17-33 Resolution No. 17-33
RESOLUTION
AUTHORIZING EXECUTION OF A FIRST AMENDMENT TO NEIGHBORHOOD
STABILIZATION PROGRAM AGREEMENT BETWEEN THE CITY OF ELGIN AND
HABITAT FOR HUMANITY OF NORTHERN FOX VALLEY, INC.
(212 Franklin Street; 484 Division Street; 637 Grace Street;
482 Fremont Street; and 269 Ann Street)
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ELGIN,ILLINOIS,that
David J. Kaptain, Mayor, and Kimberly A. Dewis, City Clerk, be and are hereby authorized and
directed to execute a First Amendment to Neighborhood Stabilization Program Agreement Between
the City of Elgin and Habitat for Humanity of Northern Fox Valley, Inc. on behalf of the City of
Elgin with Habitat For Humanity of Northern Fox Valley regarding the properties commonly known
as: 212 Franklin Street; 484 Division Street; 637 Grace Street; 482 Fremont Street; and 269 Ann
Street, a copy of which is attached hereto and made a part hereof by reference.
s/David J. Kaptain
David J. Kaptain, Mayor
Presented: February 22, 2017
Adopted: February 22, 2017
Omnibus Vote: Yeas: 8 Nays: 0 Abstained: 1
Attest:
s/Kimberly Dewis
Kimberly Dewis, City Clerk
FIRST AMENDMENT TO
NEIGHBORHOOD STABILIZATION PROGRAM AGREEMENT
BETWEEN THE CITY OF ELGIN AND
HABITAT FOR HUMANITY OF NORTHERN FOX VALLEY, INC.
This AMENDED AGREEMENT is entered into as of the 22nd day of
February , 2017, by and between the CITY OF ELGIN, Illinois, a body corporate
and politic of the State of Illinois with offices at 150 Dexter Court, Elgin, Illinois ("CITY") and
HABITAT FOR HUMANITY OF NORTHERN FOX VALLEY, INC., an Illinois not-for-profit
corporation having a principal place of business at 56 South Grove Avenue, Elgin, Illinois, 60120
("DEVELOPER").
RECITALS
WHEREAS,the Illinois General Assembly has granted the CITY authority to enter into
agreements for the purposes of receiving funds from the United States government under the
"Housing and Community Development Act of 1974," and other subsequent housing acts, and
may disburse those funds and other CITY funds for community development and other housing
program activities (Illinois Complied Statutes, Chapter 65, paragraph 5/11-39.1-1); and
WHEREAS, the CITY is a home rule unit which may exercise any power and perform
any function relating to its government and affairs; and
WHEREAS, in 2008, the United States government appropriated funds for emergency
assistance for the redevelopment of abandoned and foreclosed upon homes and residential
properties under Title III of the Housing and Economic Recovery Act of 2008 (Pub. L 110-289,
122 Stat. 2850, enacted July 30, 2008)("HERA"), to be treated as though such funds were
Community Development Block Grant funds under the Housing and Community Development
Act of 1974, (Pub. L 93-383) as amended (the"ACT") and to be administered through the United
States Department of Housing and Urban Development("HUD"); and
WHEREAS, on July 14, 2010, the CITY selected Habitat For Humanity of Northern
Fox Valley, Inc. as the DEVELOPER and entered into agreements to convey to DEVELOPER
four abandoned or foreclosed upon homes to be rehabilitated and sold by DEVELOPER to
qualified home buyers; using a portion of funds available from the CITY'S NSP funds for the
redevelopment and sale of such homes; and
WHEREAS, on June 24, 2015, the CITY and DEVELOPER further entered into an
AGREEMENT to convey certain vacant property owned by City and provide $450,000 in funds
derived from the City's NSP program income gained from the sale of the City's rehabilitated
homes for the further acquisition, rehabilitation, reconstruction and sale of five foreclosed,
abandoned or blighted residential properties in Elgin; and
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WHEREAS, Section VI of AGREEMENT between the CITY and DEVELOPER
entitled "Program Income" provides conditions for the accounting, submission to CITY and
reporting of proceeds from the sales of rehabilitated homes from DEVELOPER within paragraph
(a); and further defines the payments or proceeds from the sales of rehabilitated homes received
by DEVELOPER as "Program Income," requiring these proceeds to be accurately accounted for
and re-used to benefit eligible households in an area of greatest need within the city and for a time
period equal to the minimum affordability requirement period for the subject property; and
WHEREAS, Pursuant to federal notice at Docket No. FR-5447-N-01 (Federal Register
75,page 6433724), Section N(1)—"the definition of program income at 24CFR§570.500(a)shall
be applied to amounts received only by states, units of general local government, and
subrecipients,"and
WHEREAS, Habitat for Humanity of Northern Fox Valley is DEVELOPER for the
CITY as it relates to the acquisition and rehabilitation of properties under said AGREEMENTS;
and
WHEREAS, Pursuant to NSP Policy Alert entitled "Program Income in the
Neighborhood Stabilization Program, dated July 13, 2011, Subrecipient and Developers provides
that"Revenues received by developers are not considered program income."
WHEREAS, DEVELOPER possesses the legal authority to amend any agreement to
undertake the activities described herein and its governing body has duly adopted or passed as an
official act, a resolution, motion or similar action authorizing the person identified as the official
representative of the DEVELOPER to execute the AMENDED AGREEMENT,all understandings
and assurances contained herein, and directing the authorization of the person identified as the
official representative of the DEVELOPER to act in connection with the execution of the
AMENDED AGREEMENT and to provide such additional information as may be required; and
WHEREAS, the CITY and DEVELOPER now enter into this AMENDED
AGREEMENT pursuant to their respective powers to enter into such Agreements,as those powers
are defined in the Illinois Constitution and applicable statutes.
NOW, THEREFORE, for and consideration of the mutual promises and undertakings
set forth herein,and for other good and valuable consideration,the receipt and sufficiency of which
is hereby acknowledged, the parties hereto agree as follows:
A. The agreement entitled Neighborhood Stabilization Program Agreement Between the City
of Elgin and Habitat for Humanity of Northern Fox Valley, Inc., executed on June 24,
2015, and hereto attached as Exhibit "A" be and is hereby amended only as stipulated as
follows:
Pursuant to NSP Policy Alert entitled"Program Income in the Neighborhood Stabilization
Program,dated July 13,2011, Section VI entitled"Program Income" shall be deleted in its
entirety and replaced with the following section:
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VI. REVENUES FROM THE SALE OF NSP HOMES
A. Payments received by DEVELOPER on the notes and mortgages between
DEVELOPER and the homebuyer/purchaser of the PROPERTY are considered
proceeds from the sale of homes and will be not be subject to the requirements of
program income as outlined in CFR Part §570.500(a).
B. CITY agrees that such revenues from the sale of NSP homes shall not be returned to
the CITY,but must be accurately accounted for, and must be reused by DEVELOPER
on projects related to the rehabilitation of homes within the municipal boundaries of
the city of Elgin that benefit INCOME ELIGIBLE HOUSEHOLDS OR
NEIGHBORHOODS in a CITY approved area of greatest need within the CITY, or
for purposes prioritized by CITY related to affordable housing or other community
development related activities,and for a time period equal to the minimum affordability
requirements period for such projects or activities.
C. CITY further agrees that although DEVELOPER shall not be required to report to
CITY on the future revenues and payments received from the reinvestment of these
proceeds from the sale of homes,CITY requires the DEVELOPER to maintain detailed
accounting records in the form and manner previously approved by CITY. Such records
shall be made available to city from time to time, or when requested by CITY, should
HUD require additional reporting or monitoring periods.
B. Consent: By their signatures hereto, the CITY AND DEVELOPER consent to the
modifications and agreements set forth above.
C. In the event of any conflict between the terms of the Agreement, the terms of this First
Amendment to the Agreement,the terms of this First Amendment shall control. In all other
respects, the Agreement shall remain in full force and effect as originally written.
SIGNATURE PAGE FOLLOWS
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IN WITNESS WHEREOF,the parties hereto have executed this FIRST AMENDMENT TO
AGREEMENT on the dates recited below to be effective on the date first written above.
CITY OF ELGIN, a body politic in the State of Illinois.
JI
By:
David Kaptain, Wayor
City of Elgin
Date: February 22, 2017
Attes
Kimberly A. s, City Clerk
DEVELOPER:
HABITAT FOR HUMANITY OF NORTHERN
FOX VALLEY
an Illinois not-for-profit corporation
Address: 56 South Grove Avenue, Elgin, Illinois, 60120
By: Nk 04A V Wl YO-J�
Barbara Beckman, Executive Director
Date: ?-1 7 1 of 7
Attest: �,a-
4 y
EXHIBIT A
NEIGHBORHOOD STABILIZATION PROGRAM AGREEMENT
BETWEEN THE CITY OF ELGIN AND HABITAT FOR HUMANITY
OF NORTHERN FOX VALLEY,INC.
5
NEIGHBORHOOD STABILIZATION PROGRAM
AGREEMENT
BETWEEN THE CITY OF ELGIN AND
HABITAT FOR HUMANITY OF NORTHERN FOX VALLEY, INC.
