Full Text
HOME Contract H-10-02 Page 1 of 12 CFDA NO. 14.239 HOME INVESTMENT PARTNERSHIPS PROGRAM CONTRACT CONTRACT # H-10-02 This Contract is entered into by homeWORD, a Montana non-profit corporation (the Grantee), and the City of Missoula, Montana (the City). The Grantee and the City agree to the following terms: 1. PURPOSE The purpose of this Contract is to provide funding for project activities approved by the City under the U.S. Department of Housing and Urban Development (HUD) Home Investment Partnerships Program (HOME). 2. APPLICATION INCORPORATED BY REFERENCE The Grantee’s application for HOME assistance is incorporated into this Contract by this reference and the representations made in the application are binding upon the Grantee. 3. ACCEPTANCE OF HOME PROGRAM REQUIREMENTS The Grantee will comply with all applicable parts of Title II of the Cranston-Gonzalez National Affordable Housing Act, as amended; the applicable Department of Housing and Urban Development (HUD) regulations in 24 CFR Part 92, as now in effect or as they may be amended during the term of this contract; all requirements established by the City; applicable State and federal laws, regulations, administrative directives and procedures; and local ordinances and resolutions. The Grantee expressly agrees to repay to the City any funds advanced to the Grantee under this Contract which the Grantee, its subcontractors or subrecipient entities, or any public or private agent or agency to which it delegates authority to carry out portions of this Contract expends in violation of the terms of this Contract or the federal statutes and regulations governing the HOME Program. 4. EFFECTIVE DATE AND TIME OF PERFORMANCE This Contract takes effect upon execution by the parties and will terminate upon completion of the final project closeout by the City. The activities to be performed by the Grantee will be completed according to the implementation schedule included as Attachment A to this Contract, which by this reference is made a part of this Contract. 5. SCOPE OF ACTIVITIES The Grantee will engage in the activities set forth in the Grantee’s application for HOME grant assistance. The major components of the project include: Will purchase 3.22 acre parcel at 601 N. Russell to develop Liberty Lanes Housing Community. Will provide 34 affordable rental housing units. ---PAGE BREAK--- HOME Contract H-10-02 Page 2 of 12 Will provide said housing to occupants whose incomes are at or below 80% of the local median income, as determined by the US Department of Housing and Urban Development (HUD), at costs within HUD's guidelines for affordability. Will provide security for the City's financial interest in the subject property in the form of a Trust Indenture included as Attachment B until such time that the housing units are occupied according to the terms herein. Will comply with applicable codes, regulations and standards, including those contained in the Americans with Disabilities Act (ADA), in the modifications to the above-referenced facility. Will make requests for payment based on invoices submitted and documented completion of construction components. Will provide reports to the City of Missoula on prescribed forms and including family size and income information for all program participants. 6. BUDGET The total amount of this Contract will not exceed $315,000. A copy of the project budget is included as Attachment C to this Contract, and by this reference is made a part of this Contract and binding upon the Grantee. Budget adjustments must be approved in advance by the City. For adjustments between line items of the HOME portion of Attachment C, in an amount not to exceed $1,000, City approval of the Request for Payment form will constitute approval of the budget adjustment. The Grantee must describe the rationale for a budget adjustment in the Project Progress Report and the adjustments noted in the Request for Payment and Status of Funds Report submitted with draws against the grant funding reserve. Budget adjustments in excess of $1,000 are subject to written City approval. During construction to better ensure that all contract performance issues, including but not limited to ensuring appropriate contract required performance and payments occur pursuant to the construction