Loading...
HomeMy WebLinkAboutContracts & Agreements_11-2025RECORDING REQUESTED BY AND WHEN RECORDED RETURN TO: City of Redlands 35 Cajon Street Redlands, California 92373 Attention: City Clerk Electronically Recorded in Official Records San Bernardino County Assessor -Recorder -County Clerk DOC# 2025-0014129 01/22/2025 Titles:2 Pages:44 11:11 AM SAN Fees $0.00 Taxes $0.00 J7269 CA SB2 Fee $0.00 Total $0.00 (Space Above For Recorder's Use) This Inclusionary Housing Regulatory Agreement With Declaration of Covenants and Restrictions is recorded at the request and for the benefit of the City of Redlands and is exempt from the payment of a recording fee pursuant to Government Code Sections 6103 and 27383. AFFORDABLE HOUSING AGREEMENT WITH DECLARATION OF COVENANTS AND RESTRICTIONS (TENNESSEE VILLAGE INCLUSIONARY HOUSING) This AFFORDABLE HOUSING AGREEMENT WITH DECLARATION OF COVENANTS AND RESTRICTIONS ("Agreement") is entered into as of this 4Th day of DECL---1F�E. 2024, by and between the CITY OF REDLANDS, a California municipal corporation ("City"), and Lugonia Park Associates, LLC, a California limited liability company ("Owner") (hereinafter, City and Owner are sometimes referred to collectively as "Parties" and individually as a "Party"). RECITALS A. Owner is the owner in fee of one parcel located northeast of the intersection at Tennessee Street and Lugonia Avenue (APNs: 0167-171-15-0000) in the City of Redlands, consisting of approximately 13.48 gross acres of land, and more particularly described in the legal description attached hereto as Attachment 1" (the "Property"). B. Owner has submitted to City plans to develop on the Property, a 460-unit multifamily residential rental development (the "Project"). C. The purpose of this Agreement is to implement the City of Redlands's Inclusionary Housing Ordinance (Redlands Municipal Code Chapter 18.230), and all of the terms, conditions, provisions and covenants set forth in this Agreement shall be interpreted to be consistent with the Inclusionary Housing Ordinance. D. City and Owner desire to enter into this Agreement to place certain covenants and restrictions on the Property and use and operation of the Project, including the imposition of affordability covenants requiring that no less than twenty (20) residential units will be used and occupied or available for use and occupancy by Very Low Income Households as defined in Health and Safety Code Section 50105. The number of 179 l2 001 5iA426888>8 1 DOC #2025-0014129 Page 2 of 44 Inclusionary Units is based upon the base density for the Project (384 units), and excludes the number of units authorized under the Density Bonus Agreement. E. It is the intent of the City and Owner that Owner's fee interest in the Property shall be subject to this Agreement and that the terms hereof shall be binding on the Owner and its successors in interest in the Property for so long as this Agreement shall remain in effect. AGREEMENT Based upon the foregoing Recitals, which are incorporated herein by this reference, and for other good and valuable consideration, the receipt and sufficiency of which is acknowledged, the Parties hereby agree as follows: 1. Definitions. In addition to the terms defined elsewhere in this Agreement, the following terms shall have the meanings in this Agreement given below unless expressly provided to the contrary: 1.1 "Adjusted for household size appropriate to the unit' means a household of one person in the case of a studio unit, a household of two persons in the case of a one -bedroom unit, a household of three persons in the case of a two -bedroom unit, and a household of four persons in the case of a three -bedroom unit, or as determined in accordance with California Health and Safety Code Section 50052.5 or implementing regulations. 1.2 "Affordable Rent' means the maximum Monthly Rent that does not exceed the amount of rent for a Very Low Income household authorized pursuant to Health and Safety Code Section 50053 as such statute exists on the date hereof, which is the product of thirty percent (30%) times fifty percent (50%) of Median Income, adjusted for household size appropriate to the unit. Affordable Rent shall be determined in accordance with any applicable regulations implementing Health and Safety Code Section 50053 and the amounts published by the California Department of Housing and Community Development applicable to the City. A sample calculation of the Affordable Rent for 2024 is set forth in Attachment 2 hereto, which is incorporated herein by this reference. 1.3 "Certification of Continuing Program Compliance" means the certificate described in Section 9 of this Agreement. 1.4 "CitV' means the City of Redlands, California, and the City's successors and assigns. 1.5 "City Attornek' means the City Attorney for the City of Redlands. 1.6 "City Manager" means the City Manager for the City of Redlands or his designee. -2- 179d 2.0015>'42088 S>S I DOC #2025-0014129 Page 3 of 44 1.7 "City Monitoring Fee" means the fee paid every year after the Effective Date in the amount of Seventy -Five Dollars ($75.00) per completed Inclusionary Unit, to be paid to City by Owner to defray the costs incurred by City for monitoring compliance with the affordability covenants set forth in this Agreement. The Seventy - Five Dollar ($75.00) base amount (effective on the Effective Date) shall be increased or decreased (as applicable) annually by the percentage increase or decrease (as applicable) (between September of the year preceding and September of the current year) in the Consumer Price Index published by the United States Department of Labor, Bureau of Labor Statistics, for All Urban Consumers, Los Angeles -Long Beach -Anaheim Average, All Items (1982-84 = 100). A "completed Inclusionary Unit" shall mean an Inclusionary Unit that has received a certificate of occupancy by City. 1.8 "Density Bonus Agreement" means the Density Bonus Agreement (Tennessee Village) executed and recorded concurrently with this Agreement. 1.9 "Effective Date" means the date of City approval of this Agreement. 1.10 "Eligible Tenant(s)" means a Household who complies with all income verification requirements of this Agreement and, for Inclusionary Units designated for rental to and occupancy by Very Low Income Households, a Household that qualifies as a Very Low Income Household as defined. 1.11 "Gross Income" means all income from whatever source from all adult Household members, which is anticipated to be received during the 12-month period following the date of the determination of Gross Income. The applicable sources of income are defined in California Code of Regulations Title 25 Housing and Community Development Section 6914. The definition includes the following specific requirements: 1. Except as provided in subdivision 2 below, all payments from all sources received by the head of Household (even if temporarily absent) and each additional member of the Household who is not a minor shall be included in the annual income of a Household. Gross Income shall include, but not be limited to: a. The gross amount, before any payroll deductions, of wages and salaries, overtime pay, commissions, fees, tips and bonuses; b. The net income from operation of a business or profession or from rental or real or personal property (for this purpose, expenditures for business expansion or amortization of capital indebtedness -3- u��aa.uui�sa��,;�ss�s i DOC #2025-0014129 Page 4 of 44 shall not be deducted to determine the net income from a business),- C. Interest and dividends; d. The full amount of periodic payments received from social security, annuities, insurance policies, retirement funds, pensions, disability or death benefits and other similar types of periodic receipts (but see subdivision (2)(c)); e. Payments in lieu of earnings, such as unemployment and disability compensation, worker's compensation and severance pay. f. Public Assistance. If the public assistance payment includes an amount specifically designated for shelter and utilities which is subject to adjustment by the public assistance agency in accordance with the actual cost of shelter and utilities, the amount of public assistance income to be included as income shall consist of: The amount of the allowance or grant exclusive of the amount specifically designated for shelter and utilities, plus ii. The maximum amount which the public assistance agency could in fact allow for the Household for shelter and utilities. g. Periodic and determinable allowances such as alimony and child support payments, and regular contributions or gifts received from persons not residing in the dwelling, h. All regular pay, special pay and allowances of a member of the Armed Forces (whether or not living in the dwelling) who is head of the Household or spouse or domestic partner (but see subdivision (2)(e)). -4- DOC #2025-0014129 Page 5 of 44 Where a Household has net assets in excess of $5,000, income shall include the actual amount of income, if any, derived from all of the net Household assets or 10 percent (10%) of the value of all such assets, whichever is greater. For purposes of this definition, net Households assets means value of equity in real property other than the Household's full- time residence, savings, stocks, bonds, and other forms of capital investment. The value of necessary items such as furniture and automobiles shall be excluded. 2. The following items shall not be considered as income: a. Casual, sporadic or irregular gifts; b. Amounts which are specifically for or in reimbursement of the cost of medical expenses; C. Lump -sum additions to Household assets, such as inheritances, insurance payments (including payments under health and accident insurance and worker's compensation), capital gains and settlement for personal or property losses; d. Amounts of educational scholarships paid directly to the student or to the educational institution, and amounts paid by the government to a veteran for use in meeting the costs of tuition, fees, books and equipment. Any amounts of such scholarships, or payments to veterans not used for the above purposes of which are available for subsistence are to be included in income; e. The special pay to a serviceman head of a Household away from home and exposed to hostile fire; f. Relocation payments made pursuant to federal, state, or local relocation law; g. Foster child care payments; -5- 17942.001 »\426888i8 1 DOC #2025-0014129 Page 6 of 44 h. The value of coupon allotments for the purchase of food pursuant to the Food Stamp Act of 1964 which is in excess of the amount actually charged the eligible Household; Payments received pursuant to participation in the following volunteer programs under the ACTION Agency: National Volunteer Antipoverty Programs which include VISTA, Service Learning Programs and Special Volunteer Programs. National Older American Volunteer Programs for persons aged 60 and over which include Retired Senior Volunteer Programs, Foster Grandparent Program, Older American Community Services Program, and National Volunteer Program to Assist Small Business Experience, Service Corps of Retired Executive (SCORE) and Active Corps of Executives (ACE). 1.12 "Home Office" means a separate area or room in an Inclusionary Unit used for business purposes and claimed as a business expense pursuant to federal and state income tax laws. Any room used for business purposes shall not reduce the number of bedrooms that are required to be within an Inclusionary Unit pursuant to this Agreement. 1.13 "Household' means all the persons who will occupy an Inclusionary Unit as their primary residence. A child who is subject to a legally -binding shared -custody agreement, in which the child resides with the Household at least 50% of the time, is counted as a member of the Household. Excluded from the definition of Household are live-in caregivers/caretakers, foster children, unborn children and children being pursued for legal custody or adoption that are not currently living with the Household. 