This AGREEMENT is entered into as of the 24th day of
June , 2015, by and between the CITY OF ELGIN, Illinois, a body corporate and
politic of the State of Illinois with offices at 150 Dexter Court, Elgin, Illinois ("CITY") and
HABITAT FOR HUMANITY OF NORTHERN FOX VALLEY, INC., an Illinois not-for-profit
corporation having a principal place of business at 56 South Grove Avenue, Elgin, Illinois,
60120('DEVELOPER").
RECITALS
WHEREAS, the Illinois General Assembly has granted the CITY authority to
enter into agreements for the purposes of receiving funds from the United States government
under the "Housing and Community Development Act of 1974," and other subsequent housing
acts, and may disburse those funds and other CITY funds for community development and other
housing program activities(Illinois Complied Statutes,Chapter 65,paragraph 5/11-39.1-1); and,
WHEREAS, the CITY is a home rule unit which may exercise any power and
perform any function relating to its government and affairs; and,
WHEREAS, in 2008, the United States government appropriated funds for
emergency assistance for the redevelopment of abandoned and foreclosed upon homes and
residential properties under Title III of the Housing and Economic Recovery Act of 2008 (Pub. L
110-289, 122 Stat. 2850, enacted July 30, 2008)("HERA"), to be treated as though such funds
were Community Development Block Grant funds under the Housing and Community
Development Act of 1974, (Pub. L 93-383) as amended (the "ACT") and to be administered
through the United States Department of Housing and Urban Development("HUD"); and,
WHEREAS, the CITY applied to HUD for HERA funds to be used for a
Neighborhood Stabilization Program (NSP) for the purpose of acquiring eleven abandoned or
foreclosed upon homes while redeveloping and selling four homes to qualified home buyers and
demolishing two residential properties that might have otherwise become sources of blight
within Elgin neighborhoods, with all income derived from the sale of such homes being required
to be reinvested according to the requirements of HERA; and,
WHEREAS, the CITY, as part of its application to HUD, held a citizen
participation period to solicit comment and input from not-for-profit organizations and social
service agencies to partner with the CITY to carry out and execute the goals and objectives of
NSP, specifically to assist to acquire and redevelop foreclosed and abandoned properties for
affordable housing for low-income families under the NSP; and,
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WHEREAS, on July 14, 2010, the CITY selected Habitat For Humanity of
Northern Fox Valley, Inc. as the DEVELOPER and entered into agreements to rehabilitate four
of the five remaining abandoned or foreclosed upon homes and agreed to distribute to
DEVELOPER a portion of funds available from the CITY'S NSP funds for the redevelopment
and sale of such homes; and
WHEREAS, on January 31, 2013, the CITY conveyed the last remaining
property acquired through the use of NSP funds to DEVELOPER for the rehabilitation and sale
of such property in accordance with the requirements of HERA; and
WHEREAS, the CITY and DEVELOPER intend to enter into this
AGREEMENT to convey certain vacant property owned by City and provide $450,000 in funds
derived from the NSP program income gained from the sale of the City's rehabilitated homes for
the further acquisition, rehabilitation, reconstruction and sale of five foreclosed, abandoned or
blighted residential properties in Elgin; and
WHEREAS, DEVELOPER has clearly demonstrated its ability to fulfill the task
of reinvesting the available funds within areas of greatest need in Elgin and in compliance with
the requirements of the NSP and the terms and conditions of this AGREEMENT; and
WHEREAS, DEVELOPER possesses the legal authority to execute an agreement to
undertake the activity described herein and its governing body has duly adopted or passed as an
official act, a resolution, motion or similar action authorizing the person identified as the official
representative of the DEVELOPER to execute the AGREEMENT, all understandings and
assurances contained herein, and directing the authorization of the person identified as the
official representative of the DEVELOPER to act in connection with the execution of the
AGREEMENT and to provide such additional information as may be required; and
WHEREAS, the CITY and DEVELOPER enter into this Agreement pursuant to their
respective powers to enter into such Agreements, as those powers are defined in the Illinois
Constitution and applicable statutes.
NOW, THEREFORE, for and consideration of the mutual promises and undertakings
set forth herein, and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged,the parties hereto agree as follows:
I. INCORPORATION AND CONSTRUCTION
A. All recitals set forth above are incorporated herein and made part hereof, the same
constituting the factual basis for this AGREEMENT.
B. The section headings of the paragraphs and subparagraphs of this AGREEMENT are for
convenience of reference only and shall not be deemed to constitute part of this
AGREEMENT or to affect the construction hereof.
II. CONVEYANCE OF CERTAIN VACANT PROPERTY
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The CITY hereby agrees to convey, in consideration of one dollar, the property commonly
known as 212 Franklin Street, Elgin, Illinois 60120, P.I.N. 06-13-103-010 (the "VACANT
PROPERTY")to DEVELOPER.A contract providing for the sale of the VACANT PROPERTY,
to be entered into concurrently with this AGREEMENT,is attached hereto as Exhibit A.
111. STATEMENT OF WORK AND ELIGIBLE COSTS
A. STATEMENT OF WORK SUMMARY: The DEVELOPER hereby agrees to perform
activities described in this Section III in accordance with the time periods specified in Section
V hereof. The DEVELOPER shall utilize NSP funds for eligible costs associated with the
new construction and sale of a single-family home on the VACANT PROPERTY, and for
the rehabilitation and resale of up to five additional properties (the "REHABILITATION
PROPERTIES")to low-income eligible households as specified in Section III and Section IV
hereof(the"PROJECT").
B. SCOPE OF WORK AND COST ESTIMATES: Within the time period specified in Section V
hereof,the Developer shall prepare and submit to the City for its approval a detailed scope of
work ("Scope of Work") providing for the construction of a new single-family home on the
VACANT PROPERTY and rehabilitation of the REHABILITATION PROPERTIES in
accordance with the rehabilitation standards contained herein, and detailed cost estimates for
the same. Upon approval by the City, the Scope of Work and Cost Estimates shall be
incorporated into this AGREEMENT as Exhibit B.
C. PERFORMANCE OF THE WORK AND REHABILITATION STANDARDS: The
DEVELOPER agrees to rehabilitate and renovate the REHABILITATION PROPERTIES in
accordance with the Scope of Work and the terms, conditions and provisions of this
AGREEMENT.The REHABILITATION PROPERTIES shall be rehabilitated in accordance
with the CITY "housing rehabilitation standards," which are defined as those standards
currently in place under the City of Elgin Property Maintenance Code, Chapter 16.12 of the
Elgin Municipal Code, 1976, as amended. The standard requires that all buildings purchased
for redevelopment be brought up to local code, that required building permits be obtained,
and that appropriate inspections be performed. In addition the rehabilitation of the
PROPERTY shall include, but not be limited to, any repairs or alterations where necessary to
provide for the conversion of the REHABILITATION PROPERTIES from multi-unit
residential uses to single-family use. DEVELOPER shall permit CITY to erect a sign in a
prominent place at the PROPERTY crediting the City of Elgin, Community Development
Group and HUD for funding of the PROJECT.
D. DEVELOPER may subcontract all or any portion of the PROJECT, as allowed by CITY
policy, to such engineers, architects, construction contractors or other entities as
DEVELOPER shall deem appropriate or necessary and upon such terms as may be
acceptable to DEVELOPER, provided applicable administrative and procurement
requirements are followed as set forth in Sections VII and VIII of this AGREEMENT.
DEVELOPER certifies that it will include in its contracts financed in whole or in part with
NSP funds, all clauses required by Federal laws, executive orders, or regulations, and each
contractor will also include in its sub-agreements and contracts financed in whole or in part
with NSP funds all applicable clauses required by Federal laws, executive orders, or
regulations.
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E. COMPLIANCE WITH LAWS: Notwithstanding anything to the contrary in this
AGREEMENT, it is expressly agreed and understood by the DEVELOPER that in
performance of this AGREEMENT for the construction of a new single-family home on the
VACANT PROPERTY and the rehabilitation of the REHABILITATION PROPERTIES that
the DEVELOPER shall also comply with all applicable federal, state, city and other
requirements of law. DEVELOPER shall also at its expense secure all permits and licenses,
pay all charges and fees and give all notices necessary and incident to the due and lawful
prosecution of the work necessary to provide for the construction of a new single-family
home on the VACANT PROPERTY and rehabilitation of the REHABILITATION
PROPERTIES as described in this AGREEMENT, subject to any reimbursement by the
CITY as provided herein. All costs of the rehabilitation of the PROPERTY shall be paid in
accordance with the terms of this AGREEMENT.The rehabilitation of the PROPERTY shall
be in accordance with all City standards and regulations relating to historic preservation, as
applicable.