contract, a monetary retainage of $15,750.00 constituting five percent of the total construction contract price $315,000.00 shall be withheld until satisfactory completion and written acceptance of the construction project has occurred. During the construction the City may in reviewing the progress and workmanship of the construction contractors may reduce or release portions of the retainage if justifiable grounds exist for doing so; conversely the City may maintain or increase the retainage dollar amount as is deemed necessary as part of the review of the progress and workmanship of the construction project. The City will retain $10,000 of the grant award until the City issues its HOME project completion report. 7. AMOUNT OF GRANT AND METHOD OF PAYMENT The City will pay to the Grantee funds available under this Contract upon approval by the City of the Grantee’s Request for Payment. The City may agree to make advance payments to the Grantee for activities set forth in Section 5. SCOPE OF ACTIVITIES upon satisfactory demonstration of need as presented by the Grantee and approved by the City. In expending funds advanced by the City, the Grantee will limit expenditures to those included in the Request for Payment and expressly approved by the City. The City will reimburse the Grantee for approved, eligible and necessary expenses according to the documentation submitted by the Grantee to support the expenditures. The City will not reimburse the Grantee for any expenses not included in the approved budget or not clearly and accurately supported by the Grantee’s records. Any authorized funds not expended under this grant will revert to the City and will be used to finance other HOME projects. The reimbursement of eligible costs incurred is contingent upon the Grantee’s completion of Section 15. SPECIAL PROJECT START UP CONDITIONS. In the event the Grantee is unable to comply with the terms and the conditions of this Contract, any costs incurred will be the Grantee’s sole responsibility. ---PAGE BREAK--- HOME Contract H-10-02 Page 3 of 12 If the actual total cost of completing the project is less than has been projected by the Grantee in the budget (Attachment the City may, at its discretion, reduce the amount to be provided under this Contract in proportion to the overall savings. If the City determines that the Grantee has failed to satisfactorily carry out its responsibilities under this Contract, the City may revoke the Grantee’s authority to draw against the reservation described in this Contract until the City and the Grantee agree on a plan to remedy the deficiency. The City reserves the right to withdraw a commitment for any HOME funds which remain unobligated 24 months after the date of execution of this Contract. 8. LIAISON Nancy J. Harte, Grants Administrator in the Missoula Office of Planning and Grants (OPG), is the City’s liaison with the Grantee regarding all administrative and technical matters concerning this Contract. Betsy Hands, Executive Director of homeWORD, is the Grantee’s liaison with the City for administrative and technical matters. 9. OWNERSHIP AND PUBLICATION OF MATERIALS All reports, information, data, and other materials prepared by any contractor or subcontractor pursuant to this Contract are to be the property of the Grantee and the City which have exclusive and unrestricted authority to release, publish or otherwise use, in whole or in part, information relating thereto. No material produced in whole or part under this Contract may be copyrighted or patented in the United States or in any other country without the City’s prior written approval. 10. ACCESS TO RECORDS AND PROJECT MONITORING The Grantee will maintain adequate and reasonable records of its performance under this Contract and will allow access to these records at any time during normal business hours by the City, the U.S. Department of Housing and Urban Development and the Comptroller General. These records will be kept in the Grantee’s offices in Missoula, Montana. The City or its agents may monitor and inspect all phases and aspects of the Grantee’s performance to determine compliance with the Scope of Work, and other technical and administrative requirements, including the adequacy of the Grantee’s records and accounts. The City will advise the