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HomeMy WebLinkAbout2020-03-11 e-packet@7:00Wednesday, March 11, 2020 7:00 PM City of South San Francisco P.O. Box 711 South San Francisco, CA Municipal Services Building, Council Chambers 33 Arroyo Drive, South San Francisco, CA City Council Regular Meeting Agenda March 11, 2020City Council Regular Meeting Agenda PEOPLE OF SOUTH SAN FRANCISCO You are invited to offer your suggestions. In order that you may know our method of conducting Council business, we proceed as follows: The regular meetings of the City Council are held on the second and fourth Wednesday of each month at 7:00 p.m. in the Municipal Services Building, Council Chambers, 33 Arroyo Drive, South San Francisco, California. The City Clerk will read successively the items of business appearing on the Agenda. As she completes reading an item, it will be ready for Council action. RICHARD A. GARBARINO, Mayor MARK ADDIEGO, Vice Mayor MARK NAGALES, Councilmember BUENAFLOR NICOLAS, Councilmember KARYL MATSUMOTO, Councilmember FRANK RISSO, City Treasurer ROSA GOVEA ACOSTA, City Clerk MIKE FUTRELL, City Manager SKY WOODRUFF, City Attorney PLEASE SILENCE CELL PHONES AND PAGERS HEARING ASSISTANCE EQUIPMENT AVAILABLE FOR USE BY THE HEARING IMPAIRED AT CITY COUNCIL MEETINGS In accordance with California Government Code Section 54957.5, any writing or document that is a public record, relates to an open session agenda item, and is distributed less than 72 hours prior to a regular meeting will be made available for public inspection in the City Clerk’s Office located at City Hall. If, however, the document or writing is not distributed until the regular meeting to which it relates, then the document or writing will be made available to the public at the location of the meeting, as listed on this agenda. The address of City Hall is 400 Grand Avenue, South San Francisco, California 94080. Page 2 City of South San Francisco Printed on 5/8/2020 March 11, 2020City Council Regular Meeting Agenda CALL TO ORDER ROLL CALL PLEDGE OF ALLEGIANCE AGENDA REVIEW ANNOUNCEMENTS FROM STAFF PUBLIC COMMENTS For those wishing to address the City Council on any Agenda or non-agendized item, please complete a Speaker Card located at the entrance to the Council Chamber’s and submit it to the City Clerk. Please be sure to indicate the Agenda Item # you wish to address or the topic of your public comment. California law prevents the City Council from taking action on any item not on the Agenda (except in emergency circumstances). Your question or problem may be referred to staff for investigation and/or action where appropriate or the matter may be placed on a future Agenda for more comprehensive action or a report. When your name is called, please come to the podium, state your name and address (optional) for the Minutes. COMMENTS ARE LIMITED TO THREE (3) MINUTES PER SPEAKER. Thank you for your cooperation. COUNCIL COMMENTS/REQUESTS CONSENT CALENDAR Motion to approve the Minutes for the meetings on January 8, 2020 and January 15, 2020. (Rosa Govea Acosta, City Clerk) 1. Report regarding a resolution approving an amendment to the service agreement between the City of South San Francisco and the Town of Colma for Police Communication Services. (Mike Remedios, Police Captain) 2. Resolution approving an amendment to the service agreement between the City of South San Francisco and the Town of Colma for Police Communication Services and authorizing the City Manager to execute the agreement. 2a. Report regarding a resolution approving an amendment to the service agreement between the City of South San Francisco and the City of Pacifica for Police Communication Services. (Mike Remedios, Police Captain) 3. Page 3 City of South San Francisco Printed on 5/8/2020 March 11, 2020City Council Regular Meeting Agenda Resolution approving an amendment to the service agreement between the City of South San Francisco and the City of Pacifica to continue to provide police communications services. 3a. Report regarding adoption of Ordinance to amend Title 2, Chapters 2.52, 2.56, 2.60, 2.62, 2.64, and 2.80, of the South San Francisco Municipal Code pertaining to eligibility requirements for City commissioners. (Rosa Govea Acosta, City Clerk) 4. Ordinance amending Title 2, Chapters 2.52, 2.56, 2.60, 2.62, 2.64, and 2.80, of the South San Francisco Municipal Code pertaining to eligibility requirements for City commissioners. 4a. PUBLIC HEARING Report regarding a resolution approving a Density Bonus and Incentives Request and modifications to previous entitlements for the properties located at 418 Linden Avenue, in the Downtown Transit Core District, and 201-219 Grand Avenue, in the Grand Avenue Core District, and determination that the projects continue to be consistent with the Downtown Station Area Specific Plan Environmental Impact Report, and resolution approving a $1,050,000 Housing Trust Fund loan agreement, resolution approving a $2,450,000 Housing Asset Fund loan agreement, resolutions approving the fourth amendments to the 418 Linden Avenue and 201-219 Grand Avenue Purchase and Sale Agreements, and resolution approving the fourth amendment to the Development Agreement with ROEM Development Corporation. (Billy Gross, Senior Planner and Julie Barnard, Economic Development Coordinator) 5. Resolution making findings and approving amendments to previous entitlements, including a Density Bonus and Incentives Request, at 418 Linden Avenue, in the Downtown Transit Core District, and 201-219 Grand Avenue, in the Grand Avenue Core District, and determination that the projects continue to be consistent with the Downtown Station Area Specific Plan Environmental Impact Report. 5a. Resolution approving the Fourth Amendment to the Development Agreement for 201-219 Grand Avenue and 418 Linden Avenue properties with ROEM Development Corporation. 5b. Resolution approving the Fourth Amendment to the 418 Linden Purchase and Sale Agreement with ROEM Development Corporation 5c. Resolution approving the Fourth Amendment to the 201-219 Grand Avenue Purchase and Sale Agreement with ROEM Development Corporation 5d. Page 4 City of South San Francisco Printed on 5/8/2020 March 11, 2020City Council Regular Meeting Agenda Resolution approving Budget Amendment Number 20.034 which appropriates $2,450,000 from the City of South San Francisco’s Housing Asset Fund (Fund 241) for a developer loan to ROEM Development Corporation for the development of 46 Below Market Rate units and one managers unit at 201-219 Grand Avenue. 5e. Resolution approving Budget Amendment Number 20.033 which appropriates $1,050,000 of the City of South San Francisco’s Housing Trust Fund (Fund 205) as a loan to ROEM Development Corporation for the development of 36 Below Market Rate units and one managers unit at 418 Linden Avenue. 5f. ADMINISTRATIVE BUSINESS Report regarding a resolution of the City Council of the City of South San Francisco proclaiming a local State of Emergency related to the Novel Coronavirus 2019 (COVID-19). (Sharon Ranals, Assistant City Manager) 6. Resolution of the City Council of the City of South San Francisco proclaiming a local State of Emergency related to the Novel Coronavirus 2019 (COVID-19). 6a. Report regarding a Fleet Procurement Policy as it relates to Electric Vehicles (Dave Bockhaus, Deputy Director of Public Works) 7. Study Session regarding conceptual program guidelines for an Employee Down Payment Assistance Program. (Nell Selander, Deputy Director, Economic & Community Development Department) 8. Report regarding an ordinance adding Chapter 8.72 to the South San Francisco Municipal Code Title 8 regulating the use of disposable food service ware by food facilities. (Christina Fernandez, Assistant to the City Manager) 9. An ordinance adding Chapter 8.72 to Title 8 of the South San Francisco Municipal Code regulating the use of Disposable Food Service Ware by Food Facilities. 9a. Follow-up discussion of proposed relocation of South San Francisco Farmers’ Market from Orange Memorial Park to the downtown area. (Sheri Boles, Community Programs Manager, and Jorge Vega, Regional Manager, Pacific Coast Farmers’ Market Association) 10. ITEMS FROM COUNCIL – COMMITTEE REPORTS AND ANNOUNCEMENTS Page 5 City of South San Francisco Printed on 5/8/2020 March 11, 2020City Council Regular Meeting Agenda CLOSED SESSION Conference with Legal Counsel - Existing Litigation (Government Code Section 54956.9(d)(1)) Name of Case: Kashiwa Fudosan America, Inc. v. City of South San Francisco San Mateo County Superior Court Case Number: 18-CIV-01728 11. ADJOURNMENT Page 6 City of South San Francisco Printed on 5/8/2020 City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-204 Agenda Date:3/11/2020 Version:1 Item #:1. Motion to approve the Minutes for the meetings on January 8, 2020 and January 15, 2020. (Rosa Govea Acosta, City Clerk) City of South San Francisco Printed on 3/6/2020Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-41 Agenda Date:3/11/2020 Version:1 Item #:2. Report regarding a resolution approving an amendment to the service agreement between the City of South San Francisco and the Town of Colma for Police Communication Services.(Mike Remedios, Police Captain) RECOMMENDATION It is recommended that City Council adopt a resolution approving an amendment to the service agreement with the Town of Colma in order to continue to provide communication services to the Town of Colma. BACKGROUND/DISCUSSION The City of South San Francisco (“City”)has been providing police communication services to the Town of Colma (“Colma”)for the last thirty-two (32)years.The current agreement is set to expire in June of 2020.City staff recommends that the City Council authorize the execution of an amendment to the services agreement with Colma in order to continue to provide police communication services through 2023.In addition,the amendment would provide that Colma can only terminate the agreement with 180 days’notice.The City will retain its ability to terminate without cause with 180 days’ notice. FISCAL IMPACT The City will charge Colma $97,418 for Fiscal Year 2020-2021,$99,366 for Fiscal Year 2021-2022 and $101,353 for Fiscal Year 2022-2023 for dispatch services.This reflects a 2%increase from the last year of the previous service agreement for dispatch services ($95,508),as well as a 2%increase for each of the following years.The revenue received pursuant to this amendment will be sufficient to cover the cost of providing the services contemplated by this agreement.Staffing for these services is presently allocated in the Police Department’s current operating budget and no modifications will be required. RELATIONSHIP TO THE STRATEGIC PLAN Amending the service agreement with the Town of Colma meets the City’s strategic goals of maintaining skilled police, fire, emergency medical and disaster management programs. CONCLUSION Adoption of the attached resolution will authorize the City to execute an amendment to the agreement with Colma in order to continue to provide police communication services to Colma for the next three years,starting July 1,2020.The annual revenue to the City for providing this service to Colma will be $97,418 for year one, $99,366 for year two, and $101,353 for year three (2% increase per year). Attachment: 1.2017 Town of Colma/South San Francisco Agreement City of South San Francisco Printed on 3/4/2020Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-42 Agenda Date:3/11/2020 Version:1 Item #:2a. Resolution approving an amendment to the service agreement between the City of South San Francisco and the Town of Colma for Police Communication Services and authorizing the City Manager to execute the agreement. WHEREAS, the City of South San Francisco Police Department has been providing police communication services to Colma for the past thirty-two (32) years; and WHEREAS, the current agreement between the City of South San Francisco (“City”) and the Town of Colma (“Colma”) is due for renewal; and WHEREAS, staff recommends that the City Council adopt a resolution authorizing the Police Department to enter into an agreement amendment with Colma in order to continue to provide police communication services to Colma; and WHEREAS, adequate funding and staffing for these services is presently allocated in the Police Department’s current operating budget and no modification are required. