizes the City to loan, from allocated sales tax revenues, up to $100,000 for mortgage buy-down and closing costs of new homes for eligible homeowners pursuant to this Program Agreement. Eligible homeowner of homes with total price of less than $90,000 may qualify for a maximum $15,000 loan, Eligible homeowner of home with total price between $90,000 to $93,500 may qualify for a maximum $20,000 loan, b. Any payment of funds by the Corporation under the provisions of this Program Agreement are subject to the receipt of sales taxes, by the City, from the Office of the Comptroller of the State of Texas and payment of the sales taxes to the Corporation by the City, c. Payment of the buy-down funds will be made by the City directly to the title company or mortgage company involved in the closing transaction, Supporting documentation, such as closing and settlement forms, must be provided to the City Director by Miramar prior to processing a request for loan, d. Miramar shall secure for the Corporation the recapture of all loans provided to Homeowner under this Program Agreement by having each Homeowner execute a note secured by a deed of trust that represents a second mortgage lien on the property, Recapture shall occur upon the earlier of the following events: i. Sale of home; ii. Homeowner no longer occupies the home as primary residence; or iii, foreclosure of home, 7. Documentation and Reports. a. Miramar shall maintain all documentation relating to the receipt and expenditure of the funds provided under this Program Agreement for a period of three years following the expiration of this Program Agreement or for such longer period as may be required by federal or State law, b. Miramar shall provide access to all records, documents, reports, and audits, regarding the funded activity under this Program Agreement, during regular business hours, for the purpose of inspection and copying by the City Manager. Furthermore, Miramar shall provide to the City Manager any information pertinent to this Program Agreement, as may be requested during the term of this Program Agreement. c. Miramar shall submit a performance report ("Report") to the City and the Corporation at least once each quarter and a final Report within 30 days of the expiration of this Program Agreement. The Report must contain all relevant details pertaining to the lot and home purchases and include any supporting documentation required to substantiate the written narrative contained in the Report, 8. Amendments or Modifications. No amendments or modifications to this Program Agreement may be made. nor any provision waived, unless the amendment or modification is made in writing and signed by persons duly authorized to sign agreements on behalf of all parties. 9. Severability. a. If for any reason, any section, paragraph, subdivision, clause, provision, phrase or word of this Program Agreement or the application of this Program Agreement to any person or circumstance is, to any extent, held illegal, invalid, or un-enforceable under present or future law or by a final judgment of a court of competent jurisdiction, then the remainder of this Program Agreement, or the application of the term or provision to persons or circumstances other than those as to which it is held illegal, invalid, or unenforceable, will not be affected by the law or judgment, for it is the definite intent of the parties to this Program Agreement that every section, paragraph, subdivision, clause, provision, phrase, and word of this Program Agreement be given full force and effect for its purpose, b. To the extent that any clause or provision is held illegal, invalid, or unenforceable under present or future law effective during the term of this Program Agreement, then the remainder of this Program Agreement is not affected by the law, and in lieu of any illegal, invalid, or unenforceable clause or provision, a clause or provision, as similar in terms to the illegal, invalid, or unenforceable clause or provision as may be possible and be legal, valid, and enforceable, will be added to this Program Agreement automatically, 10. Compliance with Laws. Miramar shall comply with all applicable federal, State, and local government laws, rules, regulations, and ordinances which may be relevant to Miramar's performance under this Program Agreement. 11. Jurisdiction and Venue. a. This Program Agreement will be governed by and construed in accordance with the laws of the State of Texas, b. All actions brought to enforce compliance with this Program Agreement must be brought in Nueces County, Texas, where this Program Agreement was entered into and must be performed, 12. Acknowledgment and Construction of Ambiguities. The parties expressly agree that each has independently read and does understand this Program Agreement. By Miramar's execution of this Program Agreement, Miramar agrees to be bound by the terms, covenants, and conditions contained in this Program Agreement. Any ambiguities in this Program Agreement may not be construed against the drafter. 