F. SALE TO INCOME ELIGIBLE HOUSEHOLD: After new construction or rehabilitation, the
DEVELOPER shall sell the PROPERTY to a household whose income does not exceed fifty
percent (50%), of the median family income of the Chicago-Naperville-Joliet MSA as
published by HUD from time to time, adjusted for family size (hereinafter INCOME-
ELIGIBLE HOUSEHOLDS). Households shall be determined to be INCOME-ELIGIBLE
HOUSEHOLDS using the IRS Form 1040 Adjusted Gross Income definition of income
calculation. The DEVELOPER shall be responsible for identifying a qualified new owner
following the completion of the rehabilitation of the PROPERTY in accordance with the
terms and provisions of the AGREEMENT. Notwithstanding anything contained herein to
the contrary, in the event the income eligibility threshold relating to INCOME-ELIGIBLE
HOUSEHOLDS is raised subsequently by HUD or under HERA,or any successor entities or
laws, the income eligibility threshold for purposes of this AGREEMENT shall then be
deemed such new and raised income eligibility threshold.
IV.ELIGIBLE COSTS BUDGET; TERMS OF NSP FUNDING; REIMBURSEMENT
PROCEDURES
A. The Eligible Costs budget eligible to be disbursed to the DEVELOPER for the for the
completion of the PROJECT including construction of a new single-family home on the
VACANT PROPERTY and rehabilitation of the REHABILITATION PROPERTIES, as
described in Section III, shall be in the total amount not to exceed$450,000,to be allocated as
follows:
1. An amount not to exceed $105,000 for the construction of a new single family home on
the VACANT PROPERTY located at 212 Franklin Street, Elgin, Illinois 60120, P.I.N.
06-13-103-010;
2. An amount not to exceed S105,000 to be used towards eligible rehabilitation costs at
THE REHABILITATION PROPERTY located at 484 Division Street, Elgin, Illinois
60120,P.I.N.06-13-253-009;
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3. An amount not to exceed$75,000 to be used towards eligible rehabilitation costs at THE
REHABILITATION PROPERTY located at 637 Grace Street, Elgin, Illinois 60120,
P.I.N.06-24-256-012;
4. An amount not to exceed$50,000 to be used towards eligible rehabilitation costs at THE
REHABILITATION PROPERTY located at 482 Fremont Street, Elgin, Illinois 60120,
P.I.N.06-12-456-010;
5. An amount not to exceed $25,000 to be used towards the complete demolition of the
existing structures and an amount not to exceed $90,000 to be used towards the
construction of a new single-family home at THE REHABILITATION PROPERTY
located at 269 Ann Street,Elgin,Illinois 60120,P.I.N. 06-13-104-006.
The eligible costs are to be obligated to the PROJECT by DEVELOPER in accordance with
the preceding paragraphs of this Section. For the purposes of this AGREEMENT, obligated
includes eligible rehabilitation, demolition and new construction costs for which work may
not have been completed, but for which a bid has been awarded or for which a detailed cost
estimate has been provided, or for which rehabilitation is currently on-going and in
compliance with all local state and federal requirements of the NSP.
B. ELIGIBLE COSTS: DEVELOPER agrees to administer the PROJECT in accordance with
the following: the ACT; HERA; Federal Register Notice, Vol. 73, No. 194, published
October 6, 2008; Title 24 CFR Part 570 (Community Development Block Grants); and other
applicable federal, state, and local laws, ordinances and regulations. DEVELOPER shall
require such compliance and assurances in all lower tier contracts and subcontracts financed
in whole or in part with the NSP funds. DEVELOPER shall perform all acts with
responsibility to the CITY in the same,manner as the CITY is required to perform all acts
with responsibility to the Federal government. The scope of activities to be performed,
pursuant to this AGREEMENT,will be governed by,and limited to,the following:
1. DEVELOPER has requested disbursement of funds under this AGREEMENT for
payment of all eligible costs, as determined to be reasonable by the CITY, to complete
the PROJECT as outlined in the "Proposal for Re-Use of NSP 1 Investment Dollars"
("PROPOSAL") dated April 7, 2015 and made a part of this AGREEMENT through
Exhibit C.
2. CITY shall provide to DEVELOPER the funds derived from the program income
gained from the sale of the City's rehabilitated homes in an amount not to exceed
$450,000 to allow DEVELOPER to complete the rehabilitation and new construction of
qualified properties that the CITY determines to be customary and reasonably associated
with the PROJECT,as follows:
a. Costs of rehabilitation, as applicable, including supplies, materials, and hiring
contractors, subcontractors, and trades necessary to complete the work. All work for
which a licensure or certification program exists locally or in the State of Illinois
must be carried out by properly licensed or certified persons.
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b. Usual and customary costs associated with carrying each PROPERTY until it is sold
to an eligible household, including,but not limited to,management fees,maintenance
costs,insurance, real estate taxes,and replacement reserves.
c. Costs associated with the sale of each PROPERTY to an INCOME ELIGIBLE
HOUSEHOLD, including,but not limited to,the costs of advertising the unit for sale,
homebuyer counseling by a HUD certified home owner counseling agency, screening
potential homebuyers, performing income qualification procedures, reasonable
attorneys' fees and preparing required documentation.
d. Other such related costs that have the same intent as this AGREEMENT, that are
customary and reasonably pre-approved by the CITY, and that are eligible for NSP
funding.
C. Upon release of funds by CITY for the PROJECT, the DEVELOPER shall ensure that all
claims shall comply with the following requirements:
1. DEVELOPER shall submit a listing of all disbursements of NSP funding, on a form
provided by the CITY.
2. Any request for reimbursement or advancement pertaining to work under contracts and
subcontracts shall include DEVELOPER'S certification as follows:
a. For interim payments to contractors and subcontractors,certification that the work for
which payment is requested has been performed and is in place and to the best of
DEVELOPER'S knowledge, information and belief, the quality of such work is in
accordance with the subcontract, subject to: (i) any evaluation of such work as a
functioning project upon substantial completion; (ii) the results of any subsequent
tests permitted by the subcontract; and (iii) any defects or deficiencies not readily
apparent upon inspection of the work; and;
b. For final payment, that the work has been performed in a good, workmanlike,
satisfactory manner and in conformance with the subcontract and local building code.
3. If so requested by CITY, DEVELOPER shall submit documentation to CITY that fully
complies with all applicable Federal, state,CITY or local statutes,rules or regulations.
4. If so requested by CITY, DEVELOPER shall forward to the CITY all billings, vouchers,
and other documents representing any accounts payable, in such timely and reasonable
manner as both parties shall determine.
D. Resale of the PROPERTY to an income eligible household shall be subject to the submission
of the following information to the CITY prior to closing and in accordance with the
following procedures:
1. Original, executed Request for Payment form, if closing will require NSP funds from
CITY.
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2. A copy of either (a) the executed contract or (b) other written instrument used by
DEVELOPER for the sale or conveyance of real estate between DEVELOPER and
purchaser.
3. Documentation of the purchaser household characteristics and income in a,;form
reasonably approved by the CITY.
4. Documentation verifying that purchaser has completed eight hours of homebuyer
counseling from a HUD approved homebuyer counseling agency.
5. A copy of financing commitment letter from DEVELOPER or other lender(s),if any.
6. A copy of Truth-in-Lending statement from DEVELOPER or other lender(s),if any.
7. Copy of a certificate of insurance or letter from an insurance carrier to the effect that as
of the date of the conveyance, the purchaser will have a hazard insurance policy for the
PROPERTY.
8. Information as to date,time, and location of closing.
9. The sales price of any PROPERTY shall be the lesser of the appraised value or the
aggregation of all costs of acquisition, rehabilitation, and redevelopment. DEVELOPER
shall also record deed restrictions against each PROPERTY in a form customary for
conveyances of this nature and reasonably acceptable to CITY to ensure long-term
affordability.
E. RESALE AND AFFORDABILITY: Housing assisted with NSP funds must meet the
affordability requirements of 24 CFR 92.954, and funds must be repaid to the CITY if the
PROPERTY does not meet the affordability requirements for the specified time period. To
maintain such affordability, the deed of conveyance conveying the PROPERTY from the
CITY to the DEVELOPER shall contain a provision making such conveyance subject to the
terms and obligations of this AGREEMENT and to provide for continued affordability of the
PROPERTY to an INCOME ELIGIBLE HOUSEHOLD for a period of fifteen(15)years.All
of the following conditions shall be included in the deed restrictions. In the event that any
one or more of these conditions occurs or fails to be satisfied, the DEVELOPER shall be
considered in default:
1. For the purposes of this AGREEMENT"affordable"or"affordability"shall be defined as
a condition where the total fixed costs (principal, interest, taxes and insurance) for a
purchaser of the PROPERTY do not exceed thirty-five percent (35%) of the purchaser's
household income. The "affordability period" shall be defined as a period of fifteen (15)
years from the date of "project completion," defined at 24 CFR §92.2 as when all
necessary title transfer requirements to the purchaser have been performed and
construction work has been completed on the PROPERTY.
2. The DEVELOPER fails to sell the PROPERTY as affordable housing for households
whose incomes are below 50% of the median family income as defined in Section III.F,
above.
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3. If during the affordability period the PROPERTY is subsequently sold to a purchaser
with household incomes not below the fifty percent (50%) of the median family income
as defined in Section III.F,above.