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of South San Francisco that the City Council approves an amendment to the service agreement with the Town of Colma, attached to this resolution as Exhibit A, in order to continue to provide Colma with police communication services. BE IT FURTHER RESOLVED, that the City Manager of the City of South San Francisco, or his designee, is hereby authorized and directed to execute the amendment to the Agreement on behalf of the City of South San Francisco, subject to approval as to form by the City Attorney, and to take any other action consistent with the intent of this Resolution. ***** City of South San Francisco Printed on 5/8/2020Page 1 of 1 powered by Legistar™ 1 OAK #4819-0376-8073 v1 AGREEMENT BETWEEN THE CITY OF SOUTH SAN FRANCISCO AND THE TOWN OF COLMA FOR POLICE COMMUNICATIONS SERVICES This Police Communications Services Agreement (“Agreement”) is entered into on July 1, 2020, by and between the CITY OF SOUTH SAN FRANCISCO, hereinafter referred to as "SSF" and the TOWN OF COLMA, hereinafter referred to as "COLMA." (together sometimes referred to as the “Parties”) RECITALS WHEREAS, SSF desires to furnish police communications services to COLMA through the utilization of SSF facilities and staff; and WHEREAS, SSF is willing to furnish said services to COLMA for a mutually agreed cost; and WHEREAS, the Parties to this Agreement have determined that the computer-aided dispatch and records management systems belonging to the Parties are compatible and will be an effective method of communications and record keeping for both Parties; and WHEREAS, it is necessary and desirable that the parties enter into this Agreement as set forth below; NOW, THEREFORE, in consideration of the recitals and mutual obligations contained herein, SSF and COLMA agree as follows: 1. Description of Services (a) SOUTH SAN FRANCISCO will provide to COLMA basic police dispatch services on a daily basis from 0000 hours to 0800 hours and for two one-hour breaks during the time of 0800 hours to 2359 hours, for 24 hours on Thanksgiving Day, Christmas Day and New Year’s Day, and provide basic police dispatch services under extenuating emergency situations after all other means of filling the position have been exhausted, and at other times as agreed upon by the Communications Services Manager. Dispatch services will include answering emergency telephone calls, dispatching police units by radio, telephone notification of key personnel, providing record keeping activities associated with police dispatch and participating in a quality control and incident critique. (b) SSF shall cause all emergency and non-emergency telephone calls and two-way radio traffic related to COLMA to be recorded. The recordings shall be retained by SSF for a minimum of one hundred (100) days following the date of the call or message. SSF shall provide excerpts of these recordings to COLMA upon request. (c) SSF shall provide and maintain computer hardware and system software at the SSF communications center to support COLMA computer aided dispatching and automated records management. COLMA, at its own expense, shall procure the necessary compatible application software for computer aided dispatching and automated records management. Further, COLMA shall be responsible for paying any and all recurring software maintenance fees for all software that it has 2 OAK #4819-0376-8073 v1 purchased and/or licensed in connection with this Agreement. (d) SSF shall provide and maintain sufficient telephone equipment to accommodate the COLMA E911, 7-digit emergency telephone lines, and administrative business lines. (e) COLMA shall be responsible for the non-recurring and recurring cost of its telephone lines and any equipment required to extend its telephone lines to the SSF police communications center. (f) SSF shall provide and maintain radio console equipment within the SSF police communications center to effect radio transmissions to and from the SSF police communications center to the COLMA field units. (g) SSF shall provide recording equipment to log and record incoming and outgoing radio and telephone transmissions related to this Agreement. (h) SSF shall make the services of its telecommunications engineering and police technology team available to design the radio and telephone systems required to provide the services identified herein. In the event that the telecommunications engineering and police technology team costs increase during this Agreement, the Parties will meet to agree upon an additional amount to be paid by COLMA sufficient to cover the increased costs. (i) COLMA and SSF shall jointly maintain and update a computerized geographic information file, with each party focusing on streets and premise data in its own jurisdiction. 2. Operational Responsibilities (a) The SSF Communications Center shall be under the direction and management control of SSF’s Chief of Police. Matters concerning communications procedures, operations, complaints, requests for changes and/or similar operational matters provided for under this Agreement and specifically related to COLMA shall be approved by COLMA’s Chief of Police and submitted to the SSF Chief of Police or his/her designee for consideration. (b) SSF shall provide sufficient working space and facilities at the SSF police communications center for SSF personnel and equipment to provide the services described in this Agreement. SSF, in its sole discretion, shall determine the quantity and classification of employees required to provide the services to COLMA contemplated under this Agreement. 3. Compensation for Services (a) COLMA shall pay SSF the amounts detailed below as compensation for services provided during each fiscal year beginning July 1, 2020 and ending on June 30, 2023. SSF shall invoice COLMA in advance on a quarterly basis beginning on July 1, 2020 in an amount equal to ¼ of annual amount due. COLMA shall remit in full within 45 days of receiving an invoice from SSF. 2020-2021 2021-2022 2022-2023 $97,418 $99,366 $101,353 3 OAK #4819-0376-8073 v1 (b) In the event SSF and COLMA agree that additional employees must be hired by SSF in order to implement this Agreement and SSF and COLMA have agreed on the costs associated with those additional hires, COLMA shall pay SSF an amount equal to the cost of the additional employees hired by SSF to fulfill its obligations under this Agreement. (c) Upon mutual agreement, COLMA may request SSF to provide additional police communications services for special events at the rate of $85 per hour per employee with a minimum of four (4) hours per event. COLMA must schedule special events with SSF at least thirty (30) days in advance of the event date. 4. Term SSF shall furnish the agreed-upon services as set forth above for a period of three (3) years, commencing July 1, 2020 and expiring June 30, 2023. This Agreement may be extended for up to a three (3) year period if mutually agreed by SSF and COLMA in writing. 5. Waiver/Immunities (a) Waiver. COLMA is responsible for damages to or loss of its property and waives its right to sue SSF for any damages to or loss of its property or injury to its personnel that may occur in responding to communication services pursuant to this Agreement, except for loss of COLMA’S property or injury to COLMA’S personnel that is caused by the gross negligence or willful misconduct of SSF. (b) Immunities. By entering into this Agreement, neither Party waives any of the immunities provided by the California Government Code or other applicable provisions of law. 6. Termination of Agreement This Agreement may be terminated in accordance with the following: (a) Termination without Cause Notwithstanding any other provision of this Agreement, at any time and without cause, the Parties to this Agreement shall have the right, in their sole discretion, to terminate this Agreement by giving one hundred eighty (180) days' written notice to the other Party. (b) Termination for Cause Notwithstanding any other provision of this Agreement, if either Party fails to perform or cure any of its obligations hereunder, within the time and in the manner herein provided, or otherwise violates any of the terms of this Agreement, the other Party may immediately 4 OAK #4819-0376-8073 v1 terminate this Agreement by giving written notice of such termination, stating the reason for the termination. (c) Ability to Cure In the event of any alleged failure to perform any terms or conditions of this Agreement, the Party alleging such breach shall give the other Party notice in writing specifying the nature of the breach and the manner in which said breach or default may be satisfactorily cured, and the Party in breach shall have thirty (30) days following such notice ("Cure Period") to cure such breach. During the Cure Period, the Party charged shall not be considered in default for purposes of termination or institution of legal proceedings. The failure of any Party to give notice of any breach shall not be deemed to be a waiver of that Party's right to allege any other breach at any other time. (d) Payment Upon Termination Upon termination of this Agreement, COLMA shall, within thirty (30) days of termination, pay SSF any outstanding balance for services or materials provided by SSF. 7. Notices All notices, demands, requests, consents, approvals, waivers, or communications ("Notices") that either party desires or is required to give to the other party or any other person shall be in writing and either personally served or sent by prepaid postage, first class mail. Notices shall be addressed as appears below for each party except if either party gives notice of a change of name or address, notices to the giver of that Notice shall thereafter be given as demanded in that Notice. SSF: City of South San Francisco City Manager 400 Grand Avenue South San Francisco, CA 94080 COLMA: Town of Colma City Manager 1188 El Camino Real Colma, CA 94014 8. Relationship of Parties Both parties agree and understand that the services performed under this Agreement are performed as an independent contractor, and that neither party’s employees acquire any of the rights, privileges, powers, or advantages of the other party’s employees. No pension rights of COLMA or SSF employees will be affected by this Agreement. 9. Confidential Law Enforcement Information 5 OAK #4819-0376-8073 v1 COLMA shall provide SSF with proof of eligibility to access State and Federal automated criminal justice databases. COLMA shall provide to SSF identifying information on its employees that require access to said databases to facilitate SSF maintaining computerized security tables that allow or prohibit access. SSF may restrict access from view by COLMA if SSF deems it necessary to protect security of its employee information. SSF and COLMA shall be individually responsible for complying with State and Federal training requirements for employees related to criminal justice databases. COLMA shall be responsible for proper use of criminal justice information disseminated to it by SSF. COLMA agrees to indemnify and hold harmless SSF in the event of misuse of confidential information by COLMA users. 10. Hold Harmless, Indemnification (a) COLMA shall defend, save harmless and indemnify SSF, its officers and employees from any and all claims which arise out of the terms and conditions of this Agreement and which result from the negligent acts or omissions of COLMA, its officers, employees and contractors. (b) SSF shall defend, save harmless, and indemnify COLMA, its officers and employees from any and all claims for injuries or damage to persons and/or property which arise out of the terms and conditions of this Agreement and which result from the negligent acts or omissions of SSF, its officers, employees and contractors. (c) In the event of concurrent negligence of SSF, its officers and/or employees, and COLMA, its officers and/or employees, then the liability for any and all claims for injuries or damage to persons and/or property which arise out of terms and conditions of this Agreement shall be apportioned according to the California theory of comparative negligence. (d) This section shall include, without limitation, any actions, claims, suits, demands, and liability of every name, kind, and description brought for, or on account of injuries to or death of any person, including COLMA or SSF, or damage to property of any kind whatsoever and to whomsoever belonging. (e) The duty to indemnify and hold harmless as set forth herein shall include the duty to defend as set forth in Civil Code Section 2778. 