13. Indemnity. Miramar must fully indemnify and hold harmless the City of Corpus Christi, the Corpus Christi Business and Job Development Corporation, and their officers, employees, and agents (hereinafter, collectively "Indemnitees") from and against any and all liability, damage, loss, claims, demands, expenses, suits, and causes of action of any nature whatsoever on account of injury or damage to person (including, without limitation on the foregoing, premises de-fects, workers' compensation, and death claims) or property loss or damage of any kind whatsoever which arise out of or are in any manner connected with, or are claimed to arise out of or be in any way connected with, either proximately or remotely, wholly or in part, any activities by Miramar, its officers, employees, agents, members, invitees, or independent contractors with respect to this Program Agreement or the Project that is the subject of this Program Agreement, regardless of whether such injuries, death, or damages are caused, or are claimed to be caused, by the contributory negligence of any of the Indemnitees, but not if caused by the sole negligence of the Indemnitees unmixed with the fault of any other person or entity. Miramar covenants and agrees that if Indemnitees, or any of them, are made a party to any litigation against Miramar or in any litigation commenced by any party other than Miramar relating to this Program Agreement or Project, Miramar shall, upon receipt of reasonable notice regarding commencement of litigation, at its own expense, investigate all claims and demands, attend to their settlement or other disposition, defend Indemnitees in all actions based thereon with legal counsel satisfactory to Indemnitees, and pay all charges of attorneys and all other costs and expenses of any kind arising from any said liability, damage, loss, demand, claim, or action. 14. Warranties. Miramar warrants and represents to Corporation the following: a, Miramar is a duly organized, validly existing, and in good standing under the laws of the State of Texas, has all authority to carry on its business as presently conducted in Corpus Christi, Texas, b, Miramar has the authority to enter into and perform, and will perform, the terms of this Program Agreement. c, Miramar has timely filed and will timely file all local, State, and Federal tax reports and returns required by law to be filed and all taxes, assessments, fees, and other governmental charges, including applicable ad valorem taxes, have been timely paid, and will be timely paid, during the term of this Program Agreement. d, Miramar has received a copy of the Texas Development Corporation Act of 1979, Art, 5190,6, Vernon's Texas Revised Civil Statutes, and acknowledges that the funds granted in this Program Agreement must be utilized solely for purposes authorized under State law and by the terms of this Program Agreement. e, If an audit determines that the funds were not used for authorized purposes, Miramar agrees to reimburse Corporation for the sums of money spent for purposes not authorized by law within 30 days written notice requesting reimbursement.. f, The parties executing this Program Agreement on behalf of Miramar are duly authorized to execute this Program Agreement on behalf of Miramar. 15. Events of Default. The following events constitute a default of this Agreement: a, Failure of Miramar to timely, fully, and completely comply with anyone or more of the requirements, obligations, duties, terms, conditions, or warranties of this Program Agreement; b, The Corporation or City determines that any representation or warranty on behalf of Miramar contained in this Program Agreement or in any financial statement, certificate, report, proposal, or opinion submitted to the Corporation in connection with this Program Agreement was incorrect or misleading in any material respect when made; c, Any judgment is assessed against Miramar or any attachment or other levy against the property of Miramar with respect to a claim remains unpaid, undischarged, or not dismissed for a period of 30 days, d, Miramar makes an assignment for the benefit of creditors, e, Miramar files a petition in bankruptcy, or is adjudicated insolvent or bankrupt. 1. If taxes on property owed by Miramar become delinquent, and Miramar fails to timely and properly follow the legal procedures for protest or contest. g, Miramar changes the general character of its business as conducted on or following the date this Agreement is approved by the Corporation, 16. Notice of Default. Should the Corporation or City determine that Miramar is in default according to the terms of this Agreement, the Corporation or City shall notify Miramar in writing of the event of default and provide 60 days from the date of the notice ("Cure Period") for Miramar to cure the event of default. 