Grantee of any specific areas of concern and provide the Grantee opportunity to propose corrective actions acceptable to the City. 11. PROJECT PROGRESS REPORTING During the term of this contract, the Grantee will submit a Project Progress Report to the City during each quarter for the periods ending June, September, December and March. This report will describe the status of the project with respect to each implementation objective including, at a minimum, the percentage of the project which has been completed, costs incurred, funds remaining and anticipated completion date. The report must also describe any significant problems encountered and any necessary modification of the project scope or implementation schedule that is being requested. The Grantee will submit the Project Progress Report to the City within 15 days of the close of each quarter. The City will not honor claims for payment until the required quarterly report has been submitted to and approved by the City. Project Progress Reports submitted during a quarter in conjunction with a Request for Payment will satisfy the quarterly progress-reporting requirement. 12. EQUAL EMPLOYMENT OPPORTUNITY Any hiring of employees by the Grantee under this Agreement will be on the basis of merit and qualification, and the Grantee will not discriminate against any person on the basis of race, color, religion, creed, political ideas, sex, age, marital status, physical or mental disability or national origin. As used herein, "qualifications" means qualifications as are generally related to competent performance of the particular occupational task. ---PAGE BREAK--- HOME Contract H-10-02 Page 4 of 12 13. AVOIDANCE OF CONFLICT OF INTEREST The Grantee will comply with the provisions of the applicable HUD regulations of 24 CFR 92.356; and with sections 2-2-125, 2-2-201, and 7-5-4109, MCA, (as applicable) regarding the avoidance of conflict of interest. 14. MODIFICATION AND ASSIGNABILITY OF CONTRACT This Contract contains the entire agreement between the parties, and no statements, promises, or inducements made by either party, or agents of either party, which are not contained in or authorized by this written Contract, are valid or binding. This Contract may not be enlarged, modified, or altered except upon written agreement, and does not imply any continuing commitment by the City of Missoula beyond the termination date noted in this Contract. The Grantee accepts responsibility for the adherence to the terms of this Contract by subcontractor or subrecipient entities and by public or private agents or agencies to which it delegates authority to carry out portions of this Contract. 15. SPECIAL PROJECT START UP CONDITIONS The Grantee will not obligate or utilize funds for any activities provided for by this Contract until: The City completes an Environmental Review Record, if applicable, and The City issues a Notice of Release of Funds. 16. CONSTRUCTION AND VENUE This Contract will be construed under and governed by the laws of the State of Montana. In the event of litigation concerning it, venue is in the District Court of the Fourth Judicial District in and for the County of Missoula, State of Montana. 17. INDEMNIFICATION The Grantee waives any and all claims and recourse against the City including the right of contribution, for loss or damage to persons or property arising from, growing out of, or in any way connected with or incidental to the Grantee’s or any subrecipient’s performance under this Contract. Further, the Grantee will indemnify, hold harmless, and defend the City against any and all claims, demands, damages, costs, expenses, or liability arising out of the Grantee’s or any subrecipient’s performance of this Contract. In the event that the City is named as a codefendant in any action relating to activities to be performed by the Grantee or a subrecipient under this Contract, the Grantee will notify the City of the action and will represent the City in the action unless the City undertakes to represent itself as a codefendant, in which case the City will bear its own litigation costs, expenses, and attorneys’ fees. 18. CONTRACT AMENDMENT The Grantee may request that this contract be amended. However, the City will allow an amendment only if the Grantee clearly demonstrates that the