4. If the PROPERTY ceases to be occupied and used as the primary place of residence for
any purchaser that is on the title to the home; provided however, that in the event the
PROPERTY ceases to be a purchaser's primary place of residence, CITY will allow a
reasonable amount of time, not to exceed sixty (60) days, to permit either (a)
DEVELOPER to repurchase the PROPERTY for resale to an ELIGIBLE-INCOME
HOUSEHOLD, or(b) the PROPERTY to otherwise be sold to an INCOME-ELIGIBLE
HOUSEHOLD,prior to otherwise enforcing said residency requirement.
5. If the DEVELOPER files any petition in bankruptcy, or for a receiver, or insolvency, or
for reorganization of composition,or makes any assignment for the benefit of creditors or
to a trustee for creditors, or permits an adjudication in bankruptcy, the taking of
possession of the PROPERTY or any part thereof by the receiver, or the seizure and sale
of the PROPERTY or any part thereof under judicial process or pursuant to any power of
sale,and fails to have such adverse action set aside within ninety(90)days.
6. The DEVELOPER transfers, or otherwise encumbers the PROPERTY, without the prior
express written consent of the CITY;provided, however, no such express written consent
of the CITY is required for the transfer to the DEVELOPER pursuant to this
AGREEMENT, including Exhibit A hereof.
7. If the DEVELOPER fails to maintain during its ownership the PROPERTIES or any
PROPERTY and its grounds and equipment pertinent thereto according to applicable
housing quality standards and all local and state codes and ordinances.
8. If the DEVELOPER shall fail to purchase fire and extended coverage insurance and flood
insurance, if required, thereon and provide and file a certificate of said coverage with the
CITY, the proceeds of which, in the event said structure shall be destroyed or damaged
by fire or other casualty, shall be used for reconstruction of said structure upon the said
real estate.
9. The foregoing notwithstanding, in the event of any sale by a purchaser of the
PROPERTY, the purchaser shall be entitled to receive a fair return on the purchaser's
investment. The purchaser's investment is defined as the sum of the purchaser's down
payment,principal payments and capital improvements.
In the event of a default with respect to one or more of the conditions above, and/or in the
event the DEVELOPER otherwise breaches the terms of this AGREEMENT, which default
has not been cured within thirty(30) days after receipt of written notice of such default, the
City may file suit within the Circuit Court for the Sixteenth Judicial Circuit, Kane County,
Illinois, for a determination that the DEVELOPER has so breached this agreement and may
then pursue any and all available remedies at law, equity or otherwise including but not
limited to recapturing the amount of any subsidy provided under this AGREEMENT and/or
terminating the DEVELOPER's and any purchaser's rights in and to the PROPERTY and
requiring the conveyance of the PROPERTY back to the CITY free and clear of all rights of
the DEVELOPER and any other person or entity. Upon the expiration of the affordability
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period, the CITY agrees to provide the DEVELOPER a release from the deed restrictions in
recordable form.Notwithstanding the foregoing to the contrary,DEVELOPER shall have the
right to make it a deed restriction that it shall have the right of first refusal to repurchase the
PROPERTY should the purchaser sell the PROPERTY to a subsequent buyer who is not
deemed an INCOME ELIGIBLE HOUSEHOLD in which case, such sale shall not be
deemed an event of default under this AGREEMENT.
V. SCHEDULE FOR COMPLETION AND TIMELINESS; REHABILITATION; TERM OF
AGREEMENT
A. Time is of the essence of this AGREEMENT. DEVELOPER shall be responsible for
completing the PROJECT within 24 months and no later than November 30, 2016. If
DEVELOPER does not meet the stated completion date, DEVELOPER shall immediately
submit a revised implementation schedule for approval by the CITY. The DEVELOPER
shall be required to secure all permits to complete the rehabilitation of the PROPERTY in
accordance with the Scope of Work. If the DEVELOPER bids out any or all of the
rehabilitation work,the bids shall be based on the Scope of Work.
B. DEVELOPER shall commence with the rehabilitation of the PROPERTY in accordance with
a schedule provided to and approved the CITY. Upon DEVELOPER commencing with
PROJECT,DEVELOPER shall continue with such rehabilitation in as expeditious manner as
is reasonably practicable.DEVELOPER shall complete the PROJECT in accordance with the
schedule;provided, however, that such Completion Date for the PROJECT shall be extended
by one(1)day for each day which construction is delayed or stopped due to accident, strikes,
shortage of materials, extreme weather or acts of God. In the event DEVELOPER requires
any further extension of the Completion Date for the PROJECT, any such request shall be
submitted to the CITY in writing specifying the reasons for such an extension and the amount
of additional time being requested. Any agreement by the City to further extend the
Completion Date for the PROJECT shall be at the commercially reasonable discretion of the
City Council of the CITY. The PROJECT shall be deemed completed when the
DEVELOPER has completed all of the work involved with the proposed PROJECT and has
obtained a final inspection and final occupancy permit for the properties related to the
PROJECT from the CITY.
C. This AGREEMENT shall remain in full force and effect for as long as the required
affordability period of the PROJECT is in place as provided herein.
VI. PROGRAM INCOME
A. DEVELOPER must keep detailed accounting records, in a form approved by CITY, of the
'income and expenses of its NSP portfolio. Such records shall be submitted to CITY for its
review no later than forty-five (45)days after the end of DEVELOPER's fiscal year or from
time to time as requested by CITY should HUD require additional reporting periods.
B. Payments received by DEVELOPER on the notes and mortgages between DEVELOPER
and the homebuyer/purchaser of the PROPERTY are considered program income under the
NSP. These mortgages will be considered"financing mechanisms"under the NSP and repaid
amounts shall be retained by DEVELOPER, must be accurately accounted for, and must be
9
re-used to benefit INCOME ELIGIBLE HOUSEHOLDS in a CITY approved area of greatest
need within the CITY for a time period equal to the minimum affordability requirement
period for the PROPERTY.
VII.UNIFORM ADMINISTRATIVE REQUIREMENTS
A. Although acting as a developer, DEVELOPER must comply with applicable portions of 24
CFR Part 84 Uniform Administrative Requirements for Grants and Agreements with
Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations, except that
DEVELOPER may name its development team.These regulations implement OMB Circular
110 and set forth uniform requirements for nonprofit organizations, including financial
management systems, property standards, procurement standards, reporting and record
keeping.
B. Although acting as a developer, DEVELOPER must comply with the requirements and
standards of OMB Circular A-122, "Cost Principles for Non-profit Organizations." This
Circular establishes principles for determining allowable costs.
C. Although acting as a developer, DEVELOPER must comply with OMB Circular A-133
"Audit Requirements." For any year that DEVELOPER expends more than $500,000 in NSP
funds,DEVELOPER must have a single audit which includes its financial statements and its
federal awards from all applicable federal programs. Notwithstanding the foregoing, if NSP
funding is the sole source of federal funds during any year in which DEVELOPER expends
more than$500,000 in federal funds,a program-specific audit may be conducted.
VIII.OTHER PROGRAM REQUIREMENTS
A. The project will be conducted and administered in compliance with applicable federal civil
rights and fair housing law,including,but not limited to:
1. Title VI of the Civil Rights Act of 1964 (Pub. L. 88-352, 42 U.S.C. §2000d et seq.) and
implementing regulations issued at 24 CFR Part 1.
2. Title VIII of the Civil Rights Act of 1 968 (Pub. L. 90-208, 42 U.S.C. §2000d et seq.), as
amended;and that the DEVELOPER will administer all programs and activities related to
housing and community development in a manner to affirmatively further fair housing.
3. The Fair Housing Act(42 U.S.C. 3601-20).
4. Executive Order 11063, as amended by Executive Order 12259 (Equal Opportunity in
Housing),and implementing regulations in 24 CFR Part 107.
5. Age Discrimination Act of 1975 (Pub. L. 94-135), as amended and implementing
regulations when published for effect.
Concurrently with the execution of this AGREEMENT, DEVELOPER shall execute an
Equal Employment Opportunity Certification for the PROJECT, attached hereto as Exhibit
D.
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B. Section 109 of the ACT requires that no person in the United States shall on the grounds of
race, color, national origin, religion, or sex be excluded from participation in, be denied the
benefits of,or be subjected to discrimination under any program or activity receiving Federal
financial assistance made available to the ACT. Discrimination on the basis of age is also
prohibited.
C. If the PROJECT is for a capital improvement on a facility or for rehabilitation of residential
property if such property contains more than seven(7)units, the DEVELOPER shall comply
with the Federal Labor Standards and Prevailing Wage Rates, including the conducting of
employee interviews of the contractor and/or subcontractors at the job site. This PROJECT
is for acquisition and rehabilitation of one(1)single family unit.
D. CITY is responsible for the preparation of environmental reviews for the PROJECT and
enforcement of environmental standards. CITY and DEVELOPER agree and acknowledge
that this AGREEMENT does not constitute a commitment of funds or site approval for a
particular PROPERTY or PROPERTIES, and that such commitment of funds or approval
may occur only upon satisfactory completion of environmental review under 24 CFR Part 58.