11. Radio Systems COLMA shall own and operate its police radio system and be solely responsible for its procurement, maintenance and replacement. This includes receivers, transmitters, voter/comparators and associated equipment. COLMA shall maintain its radio equipment in a manner that will allow clear reception that is free from static and interference. SSF shall own and operate its police communications dispatch equipment and be solely responsible for its procurement, maintenance and replacement. This includes dispatch console electronic equipment, logging recorder, computer servers and associated equipment. SSF shall use this equipment to provide radio dispatch service to COLMA. 12. Ownership of Computerized Data 6 OAK #4819-0376-8073 v1 Both parties acknowledge that automated law enforcement records information for SSF and COLMA will be comingled in a single computer database owned and managed by SSF. SSF agrees to allow COLMA to electronically copy its records for the purpose of maintaining its own archive without additional cost to COLMA. 13. Assignability and Subcontracting Neither party may assign the benefits nor delegate the duties set forth in this Agreement. 14. Insurance Both parties shall maintain sufficient insurance, self-insurance or a combination thereof to comply with the following requirements, and, if requested, each party shall furnish the other party with certificates of insurance evidencing the required coverage. Thirty (30) days' notice must be given, in writing as set forth in this agreement of any pending change in the limits of liability or of any cancellation or modification of the policy. a) Worker's Compensation and Employer's Liability Insurance. Both parties shall have in effect during the entire life of this Agreement Worker’s Compensation and Employer's Liability Insurance, or an acceptable program of self-insurance providing full statutory coverage. In signing this Agreement, parties certify, as required by Section 1861 of the California Labor Code, that they are aware of the provisions of Section 3700 of the California Labor Code which requires every employer to be insured against liability for Worker's Compensation or to undertake self-insurance in accordance with the provisions of the Code, and parties will comply with such provisions before commencing the performance of the work of this Agreement. b) Liability Insurance. COLMA and SSF shall take out and maintain during the life of this Agreement such Bodily Injury Liability and Property Damage Liability Insurance as shall protect it while performing work covered by this Agreement from any and all claims for damages for bodily injury, including accidental death, as well as any and all claims for property damage which may arise from COLMA’s and SSF’s operations under this Agreement, whether such operation be by itself or by any subcontractor or by anyone directly or indirectly employed by either of them. Such insurance shall be combined single limit bodily injury and property damage for each occurrence and shall be not less than: 1. Comprehensive General Liability . . . . . . . . . . . . . . . $ 2,000,000 2. Motor Vehicle Liability Insurance . . . . . . . . . . . . . . . $ 2,000,000 15. Non-Discrimination No person shall, on the grounds of race, color, religion, ancestry, gender, age (over 40), national origin, medical condition (cancer), physical or mental disability, sexual orientation, pregnancy, child birth or related medical condition, marital status, or political affiliation be denied any benefits or subject to discrimination under this Agreement. COLMA and SSF shall ensure equal employment opportunity based on objective standards of recruitment, classification, selection, promotion, compensation, performance evaluation, and management relations for all employees under this 7 OAK #4819-0376-8073 v1 Agreement. COLMA’s and SSF’s equal employment policies shall be made available to either party upon request. 16. Retention of Records Each party agrees to provide to the other party, to any federal or state department having monitoring or reviewing authority, to SSF’s or COLMA’s authorized representatives and/or their appropriate audit agencies upon reasonable notice, access to and the right to examine and audit records and documents necessary to determine compliance with relevant federal, state, and local statutes, rules, and regulations, and this Agreement, and to evaluate the quality, appropriateness and timeliness of services performed. COLMA shall maintain and preserve all records relating to this Agreement for a period of five (5) years from the termination date of this Agreement, or until audit findings are resolved, whichever is greater. SSF shall maintain and preserve all records relating to this Agreement in accordance with SSF’s adopted records retention schedule. 17. Response to Public Records Act Requests, Subpoenas, and DOJ Audits COLMA and SSF shall be individually responsible for complying with requests for records under the California Public Records Act. SSF shall provide technical assistance to COLMA if the request involves incident records contained in SSF’s computer aided dispatch system. The Parties agree for purposes of section 6254.5 of the California Government Code that any and all information exchanged between SSF and COLMA pursuant to this Agreement will be treated as confidential, that only persons authorized in writing by the SSF City Manager or the COLMA City Manager or their delegees shall be permitted to obtain such information, subject to all applicable laws and regulations, and that any and all information exchanged between SSF and COLMA pursuant to this Agreement will only be used for purposes consistent with existing law. COLMA and SSF shall be individually responsible for responding to California Department of Justice audits related to the California Law Enforcement Telecommunications System (CLETS) and the Department of Justice Criminal Justice Information System (CJIS) databases. SSF shall provide technical assistance to COLMA to extract the necessary information from the computer aided dispatch and records management systems when requested. 18. Merger Clause This Agreement, including any Exhibit(s) hereto constitutes the sole Agreement of the parties hereto and correctly states the rights, duties, and obligations of each party as of this document's date. Any prior agreement, promises, negotiations, or representations between the parties not expressly stated in this document are not binding. All subsequent modifications shall be in writing and signed by the parties. 19. Controlling Law The validity of this Agreement and of its terms or provisions, as well as the rights and duties of the parties hereunder, the interpretation, and performance of this Agreement shall be governed by the laws of the State of California. 8 OAK #4819-0376-8073 v1 20. Amendment This Agreement may be amended at any time upon the written mutual approval of the Parties. 21. Severability If any provision of this Agreement shall be held to be invalid, void or unenforceable, the validity, legality or enforceability of the remaining portions hereof shall not in any way be affected or impaired thereby. 22. Waiver A waiver by either Party of the performance of any covenant or condition herein shall not invalidate this Agreement nor shall it be considered a waiver of any other covenant or condition, nor shall the delay or forbearance by either Party in exercising any remedy or right be considered a waiver of, or an estoppel against, the later exercise of such remedy or right. 23. Remedies Cumulative Except as otherwise expressly stated in this Agreement, the rights and remedies of the Parties hereunder are cumulative, and the exercise or failure to exercise one or more of such rights or remedies by either Party shall not preclude the exercise by it, at the same time or different times, of any right or remedy for the same default or any other default. Upon the occurrence of an event of default, the Parties may pursue all remedies at law or in equity which are not otherwise provided for in this Agreement, expressly including the remedy of specific performance of this Agreement. 24. Binding Effect This Agreement shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors in interest and assigns of each of the Parties hereto. Any reference in this Agreement to a specifically named Party shall be deemed to apply to any successor, heir, administrator, executor or assign of such Party who has acquired an interest in compliance with the terms of this Agreement, or under law. 25. Attorneys' Fees In any action at law or in equity, arbitration or other proceeding arising in connection with this Agreement, the prevailing party shall recover attorneys' fees and other costs, including, but not limited to court costs and expert and consultants' fees incurred in connection with such action, in addition to any other relief awarded, and such attorneys' fees and costs shall be included in any judgment in such action. 26. Captions; Interpretation The captions used in this Agreement are for convenience only and are not intended to affect the interpretation or construction of the provisions herein contained. The Parties acknowledge that this Agreement is the product of negotiation and compromise on the part of both Parties, and the Parties agree, that since both Parties have participated in the negotiation and drafting of this Agreement, this Agreement shall not be construed as if 9 OAK #4819-0376-8073 v1 prepared by one of the Parties, but rather according to its fair meaning as a whole, as if both Parties had prepared it. 27. Disputes If a dispute arises between the Parties regarding performance of either Party under this Agreement, the Parties shall attempt to resolve such dispute informally by a meeting with representatives of each Party. If, after a good faith attempt by both Parties to resolve the dispute informally no resolution can be reached, the Parties may, at their sole and mutual discretion, agree to engage in mediation, the costs of which shall be divided equally between the Parties, unless otherwise agreed. 28. Counterparts This Agreement may be executed in multiple counterparts, each of which shall be an original and all of which together shall constitute one agreement. 29. Further Assurances The Parties agree to execute, acknowledge and deliver to the other such other documents and instruments, and to undertake such actions, as either shall reasonably request or as may be necessary to carry out the intent of this Agreement. 30. Time is of the Essence Time is of the essence and is a material term for all conditions and provisions contained in this Agreement. 31. Authority Each person executing this Agreement on behalf of one of the Parties represents that he or she is duly authorized to sign and deliver the Agreement on behalf of such Party and that this Agreement is binding on such Party in accordance with its terms. IN WITNESS WHEREOF, the parties hereto by their duly authorized representatives have affixed their hands on the day and year in this Agreement first above written. __________________________ ___________________________________ City Manager City Manager City of South San Francisco Town of Colma ATTEST By: 10 OAK #4819-0376-8073 v1 COLMA _______________________________ ___________________________________ Dated City Attorney Approved as to form: SOUTH SAN FRANCISCO ___________________________ _________________________________ Dated City Attorney Approved as to form: 1665866.1 City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-43 Agenda Date:3/11/2020 Version:1 Item #:3. Report regarding a resolution approving an amendment to the service agreement between the City of South San Francisco and the City of Pacifica for Police Communication Services.