1.14 "Housing Related Expenses" means any costs other than rent that are required to be borne by a tenant in a Inclusionary Unit. These costs include, but are not limited to, a Utility Allowance, any costs that are imposed by the Owner on a mandatory basis, and any mandatory costs that are charged by the Owner for amenities included in the Project. Owner may charge tenants in an Inclusionary Unit optional costs related to elective amenities requiring an optional service fee such as classes, room rentals, food service, or special events, but is prohibited from charging a tenant in an -6- 1794'_U015��126SSSiS 1 DOC #2025-0014129 Page 7 of 44 Inclusionary Unit any fee for equal access to common areas or project amenities such as pools, gyms, community rooms and outdoor areas. In addition, Owner is prohibited from charging any optional amenity fees to a tenant in an Inclusionary Unit that is higher than optional amenity fees charged to tenants in Market Rate Units. 1.15 "Inclusionary Housing Fund' means a separate fund of the City established pursuant to Section 18.230.170(B) of the Redlands Municipal Code. 1.16 "Inclusionary Housing Plan" means the plan approved by City's Inclusionary Housing Administrator that details the manner in which the Project's inclusionary housing obligations will be fulfilled. The Inclusionary Housing Plan is attached hereto and incorporated herein as Attachment 3. 1.17 "Inclusionary Units" means the twenty (20) Units within the Project to be rented by Owner to a Very Low Income Household at Affordable Rent in accordance with this Agreement. The number, location, and characteristics of the Inclusionary Units shall be as set forth in the Inclusionary Housing Plan. 1.18 "Market Rate Units" means the Units within the Project to be rented by Owner to a Household without restriction. 1.19 "Median Income" means the San Bernardino County area median income, adjusted for household size, as established by the United States Department of Housing and Urban Development, and as published periodically by the California Department of Housing and Community Development in Section 6932 of Title 25 of the California Code of Regulations, or successor regulation. The Median Income figures for 2024 are set forth in Attachment 2 hereto, which is incorporated herein by this reference. During the Term, upon the written request of Owner, City shall provide to Owner the Median Income figures for the then -applicable year. Developer shall ensure that any change to Median Income is effective immediately upon publication by HCD. 1.20 "Monthly Rent" means the total of monthly payments for use and occupancy of each Inclusionary Unit and land and facilities associated therewith minus any Housing Related Expenses. 1.21 "Owner" means Lugonia Park Associates, LLC, a California limited liability company, and its successors and assigns to the Property. 1.22 "Project' means that certain housing development as more particularly described in Recital B of this Agreement. 1.23 "Property' means that certain real property more particularly described in the legal description in Attachment 1 to this Agreement, and improvements thereon. 1.24 "Substitute Inclusionary Unit" means an equivalent Unit in terms of level of affordability restriction (Low Income Household) and number of bedrooms to a previously designated Inclusionary Unit, that is substituted for that previously designated -7- 179d2001»1d26ABS,�S I DOC #2025-0014129 Page 8 of 44 Inclusionary Unit; provided, however, that Units may designated as Substitute Inclusionary Units to the extent all the Inclusionary Units remain reasonably dispersed throughout the entire Project and do not result in Inclusionary Units and Substitute Inclusionary Units being clustered in one area or building. 1.25 "Tenant Income Certification Form and Questionnaire" means the forms used to determine and certify whether a potential renter is an Eligible Tenant, in a form approved by the City. City hereby approves the form attached hereto and incorporated herein as Attachment 4 to this Agreement. 1.26 "Term" means the term of this Agreement, which shall be for a period commencing upon the date the Agreement is fully executed and continuing in perpetuity; provided, however, if the Project has complied with this Agreement for a period of fifty five (55) years from the date a final certificate of occupancy is issued for the Project, this Agreement shall terminate if the Property is rezoned and no longer used for residential purposes. 1.27 "Unit' means a residential dwelling unit within the Project to be rented by Owner pursuant to this Agreement. 1.28 "Utility Allowance" means a reasonable allowance for an adequate level of service of utilities, including garbage collection, sewer, water, electricity, gas and other heating, cooking and refrigeration fuels, if such utilities are paid for separately by the tenant and which allowance shall be based on the schedules determined by the Housing Authority of the County of San Bernardino; but not including telephone, internet or cable service. In the event that all utility charges are paid by the landlord rather than the tenant, no utility allowance shall be deducted from the rent. 1.29 "Very Low Income Household' means a Household whose Gross Income does not exceed the standards defined in Title 25 of the California Code of Regulations Section 6932, and by California Health and Safety Code Section 50105. The maximum household income amount for Very -low Income Households shall be the amount published by the California Department of Housing and Community Development as adjusted to reflect the Household size of the Eligible Tenant of a particular Inclusionary Unit 2. Development of the Project. Owner shall commence and complete the construction and development of the Project on the Property subject to the terms and conditions set forth in this Agreement. The Inclusionary Units shall be designated before issuance of building permits for the Project and shall be reasonably dispersed throughout the Project so that no single area of the Project has an unreasonable concentration of Inclusionary Units. The Inclusionary Units shall be built concurrently with the Market Rate Units. The bedroom mix for the Inclusionary Units shall be proportional to the bedroom mix of the Market Rate Units. The Inclusionary Units shall be constructed with the same exterior appearance and interior features, fixtures, and amenities and shall use the same type and quality of materials as provided for the balance of the Units in the Project. -8- 17942 001 i A2_688St 1 DOC #2025-0014129 Page 9 of 44 3. Term. Each Inclusionary Unit designated for Very Low Income Households shall be restricted during the Term to use and occupancy by a Very Low Income Household. During the Term, Owner may elect to substitute an equivalent Unit in terms of number of bedrooms (the "Substitute Inclusionary Unit") for an Inclusionary Unit. 4. Use; Affordability Covenants. For the entirety of the Term, Owner shall own, operate, and maintain the Project by renting out the Inclusionary Units in accordance with the covenants and conditions of this Section 4. 4.1 General. Owner shall devote the Property for use as a residential rental community with no less than twenty (20) Units to be rented to and occupied or held available for occupancy by Eligible Tenants who are Very Low Income Households at Affordable Rent. The Project distribution of studio, one-, two-, and three -bedroom Inclusionary Units shall be as designated in the Inclusionary Housing Plan, and the average square footage for the Inclusionary Units shall be approximately the same as the average square footage for Market Rate Units of the same number of bedrooms. Nothing herein shall preclude Owner from increasing the number of Inclusionary Units. Tenants of Inclusionary Units shall be provided the same rights and access to common amenities in the Project as residents occupying Market Rate Units. 4.2 Use of Inclusionary Units. The Inclusionary Units shall not at any time be utilized on a transient basis or rented for a period of less than thirty (30) consecutive days, nor shall they be used as a hotel, motel, dormitory, fraternity house, sorority house, rooming house, nursing home, hospital, sanitarium, rest home day care facilities, or non-residential uses (other than to maintain a Home Office); provided that the use of the Inclusionary Units for guests on an intermittent basis shall not be considered transient use for purposes of this Agreement. All of the Inclusionary Units shall be available for rental on a continuous basis to members of the general public, and Owner shall not give preference to any particular class or group in renting the Inclusionary Units, except to the extent that Inclusionary Units are required to be rented to Eligible Tenants. A vacated Inclusionary Unit shall be held vacant until re -leased to an Eligible Tenant or until another Unit at the Property with the same number of bedrooms is leased to an Eligible Tenant and therefore becomes a Substitute Inclusionary Unit hereunder. Owner shall exercise diligent efforts to lease any such vacated Inclusionary Unit to an Eligible Tenant in an expeditious manner. 4.3 Affordable Rent. The rent for the Inclusionary Units shall not exceed Affordable Rent. Prior to renting any Units, Owner shall advise City, in writing, of any utilities that are not provided by Owner and that will be paid by tenants at the Project. Within thirty (30) days following such advisement, City shall calculate and determine, and provide to Owner a chart of the Affordable Rent for the Project. On an annual basis following any increase in the Median Income, City shall prepare and provide to Owner an updated chart of the Affordable Rent for the Project. Owner shall promptly notify City, in writing, of any changes to the utilities that are paid by tenants at the Project. 4.4 Locatio and D`c�Siyiiatliiii of IiiCiUSionariJ Units. SUb�ect t0 the terms of Section 4.3 and this Section 4.4, the Inclusionary Units shall be permitted to float -9- U912.001.��A1_'hX8\�S I DOC #2025-0014129 Pagel 0 of 44 among all 460 Units in the Project. The Inclusionary Units shall be constructed with the same exterior appearance and interior features, fixtures, and amenities, and shall be constructed with the same type and quality of materials as provided for the Units in the Project that are not Inclusionary Units. The Inclusionary Units shall be distributed throughout the Project and shall not be clustered in one area or building. The Inclusionary Units must be designated in the approved Inclusionary Housing Plan prior to issuance of a building permit for the Project. 4.5 Income Eligibility; Certification. The Inclusionary Units are to be rented to and occupied only by Eligible Tenants. Prior to any occupancy of an Inclusionary Unit, Owner shall obtain from each applicant for the Inclusionary Unit and submit to City for review and approval a Tenant Income Certification Form and Questionnaire, certifying the income of the applicant based upon the current income of each member of the Household. The Tenant Income Certification Form and Questionnaire shall be dated immediately prior to the date submitted to City. Owner shall use diligent efforts to verify that the income provided by an applicant is accurate by obtaining the following as a part of the verification process: (a) three (3) pay stubs for the most recent pay periods; (b) three most recent statements for all asset accounts, including checking, savings, retirement, 401 K, etc. for all household members; (c) copies of the federal and state income tax returns if filed by the applicant for the prior two (2) calendar years; (d) a written verification of income and employment from the applicant's current employer if the applicant is employed; (e) an income verification form from the Social Security Administration and/or California Department of Social Services if the applicant receives assistance from either agency; (f) a certification as to the income and household size of the applicant; (g) if an applicant is unemployed or did not file an income tax return for the previous calendar year, such other information as reasonably necessary to verify the applicant's income; and (g) any other information that City may reasonable require to verify the income of the proposed tenant. City shall review and approve or disapprove each applicant within ten (10) business days after City's receipt of a complete submittal. Owner shall maintain on file a copy of each Tenant Income Certification Form and Questionnaire along with the information obtained to verify the applicant's income for a period of five (5) years. An Inclusionary Unit occupied by a tenant who qualifies as an Eligible Tenant at the commencement of the occupancy shall be treated as occupied by an Eligible Tenant until a recertification of such Eligible Tenant's income demonstrates that such tenant no longer qualifies as an Eligible Tenant, as further set forth in Section 4.6 below. 