DEVELOPER shall supply all information requested by CITY to complete such reviews,
shall carry out any mitigating measures required by CITY,and shall not rehabilitate,repair or
sell any property, nor commit or expend NSP or local funds for a PROPERTY or
PROPERTIES until CITY has completed an environmental review to the extent required
under 24 CFR Part 58 and has given notification of its approval in accordance with 24 CFR
Part 58. Such environmental review and report shall be (a) submitted to DEVELOPER upon
not less than 15 days prior to the CITY conveying the PROPERTY to DEVELOPR and (b)
acceptable to DEVELOPER, in DEVELOPER'S reasonable discretion.
E. DEVELOPER shall comply with the Lead-Based Paint Poisoning Prevention Act(42 U.S.C.
§48214846), the Residential Lead-Based Paint Hazard Reduction Act of 1992 (42 U.S.C.
§4851-4856) and implementing regulations at 24 CFR Part 35; subparts A, B, J, K, and R of
this part apply to this PROJECT.
F. DEVELOPER shall not use debarred, suspended or ineligible contractors or subcontractors
in carrying out this PROJECT.
G. DEVELOPER shall comply with administrative and procurement requirements in accordance
with 24 CFR Part 84 (except that DEVELOPER may name its development team), including
the conflict of interest provisions and the following provisions, to assure the best available
price for any subcontracts for rehabilitation activities associated with the PROJECT:
I. DEVELOPER shall avoid purchasing unnecessary items.
2. Where appropriate, an analysis should be made of lease and purchase alternatives to
determine which would be most economical and practical.
3. The bid specifications or work write-ups shall include:a clear and accurate description of
the technical requirements for the material, product or service to be procured (such
descriptions shall not contain features which unduly restrict competition); requirements
11
which the bidder/offerer must fulfill and all other factors to be used in evaluating bids or
proposals; a description, whenever practicable, of technical requirements in terms of
functions to be performed, including the range of acceptable characteristics or minimum
acceptable standards; specific features of"brand name or equal"descriptions that bidders
are required to meet; acceptance to the extent practicable and economically feasible, of
products and services dimensioned in the metric system of measurement; preference, to
the extent practicable and economically feasible, for products and services that conserve
natural resources,protect the environment,and are energy efficient.
4. The DEVELOPER shall submit the bid specifications or work write-ups and plans to the
CITY office for staffs approval prior to any advertising or bid solicitation.
5. In the event any contracts are required to by publicly bid,the DEVELOPER shall include
in any invitation for bids or work write-up being used to solicit bids, the statement
"Minorities and women contractors are encouraged to submit bids." DEVELOPER shall
send an invitation to bid to the MBE and WBE firms currently listed with CITY, as
appropriate for the type of work to be done.
6. If sealed bids are required, all bids will be publicly opened at the time and place
prescribed in the invitation for bids.
7. If sealed bids are required, the DEVELOPER shall provide the CITY office with a copy
of the classified advertisements and the results from the bid opening.
8. The contract award will be made, in writing, to the entity submitting lowest qualified
responsive and responsible bid or proposal meeting the specifications. Any or all bids
may be rejected, if there is reason to believe that the low bidder will be unable to
complete the project in accordance with the bid specifications, including,but not limited
to, the following reasons: contractor has been debarred by the U.S. government from
working on Federally funded projects, contractor is unable to furnish any required bond,
contractor has a poor record of past performance, or contractor's bid is unusually low in
relation to other bids and contractor is not able to document how it will be able to meet
the bid specifications for the amount bid.
9. Except as otherwise required by statute, DEVELOPER may follow its own requirements
relating to bid guarantees, performance bonds, and payment bonds, except for contracts
or subcontracts exceeding $100,000. Such contracts or subcontracts must meet the
following requirements: a bid guarantee from each bidder equivalent to five percent(5%)
of the bid amount shall be obtained consisting of a bid bond, certified check, or other
negotiable instrument; a performance bond on the part of the contractor for 100 percent
(100%) of the contract price shall be required; and a payment bond on the part of the
contractor for 100 percent (100%)of the contract price shall be required.
10. DEVELOPER shall provide the CITY with copies of all executed contracts.
H. In the acquisition and disposition of real property and the provision of assistance, in
accordance with 24 CFR §570.611, no person who exercises or has exercised any functions
or responsibilities with respect to NSP activities, or who is in a position to participate in a
12
decision making process or gain inside information with regard to such activities,may obtain
a financial interest or benefit from an NSP assisted activity,or have a financial interest in any
contract, subcontract, or agreement with respect to an NSP assisted activity, or with respect
to the proceeds of the NSP assisted activity, either for themselves or those with whom they
have business or immediate family ties, during their tenure or for one year thereafter. This
applies to any person who is an employee,agent,consultant,or officer of DEVELOPER.
I. The Architectural Barriers Act, the Americans with Disabilities Act, and Section 504 of the
Rehabilitation Act of 1973 shall be followed,to the extent applicable to the PROJECT.
J. DEVELOPER agrees that to the best of its knowledge, neither the PROJECT nor the funds
provided therefore, and the personnel employed in the administration of the program shall be
in any way or to any extent engaged in the conduct of political activities in contravention of
Chapter 15 of Title 5,United States Code,referred to as the Hatch Act.
K. DEVELOPER certifies,to the best of its knowledge and belief,that:
1. No Federal appropriated funds have been paid or will be paid, by or on behalf of the
undersigned, to any person for influencing or attempting to influence an officer or
employee of an agency, a Member of Congress, an officer or employee of Congress, or
an employee of a Member of Congress in connection with the awarding of any Federal
contract, the making of any Federal grant, the making of any Federal loan, the entering
into of any cooperative agreement,and the extension,continuation,renewal,amendment,
or modification of any Federal contract,grant, loan,or cooperative agreement.
2. If any funds other than Federal appropriated funds have been paid or will be paid to any
person for influencing or attempting to influence an officer or employee of any agency, a
Member of Congress, an officer or employee of Congress, or an employee of a member
of Congress in connection with this Federal contract, grant, loan, or cooperative
agreement, the undersigned shall complete and submit Standards Form —LLL,
"Disclosure Form to Report Lobbying," in accordance with its instructions.
3. The undersigned shall require that the language of this certification be included in the
award documents for all sub-awards at all tiers (including subcontracts, sub-grants, and
contracts under grants, loans, and cooperative agreements) and that DEVELOPER shall
certify and disclose accordingly.
This certification is a material representation of fact upon which reliance was placed
when this transaction was made or entered into. Submission of this certification is a
prerequisite for making or entering into this transaction imposed by section 1352,title 31,
U.S. Code. Any person who fails to file the required certification shall be subject to a
civil penalty of not less than$10,000 and not more than$100,000 for each such failure.
L.The DEVELOPER certifies that it will provide a drug-free workplace by:
1. Publishing a statement notifying employees that the unlawful manufacture, distribution,
dispensing, possession or use of a controlled substance is prohibited in the
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DEVELOPER's workplace and specifying the actions that will be taken against
employees for violation of such prohibition;
2. Establishing a drug-free awareness program to inform employees about
a. The dangers of drug abuse in the workplace;
b. The DEVELOPER's policy of maintaining a drug-free workplace;
c. Any available drug counseling,rehabilitation,and employee assistance programs;
and,
d. The penalties that may be imposed upon employees for drug abuse violations
occurring in the workplace.
3. Making it a requirement that each employee to be engaged in the performance of the
grant be given a copy of the statement required by paragraph(1);
4. Notifying the employee in the statement required by paragraph (1)that, as a condition of
employment under the grant,the employee will
a. Abide by the terms of the statement;and,
b. Notify the employer of any criminal drug statute conviction for a violation occurring
in the workplace no later than five days after such conviction;
5. Notifying the CITY within ten(10)days after receiving notice under subparagraph(4)(b)
from an employee or otherwise receiving actual notice of such conviction;
6. Taking one of the following actions, within 30 days of receiving notice under
subparagraph(4)(b),with respect to any employee who is so convicted:
a. Taking appropriate personnel action against such an employee,up to and including
termination;or.
b. Requiring such employee to participate satisfactorily in a drug abuse assistance or
rehabilitation program approved for such purposes by a Federal, State,or local health,
law enforcement,or other appropriate agency;
7. Making a good faith effort to continue to maintain a drug-free workplace through
implementation of paragraphs(1), (2),(3),(4), (5)and(6).
IX.CITY'S OBLIGATION TO PROSECUTE AGREEMENT
A. CITY shall forthwith file all applicable documents and shall comply with all applicable rules
and regulations to secure a release of funds for the PROJECT.
B. After the CITY has received notification that funds for the PROJECT have been released by
HUD,the DEVELOPER shall be authorized to begin the PROJECT so long as the PROJECT
remains in compliance with the Neighborhood Stabilization Program and this
AGREEMENT.
X.RECORDS AND REPORTS
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A. DEVELOPER authorizes the CITY, HUD, and the Comptroller General of the United States
to conduct on-site reviews, to examine, inspect, and audit, the DEVELOPER'S records with
respect to the PROPERTY, rental applications and to conduct any other procedures or
practices to assure compliance with the provisions of this AGREEMENT upon demand. All
of the foregoing shall be at no cost to the DEVELOPER.