(Mike Remedios, Police Captain) RECOMMENDATION It is recommended that City Council adopt a resolution approving an amendment to the service agreement with the City of Pacifica in order to continue to provide communication services to the City of Pacifica. BACKGROUND/DISCUSSION The City of South San Francisco (“City”)has been providing police communication services to the City of Pacifica (“Pacifica”)for the last eight (8)years.The current agreement is set to expire in June of 2020.City staff recommends that the City Council authorize the execution of an amendment to the services agreement with Pacifica in order to continue to provide police communication services through 2023.In addition,the amendment would provide that Pacifica can only terminate the agreement with 180 days’notice.The City will retain its ability to terminate without cause with 180 days’ notice. FISCAL IMPACT The City will charge Pacifica $671,108 for Fiscal Year 2020-2021,$684,530 for Fiscal Year 2021-2022 and $698,221 for Fiscal Year 2022-2023 for dispatch services.This reflects a 2%increase from the last year of the previous service agreement for dispatch services ($657,949),as well as a 2%increase for each of the following years.The revenue received pursuant to this amendment will be sufficient to cover the cost of providing the services contemplated by this agreement.Staffing for these services is presently allocated in the Police Department’s current operating budget and no modifications will be required. RELATIONSHIP TO THE STRATEGIC PLAN Providing communication services to the City of Pacifica meets the City’s strategic goals of providing skilled police, fire, emergency medical, and disaster management programs. CONCLUSION Adoption of the attached resolution will authorize the City to execute an amendment to the agreement with Pacifica in order to continue to provide police communication services to Pacifica for the next three years, starting July 1,2020.The annual revenue to the City for providing this service to Colma will be $671,108 for year one, $684,530 for year two, and $698,221 for year three (2% increase per year). Attachment: 1.2017-2020 Pacifica/South San Francisco Dispatch Agreement City of South San Francisco Printed on 3/4/2020Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-44 Agenda Date:3/11/2020 Version:1 Item #:3a. Resolution approving an amendment to the service agreement between the City of South San Francisco and the City of Pacifica to continue to provide police communications services. WHEREAS,the City of South San Francisco Police Department has been providing police communication services to Pacifica for the eight (8) years; and WHEREAS,the current agreement between the City of South San Francisco (“City”)and the City of Pacifica (“Pacifica”) is due for renewal; and WHEREAS,staff recommends that the City Council adopt a resolution authorizing the Police Department to enter into an agreement amendment with the City of Pacifica in order to continue to provide police communication services to Pacifica; and WHEREAS,adequate funding and staffing for these services is presently allocated in the Police Department’s current operating budget and no modifications are required. NOW,THEREFORE,BE IT RESOLVED by the City Council of the City of South San Francisco that the City Council approves an amendment to the service agreement with the City of Pacifica,attached to this resolution as Exhibit A, in order to continue to provide Pacifica with police communication services. BE IT FURTHER RESOLVED,that the City Manager of the City of South San Francisco,or his designee,is hereby authorized and directed to execute the amendment to the service agreement on behalf of the City of South San Francisco,subject to approval as to form by the City Attorney,and to take any other action consistent with the intent of this Resolution. ***** City of South San Francisco Printed on 5/8/2020Page 1 of 1 powered by Legistar™ 1 OAK #4819-0376-8073 v1 AGREEMENT BETWEEN THE CITY OF SOUTH SAN FRANCISCO AND THE CITY OF PACIFICA FOR POLICE COMMUNICATIONS SERVICES This Police Communications Services Agreement (“Agreement”) is entered into on July 1, 2020, by and between the CITY OF SOUTH SAN FRANCISCO, hereinafter referred to as "SSF" and the CITY OF PACIFICA, hereinafter referred to as "PACIFICA." (together sometimes referred to as the “Parties”) RECITALS WHEREAS, SSF desires to furnish police communications services to PACIFICA through the utilization of SSF facilities and staff; and WHEREAS, SSF is willing to furnish said services to PACIFICA for a mutually agreed cost; and WHEREAS, the Parties to this Agreement have determined that the computer-aided dispatch and records management systems belonging to the Parties are compatible and will be an effective method of communications and record keeping for both Parties; and WHEREAS, it is necessary and desirable that the parties enter into this Agreement as set forth below; NOW, THEREFORE, in consideration of the recitals and mutual obligations contained herein, SSF and PACIFICA agree as follows: 1. Description of Services (a) SSF will provide PACIFICA with the following services: telephone answering and personnel notification, including status keeping, activity reporting and database inquiries in response to PACIFICA police operational needs. SSF will be responsible for answering PACIFICA’s non-emergency administrative telephone calls outside of normal weekday PACIFICA office hours which are defined as Monday, Tuesday, Thursday, Friday 8:30 am to 5:00 pm and Wednesday 8:30 am to 7:30 pm. (b) SSF will provide PACIFICA with the services described in Paragraph (a) above 24-hours per day, 7-days per week, 365-days per year beginning on July 1, 2020. (c) SSF shall cause all emergency and non-emergency telephone calls and two-way radio traffic related to PACIFICA to be recorded. The recordings shall be retained by SSF for a minimum of one hundred (100) days following the date of the call or message. SSF shall provide excerpts of these recordings to PACIFICA upon request. (d) SSF shall provide and maintain computer hardware and system software at the SSF communications center to support PACIFICA computer aided dispatching and automated records management. PACIFICA, at its own expense, shall procure the necessary compatible application software for computer aided dispatching and automated records management. Further, PACIFICA shall be responsible for paying any and all recurring software maintenance fees for all software that it has purchased and/or licensed in connection with this Agreement. 2 OAK #4819-0376-8073 v1 (e) SSF shall provide and maintain sufficient telephone equipment to accommodate the PACIFICA E911, 7-digit emergency telephone lines, and administrative business lines. (f) PACIFICA shall be responsible for the non-recurring and recurring cost of its telephone lines and any equipment required to extend its telephone lines to the SSF police communications center. (g) SSF shall provide and maintain radio console equipment within the SSF police communications center to effect radio transmissions to and from the SSF police communications center to the PACIFICA field units. (h) SSF shall provide recording equipment to log and record incoming and outgoing radio and telephone transmissions related to this Agreement. (i) SSF shall make the services of its telecommunications engineering and police technology team available to design the radio and telephone systems required to provide the services identified herein. In the event that the telecommunications engineering and police technology team costs increase during this Agreement, the Parties will meet to agree upon an additional amount to be paid by Pacifica sufficient to cover the increased costs. (j) PACIFICA and SSF shall jointly maintain and update a computerized geographic information file, with each party focusing on streets and premise data in its own jurisdiction. (k) SSF will complete all functions of the warrant process for PACIFICA. These duties include, but are not limited to, new warrant entries, warrant updates and warrant due-diligence. 2. Operational Responsibilities (a) The SSF Communications Center shall be under the direction and management control of SSF’s Chief of Police. Matters concerning communications procedures, operations, complaints, requests for changes and/or similar operational matters provided for under this Agreement and specifically related to PACIFICA shall be approved by PACIFICA’s Chief of Police and submitted to the SSF Chief of Police or his/her designee for consideration. (b) SSF shall provide sufficient working space and facilities at the SSF police communications center for SSF personnel and equipment to provide the services described in this Agreement. SSF, in its sole discretion, shall determine the quantity and classification of employees required to provide the services to PACIFICA contemplated under this Agreement. 3. Compensation for Services (a) PACIFICA shall pay SSF the amounts detailed below as compensation for services provided during each fiscal year beginning July 1, 2020 and ending on June 30, 2023. SSF shall invoice PACIFICA in advance on a quarterly basis beginning on July 1, 2020 in an amount equal to ¼ of annual amount due. Pacifica shall remit in full within 45 days of receiving an invoice from SSF. 3 OAK #4819-0376-8073 v1 2020-2021 2021-2022 2022-2023 $671,108 $684,530 $698,221 (b) In the event SSF and PACIFICA agree that additional employees must be hired by SSF in order to implement this Agreement and have agreed on the costs associated with those additional hires, PACIFICA shall pay SSF an amount equal to the cost of the additional employees hired by SSF to fulfill its obligations under this Agreement. (c) Upon mutual agreement, PACIFICA may request SSF to provide additional police communications services for special events at the rate of $85 per hour per employee with a minimum of four (4) hours per event. PACIFICA must schedule special events with SSF at least thirty (30) days in advance of the event date. 4. Term SSF shall furnish the agreed-upon services as set forth above for a period of three (3) years, commencing July 1, 2020 and expiring June 30, 2023. This Agreement may be extended for up to a three (3) year period if mutually agreed by SSF and PACIFICA in writing. 5. Waiver/Immunities (a) Waiver. PACIFICA is responsible for damages to or loss of its property and waives its right to sue SSF for any damages to or loss of its property or injury to its personnel that may occur in responding to communication services pursuant to this Agreement, except for loss of PACIFICA’S property or injury to PACIFICA’S personnel that is caused by the gross negligence or willful misconduct of SSF. (b) Immunities. By entering into this Agreement, neither Party waives any of the immunities provided by the California Government Code or other applicable provisions of law. 6. Termination of Agreement This Agreement may be terminated in accordance with the following: (a) Termination Without Cause Notwithstanding any other provision of this Agreement, at any time and without cause, the Parties to this Agreement shall have the right, in their sole discretion, to terminate this Agreement by giving ninety (90) days' written notice to the other Party. (b) Termination for Cause Notwithstanding any other provision of this Agreement, if either Party fails to perform or cure any of its obligations hereunder, within the time and in the manner herein provided, or 4 OAK #4819-0376-8073 v1 otherwise violates any of the terms of this Agreement, the other Party may immediately terminate this Agreement by giving written notice of such termination, stating the reason for the termination. The termination shall become effective on the last day of the quarter in which the written notice of termination is provided. (c) Ability to Cure In the event of any alleged failure to perform any terms or conditions of this Agreement, the Party alleging such breach shall give the other Party notice in writing specifying the nature of the breach and the manner in which said breach or default may be satisfactorily cured, and the Party in breach shall have thirty (30) days following such notice ("Cure Period") to cure such breach. During the Cure Period, the Party charged shall not be considered in default for purposes of termination or institution of legal proceedings. The failure of any Party to give notice of any breach shall not be deemed to be a waiver of that Party's right to allege any other breach at any other time. (d) Payment Upon Termination Upon termination of this Agreement, PACIFICA shall, within thirty (30) days of termination, pay SSF any outstanding balance for services or materials provided by SSF. 7. Notices All notices, demands, requests, consents, approvals, waivers, or communications ("Notices") that either party desires or is required to give to the other party or any other person shall be in writing and either personally served or sent by prepaid postage, first class mail. Notices shall be addressed as appears below for each party except if either party gives notice of a change of name or address, notices to the giver of that Notice shall thereafter be given as demanded in that Notice. SSF: City of South San Francisco City Manager 400 Grand Avenue South San Francisco, CA 94080 PACIFICA: City of Pacifica City Manager 170 Santa Maria Avenue Pacifica, CA 94044 8. Relationship of Parties Both parties agree and understand that the services performed under this Agreement are performed as an independent contractor, and that neither party’s employees acquire any of the rights, privileges, powers, or advantages of the other party’s employees. No pension rights of PACIFICA or SSF employees will be affected by this Agreement. 