modification is justified and will enhance the overall impact of the original project. The City will consider each request to determine whether the modification is substantial enough to necessitate reevaluating the project’s original ranking. If warranted, the City will analyze the impact of the proposed modification on the scores assigned the Grantee’s application in the original grant competition. The City will not approve amendments to the scope of work or the budget that will affect high priority activities or improvements that would materially alter the circumstances under which the grant was originally ranked. If the City determines that the proposed amendment represents a substantial change in the project activities proposed in the original application for HOME funds, the City will hold a local public hearing on the amendment with reasonable notice. ---PAGE BREAK--- HOME Contract H-10-02 Page 5 of 12 19. PROPERTY MANAGEMENT Title to real property or equipment acquired under a grant or subgrant will vest upon acquisition in the Grantee or subgrantee. The Grantee or subgrantee will use, manage, and dispose of this property or equipment in accordance with the requirements set out in 24 CFR Part 85, Subpart C and 24 CFR Part 570, Subpart J. 20. TERMINATION OF CONTRACT This contract may be terminated as follows: Termination and Modification Due to Loss of Funding. If, for any reason, the federal financial resources required by the City to fund the Grantee’s project are withdrawn from the City, the City may unilaterally terminate or modify the terms of this Contract to reflect the loss of funding. If a termination or modification is required, the City will, to the extent permitted by available HOME funds, compensate the Grantee for eligible work elements the Grantee has completed and for actual, necessary and eligible expenses incurred by the Grantee as of the revised termination date. The City will give the Grantee written notice of the effective date of the modification or termination of this Contract and, if a reduction in funding is required, will provide the Grantee with a modified project budget. Termination Due to Noncompliance with Contract Terms. If the City determines that the Grantee has failed to comply with the general terms and conditions of this Contract, the project schedule, or any special conditions, and if upon notification of the defect the Grantee does not remedy the deficiency within a reasonable period to be specified in the notice, the City may terminate this Contract in whole or in part at any time before the date of completion. The City will notify the Grantee in writing of the decision to terminate, the reasons for the termination, and the effective date of the termination. Termination Due to Adverse Environmental Impact. This Contract will terminate at the conclusion of the environmental review process if the Grantee or the City determines that the project would have a significant adverse impact on the quality of the human environment and that this impact cannot be avoided or sufficiently mitigated by reasonable, cost-effective means. Effect of Termination. In the event of termination due to the Grantee’s failure to comply with the terms of this Contract or the project’s adverse environmental impact, any costs incurred will be the responsibility of the Grantee. However, at its discretion, the City may approve requests by the Grantee for reimbursement of expenses incurred. The City’s decision to authorize payment of these costs or to recover expended HOME funds will be based on a consideration of the extent to which the expenditure of those funds represented a good faith effort of the Grantee to comply with the terms of this Contract and on whether any failure to comply with the terms of this Contract was the result of circumstances beyond the Grantee’s control. ---PAGE BREAK--- HOME Contract H-10-02 Page 6 of 12 IN WITNESS OF THE TERMS SET OUT ABOVE, the parties have executed this Contract. City of Missoula: John Engen, Mayor Date: homeWORD: Joe Easton, President, Board of Directors Date: ATTEST: Martha L. Rehbein, City Clerk ---PAGE BREAK--- HOME Contract H-10-02 Page 7 of 12 ATTACHMENT A: PROJECT TIMELINE PART XIV IMPLEMENTATION SCHEDULE Anticipated Completion (month / year) Actual Completion (month / year) Financing