4.6 Recertification. Annually, during the term hereof, on or before the anniversary of the move -in date for each Eligible Tenant with respect to an Inclusionary Unit, Owner shall recertify the income of each Eligible Tenant by obtaining a completed Tenant Income Certification Form and Questionnaire based upon the current income of each member of the Household of the Inclusionary Unit. in the event that recertification demonstrates that a Household's income exceeds the income permitted for Eligible Tenant status, Owner shall perform either of the following: (i) to the extent permitted by applicable law, the occupants' lease shall not be renewed and said occupants shall be required to vacate the unit within one hundred eighty (180) days after the recertification; or (ii) the next available Market Rate Unit in the Project with the same number of -10- DOC #2025-0014129 Page 11 of 44 bedrooms shall be leased as an Inclusionary Unit at Affordable Rent to an Eligible Tenant so that the Project will be in compliance with the covenants and conditions of this Agreement, and the previous Inclusionary Unit shall be re -designated as a Market Rate Unit and the occupants thereof may be charged the amount of rent for a Market Rate Unit. 4.7 Selection of Tenants. The Inclusionary Units shall be available for rental on a continuous basis and Owner shall not give preference to any particular class or group in renting Inclusionary Units, except to the extent that Inclusionary Units are required to be rented to Eligible Tenants. Owner shall market the Inclusionary Units to persons who live and/or work in the City of Redlands on a nonexclusive basis. 4.8 Lottery System. The initial lease -up of the Inclusionary Units shall be done pursuant to a lottery system. Prior to commencing any marketing activities for the Inclusionary Units, Owner shall submit to City for City's review and approval Owner's proposed marketing plan, and procedures for conducting the interest list and subsequent lottery. A representative of City shall have the right, but not the obligation, to attend the lottery. 4.9 Waiting List. Following the initial lease -up of the Inclusionary Units, Owner shall maintain a waiting list of persons interested in renting an Inclusionary Unit. Subject to Section 4.9 below, at such time as an Inclusionary Unit becomes available for rental, Owner shall rent such Inclusionary Unit to the first person on the waiting list that qualifies as an Eligible Tenant to rent the Inclusionary Unit. Owner shall use commercially reasonable efforts to lease Inclusionary Units that become available as quickly as possible. 4.10 Occupancy Levels. The number of persons permitted to occupy each Inclusionary Unit shall not exceed the occupancy permitted pursuant to the requirements of the United States Department of Housing and Urban Development which, as of the Effective Date, is two persons per bedroom, plus one person (e.g., for a two bedroom unit the maximum number of persons residing in the unit can be five persons). The lease for each Inclusionary Unit shall include a provision limiting the number of persons permitted to occupy each Inclusionary Unit in accordance with the preceding sentence and Owner shall enforce such occupancy restrictions. Further, the minimum household size permitted for the lease of an Inclusionary Unit shall be one (1) person per bedroom, such as, for example, that a two (2) bedroom Inclusionary Unit may not be leased to a household consisting of less than two (2) persons. 4.11 Principal Residence. The lease for each Inclusionary Unit shall provide that the Inclusionary Unit shall be used as the principal residence of the Inclusionary Unit's Eligible Tenant and for no other purpose. An Eligible Tenant shall be considered as occupying the Unit if the Eligible Tenant is living in the Unit for at least ten (10) months out of each calendar year. Upon receipt of a written request, City may grant a temporary waiver of this occupancy requirement for good cause in its sole discretion The lease for an Inclusionary Unit may allow the Eligible Tenant to have a Home Office so long as UIG Inclusionary VIIIL IS the Eligible IGllanls principal residence. The ease 17942.001 � �A4X688858.1 DOC #2025-0014129 Page 12 of 44 shall further provide that the Eligible Tenant shall not lease or sublease its Inclusionary Unit or its right of occupancy. Owner shall enforce such restrictions. 4.12 Rental Agreement. The form of the lease used by Owner for the rental of the Inclusionary Units shall be approved in advance by City. Once approved, no material changes shall be made to the form of the lease without City's prior written consent, which shall not be unreasonably withheld. The form lease shall obligate the Eligible Tenants to comply with the provisions set forth in this Agreement that are applicable to the Eligible Tenants, and an Eligible Tenant who violates such requirements shall be in default under the lease and, if requested by City, Owner shall take necessary action to evict the tenant. Each lease entered into with an Eligible Tenant shall include a provision to the effect that the Owner has relied on the information provided by the Eligible Tenant on the Tenant Income Certification Form and Questionnaire and all other supporting information supplied by the Eligible Tenant in determining qualification for occupancy of the applicable Inclusionary Unit, and that any material misstatement in such certification (whether or not intentional) will be cause for immediate termination of such lease. Each lease for an Inclusionary Unit (or addendum thereto) also shall contain a provision that failure to cooperate with the annual recertification process may disqualify the Eligible Tenant as such and will be cause for immediate termination of such lease. In addition, each lease for an Inclusionary Unit (or addendum thereto) shall contain a provision requiring the Eligible Tenant to waive any right to relocation assistance from City. Any termination shall be subject to fair housing laws and other laws designed to protect the rights of tenants. In addition to the foregoing, the form of lease may not contain any of the following provisions: 4.12.1 Agreement to be sued. Agreement by the tenant to be sued, to admit guilt, or to a judgment in favor of the owner in a lawsuit brought in connection with the lease; 4.12.2 Treatment of property. Agreement by the tenant that the owner may take, hold, or sell personal property of household members without notice to the tenant and a court decision on the rights of the parties. This prohibition, however, does not apply to an agreement by the tenant concerning disposition of personal property remaining in the housing unit after the tenant has moved out of the unit. The owner may dispose of this personal property in accordance with State law; 4.12.3 Excusing owner from responsibility. Agreement by the tenant not to hold the owner or the owner's agents legally responsible for any action or failure to act, whether intentional or negligent, 4.12.4 Waiver of notice. Agreement of the tenant that the owner may institute a lawsuit without notice to the tenant; 4.12.5 Waiver of legal proceedings. Agreement by the tenant that the owner may evict the tenant or household members without instituting a civil court -12- 179 2OUP>i'ak_CiRBS�S DOC #2025-0014129 Page 13 of 44 proceeding in which the tenant has the opportunity to present a defense, or before a court decision on the rights of the parties; 4.12.6 Waiver of a jury trial. Agreement by the tenant to waive any right to a trial by jury; 4.12.7 Waiver of right to appeal court decision. Agreement by the tenant to waive the tenant's right to appeal, or to otherwise challenge in court, a court decision in connection with the lease; 4.12.8 Tenant chargeable with cost of legal actions regardless of outcome. Agreement by the tenant to pay attorney's fees or other legal costs even if the tenant wins in a court proceeding by the owner against the tenant. The tenant, however, may be obligated to pay costs if the tenant loses; and 4.12.9 Mandatory supportive services. Agreement by the tenant (other than a tenant in transitional housing) to accept supportive services that are offered. 4.13 Records and Reports; Inspection. 4.13.1Owner shall maintain complete and accurate records pertaining to the Inclusionary Units and the matters pertaining to this Agreement for a period of no less than five (5) years (unless a longer period of time is expressly set forth herein), and shall permit any duly authorized representative of City to inspect the books and records of Owner pertaining to the tenants and rents of the Inclusionary Units. 4.13.2 On or before the annual anniversary of the recording of this Agreement, and the same date each year thereafter, Owner shall provide the City with an annual report that sets forth the number of Inclusionary Units that are rented or vacant, the income and family size of the occupants of each Inclusionary Unit, the dates of any vacancies and new leases by each Inclusionary Unit, certification of compliance with all requirements to verify income for Eligible Tenants, and any other information reasonably required by the City to ensure compliance with this Agreement. 5. No Discrimination. In addition to any other nondiscrimination provisions applicable to the Property under federal, state or local law, Owner by and for itself and any successor in interest covenants that there shall be no discrimination against, or segregation of, any persons, or group of persons, on account of any basis listed in subdivision (a) and (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the enjoyment, sale, lease or development of the Property, nor shall Owner itself, or any person claiming under or through it, establish or permit any such practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Property or any portion thereof. The foregoing covenants shall run with the land. 17942 001 5�1926838�8_ 1 DOC #2025-0014129 Page 14 of 44 6. Repair and Maintenance of Property. Owner shall maintain or cause to be maintained the Property and all improvements on the Property, including the Inclusionary Units, in good condition and repair (and, as to landscaping, in a healthy condition) and in accordance with all applicable laws, rules, ordinances, orders, and regulations of all federal, state, county, municipal, and other governmental agencies and bodies having jurisdiction. City places prime importance on quality maintenance to ensure that housing projects within the City of Redlands are not allowed to deteriorate due to substandard maintenance. Owner shall make all repairs and replacements necessary to keep the improvements in good condition and repair and shall promptly eliminate all graffiti and any accumulation of debris or waste material and replace dead and diseased plants and landscaping with comparable approved materials. In the event that Owner breaches any of the covenants contained in this Section 6, and such default continues for a period of five (5) days after written notice from City (with respect to landscaping, graffiti, debris, waste material, and general maintenance) or thirty (30) days after written notice from City (with respect to building improvements) (provided, that if such building improvement default cannot reasonably be cured within such thirty (30) day period, such period shall be extended for the time reasonably necessary to cure the default if Owner commences to cure within said thirty (30) day period and diligently prosecutes such cure to completion) then City in addition to whatever other remedy it may have at law or in equity, shall have the right to enter upon the Property and perform or cause to be performed all such acts and work necessary to cure the default. Pursuant to such right of entry, City shall be permitted (but is not required) to enter upon the Property and perform all acts and work necessary to protect, maintain, and preserve the improvements and landscaped areas on the Property, and to attach a lien on the Property, or to assess the Property, in the amount of the expenditures arising from such acts and work of protection, maintenance, and preservation by City and/or costs of such cure, including a ten percent (10%) administrative charge, which amount shall be promptly paid by Owner to City upon demand. 