9. Confidential Law Enforcement Information 5 OAK #4819-0376-8073 v1 PACIFICA shall provide SSF with proof of eligibility to access State and Federal automated criminal justice databases. PACIFICA shall provide to SSF identifying information on its employees that require access to said databases to facilitate SSF maintaining computerized security tables that allow or prohibit access. SSF may restrict access from view by PACIFICA if SSF deems it necessary to protect security of its employee information. SSF and PACIFICA shall be individually responsible for complying with State and Federal training requirements for employees related to criminal justice databases. PACIFICA shall be responsible for proper use of criminal justice information disseminated to it by SSF. PACIFICA agrees to indemnify and hold harmless SSF in the event of misuse of confidential information by PACIFICA users. 10. Hold Harmless, Indemnification (a) PACIFICA shall defend, save harmless and indemnify SSF, its officers and employees from any and all claims which arise out of the terms and conditions of this Agreement and which result from the negligent acts or omissions of PACIFICA, its officers, employees and contractors. (b) SSF shall defend, save harmless, and indemnify PACIFICA, its officers and employees from any and all claims for injuries or damage to persons and/or property which arise out of the terms and conditions of this Agreement and which result from the negligent acts or omissions of SSF, its officers, employees and contractors. (c) In the event of concurrent negligence of SSF, its officers and/or employees, and PACIFICA, its officers and/or employees, then the liability for any and all claims for injuries or damage to persons and/or property which arise out of terms and conditions of this Agreement shall be apportioned according to the California theory of comparative negligence. (d) This section shall include, without limitation, any actions, claims, suits, demands, and liability of every name, kind, and description brought for, or on account of injuries to or death of any person, including PACIFICA or SSF, or damage to property of any kind whatsoever and to whomsoever belonging. (e) The duty to indemnify and hold harmless as set forth herein shall include the duty to defend as set forth in Civil Code Section 2778. 11. Radio Systems PACIFICA shall own and operate its police radio system and be solely responsible for its procurement, maintenance and replacement. This includes receivers, transmitters, voter/comparators and associated equipment. PACIFICA shall maintain its radio equipment in a manner that will allow clear reception that is free from static and interference. SSF shall own and operate its police communications dispatch equipment and be solely responsible for its procurement, maintenance and replacement. This includes dispatch console electronic equipment, logging recorder, computer servers and associated equipment. SSF shall use this equipment to provide radio dispatch service to PACIFICA. 12. Ownership of Computerized Data 6 OAK #4819-0376-8073 v1 Both parties acknowledge that automated law enforcement records information for SSF and PACIFICA will be comingled in a single computer database owned and managed by SSF. SSF agrees to allow PACIFICA to electronically copy its records for the purpose of maintaining its own archive without additional cost to PACIFICA. 13. Assignability and Subcontracting Neither party may assign the benefits nor delegate the duties set forth in this Agreement. 14. Insurance Both parties shall maintain sufficient insurance, self-insurance or a combination thereof to comply with the following requirements, and, if requested, each party shall furnish the other party with certificates of insurance evidencing the required coverage. Thirty (30) days' notice must be given, in writing as set forth in this agreement of any pending change in the limits of liability or of any cancellation or modification of the policy. a) Worker's Compensation and Employer's Liability Insurance. Both parties shall have in effect during the entire life of this Agreement Worker’s Compensation and Employer's Liability Insurance, or an acceptable program of self-insurance providing full statutory coverage. In signing this Agreement, parties certify, as required by Section 1861 of the California Labor Code, that they are aware of the provisions of Section 3700 of the California Labor Code which requires every employer to be insured against liability for Worker's Compensation or to undertake self-insurance in accordance with the provisions of the Code, and parties will comply with such provisions before commencing the performance of the work of this Agreement. b) Liability Insurance. PACIFICA and SSF shall take out and maintain during the life of this Agreement such Bodily Injury Liability and Property Damage Liability Insurance as shall protect it while performing work covered by this Agreement from any and all claims for damages for bodily injury, including accidental death, as well as any and all claims for property damage which may arise from PACIFICA’s and SSF’s operations under this Agreement, whether such operation be by itself or by any subcontractor or by anyone directly or indirectly employed by either of them. Such insurance shall be combined single limit bodily injury and property damage for each occurrence and shall be not less than: 1. Comprehensive General Liability . . . . . . . . . . . . . . . $ 2,000,000 2. Motor Vehicle Liability Insurance . . . . . . . . . . . . . . . $ 2,000,000 15. Non-Discrimination No person shall, on the grounds of race, color, religion, ancestry, gender, age (over 40), national origin, medical condition (cancer), physical or mental disability, sexual orientation, pregnancy, child birth or related medical condition, marital status, or political affiliation be denied any benefits or subject to discrimination under this Agreement. PACIFICA and SSF shall ensure equal employment opportunity based on objective standards of recruitment, classification, selection, promotion, compensation, 7 OAK #4819-0376-8073 v1 performance evaluation, and management relations for all employees under this Agreement. PACIFICA’s and SSF’s equal employment policies shall be made available to either party upon request. 16. Retention of Records Each party agrees to provide to the other party, to any federal or state department having monitoring or reviewing authority, to SSF’s or PACIFICA’s authorized representatives and/or their appropriate audit agencies upon reasonable notice, access to and the right to examine and audit records and documents necessary to determine compliance with relevant federal, state, and local statutes, rules, and regulations, and this Agreement, and to evaluate the quality, appropriateness and timeliness of services performed. PACIFICA shall maintain and preserve all records relating to this Agreement for a period of five (5) years from the termination date of this Agreement, or until audit findings are resolved, whichever is greater. SSF shall maintain and preserve all records relating to this Agreement in accordance with SSF’s adopted records retention schedule. 17. Response to Public Records Act Requests, Subpoenas, and DOJ Audits PACIFICA and SSF shall be individually responsible for complying with requests for records under the California Public Records Act. SSF shall provide technical assistance to PACIFICA if the request involves incident records contained in SSF’s computer aided dispatch system. The Parties agree for purposes of section 6254.5 of the California Government Code that any and all information exchanged between SSF and PACIFICA pursuant to this Agreement will be treated as confidential, that only persons authorized in writing by the SSF City Manager or the PACIFICA City Manager or their delegees shall be permitted to obtain such information, subject to all applicable laws and regulations, and that any and all information exchanged between SSF and PACIFICA pursuant to this Agreement will only be used for purposes consistent with existing law. PACIFICA and SSF shall be individually responsible for responding to California Department of Justice audits related to the California Law Enforcement Telecommunications System (CLETS) and the Department of Justice Criminal Justice Information System (CJIS) databases. SSF shall provide technical assistance to PACIFICA to extract the necessary information from the computer aided dispatch and records management systems when requested. 18. Merger Clause This Agreement, including any Exhibit(s) hereto constitutes the sole Agreement of the parties hereto and correctly states the rights, duties, and obligations of each party as of this document's date. Any prior agreement, promises, negotiations, or representations between the parties not expressly stated in this document are not binding. All subsequent modifications shall be in writing and signed by the parties. 19. Controlling Law The validity of this Agreement and of its terms or provisions, as well as the rights and duties of the parties hereunder, the interpretation, and performance of this Agreement 8 OAK #4819-0376-8073 v1 shall be governed by the laws of the State of California. 20. Amendment This Agreement may be amended at any time upon the written mutual approval of the Parties. 21. Severability If any provision of this Agreement shall be held to be invalid, void or unenforceable, the validity, legality or enforceability of the remaining portions hereof shall not in any way be affected or impaired thereby. 22. Waiver A waiver by either Party of the performance of any covenant or condition herein shall not invalidate this Agreement nor shall it be considered a waiver of any other covenant or condition, nor shall the delay or forbearance by either Party in exercising any remedy or right be considered a waiver of, or an estoppel against, the later exercise of such remedy or right. 23. Remedies Cumulative Except as otherwise expressly stated in this Agreement, the rights and remedies of the Parties hereunder are cumulative, and the exercise or failure to exercise one or more of such rights or remedies by either Party shall not preclude the exercise by it, at the same time or different times, of any right or remedy for the same default or any other default. Upon the occurrence of an event of default, the Parties may pursue all remedies at law or in equity which are not otherwise provided for in this Agreement, expressly including the remedy of specific performance of this Agreement. 24. Binding Effect This Agreement shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors in interest and assigns of each of the Parties hereto. Any reference in this Agreement to a specifically named Party shall be deemed to apply to any successor, heir, administrator, executor or assign of such Party who has acquired an interest in compliance with the terms of this Agreement, or under law. 25. Attorneys' Fees In any action at law or in equity, arbitration or other proceeding arising in connection with this Agreement, the prevailing party shall recover attorneys' fees and other costs, including, but not limited to court costs and expert and consultants' fees incurred in connection with such action, in addition to any other relief awarded, and such attorneys' fees and costs shall be included in any judgment in such action. 26. Captions; Interpretation The captions used in this Agreement are for convenience only and are not intended to affect the interpretation or construction of the provisions herein contained. The Parties acknowledge that this Agreement is the product of negotiation and compromise on the part 9 OAK #4819-0376-8073 v1 of both Parties, and the Parties agree, that since both Parties have participated in the negotiation and drafting of this Agreement, this Agreement shall not be construed as if prepared by one of the Parties, but rather according to its fair meaning as a whole, as if both Parties had prepared it. 27. Disputes If a dispute arises between the Parties regarding performance of either Party under this Agreement, the Parties shall attempt to resolve such dispute informally by a meeting with representatives of each Party. If, after a good faith attempt by both Parties to resolve the dispute informally no resolution can be reached, the Parties may, at their sole and mutual discretion, agree to engage in mediation, the costs of which shall be divided equally between the Parties, unless otherwise agreed. 