Construction Loan Commitment January 2010 Construction Loan Closing May 2010 2009 Exchange Funding July 2009 Low Income Housing Tax Credits April 2010 Grant Commitments (list each grant separately) 1. NeighborWorks Green Funding February 2010 2. State HOME November 2009 City of Missoula HOME/CDBG April 2010 Home Depot June 2010 Federal Appropriation March 2010 NorthWestern Energy June 2010 Anonymous Donor December 2007 Permanent Loan Commitment January 2010 Permanent Loan Closing May 2010 Other Deferred Developer Fees May 2010 Project Start-up Site Acquisition May 2007 Zoning July 2006 Infrastructure Available July 2006 Environmental Review January 2007 Advertise Architect / Engineer May 2010 Advertise for Construction Bids May 2010 Construction Bid Award May 2010 Design Completion June 2010 Building Permits July 2010 Other Community Design Charrette November 2006 Other Eco-Design and Universal Design Charrettes February 2007 Other Solstice Design Charrette June 2010 Project Activities Pre-Construction Conference July 2010 Issue Notice to Proceed July 2010 Begin Construction July 2010 Complete Construction Sept 2011 Final Inspection / Issue Certificate of Occupancy Sept 2011 Audit November 2011 Marketing April 2011 Prequalification Activities July 2011 Rent-up December 2011 Closeout December 2011 ---PAGE BREAK--- HOME Contract H-10-02 Page 8 of 12 ATTACHMENT B MONTANA TRUST INDENTURE THIS TRUST INDENTURE, made this day of between homeWORD and it successors and assigns whose mailing address is 127 N. Higgins #307, Missoula, MT 59802, as GRANTORS; U.S. Bank, NA, of Missoula, Montana, a bank and trust company as authorized under the laws of the State of Montana, whose mailing address is Post Office Box 4787, Missoula, MT 59806, as TRUSTEE; and the CITY OF MISSOULA, a Municipal Corporation, organized under the laws of the State of Montana, whose mailing address is 435 Ryman, Missoula, MT 59802, as BENEFICIARY. WITNESSETH: That Grantor hereby irrevocably GRANTS, BARGAINS, SELLS, CONVEYS AND WARRANTS TO TRUSTEE IN TRUST, nevertheless, WITH POWER OF SALE, that certain real property, which does not exceed five acres in area, situated in the County of Missoula, State of Montana, particularly described as follows, to wit: TOGETHER WITH: All buildings, fixtures and improvements thereon, and all water rights, right-of- ways, tenements, hereditaments, privileges and appurtenances thereunto belonging, now owned or hereafter acquired, however evidenced, used or enjoyed with said premises or belonging to the same; All right, title and interest hereinafter acquired in or to any of said premises, hereby also releasing, relinquishing and waving all exemptions, rights of dower and homestead, in or to said premises, vested or inchoate; All heating, air conditioning, plumbing and lighting facilities, equipment and fixtures now or hereafter installed upon or within said premises, used or proper or necessary to constitute the said premises a habitable, usable or operating unit; all of said property being designated and deemed for the purposes of this instrument a part of the realty; and All of the rents, issues and profits of said premises, SUBJECT, HOWEVER, to the right, power and authority hereinafter conferred upon Beneficiary to collect and apply such rents, issues and profits. TO SECURE TO BENEFICIARY: Payment of the principal sum: Three Hundred Fifteen Thousand & 00/100 Dollars ($315,000.00) according to the terms of the Home Investment Partnerships program Grant Contract #H-10-02 dated 2010 (and any extensions and/or renewals or modifications thereof) by GRANTOR payable to the order of BENEFICIARY if the terms of said Contract are violated. The Beneficiary agrees to subordinate the lien of this Trust Indenture to the lien of any real property acquisition financing, construction financing, or mortgage financing obtained by Grantor with regard to the real property described herein. At Grantor’s request, Beneficiary may consent to subordinate the lien of this Trust ---PAGE BREAK--- HOME Contract H-10-02 Page 9 of 12 Indenture to other financing obtained by Grantor subject to Beneficiary’s prior written consent which may be withheld for any reason. IN WITNESS WHEREOF, the Grantor has hereunto set his hand and seal the day and year first above written. Joe