7. Management. 7.1 Owner shall manage or cause to be managed the Project in accordance with this Agreement and the standards and practices of prudent and qualified managers that manage properties similar to the Property. 7.2 Owner may contract with a management company or manager to operate the Project and maintain the Property ("Property Manager"); provided, however, that in the event of "Gross Mismanagement" (as that term is defined below), City shall have the authority to require that such Gross Mismanagement cease immediately, and further to require the immediate replacement of the Property Manager, whether that Property Manager is Owner or a third party. The replacement Property Manager shall be required to operate and maintain the Property in accordance with the terms of this Agreement and the standards and practices of prudent and qualified managers that manage properties similar to the Property. In the event of such a replacement, the costs to retain the replacement Property Manager shall be the responsibility of Owner. For purposes of this Agreement the term "Gross Mismanagement" shall mean management -14- 179-12001v1I2h,SX�S I DOC #2025-0014129 Page 15 of 44 of the Project in a manner which materially violates the terms of this Agreement and shall include, but is not limited to, the following: (i) knowingly allowing an Inclusionary Unit to be occupied by a person who does not qualify as an Eligible Tenant or renting an Inclusionary Unit for more than the Affordable Rent; (ii) knowingly allowing the prescribed occupancy levels to be exceeded without taking immediate action to stop such overcrowding; (iii) failure to maintain the Property in the manner prescribed in Section 6 after notice and an opportunity to cure, as set forth in said Section 6; (iv) failure to timely submit reports required under this Agreement after notice, and an opportunity to cure, as set forth in Section 14.1; and (v) failure to reasonably cooperate with the Sheriff's Department in maintaining a crime free environment on the Property after notice and an opportunity to cure, as set forth in Section 14.1. 8. Certification of Continuing Program Compliance. During the term of this Agreement, on or before each June 1, Owner shall annually advise the City of the status of the occupancy of the Inclusionary Units during the immediately prior April 1 — March 31 period. Owner shall advise City of the status of the occupancy of the Inclusionary Units by delivering a Certification of Continuing Program Compliance in a form approved by City, which shall provide, among other information, (a) whether the Inclusionary Units in the Project have been rented to and are occupied by Eligible Tenants, and (b) whether either (i) no un-remedied default has occurred under this Agreement, or (ii) a default has occurred, in which event the Certification of Continuing Program Compliance shall describe the nature of the default and set forth the measures being taken by the Owner to remedy such default. Owner shall have the obligation to conduct a reasonable investigation of the Inclusionary Units to ensure the information in the Certification of Continuing Program Compliance, to the best of Owner's knowledge, is true and correct. 9. Compliance with Laws; Right to Inspect. 9.1 Owner shall comply with all applicable laws, regulations, and rules of any governmental agencies having jurisdiction with regard to any activities conducted on the Property and the Project. Owner shall indemnify City for any relocation obligations arising from the performance or implementation of this Agreement. 9.2 For purposes of California Civil Code Sections 1946.2 and 1947.12, or any other state or local law regulating the rent or eviction controls for rental properties, this Agreement only regulates the Inclusionary Units, and this Agreement is not intended to and shall not be construed to permit an exception from state or local laws as applied -15- 17y 12 001 »\-J2(,.SSS>8 I DOC #2025-0014129 Page 16 of 44 to the Market Rate Units. Owner is solely responsible for compliance with all obligations under local, state or federal laws governing the rental of all units on the Property. 9.3 City shall have the right to inspect the Property and the Inclusionary Units for purposes of assuring compliance with this Agreement during normal business hours on not less than seventy-two (72) hours written notice. 9.4 Owner shall comply with manuals prepared by the City pursuant to Section 18.230.090 that implement the City's Inclusionary Housing Ordinance (Redlands Municipal Code Chapter 18.230). 10. Termination. This Agreement shall become null and void shall: (i) the City deny the Project entitlements, or (ii) the Project entitlements are voided, cancelled, terminated, expire or new entitlements, not related to the Project, are approved for the Property; provided, however, this Agreement shall apply to any units constructed for the Project under the entitlements. Owner shall notify City, in writing, of Owner's intent to terminate this Agreement under this Section 10. 11. Indemnification. Owner shall defend (with counsel of City's choosing and the reasonable consent of Owner, which may be joint defense counsel upon City's and Owner's consent, in each of their sole and absolute discretion), indemnify and hold harmless City and City's officers, officials, agents, employees, representatives, and volunteers (each, an "Indemnitee") from and against any loss, damage, costs, expenses, liability, claim, or judgment (collectively, "claims") relating in any manner to the Property or the Project, or the approval of or performance this this Agreement, except to the extent any such claims are caused by the gross negligence or willful misconduct of an Indemnitee. 12. Insurance. Upon completion of construction of the Project and in no event later than the date upon which the first Unit has received all required occupancy permits from City and for the duration of the Term of this Agreement, Owner shall procure and keep in full force and effect, or cause to be procured and kept in full force and effect for the mutual benefit of Owner and City, and shall provide City evidence reasonably acceptable to City, of insurance policies meeting the minimum requirements set forth in this Section 11: 12.1 Commercial General Liability Insurance. Commercial General Liability insurance with respect to the Property and the operations of or on behalf of Owner, in an amount not less than Two Million Dollars ($2,000,000.00) per occurrence combined single limit including products, completed operations, contractual, bodily injury, personal injury, death and property damage liability, subject to such increases in amount as City may reasonably require from time to time, provided, that the percentage increase in coverage shall not be required to exceed the percentage increase in the Consumer Price Index published by the United States Department of Labor, Bureau of Labor Statistics, for Urban Wage Earners and Clerical Workers, Los Angeles -Long Beach - Anaheim Average, All Items (1984 = 100) (the "Index"), from and after the date of this Agreement, or, if said Index is discontinued, such official index as may then be in -16- 17912 HH I t_26888>N I DOC #2025-0014129 Page 17 of 44 existence and which is most nearly equivalent to said Index (the "CPI Adjustment"). Unless otherwise approved in advance by City, the insurance to be provided by Owner may provide for a deductible or self -insured retention of not more than Ten Thousand Dollars ($10,000.00), with such maximum amount to increase at the same rate as the periodic increases in the minimum amount of total insurance coverage set forth above. City and its officers, officials, employees, volunteers, agents, and representatives shall be named as additional insureds under such policy or policies. 12.2 All -Risk Property Insurance. With respect to the improvements and any fixtures and furnishings to be owned or leased by Owner on the Property, property insurance covering all perils included within the classification of fire, extended coverage, vandalism, malicious mischief, special extended perils ("all risk" or "special causes of loss," as such terms are used in the insurance industry),with the standard form fire insurance coverage in an amount equal to full actual replacement cost thereof, as the same may change from time to time. The above insurance policy or policies shall include coverage for earthquakes to the extent generally and commercially available at commercially reasonable rates, if such insurance is generally obtained for rental apartment projects of this size and type in San Bernardino County, California. City shall be a loss payee under such policy or policies and such insurance shall contain a replacement cost endorsement. 12.3 General Insurance Requirements. A copy of each paid -up policy evidencing such insurance (appropriately authenticated by the insurer) or a certificate of the insurer, certifying that such policy has been issued, providing the coverage required herein, and containing the provisions specified herein, shall be delivered to City within five (5) days after the date of this Agreement, and thereafter, upon renewals, not less than thirty (30) days prior to the expiration of coverage. Owner shall provide written notice to City in the event of the cancellation of any policy within thirty (30) days of such cancellation. Notice shall be by certified mail, return receipt requested. City may, at any time, and from time to time, inspect and/or copy any and all insurance policies required to be procured by Owner hereunder. In no event shall the limits of any policy be considered as limiting the liability of Owner hereunder. In addition to the requirements set forth in this Section 11, each insurance policy required to be carried by Owner pursuant to this Agreement: (i) shall be primary insurance and not contributory with any other insurance which City or its officers, officials, employees, volunteers, agents, or representatives may have; (ii) shall contain no special limitations on the scope of protection afforded to City or its officers, officials, employees, volunteers, agents, and representatives; (iii) shall be "per occurrence" rather than "claims made" insurance; -17- 179d''__001 »\42688858.1 DOC #2025-0014129 Page 18 of 44 (iv) shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability; (v) shall provide that the policy will not be cancelled by the insurer or Owner unless there is a minimum of thirty (30) days (10 days for nonpayment of premium) prior written notice by certified mail, return receipt requested to City; (vi) shall be written by a California licensed insurer with a Best rating of not less than ANIL, (vii) shall be endorsed to state that any failure to comply with the reporting provisions of the policies shall not affect coverage provided to City and its officers, officials, employees, volunteers, agents, and representatives; and (viii) shall contain a waiver by the insurer of any right to subrogation against City, and its officers, officials, employees, volunteer and agents, which arises or might arise by reason of any payment under such policy or policies or by reason of any act or omission of City or its officers, officials, members, employees, agents, or representatives. 