B. At the request of the CITY, the DEVELOPER shall furnish immediately, if required by the
Comptroller General, otherwise within seven (7)business days of such request, such reports,
budgets,certifications and other documents required pursuant to federal, state,or CITY rules,
regulations and policies that are applicable to the PROJECT and shall give specific answers
to questions from the CITY, from time to time, relative to the DEVELOPER'S contracts and
operations in connection with the PROJECT.
C. DEVELOPER shall,each year as long as the PROJECT remains in effect, complete an audit
of the PROJECT, conducted by an independent Certified Public Accountant, and shall
submit a copy of the audit report to the CITY within six months of the close of
DEVELOPER'S year end. Please note the single audit requirements contained in Section
VII.C.above.
D DEVELOPER shall submit all required information to show compliance with applicable
laws,rules and regulations,as specified in this AGREEMENT,including but not limited to:
1. Prior to acquisition of any PROPERTY, it's Affirmative Marketing Plan.
2. Beneficiary data on income,race,ethnicity,gender of single head-of-households,and
other data requested by CITY necessary to complete CITY'S reporting requirements to
HUD.
E. DEVELOPER shall provide an annual Progress Report to the CITY within thirty days of the
close of the year, reporting on the status of the PROJECT. The annual Progress Report shall
begin upon the signing of this AGREEMENT and shall continue throughout the acquisition
and rehabilitation period of the PROJECT. and to meet NSP reporting requirements.
F. DEVELOPER shall maintain the following records:
1. For each PROPERTY, for a period of five(5)years after such homebuyer/purchaser has
acquired the PROPERTY: records pertaining to closing of the PROPERTY, including a
copy of the contract,closing documentation,and those records that demonstrate that the
household was income eligible at the time of the closing but shall otherwise not be
required to obtain proof that the purchaser continues to remain income eligible thereafter.
2. For a period of five years after the closing of the PROPERTY: Documentation of all
activities undertaken in connection with DEVELOPER'S affirmative marketing plan.
3. For as long as DEVELOPER owns a PROPERTY and for five years thereafter: all
financial records pertaining to the acquisition and rehabilitation of the PROPERTY.
15
4. If any litigation,claim,negotiation,audit or other action involving the records has been
started before the expiration of the five year period,the records must be retained until
completion of the action and resolution of all issues which arise from it,or until the end
of the regular five year period,whichever is later.
5. DEVELOPER shall cooperate with the CITY to facilitate the maintenance of any and all
other financial records as requested by the CITY for the length of time requested,as may
be required by Title 24 CFR Part 570.
XI. SUSPENSION AND TERMINATION;REVERSION OF ASSETS
A. In accordance with 24 CFR §85.43, suspension or termination of this AGREEMENT may
occur if the DEVELOPER materially fails to comply with any term of the award. The award
may also be terminated for convenience in accordance with 24 CFR §85.44.
B. During the implementation of the PROJECT, CITY may terminate this AGREEMENT or
may suspend any future payment of NSP funds to DEVELOPER for DEVELOPER'S breach
of the AGREEMENT, abandonment of the PROJECT or occurrence rendering impossible the
performance by DEVELOPER of this AGREEMENT. CITY may also suspend payments of
NSP funding due to use of funds in a manner unrelated to DEVELOPER'S performing the
PROJECT, failure by DEVELOPER in submitting supporting information or documentation
for a claim, submission by DEVELOPER of incorrect or incomplete reports, or
DEVELOPER'S suspension of its pursuit of the PROJECT.
C. In the event CITY elects to terminate this AGREEMENT or to suspend payments, for any
reason stated hereinabove in paragraph A and B of this Section X, it shall notify the
DEVELOPER in writing of such action, specifying the particular deficiency, at least five (5)
business days in advance of any such action and establishing a time and a place for the
DEVELOPER to refute the alleged deficiency at a time prior to CITY'S taking such action.
After allowing the DEVELOPER the opportunity to refute or correct the alleged deficiency,
if the alleged deficiency continues to exist, in the reasonable opinion of the CITY, the CITY
may withhold payment to the PROJECT until such time as the violation or breach is
remedied. No action taken or withheld by the CITY under this paragraph shall relieve the
DEVELOPER of its liability to the CITY for any funds expended in violation of any of the
terms of this AGREEMENT.
D. Reversion of assets. Upon expiration or termination of this AGREEMENT, the
DEVELOPER must transfer to the CITY any NSP funding on hand at the time of expiration
or termination and any accounts receivable attributable to use of NSP funds. If, prior to
March 1, 2015, any PROPERTY under this AGREEMENT has not been maintained for the
purpose stated in Section III hereof, DEVELOPER shall pay to CITY an amount equal to the
current market value of the PROPERTY less any portion of the value attributable to
expenditures of non-NSP funds for the acquisition of,or improvement to,the PROPERTY.
XII. REMEDIES
A. In the event of any violation or breach of this AGREEMENT by DEVELOPER, misuse or
misapplication of funds derived from this AGREEMENT by DEVELOPER or any violation
16
of any of the statutes, rules and regulations, directly or indirectly, by the DEVELOPER
and/or any of its agents or representatives,then DEVELOPER,to the fullest extent permitted
by law, agrees to indemnify, and hold the CITY harmless from any requirement to repay to
HUD the NSP funding received by DEVELOPER for this PROJECT or penalties and
expenses, including attorneys' fees and other costs of litigation, resulting from such action or
omission by DEVELOPER.
B. In the event HUD, or any other federal agency, makes any claim which would give rise to
invoking the remedy provisions, as set forth in this Section XI, then the CITY or
DEVELOPER shall immediately notify the other party, in writing, providing the full details
of the alleged violation. The DEVELOPER shall have the right to contest the claim, in its
own name or in the name of the CITY, with its consent, through all levels of any
administrative proceedings or in any court of competent jurisdiction without any cost to the
CITY. Upon any final adjudication, or upon any settlement agreed to between the
DEVELOPER and the Federal agency, the DEVELOPER shall promptly pay any funds
found due and owing.
C. As long as the CITY is not in jeopardy of losing any other Federal funding, of any kind or
description, as a result of the alleged breach, the DEVELOPER shall have complete right to
settle or compromise any claim and to pay any judgment to the federal government, so long
as CITY is indemnified.
D. If the CITY has lost or been prevented from receiving any federal funds, other than the funds
for the PROJECT, as a result of any alleged violation subject to the remedy provisions
hereof, the DEVELOPER shall repay, upon demand by the CITY, such amount of NSP
funding due, as a result of the alleged breach, and the DEVELOPER may then pursue any
remedy it may have in an appropriate forum in its own name or in the name of the CITY,
whichever is applicable.
E. To the fullest extent allowed by law, the DEVELOPER shall assume the defense of and shall
pay, indemnify, and hold harmless CITY, its designees, and its employees from all suits,
actions, claims, mechanics' liens, demands, damages, losses, expenses, and costs of every
kind and description to which the CITY, its designees, and its employees may be subject by
reason of any act or omission of DEVELOPER, its agents or employees, in undertaking and
performing under this AGREEMENT. All litigation activity is subject to approval by the
State's Attorney's Office. The DEVELOPER does not hereby waive any defenses or
immunity available to it with respect to third parties.
XIII.MISCELLANEOUS PROVISIONS
A. AMENDMENTS — Any proposed change in this AGREEMENT shall be submitted to the
other party for prior approval. No modifications, additions, deletions, or the like, to this
AGREEMENT shall be effective unless and until such changes are executed in writing by
the authorized officers of each party. DEVELOPER acknowledges that HUD may from time
to time issue updated guidance regarding the NSP program that may require amendment of
this AGREEMENT and agrees to cooperate with CITY in making such amendment.
17
B. SUBJECT TO FINANCIAL ASSISTANCE AGREEMENT—This AGREEMENT is made
subject to financial assistance agreements between the CITY and the United States
Department of Housing and Urban Development, with the rights and remedies of the parties
hereto being in accordance with this AGREEMENT.
C. ASSIGNMENT—DEVELOPER shall not assign this AGREEMENT or any part thereof, nor
shall DEVELOPER transfer or assign any property or assets acquired using NSP funding or
claims due or to become due hereunder,without the written approval of the CITY having first
been obtained.The contracting or subcontracting of rehabilitation work on the PROPERTIES
does not constitute an assignment.
D. CORPORATE RESOLUTION — If requested, DEVELOPER shall provide a corporate
resolution of its board of directors, in DEVELOPER'S standard form,that all steps necessary
to adopt and authorize for DEVELOPER to enter into this AGREEMENT have been taken by
DEVELOPER.
E. SEVERABILITY—In the event any provision of this AGREEMENT shall be held invalid or
unenforceable by any court of competent jurisdiction, such holding shall not invalidate or
render unenforceable any other provision hereof.
F. AGREEMENT DURATION —Unless terminated by the CITY pursuant to the terms of this
AGREEMENT above, this AGREEMENT will remain in effect for the duration of the
affordability period previously provided for herein.
G. NO PARTNERSHIP—Nothing contained in this AGREEMENT, any mortgage, note or any
other document or instrument related to this PROJECT shall be deemed to create a venture,
partnership relationship, or employer/employee relationship between the CITY and
DEVELOPER. DEVELOPER shall at all times remain an "independent contractor" with
respect to the services to he performed under this AGREEMENT.