28. Counterparts This Agreement may be executed in multiple counterparts, each of which shall be an original and all of which together shall constitute one agreement. 29. Further Assurances The Parties agree to execute, acknowledge and deliver to the other such other documents and instruments, and to undertake such actions, as either shall reasonably request or as may be necessary to carry out the intent of this Agreement. 30. Time is of the Essence Time is of the essence and is a material term for all conditions and provisions contained in this Agreement. 31. Authority Each person executing this Agreement on behalf of one of the Parties represents that he or she is duly authorized to sign and deliver the Agreement on behalf of such Party and that this Agreement is binding on such Party in accordance with its terms. IN WITNESS WHEREOF, the parties hereto by their duly authorized representatives have affixed their hands on the day and year in this Agreement first above written. __________________________ ___________________________________ City Manager City Manager City of South San Francisco City of Pacifica ATTEST By: 10 OAK #4819-0376-8073 v1 _______________________________ ___________________________________ ATTEST: ___________________________ _________________________________ 1665866.1 City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-182 Agenda Date:3/11/2020 Version:1 Item #:4. Report regarding adoption of Ordinance to amend Title 2, Chapters 2.52, 2.56, 2.60, 2.62, 2.64, and 2.80, of the South San Francisco Municipal Code pertaining to eligibility requirements for City commissioners.(Rosa Govea Acosta, City Clerk) RECOMMENDATION It is recommended that the City Council waive reading and adopt an Ordinance to amend Title 2, Chapters 2.52,2.56,2.60,2.62,2.64,and 2.80,of the South San Francisco Municipal Code pertaining to eligibility requirements for City commissioners. BACKGROUND/DISCUSSION The City Council previously waived reading and introduced the following Ordinance to modify the current eligibility requirements for six City commissions in order to comply with Senate Bill 225, and waive further reading: 1.Ordinance to amend Title 2, Chapters 2.52, 2.56, 2.60, 2.62, 2.64, and 2.80, of the South San Francisco Municipal Code pertaining to eligibility requirements for City commissioners. (Introduced 2/26/20; Vote 5-0) The Ordinance is now ready for adoption. City of South San Francisco Printed on 3/6/2020Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-186 Agenda Date:3/11/2020 Version:1 Item #:4a. Ordinance amending Title 2,Chapters 2.52,2.56,2.60,2.62,2.64,and 2.80,of the South San Francisco Municipal Code pertaining to eligibility requirements for City commissioners. WHEREAS,California state law has historically restricted membership on appointed local boards and commissions to “citizens of the state”and excluded individuals who are not U.S.citizens from the definition of “citizens of the state”; and WHEREAS,the California State Legislature has enacted Senate Bill 225 (“S.B.225”)to change these requirements, as of January 1, 2020;and WHEREAS,as part of S.B.225,the Legislature found that “California’s democratic values of equal representation are upheld when our local and state government is diverse and representative of the people who reside in the state”; and WHEREAS,the Legislature also found that “access to positions on governmental boards and commissions creates an avenue for people from multiple backgrounds and different experiences to serve the communities in which they live and beyond”; and WHEREAS,the Legislature expressly stated that it intended by passing S.B.225 “to remove barriers to service and authorize all California residents,including those without lawful immigration status,to serve on California’s diverse local and state boards and commissions so that their perspectives and voices are heard”; WHEREAS,S.B.225 specifically amended Government Code section 1020 to allow any resident,“regardless of citizenship or immigration status,” to serve on local boards and commissions; and WHEREAS,the City of South San Francisco Municipal Code currently provides for the establishment of nine local commissions; WHEREAS,the Municipal Code currently provides that commissioners on six of these commissions be “electors of the city”; and WHEREAS,the City Council wishes to comply with the spirit of S.B.225 and open these commission appointments to all residents, regardless of citizenship or voter status. NOW,THEREFORE,THE CITY COUNCIL OF THE CITY OF SOUTH SAN FRANCISCO,DOES HEREBY ORDAIN AS FOLLOWS: SECTION 1.Findings City of South San Francisco Printed on 5/8/2020Page 1 of 3 powered by Legistar™ File #:20-186 Agenda Date:3/11/2020 Version:1 Item #:4a. The City Council of South San Francisco, finds that the Recitals above are true and correct and are incorporated herein by reference. SECTION 2.Amendments to Title 2 Provisions of Title 2,Chapters 2.52,2.56,2.60,2.62,2.64,and 2.80 of the South San Francisco Municipal Code is hereby amended to read as follows.Sections and subsections that are not amended by this Ordinance are not included below, and shall remain in full force and effect. 2.52.020 Public Library Board - Board of Trustees appointment. The public library shall be managed by a board of trustees consisting of five members who are residents of the city. The city council shall appoint the trustees. 2.56.010 Planning Commission Established-Member appointment. The planning commission is established, consisting of seven members who are residents of the city. The city council shall appoint the commissioners. 2.60.010 Parks and Recreation Commission Established-Member appointments. The parks and recreation commission is established, consisting of seven members who are residents of the city. The city council shall appoint the commissioners. 2.62.010 Personnel Board Established-Member appointments. The personnel board is established, consisting of five members who are residents of the city. The city council shall appoint the board members. No person shall be appointed to the board who holds any salaried public office. 2.64.010 Parking Place Commission Established-Member appointment. The parking place commission is established, consisting of three members who are residents of the city, and whose business experience and ability reasonably assure that the affairs of the district will be administered in the interests of the district. The city council shall appoint the commissioners. 2.80.010 Cultural Arts Commission established. The South San Francisco arts commission is established, consisting of up to eleven members who are residents of the city. The city council shall appoint the commissioners. SECTION 5.Severability If any provision of this ordinance or the application thereof to any person or circumstance is held invalid,the remainder of the ordinance and the application of such provision to other persons or circumstances shall not be affected thereby. SECTION 6.Publication and Effective Date Pursuant to the provisions of Government Code Section 36933,a summary of this Ordinance shall be prepared by the City Attorney.At least five (5)days prior to the Council meeting at which this Ordinance is scheduled to be adopted,the City Clerk shall (1)publish the Summary,and (2)post in the City Clerk’s Office a certified City of South San Francisco Printed on 5/8/2020Page 2 of 3 powered by Legistar™ File #:20-186 Agenda Date:3/11/2020 Version:1 Item #:4a. be adopted,the City Clerk shall (1)publish the Summary,and (2)post in the City Clerk’s Office a certified copy of this Ordinance.Within fifteen (15)days after the adoption of this Ordinance,the City Clerk shall (1) publish the summary,and (2)post in the City Clerk’s Office a certified copy of the full text of this Ordinance along with the names of those City Council members voting for and against this Ordinance or otherwise voting. This Ordinance shall become effective thirty (30) days from and after its adoption. ***** Introduced at a regular meeting of the City Council of the City of South San Francisco held the 26th day of February 2020. City of South San Francisco Printed on 5/8/2020Page 3 of 3 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:19-1012 Agenda Date:3/11/2020 Version:1 Item #:5. Report regarding a resolution approving a Density Bonus and Incentives Request and modifications to previous entitlements for the properties located at 418 Linden Avenue,in the Downtown Transit Core District,and 201- 219 Grand Avenue,in the Grand Avenue Core District,and determination that the projects continue to be consistent with the Downtown Station Area Specific Plan Environmental Impact Report,and resolution approving a $1,050,000 Housing Trust Fund loan agreement,resolution approving a $2,450,000 Housing Asset Fund loan agreement,resolutions approving the fourth amendments to the 418 Linden Avenue and 201-219 Grand Avenue Purchase and Sale Agreements,and resolution approving the fourth amendment to the Development Agreement with ROEM Development Corporation.(Billy Gross,Senior Planner and Julie Barnard, Economic Development Coordinator) RECOMMENDATION Staff recommends that the City Council conduct a public hearing and adopt the following resolutions: 1.Resolution making findings and approving a Density Bonus and Incentives Request and amendments to previous entitlements,and making a determination that the project is consistent with the Downtown Station Area Specific Plan Environmental Impact Report, 2.Resolution approving a $1,050,000 loan from the City’s Housing Trust Fund for the development of 37 Below Market Rate units at 418 Linden Avenue, 3.Resolution approving a $2,450,000 loan from the City’s Housing Asset Fund for the development of 47 Below Market Rate units at 201-219 Grand Avenue, 4.Resolution approving the fourth amendment to the 418 Linden Avenue Purchase and Sale Agreement, 5.Resolution approving the fourth amendment to the 201-219 Grand Avenue Purchase and Sale Agreement, and 6.Resolution approving the fourth amendment to the Development Agreement. EXECUTIVE SUMMARY In December 2015,the City Council (Council)approved entitlements for a scattered-site development project on two downtown parcels: 1.201-219 Grand Avenue (a Successor Agency owned site,previously entitled under the address of 255 Cypress Avenue),which is entitled as a five-story mixed-use project with 46 housing units, approximately 5,500 square feet of ground floor commercial,a leasing office,a resident lounge,and 58 parking spaces; and, 2.418 Linden Avenue (a City owned site,previously entitled under the address of 488 Linden Avenue), City of South San Francisco Printed on 3/5/2020Page 1 of 9 powered by Legistar™ File #:19-1012 Agenda Date:3/11/2020 Version:1 Item #:5. 