13. Repair of Damage. If any improvements on the Property shall be totally or partially destroyed or rendered wholly or partly uninhabitable by fire or other casualty, Owner shall promptly proceed to obtain insurance proceeds and provided the insurance proceeds are sufficient to restore the Property and the insurance proceeds are made available therefor by the secured lenders, take all steps necessary to begin reconstruction and, immediately upon receipt of insurance proceeds, to promptly and diligently commence the repair or replacement of the improvements to substantially the same condition as the improvements are required to be maintained pursuant to this Agreement, and Owner shall complete the same as soon as possible thereafter so that the Project can continue to be operated and occupied in accordance with this Agreement. In no event shall the repair, replacement, or restoration period exceed three (3) years from the date of the destruction subject to events of force majeure unless City, in its reasonable discretion, approves a longer period of time. 14. Assignment and Transfer by Owner. With the exception of individual leases entered into between Owner and Eligible Tenants that comply with the terms of this Agreement, Owner shall: (i) notify City in writing of any proposed sale, transfer, or assignment of all or any portion of the Property, and (ii) deliver to City an assignment and assumption agreement (or other agreement) executed by Owner and its transferee/assignee pursuant to which Owner's transferee/assignee has agreed to assume all of Owner's covenants and obligations set forth herein in such form as reasonably approved by City. -18- 1 T)42.001 i5A43hS8858 1 DOC #2025-0014129 Page 19 of 44 14.1.1 Release of Assigning Owner. Upon any sale, transfer, or assignment that complies with the provisions of this Section 14, City shall deliver to Owner upon request a release in writing by City, which release shall be provided by City upon the full satisfaction by Owner of the following conditions: (a) Owner no longer has a legal or equitable interest in the Property or Project. (b) Owner is not then in default under this Agreement. (c) Owner has provided to City and City has reasonably approved written evidence of the assignment and assumption of the rights, duties and obligations arising under or from this Agreement. 14.1.2 Subsequent Assignment. As used in this Agreement, the term "Owner" shall be deemed to include any such transferee or assignee after the date such sale, transfer, or assignment occurs in compliance with this Agreement.. 15. Defaults and Remedies. 15.1 Defaults. The failure or delay by either Party to perform any term or provision of this Agreement shall constitute a default. Except where a shorter period of time is specified in this Agreement, the defaulting Party shall have thirty (30) days after receipt of written notice from the other Party specifying the nature of the default to cure, correct or remedy the default, or for defaults that cannot reasonably be cured, corrected, or remedied within such thirty (30) day time period, the defaulting Party shall have thirty (30) days after receipt of the notice to commence to cure such failure or delay and shall diligently prosecute such cure, correction or remedy to completion within an additional sixty (60) days following the conclusion of such thirty (30) day period (for a total of ninety (90) days). Failure or delay in giving such notice shall not constitute a waiver of any default, nor shall it change the time of default. Except as required to protect against further damages, the injured Party may not institute legal proceedings against the Party in default until expiration of the cure period. 15.2 Liquidated Damages for Certain Defaults; Remedy For Excessive Rent Charge. It shall constitute a default for Owner to charge or accept for any Inclusionary Unit rent amounts in excess of the Affordable Rent. In the event that Owner charges or receives such higher rental amounts, in addition to any other equitable remedy City shall have for such default, Owner shall be required to pay to City an amount equal to two times the difference between the Affordable Rent that should have been charged and the amount of the rent received from the tenant. It shall also constitute a default for Owner to knowingly (or without investigation as required herein) initially rent any Inclusionary Unit to a tenant who is not an Eligible Tenant. In the event Owner violates this provision, in addition to any other equitable remedy City shall have for such default, Owner, for each separate violation, shall be required to pay to City an amount equal to (i) two times the total rent Owner received from such ineligible tenant, plus (ii) any relocation expenses incurred by City as a result of Owner having rented to such ineligible 17912 00 1 DOC #2025-0014129 Page 20 of 44 person. All amounts paid to City pursuant to this Section 15.2 shall be deposited into City's Inclusionary Housing Fund. THE PARTIES HERETO AGREE THAT THE AMOUNTS SET FORTH IN THIS SECTION 15.2 (THE "DAMAGE AMOUNTS") CONSTITUTE A REASONABLE APPROXIMATION OF THE ACTUAL DAMAGES THAT CITY WOULD SUFFER DUE TO THE DEFAULTS BY OWNER SET FORTH IN THE FIRST PARAGRAPH OF THIS SECTION 15.2, CONSIDERING ALL OF THE CIRCUMSTANCES EXISTING ON THE EFFECTIVE DATE OF THIS AGREEMENT, INCLUDING THE RELATIONSHIP OF THE DAMAGE AMOUNTS TO THE RANGE OF HARM TO CITY AND ACCOMPLISHMENT OF CITY'S PURPOSE OF PROVIDING AFFORDABLE HOUSING TO ELIGIBLE TENANTS THAT REASONABLY COULD BE ANTICIPATED AND THE ANTICIPATION THAT PROOF OF ACTUAL DAMAGES WOULD BE COSTLY OR INCONVENIENT. THE AMOUNTS SET FORTH IN THIS SECTION 15.2 SHALL BE THE SOLE MONETARY DAMAGES REMEDY FOR THE DEFAULTS SET FORTH IN THIS SECTION 15.2, BUT NOTHING IN THIS SECTION 15.2 SHALL BE INTERPRETED TO LIMIT CITY'S REMEDY FOR SUCH DEFAULT TO OTHER REMEDIES FOR NON - MONETARY DAMAGES TO ENFORCE COMPLIANCE WITH THIS AGREEMENT. IN PLACING ITS INITIAL AT THE PLACE PROVIDED HEREIN BELOW, OWNER SPECIFICALLY CONFIRMS THE ACCURACY OF THE STATEMENTS MADE ABOVE AND THE FACT THAT IT HAS BEEN REPRESENTED BY COUNSEL WHO HAS EXPLAINED THE CONSEQUENCES OF THE LIQUIDATED DAMAGES PROVISION AT OR PRIOR TO THE TIME EACH EXECUTED THIS AGREEMENT. OWNER'S INITIALS: Dmr== Notwithstanding anything herein to the contrary, in the event Owner charges an Eligible Tenant of an Inclusionary Unit more than the Affordable Rent, to the extent the tenant from whom Owner charged the excess rent still resides in the Project at the time City discovers this violation, or Owner knows the location of such tenant, Owner shall, in lieu of paying damages to City as described in this Section 15.2 above, refund the tenant the entire amount of excess rent charged to such tenant, calculated with compound interest at the lesser of the maximum legal rate or ten percent (10%). Owner shall provide evidence to City that such payment has been made, within thirty (30) days after City provides notice to Owner of the default hereunder. 16. Legal Actions. 16.1 Specific Performance. Subject to notice and cure provisions in Section 15.1 above, either party shall be permitted, but not obligated, to commence an action for specific performance of the terms of this Agreement, or to cure, correct or remedy any default hereunder or to obtain any other legal or equitable remedy consistent with the purpose of this Agreement. City shall also have the right to pursue damages for Owner's defaults but in no event shall Owner be entitled to damages of any kind from City, including, without limitation, damages for economic loss, lost profits, or any other economic or consequential damages of any kind. -20- 17942.00155\42 688 8 58.1 DOC #2025-0014129 Page 21 of 44 16.2 Institution of Legal Actions; Attorney's Fees and Costs. Any legal actions must be instituted in the Superior Court of the County of San Bernardino, State of California, or in any other court in that county. In the event of any litigation between the Parties hereto, the prevailing Party shall be entitled to receive, in addition to the relief granted, its reasonable attorney's fees (provided, however, that the attorneys' fees awarded pursuant to this Section shall not exceed the hourly rate paid by City for legal services multiplied by the reasonable number of hours spent by the prevailing Party in the conduct of the litigation) and costs and such other costs incurred in investigating the action and prosecuting the same, including costs for expert witnesses, costs on appeal, and for discovery. 16.3 Applicable Law; Interpretation. The internal laws of the State of California shall govern the interpretation and enforcement of this Agreement, without regard to conflict of law principles. This Agreement shall be construed according to its fair meaning and as if prepared by both of the Parties hereto. 16.4 Acceptance of Service of Process. In the event that any legal action is commenced by the Owner against the City, service of process on the City shall be made in such manner as provided bylaw. In the event that any legal action is commenced by the City against the Owner, service of process on the Owner shall be made by personal service upon any officer or director of the Owner or via Owner's registered service agent, and shall be valid whether made within or without the State of California or in such other manner as may be provided by law. 16.5 Rights and Remedies Are Cumulative. Except as otherwise expressly stated in this Agreement, the rights and remedies of the Parties are cumulative, and the exercise by either Party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other Party. 17. Miscellaneous. 17.1 Entire Agreement. This Agreement and all of the exhibits and attachments hereto and thereto set forth and contain the entire understanding and agreement of the Parties, and there are no oral or written representations, understandings or ancillary covenants, undertakings or agreements which are not contained or expressly referred to herein or therein. No testimony or evidence of any such representations, understandings or covenants shall be admissible in any proceeding of any kind or nature to interpret or determine the terms or conditions of this Agreement. 17.2 Assignment by City. City shall have the right, in its sole and absolute discretion, to assign its interests in this Agreement without Owner's approval to a non- profit organization of its choosing. City shall provide notice to Owner of any such assignment. 17.3 Severability. If any term, provision, covenant or condition of this Agreement shall be determined invalid, void or unenforceable, the remainder of this -21- 17942.0015 �\426888i8-1 DOC #2025-0014129 Page 22 of 44 Agreement shall not be affected thereby to the extent such remaining provisions are not rendered impractical to perform taking into consideration the purposes of this Agreement. 17.4 Notices. 17.4.1 Delivery. As used in this Agreement, "notice" includes, but is not limited to, the communication of notice, request, demand, approval, statement, report, acceptance, consent, waiver, appointment or other communication required or permitted hereunder. All notices shall be in writing and shall be considered given either: (i) when delivered in person to the recipient named below; or (ii) on the date of delivery shown on the return receipt, after deposit in the United States mail in a sealed envelope as either registered or certified mail with return receipt requested, and postage and postal charges prepaid, and addressed to the recipient named below; or (iii) two (2) days after deposit in the United States mail in a sealed envelope, first class mail and postage prepaid, and addressed to the recipient named below; or (iv) one (1) day after deposit with a known and reliable next -day document delivery service (such as FedEx), charges prepaid and delivery scheduled next -day to the recipient named below, provided that the sending Party receives a confirmation of delivery from the delivery service provider. All notices shall be addressed as follows: If to CITY: City of Redlands 35 Cajon Street Redlands, California 92373 Attn: City Manager Lugonia Park Associates, LLC If to OWNER: P.O. Box 542 Loma Linda, CA 92354 Attn: Daniel Kunihira 17.4.2 Change of Address. Either Party may, by notice given at any time, require subsequent notices to be given to another person or entity, whether a Party or an officer or representative of a Party, or to a different address, or both. Notices given before actual receipt of notice of change shall not be invalidated by the change. 17.5 Section Headings. All section headings and subheadings are inserted for convenience only and shall not affect any construction or interpretation of this Agreement 17.6 Singular and Plural. As used herein, the singular of any word includes the plural, and vice versa, as context so dictates. Masculine, feminine, and neuter forms of any word include the other as context so dictates. 