H. CITY shall provide, upon request, copies of all laws, regulations, statutes, orders, and OMB
Circulars cited in this AGREEMENT, or internet links to such.
1. Venue for the resolution of any disputes or the enforcement of any rights arising out of or in
connection with this agreement shall be in the Circuit Court of Kane County, Illinois.
J. The parties agree to waive their right to a jury trial.
K. Each and every provision of any law and clause required by law to be inserted in this
AGREEMENT shall be deemed to be inserted herein, and this AGREEMENT shall be read
and enforced as though it were included herein, and if, through mistake or otherwise, any
such provision is not inserted or is not correctly inserted in this AGREEMENT, then upon
application of either party this AGREEMENT shall forthwith be amended to make such
insertion.
SIGNATURE PAGE FOLLOWS
18
IN WITNESS WHEREOF,the parties hereto have executed this AGREEMENT on the dates
recited below to be effective on the date first written above.
CITY OF ELGIN, a body politic in the State of Illinois.
By: '0�z"&AL-ze-0..&
DavidKa-tWn, Mayor
City of Elgin
Date: June 24, 2015
Attest LZ -.o AelzeA
City Clerk
DEVELOPER:
HABITAT FOR HUMANITY OF NORTHERN
FOX VALLEY
an Illinois not-for-profit corporation
Address: 56 South Grove Avenue, Elgin, Illinois, 60120
By: 6
Bar ra Beckman, E cutive Director
Date: J�/�i•e. �, �/
Attest:
19
EXHIBIT A
REAL ESTATE SALES CONTRACT FOR THE CONVEYANCE OF
PROPERTY LOCATED AT 212 FRANKLIN STREET, ELGIN IL 60120
20
EXHIBIT C
PROPOSAL FOR RE-USE OF NSP 1 INVESTMENT DOLLARS,
PREPARED BY DEVELOPER,DATED APRIL 7, 2015
22
Exhibit A
40,W01--n.. Habitat for Humanity of Northern Fox Valley
Habitat
56 S.Grove Elgin,IL 60120
fW Nmmft* P:847-836-1432 F.847-836-1495 www.habitatnfv.org
of hk.1thvrn Fn■VAlle,
April 7,2015
Board of Proposal for Re-Use of NSP 1 Investment Dollars
Directors
David Leali Please accept Habitat for Humanity of Northern Fox Valley's(HFHNFV or Habitat)
President proposal to be Elgin's contractor of choice for the reuse of NSP1 Funding. Habitat is
Jack Fasten proposing that the$450,000 available in NSP 1 Reuse funding be applied to the
Vice President construction of 5 properties. Habitat understands that while the City of Elgin currently
retains approximately$500,000 in funds that were acquired through the proceeds of the
Treasurer Melissa surer ey sale of its NSP homes,these funds are currently available for reinvestment in the
community.The United Stated Department of Housing and Urban development(HUD)
Georgiana Sinnett requires that the funds acquired through the proceeds of the sale of homes(known as
Secretary Prom Income)be reinvested in compliance with the NSP program.Additionally,
Steven Bell Habitat also understands that the actual amount provided by the city to Habitat will be
Larry Buettner $450,000 to allow Elgin to set aside funds for the continued administration of the program
income and continue to maintain its NSP 1 projects per HUD requirements. This
James Hare reduction will not change the number of homes to be constructed,only the distribution
Dawn Holter between NSP1 Reuse and HFHNFV funding.
Gene Huxhold
Habitat proposes to use the funds made available from the city for two new construction
David McCarthy projects(tear down and rebuilds)at 212 Franklin and 269 Ann Streets, per previous
Dee Radtke discussions already begun with staff of the city and a combination of acquisition,
Jim Skomer demolition,rehab, and construction expenses for the homes at 482 Fremont Street,484
Philip Watson Division Street(historic home within the Elgin Historic District),and 637 Grace Street
Gerry Witt (targeted neighborhood initiative). As several of these houses were donated to Habitat,
the estimated acquisition and demolition expenses for the overall project are$104,000.
Staff The construction expenses for the project are$630,000. A detailed break out of
expenses by property is attached.
Barbara Beckman
Executive All five properties were foreclosed and abandoned,and constitute a negative impact on
Director the neighborhoods where they are located. The project on Ann Street will replace an
Bill Klaves existing multi-family residence with a single family residence. The acquisition of Division,
Associate Grace and Ann are complete. We request that the currently vacant Franklin Street
Director property be donated to Habitat by Elgin. The Fremont Street property is bank owned and
Sue Bottom the acquisition is currently in progress. Freemont is targeted to be Habitat's100 th house.
Business
Manager In total,this entire NSP 1 Reuse project Will cost$734,000, of which approximately
Olivia viahos $450,000 will be through the reuse of NSP 1 funds provided by the City of Elgin. The
volunteer&Outreach NSP1 Reuse monies will be leveraged With funding from Habitat's ReStore,grants,and
Manager donations from corporations to fully fund the estimated costs and any unforeseen
Travis Juracek additional expenses. Of course, most of the labor for the projects will be provided by
Construction Manager Habitat for Humanity Volunteers. Donations of time and labor are not included in the
Connie Kitzinger costs above. Also, Habitat has chosen not to attach an management fees to the cost
Family Selection estimates for this project.
y g
Coordinator p j
Visit our Restore Of the five projects,two rehabs will be completed in 2015;one rehab in 2016 and two
Deanna Davies, tear down/new construction projects in 2016. Timing estimates are included in the
Director attached proposal.
800 North State
Elgin IL.
847-742-9905
The intent of the use of these investment dollars is to maximize the impact of this effort toward neighborhood
revitalization. A new emphasis in this proposal is southeast area of Elgin as part of the Targeted Neighborhood
Initiative and continuing work in Elgin's historic district and in Elgin's northeast area where we have completed a
past project. As in the past,we continue to work with Elgin's Community Development Department to select high
impact properties for this proposal.
The scope of the rehab efforts is to completely reconstruct the homes to include new electrical, heating, plumbing
with a reconfiguration of the interior as appropriate to meet today's building standards. The extent of the exterior
work will depend on the condition of the exterior and roof. If necessary we will totally re-side and re-roof all
rehabs. Our goal is to eliminate the need for our partner families to have any extensive repairs in the early years
of home ownership. We also take pride in making our homes energy efficient,a significant component of
affordable housing.
For the vacant lot at 212 Franklin,we intend use the plans first developed for 611 Margaret Place. The design of
this home was required to follow historic district standards, in connection with the development of the Walgreen's
Pharmacy that was developed adjacent to this property. Therefore the home met the guidelines for homes in a
historic area. Most importantly for this project,the plans and construction will fit the local architecture.
Finally,at the request of the city, Habitat is also investigating the possibility of acquiring and rehabilitating the
former Larkin Home at 518 Highland Avenue, and the abandoned home at 655 Oak Street.These homes will be
evaluated in the long term for their rehabilitation and reuse by partner families following the completion of the
planned rehabilitations within this proposal.
As in all our projects,partner families are identified prior to the beginning of construction. They will of course be
selected based on the income guidelines dictated by NSP funding and live or work within our service area. We
also use our additional criteria; living with an existing housing need, being able to repay the cost based no-interest
mortgage for the home and agreeing to partner with our volunteer work force in the construction of their home.
This process supports both the immediate occupancy of the home on completion of the project and our goal of
long term ownership. Of the 92 homes we have sold to date,we have had only one foreclosure.
We believe we are well qualified to execute this partnership. We are currently working on 8 projects with various
completion times in 2015 and 2016. The projects are in Elgin and Carpentersville. Listed below are the core
competencies of our organization which eminently qualify Habitat for this project.
Property Acquisition
Habitat for Humanity of Northern Fox Valley has strong relationships with local real-estate agents who continually
search for property and has extensive experience evaluating and acquiring foreclosed houses. The construction
team assesses the structure,determines a preliminary scope of work,and estimates rehab costs prior to
acquisition. The organization has received fourteen donated properties over the last four years from banks,
municipalities, and individual owners. If appropriate additional property becomes available in our target areas,it
will be purchased and used to expand our targeted efforts in community revitalization.
General Contractor
Habitat for Humanity of Northern Fox Valley coordinates the rehabilitation of each property, including working with
architects,surveyors,engineering firms,and subcontractors for licensed, insured services such as lead,mold,
and asbestos abatement,electrical,plumbing and HVAC.
Builder
Habitat for Humanity of Northern Fox Valley builds homes under the supervision and direction of project directors
who are professional construction workers.Our construction relies heavily on volunteer labor to do the majority of
the construction. Obtaining permits,ordering materials, bidding and hiring trades people,setting construction
standards,and scheduling inspections are some of the building activities supervised centrally by the organization.
Financial Oversight
Habitat for Humanity of Northem Fox Valley establishes the scope of work and budget for each project, raises
funds,pays invoices,tracks and monitors expenses.