2.418 Linden Avenue (a City owned site,previously entitled under the address of 488 Linden Avenue), which is entitled as a five-story residential project with 38 housing units,a resident lounge and fitness room, and 47 parking spaces. The plan to build housing at these two sites is referred to as the “Grand and Linden”Project.Due to financing difficulties,including escalating construction costs,the applicant has been unable to make the project financially feasible as currently entitled.In order to secure project financing,the applicant is proposing to modify the projects to make 100%of the units affordable to extremely low to moderate income households,and is requesting three State Density Bonus Law Incentives to reduce project costs.The proposed modifications also require amendments to the Development Agreement and the Purchase and Sale Agreement. BACKGROUND/DISCUSSION In December 2015,at the same time that the Council approved entitlements for the Grand and Linden Project, the Council and Successor Agency (Agency)also approved a Disposition and Development Agreement (DDA). The original developer,Brookwood Equities,was unable to advance the project,and as a result the Council and Agency terminated the DDA.According to the terms of the DDA,after termination,the City retained the project entitlements.This allowed the City to solicit a new developer with the entitled proposal.Staff conducted an extensive Request for Proposals (RFP)process,and through that process,the Council and Agency selected ROEM Development Corporation (ROEM) as the preferred developer. In November 2017,the Council approved one Development Agreement (DA),two Purchase and Sale Agreements (PSAs),and an Affordable Housing Agreement (AHA)(collectively “the Agreements”)with ROEM for the development of the properties.At that time,the DA included provisions requiring that 20%of the residential units in the Grand and Linden project be rented at an affordable cost for a term of 55 years;that the developer pay prevailing wage for project construction;and that project construction be completed 30 months after the DA is executed. Following PSAs and DA execution,ROEM has completed drafts of their construction drawings,which have been through two rounds of City building review.ROEM has also made progress in advancing the construction aspects of the development,but continues to have trouble obtaining adequate financing.The lack of financing has led to project delays,and therefore ROEM is proposing modifications to the original project’s concept and is requesting State Density Bonus Law Incentives to reduce overall project costs.Following is a description of the proposed changes: Modifications Applicable to both Projects ·Revise the Affordable Housing Agreement so that 100%of the residential units in the Grand and Linden projects are affordable to extremely-low to moderate income households for a term of 55 years. ·Request State Density Bonus Law Incentives to reduce City Permit and Impact Fees. Modifications Applicable to 201-219 Grand Ave ·Request State Density Bonus to allow an increase of one unit on the Grand Ave site,from 46 units to 47 units.This request is being made because accessibility requirements required the removal of one unit City of South San Francisco Printed on 3/5/2020Page 2 of 9 powered by Legistar™ File #:19-1012 Agenda Date:3/11/2020 Version:1 Item #:5. units.This request is being made because accessibility requirements required the removal of one unit from the ground floor of the 418 Linden Project. ·Request State Density Bonus Law Incentive to reduce parking from 58 spaces to 31 spaces. ·Request State Density Bonus Law Incentive to reduce private storage space requirement from 200 cubic feet to 100 cubic feet per unit. ·Unit floor plans have been revised to meet accessibility requirements of California Building Code Chapter 11B, with greater spatial demands at bathrooms and kitchens. ·Project footprint has been reduced in width by four feet to provide for a stabilizing structure intended to support the walls of the existing buildings on the adjacent property. ·Exterior modifications along the 3rd Lane (south)elevation to replace the horizontal aluminum siding along the ground floor with stucco to match the rest of the south elevation. Modifications Applicable to 418 Linden Ave ·Request State Density Bonus Law Incentive to reduce parking from 47 spaces to 23 spaces. ·Request State Density Bonus Law Incentive to remove private storage space requirement. ·Revise first floor plan to include the common areas required for both 418 Linden Ave and 201-219 Grand Ave. These changes will reduce the total unit count by one unit. ·Remove basement level due to reduction in parking and storage. State Density Bonus Law Requests In accordance with State Density Bonus Law (Govt.Code Section 65915(d)(2)),the applicant is entitled to a density bonus and at least three incentives if the project includes a minimum of 30%of the units restricted to lower income households.Accordingly,the City is obligated to grant the requested incentive unless it can find that the incentive is not required in order to provide for affordable housing costs,that the incentive would have a specific adverse impact upon public health and safety or the physical environment or on any real property that is listed in the California Register of Historical Resources,or that the incentive would be contrary to state or Federal law. Density Bonus for 201-219 Grand Ave For 201-219 Grand Ave.,the Zoning Designation is Grand Avenue Core (GAC).The maximum density allowed by-right in the GAC district is 60 units per acre and the maximum FAR allowed by-right is 3.0.The maximum density allowed with an incentive program is 100 units per acre and the maximum FAR is 4.0.The project was entitled with a density of 99 units per acre, resulting in a total of 46 residential units, and an FAR of 3.69. ROEM is requesting a State Density Bonus to allow an increase of one unit for the 201-219 Grand Ave Project, to a total of 47 residential units.This would result in a density bonus of just greater than 1%.Under State Density Bonus Law,the project would be entitled to a density bonus up to 35%on top of the allowable density under the City’s General Plan as the project would set aside more than 20%of the affordable units for Low Income residents. City of South San Francisco Printed on 3/5/2020Page 3 of 9 powered by Legistar™ File #:19-1012 Agenda Date:3/11/2020 Version:1 Item #:5. Incentive 1 - Parking Reduction for both Sites Per South San Francisco Municipal Code (SSFMC)Section 20.330.007,multi-unit residential projects typically have a minimum parking requirement of one space per unit.201-219 Grand Ave.was entitled with 46 residential units and 58 parking spaces (a parking ratio of 1.26 spaces per unit),and 418 Linden Ave.was entitled with 37 residential units and 47 parking spaces (a parking ratio of 1.27 spaces per unit). State Density Bonus Law (Govt.Code Section 65915(p)(3))allows a rental development located within one- half mile of a major transit stop to request a vehicle parking ratio as low as 0.5 spaces per unit.Per this allowance,the applicant has requested a reduction in the number of parking spaces for both projects;from 58 spaces to 31 spaces in 201-219 Grand (a parking ratio of 0.67 spaces per unit),and from 47 spaces to 23 spaces in 418 Linden (a parking ratio of 0.62 spaces per unit).This reduction will lower project costs by approximately $1.5 million. Incentive 2 - Reduction in the Storage Requirement for both Sites Per SSFMC Section 20.280.005.F,each residential unit is required to have at least 200 cubic feet of enclosed, weather-proofed and lockable private storage space.For the 418 Linden entitlements,the private storage spaces were proposed to be located in the basement parking level.In combination with the Parking Reduction Incentive,the basement level will be removed,and therefore ROEM is requesting that the private storage space requirement be removed.Removal of the basement level would result in a cost savings of approximately $1 million. For the 201-219 Grand Ave Project entitlements,the private storage spaces were proposed to be located on each residential floor.Due to the reduction in the building footprint,ROEM is requesting that the private storage space requirement be reduced from 200 square feet to 100 square feet for each unit.This revision would allow for each unit to continue to be provided private storage. Incentive 3 - Reduction of City Permit and Impact Fees The applicant requests that total City permit and impact fees not exceed $1,045,000. In August 2019,the applicant requested invoices relating to the permit and impact fees that would be owed. Staff provided two invoices for the projects.The total amount for permit and impact fees for 201 Grand and 418 Linden were $533,002 and $512,916 respectively or collectively $1,045,918.The applicant is not requesting a reduction in impact and permit fees but they are requesting assurances that the fees will not change.This provides them with necessary construction cost assurances which sometimes investors will require. The Parks Construction or Acquisition fees do not apply to these projects because they were approved before the City’s rental ordinance was in place. Affordable Housing Agreement The entitled development is obligated to provide 20%of the proposed dwellings as affordable to low and City of South San Francisco Printed on 3/5/2020Page 4 of 9 powered by Legistar™ File #:19-1012 Agenda Date:3/11/2020 Version:1 Item #:5. moderate income households. Since the outset,ROEM has explored many financing options.Due to the ongoing rise in construction costs,the developer has experienced difficulties making the projects financially feasible.On September 6,2017,the Council unanimously approved providing a $3,500,000 grant for the 17 BMR units.These funds were to come from the former redevelopment agency’s City Housing Fund (Fund 241 for $2,450,000)and the City’s Affordable Housing Trust Fund (Fund 205 for $1,050,000). In late 2018,ROEM approached the City with a request to modify the scope to two fully affordable developments.The proposal provided the opportunity to make the project eligible for additional public and private financing.The challenge of relying on public funding sources is that there are usually only one or two application opportunities per year.Based on this timing cycle,in order to seek affordable housing funds to make the project fully affordable,City Council approved ROEM’s request to delay the start of construction for a year and to extend all related deadlines,while they waited for the application periods to open and outcomes to be announced. The developer has spent the past year pursuing other gap financing sources.The applicant has submitted applications for:4%Tax Credits,County of San Mateo’s Affordable Housing Fund 7.0 (AHF 7.0),County of San Mateo’s Project Based Vouchers (PBVs),and the State of California’s Affordable Housing and Sustainable Communities (AHSC)program.ROEM has secured some funding from the AHF 7.0 and PBVs but is awaiting the outcome of the 4% tax credits. Ultimately,the final Below Market Rate unit (BMR)affordability levels are driven by the funding sources and may need to be adjusted, however ROEM’s current proposal is as follows: ·43 units at 30% AMI ·39 units at 80% AMI ·2 Property Managers units AMI household income limits and the maximum affordable rent paid per month are countywide,and further determined driven by the San Mateo County median incomes.These are updated every year.For more information regarding the 2019 income and rent determinations, see Attachment 1. San Mateo County’s Housing Department staff (County staff)reached out to City staff while they were reviewing the AHF 7.0 application.The County questioned why the City was not donating the land at 418 Linden.At the time the developer was offering $500,000 for the site.County staff further suggested that it may be beneficial for the developer to request that the already approved $3,500,000 City grant be converted to a loan. This would allow the developer to leverage further alternative funding sources. An initial Affordable Housing Agreement was drafted and executed by both parties in 2017,however due to the extensive amendments to the agreements, the City and developer agreed to new Agreements. City of South San Francisco Printed on 3/5/2020Page 5 of 9 powered by Legistar™ File #:19-1012 Agenda Date:3/11/2020 Version:1 Item #:5. Loan Agreements City staff is presenting a request to the Council to write down the price of the 418 Linden property (further details provided below) with the following terms: ·$500,000 non-forgivable loan to be repaid 15 years after Certificate of Occupancy ·$3,000,000 potentially forgivable loan, repaid through residual receipts The $500,000 portion of the loan is intended to offset the loss of writing down the purchase price.This $500,000 will comprise part of the $1,050,000 drawn from the City’s Affordable Housing Trust Fund (Fund 205).Therefore this money will be returned to the City within five years,allowing the City to possibly provide funding to future affordable housing developments. Purchase and Sale Agreements and Development Agreement During the negotiations of the disposition,staff and ROEM drafted two Purchase and Sale Agreements:one for 418 Linden Avenue and the other for 201-219 Grand Avenue.Additionally,the Development Agreement was negotiated and encompasses the development of both sites.These agreements operate in conjunction with one another and most of the amendments made in the PSAs influence the amendments to the DA,and vice versa. Therefore,these documents usually travel together through any procedural amendments.Below the amendments are discussed in further detail. First Amendment In January 2018,ROEM informed staff of some of the complexities relating to the site conditions at 