17.7 Joint and Several Obligations. If at any time during the term of this Agreement the Property and/or Project is owned, in whole or in part, by more than one -22- 17942.0015�A 42688858. 1 DOC #2025-0014129 Page 23 of 44 Owner, all obligations of such Owner under this Agreement shall be joint and several, and the default of any such Owner shall be the default of all such Owners. 17.8 Computation of Days. Unless otherwise specified in this Agreement, the term "days" shall mean calendar days. 17.9 Waiver. Failure by a Party to insist upon the strict performance of any of the provisions of this Agreement by the other Party, or the failure by a Party to exercise its rights upon the default of the other Party, shall not constitute a waiver of such Party's right to insist and demand strict compliance by the other Party with the terms of this Agreement thereafter. 17.10 Mutual Covenants. The covenants contained herein are mutual covenants and also constitute conditions to the concurrent or subsequent performance by the Party benefited thereby of the covenants to be performed hereunder by such benefited Party. 17.11 Project as Private Undertaking. It is specifically understood and agreed by and between the Parties hereto that the development of the Project is a private development, that neither Party is acting as the agent of the other in any respect hereunder, and that each Party is an independent contracting entity with respect to the terms, covenants, and conditions contained in this Agreement. No partnership, joint venture, or other association of any kind is formed by this Agreement. The only relationship between City and Owner is that of a government entity regulating the development of private property and the Owner of such property. 17.12 Successors in Interest. The burdens of this Agreement shall be binding upon, and the benefits of this Agreement shall inure to, all successors in interest to the Parties to this Agreement. All provisions of this Agreement shall be enforceable as equitable servitudes and constitute covenants running with the land. Each covenant to do or refrain from doing some act hereunder with regard to development of the Property: (a) is for the benefit of and is a burden upon every portion of the Property and the Project; (b) runs with the Property and the Project and each portion thereof; and, (c) is binding upon each Party and each successor in interest during ownership of the Property and the Project or any portion thereof. 17.13 Covenants Run with the Land. The Property shall be held, sold, conveyed, hypothecated, encumbered, used, occupied and improved subject to the covenants, conditions, and restrictions set forth herein. The covenants, conditions, restrictions, reservations, equitable servitudes, liens and charges set forth in this Agreement shall run with the Property and shall be binding upon Owner and all persons having any right, title or interest in the Property, or any part thereof, their heirs, and successive owners and assigns, shall inure to the benefit of City and its successors and assigns, and may be enforced by City and its successors and assigns. The covenants established in this Agreement shall, without regard to technical classification and designation, be binding for the benefit and in favor of City and its successors and assigns, and the Parties hereto expressly agree that this Agreement and the covenants herein -23- 17942 001;5\42688858.1 DOC #2025-0014129 Page 24 of 44 shall run in favor of City, without regard to whether City is or remains an owner of any land or interest therein to which such covenants relate. However, all such covenants and restrictions shall be deemed to run in favor of all real property owned by City which real property shall be deemed the benefited property of such covenants and this Agreement shall create equitable servitudes and covenants appurtenant to all real property owned by City and running with the Property in accordance with the provisions of Civil Code Section 1468. Furthermore, all of the covenants, conditions, and restrictions contained herein shall also constitute easements in gross running in favor of City. City is deemed the beneficiary of the terms and provisions of this Agreement and of the covenants running with the land, for and in its own right and for the purposes of protecting the interests of the community and other parties, public or private, in whose favor and for whose benefit this Agreement and the covenants running with the land have been provided. Owner hereby declares its understanding and intent that the burden of the covenants set forth herein touch and concern the land and that the Owner's interest in the Property is rendered less valuable thereby. Owner hereby further declares its understanding and intent that the benefit of such covenants touch and concern the land by enhancing and increasing the enjoyment and use of the Property by the residents of City and by furthering the health, safety, and welfare of the residents of City. Owner hereby further declares its understanding that the covenants set forth in this Agreement are required by Chapter 18. of the Redlands Municipal Code to run with the land and the Property and Project for the duration of the Term. 17.14 No Subordination. City's approval of the necessary land use entitlements that authorize Owner to develop, operate, and maintain the Project was based upon Owner's obligation to provide no less than the twenty (20) Inclusionary Units pursuant to the terms and conditions of this Agreement. During the Term, this Agreement shall have priority over any and all mortgages, deeds of trust, and other similar forms of secured financing recorded against the Property or any portion thereof. 17.15 Further Actions and Instruments. Each of the Parties shall cooperate with and provide reasonable assistance to the other to the extent contemplated hereunder in the performance of all obligations under this Agreement and the satisfaction of the conditions of this Agreement. Upon the request of either Party at any time, the other Party shall promptly execute, with acknowledgment or affidavit if reasonably required, and file or record such required instruments and writings and take any actions as may be reasonably necessary under the terms of this Agreement to carry out the intent and to fulfill the provisions of this Agreement or to evidence or consummate the transactions contemplated by this Agreement. City hereby authorizes City Manager to take such other actions and negotiate and execute any additional agreements as may be necessary or proper to fulfill the City's obligations under this Agreement. The City Manager may delegate her or his powers and duties under this Agreement to an authorized management level employee of the City. 17.16 Third Party Beneficiaries. The Parties acknowledge and agree there are no third party beneficiaries of this Agreement. City shall have full right and ability to enforce each and every covenant and restriction in this Agreement. No other person or entities shall have any right of action hereunder. -24- 17912.001Ii A-I'osss>> I DOC #2025-0014129 Page 25 of 44 17.17 Interpretation and Governing Law. This Agreement shall be construed as a whole according to its fair language and common meaning to achieve the objectives and purpose of the Parties hereto, and the rule of construction that ambiguities are to be resolved against the drafting party shall not be employed in interpreting this Agreement. This Agreement and any dispute arising hereunder shall be governed and interpreted in accordance with the laws of the State of California. 17.18 Amendment. Any amendment, change, or modification of this Agreement must be executed in writing and is subject to approval by the City Council, except to the extent the City Manager, or other designee, is authorized to execute any such amendment, change or modification. 17.19 Time of Essence. Time is of the essence in the performance of the provisions of this Agreement as to which time is an element. 17.20 Authority to Execute. The person or persons executing this Agreement on behalf of Owner warrants and represents that he or she/they have the authority to execute this Agreement on behalf of his or her/their corporation, partnership or business entity and warrants and represents that he or she/they has/have the authority to bind Owner to the performance of its obligations hereunder. 17.21 Counterparts. This Agreement may be executed in two or more separate counterparts, each of which, when so executed, shall be deemed to be an original. Such counterparts shall, together, constitute and shall be one and the same instrument. This Agreement shall not be effective until the execution and delivery by the Parties of at least one set of counterparts. The Parties hereunder authorize each other to detach and combine original signature pages and consolidate them into a single identical original. Any one of such completely executed counterparts shall be sufficient proof of this Agreement. [signatures on next page] -25- 179-!3 001 �514268885s_ DOC #2025-0014129 Page 26 of 44 IN WITNESS WHEREOF, City and Owner have caused this instrument to be executed on their behalf by their respective officers or agents herein duly authorized as of the date set forth above. ATTEST: "CITY" CITY OF REDLANDS, a California municipal corporation JW� E Vk%O1 , City Clerk By: -" `'�d`� (HAOES M.D J'R. C y Manager APPROVED AS TO FORM: / G4 lrz�— ette Abich Garcia, City Attorney ATTEST: &Xz� City Clerk "OWNER" Lugonia Park Associates, LLC, a California limited liability company By: �- Dani Kunihir Its: anaqer -26- 179 2 00 DOC #2025-0014129 Page 27 of 44 CALIFORNIA ACKNOWLEDGEMENT CIVIL CODE § 1189 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of San Bernardino On Wednesday, December 4, 2024 before me, Jennifer Macias, Notary Public, personally appeared Charles M. Duggan, Jr., and Jeanne Donaldson, who proved to me on the basis of satisfactory evidence to be the persons whose names are subscribed to the within instrument and acknowledged to me that they executed the same in their authorized capacity, and that by their signatures on the instrument the persons, or the entity upon behalf of which the persons acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Signature 7'natur of Notary Public JENNIFER MACIAS Notary Public - California = San Bernardino County s Commission ' 23a&at3 `"�""�" My Comm. Expires Dec 31, 2025 (Seal) Copyright © 2018 NotaryAcknowledgement.com. All Rights Reserved. DOC #2025-0014129 Page 28 of 44 ------------ --------------------- - A Notary Public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity ofthat document. State of California County of San Bernardino On M oatP a '� , before me, VIM- Z . Notary Public, personally appeared AWACk V ivy k KrA , who proved to me on the basis of satisfactory evidence to be the person(s) whose name(�j is/a,6 subscribed to the within instrument and acknowledged to me that he/sKe/tiley executed the same in his/hKr/tl-kir authorized capacity(i¢<,), and that by his/lVr/thZir signatur*) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. certify under PI'NALTY OF IIER.IURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and ficial seal. Signature (Seal) ALICIA DW Notary Public - Calif omla ■i San Bernardino County S Commission N 2417756 *.y Comm. Expires Sep 23, 2026 179-12 001 i>'426888>S 1 DOC #2025-0014129 Page 29 of 44 ATTACHMENT 1 LEGAL DESCRIPTION OF PROPERTY Description For APN/Parcel ID(s): 0167-171-15-0-000 THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA AND IS DESCRIBED AS FOLLOWS: PARCEL 1: BEING A PORTION OF THE SOUTH HALF OF THE NORTHEAST QUARTER OF SECTION 21, TOWNSHIP 1 SOUTH, RANGE 3, WEST SAN BERNARDINO MERIDIAN, IN THE CITY OF REDLANDS, COUNTY OF SAN BERNARDINO, STATE OF CALIFORNIA, ACCORDING TO THE OFFICIAL PLAT THEREOF, SAID PORTIONS BEING DESCRIBED AS PARCELS 1 AND 2 OF THAT CERTAIN DEED TO LUGONIA PARK ASSOCIATES, A CALIFORNIA LIMITED LIABILITY COMPANY, RECORDED APRIL 11,1984 AS INSTRUMENT NO. 84-083715, OFFICIAL RECORDS OF SAID COUNTY, DESCRIBED AS FOLLOWS: BEGINNING AT THE NORTHWEST CORNER OF SAID PARCEL 2, SAID CORNER BEING A POINT OF INTERSECTION BETWEEN THE NORTHWEST CORNER OF THE SOUTH HALF OF THE NORTHEAST QUARTER OF SAID SECTION 21, AND THE EASTERLY LINE OF THAT CERTAIN PARCEL OF LAND CONVEYED TO THE STATE OF CALIFORNIA BY DEED RECORDED AUGUST 08, 1975 IN BOOK 9745, PAGE 592 AND RE RECORDED AUGUST 08, 1979 IN BOOK 9745, PAGE 595, OFFICIAL RECORDS OF SAID COUNTY, SAID POINT BEING DISTANT SOUTH 89047'47" EAST 8.23 FEET (8.22 FEET PER SAID DEEDS); THENCE CONTINUING ALONG THE NORTHERLY LINE OF SAID SOUTH HALF AND SAID PARCELS 1 AND 2 SOUTH 89047'47" EAST 816.41 FEET TO THE NORTHEAST CORNER OF SAID PARCEL 1; THENCE LEAVING THE NORTHERLY LINE OF SAID SOUTH HALF AND ALONG THE EASTERLY LINE OF SAID PARCEL 1 SOUTH 00018'33" EAST 717.50 FEET; THENCE LEAVING SAID EASTERLY LINE AT RIGHT ANGLES SOUTH 89041:27" WEST 770.55 FEET TO A POINT ON THE WESTERLY LINE OF SAID PARCEL 2, SAID WESTERLY LINE ALSO BEING THE EASTERLY LINE OF SAID STATE OF CALIFORNIA PARCELS, SAID WESTERLY AND EASTERLY LINES ALSO BEING THE BEGINNING OF A NON -TANGENT CURVE CONCAVE EASTERLY, AND HAVING A RADIUS OF 1200.00 FEET, A RADIAL LINE TO SAID POINT THAT BEARS NORTH 72019'31" EAST; THENCE ALONG THE WESTERLY LINE OF SAID PARCEL 2 AND SAID EASTERLY LINE STATE OF CALIFORNIA PARCELTHE FOLLOWING TWO (2) COURSES: 1.) THENCE NORTHERLY ALONG THE ARC OF SAID 1200.00 FOOT RADIUS CURVE THROUGH A CENTRAL ANGLE OF 18048'40", AN ARC DISTACNE OF 393.98 FEET; 17942 001»\16888�8.1 DOC #2025-0014129 Page 30 of 44 2.) THENCE TANGENT TO SAID CURVE NORTH 01 °08'11" EAST 336.47 FEET TO THE POINT OF BEGINNING. SUBJECT TO ALL COVENANTS, RIGHTS, DEDICATIONS, RIGHTS -OF -WAY AND EASEMENTS OF RECORD. THE ABOVE DESCRIBED PARCEL OF LAND CONTAINS 13.48 ACRES, MORE OR LESS PURSUANT TO CERTIFICATE OF COM 19, 2023 AS INSTRUMENT NO. 2023-0013742 OF OFFICIAL RECORDS. 