Easton, President homeWORD STATE OF MONTANA ) ) ss County of Missoula ) On this day of 2010, before me, a Notary Public for the State of Montana, personally appeared Julie Maturen, as President of the homeWORD Board of Directors, known to me to be the person described in and who executed the foregoing instrument and acknowledged that he executed the same as his free act and deed. IN WITNESS WHEREOF, I have hereunto set my hand and affixed my Notarial Seal the day and year first above written. Notary Public for the State of Montana Residing at My Commission Expires City of Missoula By: John Engen, Mayor ATTEST: Martha L. Rehbein, City Clerk ---PAGE BREAK--- HOME Contract H-10-02 Page 10 of 12 ATTACHMENT C: PROJECT BUDGET AND CONSTRUCTION COST DETAIL SECTION C - FINANCIAL PART II - USES OF FUNDS SOURCE SOURCE SOURCE SOURCE SOURCE SOURCE TOTAL PROJECT LIHTC / Exchange State HOME City HOME/ CDBG Approp/ Anon Donor Market/ Perm Def Fees BUDGET ADMINISTRATION Personnel Services Supplies Communications Printing/Duplication/Postage Advertising Accounting/Auditing Travel Training Other Administration TOTAL ADMINISTRATION COSTS LAND/ BLDG./ACQUISITION Land $352,476 $415,000 $767,476 Existing Structure Demolition Other TOTAL LAND & BUILDING COSTS $352,476 $415,000 $767,476 SITE WORK Site Work $20,000 $20,000 Off-Site Improvement Environmental Other TOTAL SITE WORK COSTS $20,000 $20,000 CONSTRUCTION AND REHAB New Building $2,847,578 $470,000 $606,867 $309,640 $137,097 $4,371,182 Rehabilitation Accessory Structures General Requirements $275,000 $275,000 Contractor Overhead $95,000 $95,000 Contractor Profit $290,000 $290,000 Contingency $370,743 $370,743 Construction Management $50,000 $50,000 Material & Compaction Testing $8,000 $8,000 TOTAL REHAB & CONST. COSTS $3,936,321 $470,000 $606,867 $309,640 $137,097 $5,459,925 SUBTOTAL $4,308,797 $470,000 $415,000 $606,867 $309,640 $137,097 $6,247,401 ---PAGE BREAK--- HOME Contract H-10-02 Page 11 of 12 PART II - USES OF FUNDS (cont.) SOURCE SOURCE SOURCE SOURCE SOURCE SOURCE TOTAL PROJECT LIHTC / Exchange State HOME City HOME/ CDBG Approp/ Anon Donor Market/ Perm Def Fees BUDGET PROFESSIONAL WORK & FEES Architect Design $256,667 $256,667 Architect Supervision $50,000 $50,000 Attorney, Real Estate $3,333 $3,333 Sustainability Consultant $16,667 $16,667 Engineer/Surveyor $3,333 $3,333 Commissioning $11,333 $11,333 Other TOTAL PROF. WORK & FEES $310,000 $31,333 $341,333 CONSTRUCTION/ INTERIM FEES Hazard & Liability Insurance $26,667 $26,667 Credit Report Construction Interest $192,000 $192,000 Origination Points $40,000 $40,000 Discount Points Inspection Fees Title & Recording $6,000 $6,000 Legal Fees Taxes $24,278 $24,278 Other USGB Fees $1,800 $1,800 TOTAL CONST. INTERIM FEES $288,945 $1,800 $290,745 PERMANENT FINANCING FEES Credit Report Discount Points Origination Fees $3,500 $3,500 Title and Recording $8,000 $8,000 Legal Fees Prepaid MIP Other Other TOTAL FINANCING FEES $11,500 $11,500 SUBTOTAL $598,945 $33,133 $11,500 $643,578 ---PAGE BREAK--- HOME Contract H-10-02 Page 12 of 12 PART II - USES OF FUNDS (cont.) SOURCE SOURCE SOURCE SOURCE SOURCE SOURCE TOTAL PROJECT LIHTC / Exchange State HOME City HOME/ CDBG Approp/ Anon Donor Market/ Perm Def Fees BUDGET SOFT COSTS Feasibility Appraisal $10,000 $10,000 Market Study $4,300 $4,300 Environmental Study Tax Credit & Exchange Fees $43,860 $43,860 Cost Certification $9,525 $9,525 Insurance prior to Construction $1,265 $1,265 ALTA Survey $12,000 $12,000 Other Other TOTAL SOFT COSTS $37,090 $43,860 $80,950 SYNDICATION COSTS Organizational (Partnership) Bridge Loan Fees & Expenses $152,660 $152,660 Tax Opinion $15,000 $15,000 Other TOTAL SYNDICATION COSTS $152,660 $15,000 $167,660 DEVELOPER'S FEES Developer's Overhead Developer's Fees $930,000 $930,000 Consultant Fee Developers Fee-Acquisition TOTAL DEVELOPER'S FEES $930,000 $930,000 PROJECT RESERVES Rent-Up Reserve $8,000 $8,000 Operating Reserve $89,000 $89,000 Replacement Reserve $34,000 $34,000 Pre-funded R for R Other TOTAL PROJECT RESERVES $131,000 $131,000 SUBTOTAL $1,250,750 $58,860 $1,309,610 SUBTOTAL PG. 1 $4,308,797 $470,000 $415,000 $606,867 $309,640 $137,097 $6,247,401 SUBTOTAL PG. 2 $598,945 $33,133 $11,500 $643,578 GRAND TOTAL PROJECT COSTS $6,158,492 $470,000 $415,000 $640,000 $380,000 $137,097 $8,200,589