Agmt15 HIP Housing Development Corporation (HHDC) (Oxford Apts. Rehab)

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3. Form of HOME CHDO Subsidv - The HOME financial assistance from the City as provided under this Agreement shall be evidenced by a Promissory Note in favor of the City, in the form attached hereto as Exhibit "C" (the "Promissory Note") and secured by a deed of trust on the Property (the "Deed of Trust"), in the form attached hereto as Exhibit "D". The Promissory Note shall provide that the loan be deferred of payments for a term of thirty 30 years at zero (0%) interest, except in the case of default as hereinafter provided, and shall be repaid in full at the end of the Loan Term, except in the case of a default as hereinafter provided in which case repayment may be accelerated. The "Loan Term" shall be the date which is thirty (30) years from the date the Promissory Note is fully executed. Funds shall be disbursed to Contractor as work progresses and such work is acceptable to the City and upon receipt of approved expenses. 4. HOME Match Reauirements — HOME regulations require a 25% HOME funding match contribution from a non federal source as described in 24 CFR 92.218 through 92.222. The Redwood City Successor Agency will provide the 25% match contribution credit on behalf of Contractor for this Project. The City shall report matching funds to HUD as required under 24 CFR Section 92.221. 5. HOME Affordabilitv Covenant — Three (3) units in the Project will be HOME assisted. In accordance with HOME program requirements, all projects receiving HOME funds must record on title a HOME affordability covenant ("CovenanY') or deed restriction ("Deed Restriction") that runs with the land and restricts household incomes and rents of HOME assisted units such that these units remain continuously affordable to very low and low income tenants for a specified period of time. The term of said HOME affordability restriction for this Project shall be ten (10) vears, the minimum term of affordability required for HOME assisted rehabilitation of existing housing when the per unit investment is greater than $15,000 but not more than $40,000 per unit. The period of affordability becomes effective upon initial occupancy of HOME assisted units notwithstanding that HUD defines Project Completion as the date when the final HOME funds are drawn down and the City has entered project completion information into HUD's disbursement and information system. The Covenant will incorporate the followinq provisions: HOME Definitions — The followinq definitions and dollar amounts referred to in these definitions mav be adiusted from time to time bv HUD or the Citv and anv such adiustments shall be incorporated bv reference into this Aqreement a. Hicth HOME Rent is rent that does not exceed the lesser of (1) the Section 8 Fair Market Rents (FMRs), as established by HUD, for existing housing minus tenant paid utilities; or(2) 30% of annual income for households at the HOME income limit for San Mateo County described below and adjusted for family size, less tenant paid utilities. Under this definition (2) for San Mateo County, High HOME rent is calculated at 60% of the Area Median Income (AMI). ATTY/AGR/2015.165/HHDC Oxford Apts Rehabilitation REV:08-13-15 RL Page 17 of 35