17942.00155'1268381 9 1 DOC #2025-0014129 Page 31 of 44 TTACHMENT 2 MEDIAN INCOME AND EXAMPLE OF CALCULATION OF AFFORDABLE RENT — 2024 2024 Median Income �- Household Size ;A 3 4 ' 5 Median (100%) $68,250 $78,000 $87,750 S97,500 S105,300 Example of Affordable Rent Calculation For purposes of determining Affordable Rent for the Inclusionary Units, Owner shall comply with Health and Safety Code Section 50053(b)(2) and (b)(4) and Section 6918 of Title 25 of the California Code of Regulations (as enacted as of the Effective Date of this Agreement). For purposes of determining Affordable Rent, Owner shall use an average of estimated housing costs for the next twelve (12) months, which shall include all of the following: • Use and occupancy of a housing unit and land and facilities associated therewith. Any separately charged fees or service charges assessed by the lessor which are required of all tenants, other than security deposits. Should utilities* be paid separately by the tenant, the costs of those utilities, as set forth in the most recent utility allowance schedule issued by the San Bernardino County Development Authority. *Utilities referenced in the utility allowance schedule include garbage collection, sewer, water, electricity, gas, and other heating, cooking, and refrigeration fuels, but do not include telephone and cable service. If applicable, possessory interest taxes or other fees or charges assessed for use of the land and facilities associated therewith by a public or private entity other than the lessor. In explanation of the foregoing, Table 1 shows the maximum monthly gross rental housing payment pursuant to Health and Safety Code Section 50053(b)(3) for Very Low Income Households. The gross monthly cost for Very Low Income Households is the product of 30 percent times 50 percent of the San Bernardino County Area Median Income adjusted for household size appropriate to the unit.' I "Adjusted for household size appropriate to the unit' shall mean for a household of -3- 179 42 001»\12688858.1 DOC #2025-0014129 Page 32 of 44 Table 1 Should utilities or other costs listed above be paid separately by the tenant, these costs shall be deducted from the above maximum monthly payment to arrive at the net rental payment for the unit. City shall provide Owner with a maximum Affordable Rent chart on an annual basis. 2024 Very Low -Income Units Gross Monthly Housing Payment Renting a studio unit, payment may not exceed $853.13 Renting a 1 bedroom unit, payment may not exceed $975.00 Renting a 2 bedroom unit, payment may not exceed $1,096.88 Renting a 3 bedroom unit, payment may not exceed $1218.75 one person in the case of a studio unit, twc three persons in the case of a two -bedroom bedroom unit. persons in the case of a one -bedroom unit, unit, and four persons in the case of a three- -4- 179t20015�`,1_6ti,8S» I DOC #2025-0014129 Page 33 of 44 ATTACHMENT 3 INCLUSIONARY HOUSING PLAN Developer's Proiect Narrative The Project shalt comply with applicant's Project Description, dated January 30, 2024, which provides as follows: The proposed project is approximately 13.48 gross acres located northeast of the intersection at Tennessee Street and Lugonia Avenue in the City of Redlands. The project site is currently part of the East Valley Corridor Specific Plan with a land use designation of EV/SD or Special Development District. Currently, the site is vacant land, vegetated by non-native grass. The proposed project is a mixed -use development with 460 apartment units and approximately 17,899 square feet of commercial space. The proposed project design comprises of ten buildings. The project incorporates several mix -used buildings with ground floor commercial space and residential units above. There will be six live/work lofts that incorporate retail/office in the bottom story and a residential unit in the second story. We are proposing 5% of the units be very low-income which allows for a 20% density bonus in accordance with the "California Density Bonus Law," revised in January of 2021. These very low-income units will be spread throughout the project to create a cohesive project that doesn't separate the market rate with the very low- income units. The residential portion of the project consists of 460 apartment units. There is a combination of three- and four-story buildings with residential units occupying each. Units will range in size from one -bedroom to athree-bedroom unit. The three-story buildings will be designed as a walk up while the four story buildings will have stairs and elevators. The architecture of the site, both residential and commercial, combine elements of modern industrial and neoclassical design styles. The commercial space will be located at the base of buildings eight and ten. The aim of the space is to create a walkable environment for residents to have easy access to goods and services as well as travel to the proposed commercial project to the south. At this stage of the project there are no identified uses/activities for the commercial components. With a total of approximately 17,899 square feet of commercial, using a range of 200-700 square Peet per employee, the project's commercial component can anticipate creating 25 to 89 jobs. Parking encompasses a combination of underground, garage, outdoor covered, outdoor uncovered, and commercial parking spaces throughout the project. There are 673 residential parking spaces offered, and 91 commercial spaces totaling 764 spaces. Residential parking is secured through the implementation of gates offering security and separation from the commercial space. 'The parking and street immediately surroundin" building ten will be publicly accessible and connect to the commercial project proposed to the south. There are three points of entry into the project: the entry points are located off Tennessee Street, Pennsylvania Avenue, and the future commercial development to the south. 17942 001 »\426898-55_ 1 DOC #2025-0014129 Page 34 of 44 There are approximately 190.098 square feet of common/private open space proposed. Current proposed outdoor amenities include a walk-throuUh linear park leading to a resort style pool in the center of the project as well as many other open space areas. Additionally, building nine will hold leasing offices, foyer, mail room and other amenities that may include office/meeting spaces, kitchen, movie theater, rooftop bar, etc. Developer's Phasing Plan for Timely Development of Inclusionary Units lithe market rate units are constructed in phases, a pro rata share of the rental Inclusionary Units obligation must be constructed prior to or concurrently with each phase of the market rate Residential Development. The developer shall not be able to obtain, and the City will not grant, a certificate of occupancy for any units on the subsequent phase of the Residential Development until the required rental Inclusionary Units are completed for the prior phase. Inclusionary Unit Information Inclusionary Units Building Phase Floor Bedroom # of Units Average SF 1 2 3 1- 1 755 2 2 4 1 1 755 2 2 1 1 755 3 2 2 1097 1-1 3 1 1-342 5 2 2 2 1 1,097 6 2 2 2 1 1,097 t 2 3 1 1 755 2 2 1 1,097 $Ii 1 3 -1 2 755 9 1 2 1 3 755 2 1 1,097 10 1 3 1 1 766 2 2 1 1,139 11 1 1 1 1 766 4 2 1 1,097 Total Inclusionary Units 20 Developer shall comply with Site Plan Attached hereto. 17942001�Y,42w 8S 8 1 DOC #2025-0014129 Page 35 of 44 SITE PLAN [Attached] -J- 1 7941 00 1 j5A426888>R_ 1 DOC #2025-0014129 Page 36 of 44 SITE PLAN TENNESSEE ST. o, — JC AZ a 1 w — Gi A z AJ 1 r O 4 �1 ni I I , � � - i 1 co Z c i _ I WC Az II 1 ti, - C) wc A Z II W cn 1 1JL I co� v 1 ' 1 Iw— ;0Z r n ' 1 (p I �: ~ I I N UZ I A � W C A Z ~ co 1 � � C pC p � C 1 II-- LL..�..�..�_...... �z �z �z ................................. DOC #2025-0014129 Page 37 of 44 ATTACHMENT 4 TENANT INCOME CERTIFICATION FORM AND QUESTIONNAIRE (Attached 179 ' 001>S,-126XS8; 8 1 DOC #2025-0014129 Page 38 of 44 TENANT INCOME CERTIFICATION I` I fective Date: ❑ Initial Certification El Is' Recertification ElOther Move -in Date: (MM/DD/YYYY) PART I - DEVELOPMENT DATA Property Namc: ___ _ County: BIN #: Address: Unit Number: # Bedrooms: PART IL IIOIISEHOLD COMPOSITION 1111 First Dame & Middlc Relationship to I lead Date of [firth F/T Student Social Security Mhlr?I Last Name Initial of household (MM/DD/YYYY) (Y or N) or Alien Res. No. HEAD l -- - - 3 4 5 6 - 7 L- -- - -- - — -- - --1 PART III. GROSS ANNUAL INCOME (USE ANNUAL AMOUNTS) I II I (A) (13) (C) (D) Mbr 9 f Fmplo� mcnt or Wages Soc. Security/Pensions Public Assistance -- _ Other Income -- Add totals from (A) through (D), above TOTAL INCOME (E): $ PART IV. INCOME FROM ASSETS I Ishld (I') (G) (11) (I) Mbr 9 I'ype of'Asset Of Cash Value of Asset Annual Income from Asset - - - -- TOTALS: Lntcr Column (h) Iotul Passbook Rate Ifovcr fi500o S N .06'N, _ (.I) Imputed b1COMe $ Doter the greater of the total ufa>lunut I, or J: imputed income COTAL INCOME FROM ASSE FS (K) S F_ (L) 'Total Annual Household Income from atl Sources Add (E) + (K)] $ F 110USEHOLD CERTIFICATION & SIGNATURES File inlixntauon on this form kill he uxd to determine ntasinnun income eligihility- 1/we have provided for cash person(s) set forth in Part If acceFtable verification of current anticipated annual income I/\%c agree to nonfN the landlord immediately upon any member ofthc household moving out of -the unit or any new member moving in I/%cc asrec to notify the landlord immcdhatek upon and memhen cCanning a full tune student Under pcnaltiC ofperjun . ih�c ceiuK that the information presented in this CCrtllleatlOn is true and accurate to the hest o1 m� /our knowledge and helief I he undersigned further understands that providing lake rcprescntations herein constitutes an act of fraud_ False, misleading or incomplete information may result in the termination ofthe lease agreement. Signature (Date) Signature (Irate) swilaturc (lkue) Sisnalurc (Oa[e) 17942 001>5\42688855_ 1 -2- DOC #2025-0014129 Page 39 of 44 - PART V. DETERMINATION OF INCOME ELIGIBILITY 1(flALANNI Al.IRWSF TOLDINCM11:1 FROM ALL SM R(Ts: From item (I.) on parr I Current Income limit per Familc Size: S I louschold Income at Move -in: Household Size at Move -in: PARTNA. RENT $ Tenant Paid Rcnt_ (lent Assistance: $ Utility Allowance $ Other non -optional charges: $ GROSS REN b FOR UNIT: Unit Meets Rent Restriction at: Low hicome Moderate Income Net Rent (Gross Rent minus Utility Allowance, minus Other Non -Optional Charges) for this unit: $ PART V11. STUDENT STATUS ARE ALL OCCUPANTS FULL TIME S YUDLN I S? ❑ yes ❑ no I Tyes, Enter student explanation* (also attach documentation) Later 1-5 SIGNATURE OF OWNER/REPRESENTATIVE *Student Explanation: 1 AI'DC / "T'ANF Assistance 2 Job "braining Program 3 Single Parent/Dependent Child 4 Married/Joint Return 5 Former Foster Care Based on the representations herein and upon the prools and documentation required to be submitted, the individual(s) named in Part 11 of this l'enant Income Certification is/are eligible under the provisions obSection 42 ofthe Internal Revenue Code, as amended, and the Land Use Restriction Agreement (inapplicable), to live in a unit in this Project. SIGNA TURD OF 0WNEIZ/RLPRF:SEN'1'A HVF DM F, 1794200155\42688SSfS 1 i benant Income l'CrtIIIGnIOn (June 2020) DOC #2025-0014129 Page 40 of 44 INSTRUCTIONS FOR COMPLETING TENANT INCOME CERTIFICATION This.form is to be completed by the otrner or an authorized rcpresentcrtive. Part 1 - Development Data Check the appropriate box for Initial Certification (move -in), Recertification (annual recertification), or Other. if Other, designate the purpose of the recertification (i.e., a unit transfer, a change in household composition, or other state -required recertification). Move -in Date Enter the date the tenant has or will take occupancy of the unit. Effective Date Enter the effective date of the certification. For move -in, this should be the move -in date. For annual recertification. this effective date should be no later than one year from the effective date of the previous (re)certification. Property Name Enter the name of the development. Address Enter the address of the building. Unit Number Enter the unit number. n' Bedrooms Enter the number of bedrooms in the unit. Part If - Household Composition List all occupants of the unit. State each household member's relationship to the head of household by using one of the following coded definitions: H - Head of Household S - Spouse A - Adult co -tenant O - Other family member C - Child F - Foster child(ren)/adult(s) L - Live-in caretaker N - None of the above Enter the date of birth, student status, and social security number or alien registration number for each occupant. II'tliere are more them 7 occupants, use an additional sheet of paper to list the remainin, household members and attach it to the certification. Part III - Annual Income See HUD Handbook 4350.3 for complete instructions on verifying and calculating income, including acceptable forms of verification. From the third party verification forms obtained from each income source, enter the gross amount anticipated to be received for the twelve months from the effective date of the (re)certification. Complete a separate line for each income -earning member. List each respective household member number from Part II. Include anticipated income only if documentation exists verifying pending employment. If any adult states zero -income, please note "zero" in the columns of Part III. COIUnul (A) Enter the annual amount of wages, salaries, tips, commissions, bonuses, and other income froth employment; distributed profits and/or net income from a business. Column (B) Enter the annual amount of Social Security, Supplemental Security Income, pensions, military retirement, cte. Column (C) Enter the annual amount of income received from public assistance (i.e.. fANF, general assistance, disability, etc.). 17Q12 00I55v42(, 8W,8.1 -4- 1enant Income Certilication (June 2020) DOC #2025-0014129 Page 41 of 44 Column (D) Enter the annual amount of alimony, child support, unemployment henelits, or any other income regularly received by the household. Row (E) Add the totals from columns (A) through (D), above. Enter this amount. Part IV - Income from .Assets See HUD Handbook 4350.3 for complete instructions on verifying and calculating income from assets, including acceptable forms of verification. From the third party verification forms obtained from each asset source, list the gross amount anticipated to be received during the twelve months from the effective date of the certification. List the respective household member number fi-om Part If and complete a separate line for each member. Column (F) List the type of asset (i.e., checking account.. savings account, etc.) Column (G) Enter C (for current, if the family currently owns or holds the asset), or I (for imputed, if the family has disposed of the asset for less than fair market value within two years of the effective date of (re)certification). Column (H) Enter the cash value of the respective asset. Column (1) Enter the anticipated annual income from the asset (i.e., savings account balance multiplied by the annual interest rate). TOTALS Add the total of Column (H) and Column (1), respectively. If the total in Column (H) is greater than $5,000, you must do an imputed calculation of asset income. Enter the Total Cash Value, multiply by 10% and enter the amount in (J), Imputed Income. Row (K) Enter the greater of the total in Column (1) or (J) Row (L) Total Annual Household Income From all Sources Add (F) and (K) and enter the total HOUSEHOLD CERTIFICATION AND SIGNATURES After all verifications of income and/or assets have been received and calculated, each household member age 18 or older must sign and date the Tenant Income Certification. For move -in, it is recommended that the Tenant Income Certification be signed no earlier than 5 days prior to the effective date of the certification. Part V— Determination of income Eligibility "Total Annual Household Income Enter the number from item (L). from all Sources Current Income Limit per Family Filter the Current Movc-in Income Limit for the household size. Size Household income at move -in For recertifications, only. Enter the household income from the move -in Household size at move -in certification. On the adjacent line. enter the number of household members from the move -in certification. Household Meets Income Check the appropriate boz for the income restriction that the household meets Restriction according to what is required by the set-aside(s) for the project. Tenant Income Certification (June 2020) 171)42 001»A12688858.1 DOC #2025-0014129 Page 42 of 44 Part VI - Rent Tenant Paid Rent Enter the amount the tenant pays toward rent (not including rent assistance payments such as Section 8). Rent Assistance Enter the amount of rent assistance, if any. Utility Allowance Enter the utility allowance. If the owner pays all utilities, enter zero. Other non -optional charges Enter the amount of non -optional charges, such as mandatory garage rent, storage lockers, charges for services provided by the development, etc. Gross Rent for Unit Enter the total of Tenant Paid Rent plus Utility Allowance and other non -optional charges. Maximum Rent Limit for this unit Enter the maximum allowable gross rent for the unit. Unit Meets Rent Restriction at Check the appropriate rent restriction that the unit meets according to what is required by the set-aside(s) for the project. Part V[I - Student Status If all household members are full time* students, check "yes". If at least one household member is not a full time student, check "no". If "yes" is checked, the appropriate exemption must be listed in the box to the right. If none of the exemptions apply, the household is ineligible to rent the unit. *Full time is determined by the school the student attends. SIGNATURE OF OWNER/REPRESENTATIVE It is the responsibility of the owner or the owner's representative to sign and date this document immediately following execution by the resident(s). The responsibility of documenting and determining eligibility (including completing and signing the Tenant Income Certification form) and ensuring such documentation is kept in the tenant file is extremely important and should be conducted by someone well trained in tax credit compliance. These instructions should not be considered a complete guide on tar credit compliance. The responsibility for compliance with federal program regulations lies with the owner of the building(s) for which the credit is allowable. Tenant Income Certification (June 2020) 179420015542688858.1 -6- DOC #2025-0014129 Page 43 of 44 TENANT INCOME CERTIFICATION QUESTIONNAIRE One Vornt prr Iduh Adcnthcr ofthe Household N:1111(: IICLE:I'IIONI( \l`11 R1:12: Initial ('ertification Add Re -certification h Other Unit 4 INCOME: INFOR:N-I:1I ION YI{S No \lo,A'I III.A Glioss Im oml: 1. Y Y I am scl I'-crnplo%ed. (List nature of sell'employmcnt) (use n_i nlrumc hour scl I -employment only) S 2. Y Y I have a job and receive wages, salary, overtime pay, commissions, fees, tips, bonuses, and/or othercompensation: List the businesses and/or companies that pay you: Name ol'Finplove[ I) $ 2) $ 3 )_ $ 3. Y Y I receive cash contributions ofgifts including rent or utility payments, on an ongoing basis from persons not living with me. 4. Y Y I receive unemployment benefits. 5. Y Y I receive Veteran's Administration, GI Bill, or National Guard/Military benefits/income. 6. Y Y I receive periodic social security payments. $ 7. Y Y The household receives unearned income from family members age 17 or under (example_ Social Security, Trust Fund disbursements, etc.). $ 8. Y Y I receive Supplemental Security Income (SSI). 9. Y Y I receive disability or death benefits other than Social Security. $ 10. Y Y I rcccive Public Assistance Income (examples. TANF, AFDC) 11. Y Y I am entitled to receive child support payments. Y Y I am currently receiving child support payments. $ Ifyes, from how many persons do you receive support? $ Y Y I ain currently making efforts to collect child support owed to Inc. List efforts being made to collect child support. 12. Y Y I receive alimony/spousal support payments 13. Y Y I receive periodic payments from trusts, annuities, inheritance, retirement funds or pensions - insurance policies, or lottery winnings. $_ ll'yes, list sources: I) $ 14. Y Y I receive income from real or personal property- (usc net earned income) ti 15. Y Y Student financial aid (public or private, not including student loans) SHIII;aCI cost oftuition from Aid received `l br Households receiving Section 8 Assistance Only ASSFI I-NEOR,NIAII ON N 1'\ NO INIvm"IIt:\Iv c1,ll\11'(v I(.. Y Y I h;ne a checking:wcnunt(s) Ilvcs- list banks) I -7- 179d2.001 $�A4208XSiS I I Cnant InCnnit' ()uesuonnaire 1 lane ?(12(1) DOC #2025-0014129 Page 44 of 44 17. Y Y 1 have a savings account(s) II ves_ list bank(s) I 2) % $ ---- 18, T y I have an 113I , Dehit Visa, MasterCard account(s). (Including Social Securihwages. Unemployment_ Public Assistance, Disability, Etc .._) IfvCS, list SOurCCS(S) of income hei[I, TCCCIVed/type of account(s) I) 3) 19. T Y I have a revocable lruSt(S) II ves. list hank(s) I) % 20. T Y I own real estate It)es, provide description $ 21. Y Y I own stocks, bonds, or Treasury Bills If yes, list sources/bank names IJ % 2) % $ ;) % $ 22. T Y I have Certificates of Deposit (CD) or Moncy Market Account(s). If yes, list sources/bank names I) % $ 2) % $ 3) % 23. Y T I have an IRA/Lump Sum Pension/Keogh ACCOutlt/401 K. II ves, list hank(s) I) % 2) % $ 24. Y T I have a whole life insurance policy_ Il'yes, how many policies $ 2-5). Y Y I have cash on hand. S 26. Y Y I have disposed ofassets (i e_ gave away money/assets) for less than the fair market value in the past 2 Vcars_ Ii�cs.Iist toms and date disposed_ I) 2) SI t UBV"t SI'AT( TS )ES NO Y Y Dnu the household consist oCal I persons who are hull -time students (Examples: K-12, ('ollcge'IFade School, etc )° T T Doti the houschold consist of all persons v ho have been a 11111-time student 5 months in the current calendar vear' Y T DOCs tour hOUSehold anticipate becoming an all full-time student household in the nest 12 inowils' 11 Vou answered qcs to am of the previous three questions are you: Y T Receiving assistance under Title IV of the Social Security Act (AE)C/T'ANF/Cal \Works - notSSA!SSI ) T T Enrolled in a job training program receiving assistance through the Job Training Participation Act (.I"IPA) or other similar pro<,ram y Y Man ted and f iliac (Of arc entitled to file) a joint tax return Y T Simulc parent with a dependant child or children and neither you nor _V our child(ren) arc dependent ofant)ther Individual Y Y Previoush enrolled in the Poster Care prosratn (cunenth ace 18-24) l,I/.1.L Pl N I rin \ \AIF of V'PI,IC 1\ r/ I v" \Sr Si(;N xTGRF of APP1, 1 C A YI IFFNAN t D:xl F, W1INr:ssr:nif) (Sic:\:xn rr of r:) I)Arr: 17942 UU 1> S 4208WS_ 1