17. Results of Uncured Default. After exhausting good faith attempts to address any default during the Cure Period, and taking into account any extenuating circumstances that might have occurred through no fault of Miramar, as determined by the Board of Directors of the Corporation, the following actions must be taken for any default that remains uncured after the Cure Period: a. Miramar shall immediately repay to Corporation, with interest at the interest rate paid by the City on its most recently issued general obligation bonds from date of expiration of Cure Period until fully paid, all funds not used in accordance with this Program Agreement. b. Miramar shall pay Corporation reasonable attorney fees and costs of court to collect amounts due to Corporation, c. The Corporation shall have no further obligations to Miramar under this Program Agreement and this Program Agreement shall terminate, d. Neither the City nor the Corporation may be held liable for any consequential damages, e. The Corporation may pursue all remedies available under law. 18. No Waiver. a. No waiver of any covenant or condition, or the breach of any covenant or condition of this Program Agreement, constitutes a waiver of any subsequent breach of the covenant or condition of the Program Agreement. b, No waiver of any covenant or condition, or the breach of any covenant or condition of this Program Agreement, justifies or authorizes the nonobservance on any other occasion of the covenant or condition or any other covenant or condition of this Program Agreement. c, Any waiver or indulgence of Miramar default may not be considered an estoppel against the Corporation, d, It is expressly understood that if at any time Miramar is in default in any of its conditions or covenants of this Program Agreement, the failure on the part of the Corporation to promptly avail itself of the rights and remedies that the Corporation may have, will not be considered a waiver on the part of the Corporation, but Corporation may at any time avail itself of the rights or remedies or elect to terminate this Program Agreement on account of the default. 19. Notices. a, Any required written notices shall be sent, certified mail, return receipt requested, addressed as follows: If to Miramar: Randy Farrar dba Miramar Homes 5417 Whitemarsh Corpus Christi, Texas 78413 If to Corporation: City of Corpus Christi Business and Job Development Corporation Attn: Executive Director 1201 Leopard Street Corpus Christi, Texas 78401 b, A copy of all notices and correspondence must be sent to the City at the following address: City of Corpus Christi Attn,: City Manager P,O, Box 9277 Corpus Christi, Texas 78469-9277 c, Notice is effective upon deposit in the United States mail in the manner provided above, 20. Incorporation of other documents. The Corpus Christi Business & Job Development Corporation 4a Board Affordable Housing Request for Proposals issued October 22, 2004 is incorporated into this Program Agreement. 21. Relationship of Parties. In performing this Agreement, the Corporation, Miramar and the City shall act in an individual capacity, and not as agents, representatives, employees, employers, partners, joint-venturers, or associates of one another. The employees or agents of either party may not be, nor be construed to be, the employees or agents of the other party for any purpose, 22. Nonassignment. Miramar may not assign, mortgage, pledge, or transfer this Program Agreement or any interest contained in this Program Agreement without the prior written consent of the other parties to this Program Agreement. 23. Non-discrimination. Miramar may not discriminate nor permit discrimination against any person or group of persons on the grounds of race, gender, disability, religion, age, or national origin in any manner prohibited by the laws of the United States or the State of Texas, The City Manager retains the right to take any action the United States or the State of Texas may direct to enforce this non- discrimination covenant. 24. Captions. The captions in this Program Agreement are for convenience only and are not a part of this Program Agreement. The captions do not in any way limit or amplify the terms and provisions of this Program Agreement. 25. Entire Agreement. This Program Agreement and the referenced and incorporated documents constitute the entire agreement between the Corporation, the City, and Miramar for the purpose stated, All other agreements, promises, representations, and understandings, oral or otherwise, with reference to the subject matter of this Program Agreement, unless contained in this Program Agreement, are expressly revoked, as the parties intended to provide for a complete understanding, within the provisions of this Program Agreement and its referenced and incorporated documents, of the terms, conditions, promises, and covenants relating to the each party's required performance under this Program Agreement. CORPUS CHRISTI BUSINESS & JOB DEVELOPMENT CORPORATION Title Signature Printed name: Date: ACKNOWLEDGMENT STATE OF TEXAS s s s KNOW ALL BY THESE PRESENTS: COUNTY OF NUECES This instrument was acknowledged before me on , 2005, by as the (title) of the Corpus Christi Business and Job Development Corporation, a Texas nonprofit corporation, on behalf of the corporation, (seal) NOTARY PUBLIC, Slate ofTexas ATTEST: CITY OF CORPUS CHRISTI Armando Chapa City Secretary George K, Noe City Manager Date: Date: APPROVED AS TO FORM: Lisa Aguilar Assistant City Attorney for the City Attorney RANDY FARRAR DBA MIRAMAR HOMES Signature Title Printed name: Date: ACKNOWLEDGMENT STATE OF TEXAS s ~ S KNOW ALL BY THESE PRESENTS: COUNTY OF NUECES This instrument was acknowledged before me on Homes, , 2005, by Randy Farrar dba Miramar NOTARY PUBLIC, State of Texas