Pre-Qualification of Buyers
Habitat for Humanity of Northern Fox Valley recruits,processes,and approves buyers(referred to as Partner
Families)for its home ownership program and follows a nondiscriminatory selection policy. Partner Families are
provided support throughout the entire application process. Once approved,each buyer is matched with a family
support volunteer for one-on-one assistance. Buyers will be prequalified for each of the homes in this project and
matched with a property prior to starting each project.
Homebuyer Education and Services
Habitat for Humanity of Northern Fox Valley partners with Neighborhood Housing Services,a HUD-certified
housing agency,for homebuyer education services. Each homebuyer completes an eight-hour curriculum and
eams a Homeownership Education Certificate,which is required by HUD as a prerequisite before purchasing the
home. Additional education on budgeting,financial management,home maintenance,and being a good neighbor
are also required.
Lending and Mortgage Processing
Upon completion of construction and passing of final inspections, Habitat for Humanity of Northern Fox Valley
sells the rehabbed homes to the pre-qualified buyers at the lesser of cost or appraised value and provides a 0%
mortgage,with a low down payment of$500, and no private mortgage insurance. Habitat for Humanity of
Northern Fox Valley processes mortgage payments monthly,maintains escrow accounts, pays real estate taxes
and homeowners insurance for its mortgagees. The principal portion of every mortgage payment is
reinvested in additional affordable housing projects.
Habitat for Humanity of Northern Fox Valley has a 24 year track record of producing affordable housing. Some of
the organization's recent accomplishments include:
• In 2006, Habitat for Humanity of Northern Fox Valley received the Small Business of the Year Award from
the Northem Kane County Chamber of Commerce.
• In February 2006, Habitat for Humanity of Northem Fox Valley received the U.S. Department of Housing
and Urban Development Secretary's Best in American Living Award for its 5 home Block Build project in
Elgin. The award recognized design excellence produced through cooperative public and private efforts
that expand home ownership opportunities for underserved families.
• In April 2006, Habitat for Humanity of Northern Fox Valley opened its Restore in a 20,000 square foot
space and in April 2008 ReStore moved to an adjacent,40,000 square foot space located at 800 N.State
Street in Elgin. The ReStore has been a key component of the organization's growth strategy.
• In July 2007, Habitat for Humanity of Northern Fox Valley's 5 home Block Build project was honored by
being included in the publication, Home Grown: Local Housing Strategies in Action. The publication
—compiled by the Metropolitan Mayors Caucus,Chicago Metropolis 2020, and Metropolitan Planning
Council—describes a number of housing "best practices"with the intent to show local policymakers and
practitioners how their peers are addressing housing issues and spark ideas for replicating or improving
upon these approaches to address their own local housing challenges.
• In May 2010, Habitat for Humanity of Northern Fox Valley received the Elgin Mayor's award for the
preservation and restoration of a historic home.
• In July 2010,a new strategic plan was adopted with an ambitious goal of completing 120 homes in 10
years.
• In August of 2010, Habitat first partnered with the City of Elgin in the NSP program to acquire, rehabilitate
and sell four abandoned and foreclosed homes in areas of greatest need using NSP-1 funds. Habitat
represented the city in fulfilling the HUD requirement of using no less than 25%of NSP-1 funds for the
sale of rehabilitated properties to low income property owners.
• In March 2011, Habitat for Humanity of Northern Fox Valley's Restore was awarded the Elgin Image
Award.
• In May 2011,Habitat for Humanity of Northern Fox Valley received the YWCA Corporate Leader Award.
• In May 2012,Habitat for Humanity of Northern Fox Valley received,for the second time,the Elgin Mayor's
award for the preservation and restoration of four historic homes.
• In March of 2013 Habitat for Humanity of Northern Fox Valley relocated to 56 S. Grove Elgin and
renovated an empty office space into a community asset.
• In 2014 we completed 11 rehab projects.
The organization is striving to build on these successes with a strategic effort to increase house production to
serve more low-income homebuyers. With the recommendation of the staff,the Board of Director's fully
supported the capacity building goals and the strategy to rehab vacant,foreclosed houses in areas destabilized
by the foreclosure crisis. The organization has been focusing on acquiring and redeveloping houses in hardest hit
areas of Carpentersville and Elgin.
We have recently hired additional construction supervision to lead the crews of skilled and unskilled volunteers on
the rehab projects. With additional project sites,additional construction staff was an identified key need. A
lesson learned by the organization is that the role of the construction supervisor is a difficult one to fill because of
the required combination of skills. Construction supervisors not only need a strong and broad knowledge of
construction,they must also have strong people and teaching skills. These supervisors have a vital role in the
organization as they train and lead volunteers who do the majority of the unlicensed work such as framing,siding,
window installation, insulation,drywall,painting,flooring,and cabinet installation. The involvement of construction
volunteers is one of Habitat for Humanity's fundamental principles as it engages the community in the mission
and greatly reduces the costs of the overall project which results in a more affordable purchase price for buyers.
A second focus has been the enhancement of construction methodologies for building or renovating homes to
meet ever increasing energy efficiency standards. While energy efficiency requires careful planning and
attention to detail throughout the construction process,reducing energy consumption will reduce energy costs for
partner families. Furthermore, it offers substantial benefits to homeowners including improved comfort,less
noise, reduced maintenance, and increased durability.
Respectfully Submitted,
e4�
Associate Director
Habitat for Humanity of Northern Fox Valley
April 7,2015
Cost&Timing
Estimated Tobl AcquisMW Construction HOW Est6nabd
Prop" AoquiskWbMe no Demo
Cost COnetnlCUM Cats Fundirp FwAng Funds COmpled"
Cab Request Request Date
484 Division(historic) $35,000 $125,000 $160,000 $0 $105,000 $55,000 August,2015
637 Grace(Targeted Ne0borlxW Initiative) $44,000 $100,000 $144,000 $0 $75,000 $69,000 August 2015
482 Fremont,Elgin donated property $100,000 $100,000 $0 $50,000 $50,000 December,2016
269 Ann(tear down,rebuid) $25,000 $150,000 $175,000 $25,000 $90,000 $60,000 December,2016
212 Franklin(new construction-Margaret model)donated by Elgin $155,000 $155,000 $0 $105,000 $5'000 December,2016
$104,000 $GUM I $734,000 $25,000 $425,000 $284,000
EXHIBIT D
EQUAL EMPLOYMENT OPPORTUNITY CERTIFICATION
Neighborhood Stabilization Program
CITY OF ELGIN
The undersigned understands and agrees that it is a DEVELOPER of a Project funded in
part by the Neighborhood Stabilization Program of the CITY. The undersigned also agrees there
shall be no discrimination against any employee who is employed in carrying out work from the
assistance received from the CITY of DuPage and the Department of Housing and Urban
Development, or against any applicant for such employment, because of race, color, religion,
sex, age or national origin, including but not limited to employment, upgrading, demotion or
transfer; recruitment or recruitment advertising; lay off or termination; rates of pay or other
forms of compensation; and selection for training, including apprenticeship.
DEVELOPER further agrees to the following:
(1) It will incorporate or cause to be incorporated into any grant contract, loan, grant insurance
or guarantee involving federally assisted construction work,or modification thereof,which
is paid for in whole or in part with funds obtained from the Neighborhood Stabilization
Program, the language contained in HUD Equal Employment Opportunity Regulations at
42 CFR 130.15(b), in Executive Order 11246, as amended by Executive Orders 11375 and
12006, and implementing regulations issued in 41 CFR Chapter 60.
(2) It will be bound by said equal opportunity clause with respect to its own employment
practices when it participates in any Neighborhood Stabilization Program construction.
(3) It will assist and cooperate actively with the CITY, the Department of Housing and Urban
Development and the Secretary of Labor in obtaining the compliance of contractors and
subcontractors with the equal opportunity clause and the rules, regulations and relevant
orders of the Secretary of Labor.
(4) It will furnish the CITY, the Department of Housing and Urban Development and the
Secretary of Labor such information as they may require for the supervision of such
compliance, and will otherwise assist the CITY and the Department of Housing and Urban
Development in the discharge of primary responsibility for securing compliance.
(5) It will refrain from entering into any contract or contract modification subject to Executive
Order 11246 of September 24, 1965, with a contractor debarred from or who has not
demonstrated eligibility for government contracts and federally assisted construction
contracts pursuant to the Executive Order.
(6) It will carry out such sanctions and penalties for violation of the equal opportunity clause as
may be imposed upon contractors and subcontractors by the Secretary of Labor, the CITY
or the Department of Housing and Urban Development.
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(7) In the event that DEVELOPER fails or refuses to comply with the undertaking, the CITY, or
the Department of Housing and Urban Development may take any or all of the following
actions: cancel,terminate or suspend in whole or in part this grant,refrain from extending
any further assistance to DEVELOPER until satisfactory assurance of future compliance
has been received; and refer the case to the Department of Housing and Urban Devel-
opment for appropriate legal proceedings.
DEVELOPER:
HABITAT FOR HUMANITY OF NORTHERN
FOX VALLEY
an Illinois not-for-profit corporation
Address: 56 South Grove Avenue, Elgin, Illinois, 60120
Oarbara B kmant Executive Director
Date: j' ',-'� 9 0 A 01,5
Attest: /j_") el'�-/I,-._A�
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