201-219 Grand Avenue.The developer noted that the neighboring building was bonded to the City’s building.The developer suspected that the neighboring building may be leaning onto the City’s building and they required more time to conduct some investigative demolition.The developer also required more time to develop a demolition strategy and demolition drawings,in order to ensure that the demolition process does not compromise the neighbor’s building.The City granted ROEM an additional 120-day administrative extension to complete the process. Second Amendment In early July 2018,ROEM asked the City to extend the deadlines by a further 90 days.This extension related to the Financing Plan portion of the project with the application for building permits remaining the same.The City Council approved both requests by resolution in August 2018. Third Amendment In late 2018 the Council agreed to a time extension of one year,to allow the developer to apply for external grant funding.At that time,the Council approved an amendment to the schedule of performance,which would allow ROEM to demolish the buildings located at 217-219 Grand Avenue.The purpose of allowing the developer to demolish the buildings was to compress the construction schedule.The demolition was to be conducted at ROEM’s risk and expense and was expected to take three to four months.ROEM has completed demolition of the interior of the building,but has not been able to take down the entire structure due to structural issues and weather.Since ROEM is not yet in a position to close escrow once the demolition is City of South San Francisco Printed on 3/5/2020Page 6 of 9 powered by Legistar™ File #:19-1012 Agenda Date:3/11/2020 Version:1 Item #:5. complete, the parking lot has been reopened to the public in the interim. Fourth Amendment (Current Request) Key changes to the Fourth Amendment to the Purchase and Sale Agreement include: 1.Amendment to the purchase price for 418 Linden. Reduced from $500,000 to a land donation. 2.Amendment to the schedule of performance,most notably the date construction financing has been secured, the delay of close of escrow and the start of construction. First,as mentioned previously,in order to approve ROEM’s application for County AHF Funds,the San Mateo County requested that the City donate the City-owned land (418 Linden)to the developer.At the time,the developer was offering $500,000 for the site.Additionally,County staff recommended that the City provide a loan that,at the City’s discretion,could be forgivable.In order to offset the $500,000 land donation,staff agreed-subject to City Council approval-to convert the $3,500,000 grant funding that was promised to the developer into a $3,000,000 forgivable loan and a $500,000 non-forgivable loan. Second,given that the developer is awaiting the outcome of their 4%Tax Credit application,the City agreed to an extension to their schedule of performance relating to the start of construction and the close of escrow.This amendment influences both PSAs and the DA. The changes outlined in the fourth DA amendment,currently under consideration,are driven mostly by the changes to the PSAs and the related schedule of performance and amendments to the parking exemptions,not previously included in the original DA. ZONING AND GENERAL PLAN CONSISTENCY In January and February of 2015,the Council adopted the Downtown Station Area Specific Plan (“DSASP”),as well as amendments to the City’s Zoning Ordinance,adding Chapter 20.280 “Downtown Station Area Specific Plan District”to implement the policies and goals in the DSASP.The DSASP covers properties within 0.5 miles of the City’s Caltrain Station, which includes the subject properties. The General Plan Land Use Designation for 201 Grand Ave.is Grand Avenue Core,which includes specific policies related to development within the Downtown,in an effort to “encourage development of Downtown as a pedestrian-friendly mixed-use activity center with retail and visitor-oriented uses,business and personal services, government and professional offices, civic uses, and a variety of residential types and densities.” The General Plan Land Use Designation for 418 Linden Ave.is Downtown Transit Core,which is considered the area most suitable for the highest intensities of new development in the Downtown Area,which will help to support transit ridership and the pedestrian activity needed to support downtown businesses,add street life and improve safety. The proposed modifications will not substantively change the previously entitled projects,and therefore,the Grand and Linden Project will continue to conform to the General Plan Land Use Policies. City of South San Francisco Printed on 3/5/2020Page 7 of 9 powered by Legistar™ File #:19-1012 Agenda Date:3/11/2020 Version:1 Item #:5. ENVIRONMENTAL REVIEW In December 2015 the Council found that the Grand and Linden Project was within the parameters analyzed within the adopted Downtown Station Area Specific Plan (DSASP)Environmental Impact Report (EIR).The DSASP EIR included a Mitigation Monitoring and Reporting Program (MMRP)that identified mitigation measures required of development projects within the DSASP area,to show that the project components are within the environmental parameters analyzed in the DSASP EIR. The proposed modifications to the project continue to be consistent with the analysis included in the previously entitled projects,and the approval would not result in any new significant environmental effects or a substantial increase in the severity of any previously identified effects beyond those disclosed and analyzed in the EIR certified by City Council,nor do the proposed modifications constitute a change in the Project or change in circumstances that would require additional environmental review.Therefore,no further CEQA action is required by the City Council at this time. CONCLUSION The proposed modifications will allow the Grand and Linden Project to move forward to construction,provide an increase from 17 to 84 affordable units (i.e.from 20%to 100%of the total units),and continue to meet the intent of the Downtown Station Area Specific Plan and General Plan guiding and implementing policies. Therefore, staff recommends that the Council adopt the following: 1.Resolution making findings and approving a Density Bonus and Incentives Request and amendments to previous entitlements,and making a determination that the project is consistent with the Downtown Station Area Specific Plan Environmental Impact Report, 2.Resolution approving a $1,050,000 loan from the City’s Housing Trust Fund for the development of 37 Below Market Rate units at 418 Linden Avenue, 3.Resolution approving a $2,450,000 loan from the City’s Housing Asset Fund for the development of 47 Below Market Rate units at 201-219 Grand Avenue, 4.Resolution approving the fourth amendment to the 418 Linden Avenue Purchase and Sale Agreement, 5.Resolution approving the fourth amendment to the 201-219 Grand Avenue Purchase and Sale Agreement, and 6.Resolution approving the fourth amendment to the Development Agreement. Staff also recommend that Council find that the Grand and Linden Projects continue to be consistent with the DSASP EIR. Attachments 1.San Mateo County AMI household limits and rent payments City of South San Francisco Printed on 3/5/2020Page 8 of 9 powered by Legistar™ File #:19-1012 Agenda Date:3/11/2020 Version:1 Item #:5. City of South San Francisco Printed on 3/5/2020Page 9 of 9 powered by Legistar™ revised 05/21/19 For HUD-funded programs, use the Federal Income Schedule. For State or locally-funded programs, you may use the State Income Schedule. For programs funded with both federal and state funds, use the more stringent income levels. Please verify the income and rent figures in use for specific programs. San Mateo County (based on Federal Income Limits for SMC) Income Category 1 2 3 4 5 6 7 8 Extremely Low (30% AMI) *33,850 38,700 43,550 48,350 52,250 56,100 60,000 63,850 Very Low (50% AMI) *56,450 64,500 72,550 80,600 87,050 93,500 99,950 106,400 HOME Limit (60% AMI) *71,170 81,340 91,500 101,630 109,830 117,920 126,060 134,220 Low (80% AMI) *90,450 103,350 116,250 129,150 139,500 149,850 160,150 170,500 NOTES * California State Income Limits Effective 4/24/19 - Area median Income $136,800 (based on household of 4) Income Category 1 2 3 4 5 6 7 8 Extremely Low (30% AMI) *33,850 38,700 43,550 48,350 52,250 56,100 60,000 63,850 Very Low (50% AMI) *56,450 64,500 72,550 80,600 87,050 93,500 99,950 106,400 Low (80% AMI) *90,450 103,350 116,250 129,150 139,500 149,850 160,150 170,500 Median (100% AMI)95,750 109,450 123,100 136,800 147,750 158,700 169,650 180,600 Moderate (120% AMI)114,900 131,300 147,750 164,750 17,300 190,400 203,550 216,700 NOTES *2019 State Income limits provided by State of California Department of Housing and Community Development ; 2019 San Mateo County Income Limits as determined by HUD - effective December 18 , 2013 Income Limits by Family Size ($) Income figures provided by HUD for following San Mateo County federal entitlement programs: CDBG, HOME, ESG.; Prepared 5/21/2018 - HUD-established area median Income $136,800 (based on household of 4). Income Limits by Family Size ($) Income limits effective 06/01/2019. Please verify the income and rent figures in use for specific programs. NOTES Income Category 1 2 3 4 5 6 7 8 Extremely Low (30% AMI) *33,850 38,700 43,550 48,350 52,250 56,100 60,000 63,850 Very Low (50% AMI) *56,450 64,500 72,550 80,600 87,050 93,500 99,950 106,400 HOME Limit (60% AMI) *71,170 81,340 91,500 101,630 109,830 117,920 126,060 134,220 HERA Special VLI (50% AMI) ***56,450 64,500 72,550 80,600 87,050 93,500 99,950 106,400 See Note regarding HERA for FY2019*** HERA Special Limit (60% AMI) ***71,170 81,340 91,500 101,630 109,830 117,920 126,060 134,220 See Note regarding HERA for FY2019*** Low (80% AMI) *90,450 103,350 116,250 129,150 139,500 149,850 160,150 170,500 State Median (100% AMI) 95,750 109,450 123,100 136,800 147,750 158,700 169,650 180,600 Income Category SRO *+Studio 1-BR 2-BR 3-BR 4-BR Extremely Low *846 907 1,088 1,256 1,401 Very Low *1,411 1,512 1,814 2,096 2,338 Low HOME Limit*1,552 1,411 1,512 1,814 2,096 2,338 effective 6/01/2018; 2019 HOME Limit High HOME Limit *1,552 1,906 2,044 2,456 2,827 3,131 effective 6/01/2018; 2019 HOME Limit HERA Special VLI (50% AMI) ***HERA Spec. Rents - Go to www.treasurer.ca.gov/ctcac/2018/supplemental.asp HERA Special Limit (60% AMI) *** Low**2,260 2,423 3,078 3,557 3,746 CA Tax Credit Rent limits for Low and Median Income Group HUD Fair Market Rent (FMR)2,069 2,561 3,170 4,153 4,392 HUD-published Fair Market Rents Median **2,964 3,176 3,811 4,405 4,913 CA Tax Credit Rent limits for Low and Median Income Grou NOTES * **CA Tax Credit Rent Limits for Low and Median Income Group *** *+ For San Mateo County, the Housing & Economic Recovery Act of 2008 (HERA) & the HUD 2010 HOME hold-harmless provision permit multifamily tax subsidy projects (MTSPs) & HOME projects placed in service before 1/1/2009 to continue to use HOME/tax credit/tax exempt bond rents based on the highest income levels that project ever operated under. Once these units are placed in service, the rents will not adjust downward should HUD establish lower incomes/rents in any subsequent year. Marketing of vacant units should be targeted to the current year's income schedule. However, HUD's Section 8 income limits are larger that those defined by Section 3009(a)(E)(ii) of the Housing and Economic Recovery Act of 2008 (Public Law 110-289). Therefore, for FY2018 no special income limits are necessary. Income Limits by Family Size ($) Maximum Affordable Rent Payment ($) SROs with -0- or 1 of the following - sanitary or food preparation facility in unit; if 5+ SRO HOME-assisted units, then at least 20% of units to be occupied by persons with incomes up to 50% AMI. HUD-defined Area Median Income $136,800 (based on householdof 4). State median $136,800 (household of 4) due to hold harmless policy. 2019 San Mateo County Income Limits as determined by HUD, State of CA HCD, and County of San Mateo Income figures provided by HUD for following San Mateo County federal entitlement programs: CDBG, HOME, ESG. OTHER NOTES (generic) 1 High HOME Limit rent set at lower of: (a) 30% of 60% AMI,or (b) FMR (HUD Fair Market Rent). For 2011, the FMR for Studio is the lower rent. 2 3 Table below provides rent guidance on appropriate income schedule to use: 2014 12/01/2012 - 12/17/2013 2013 4/01/2019 to present 2019 03/06/2015 - 03/27/16 2015 4/01/2018 - 3/31/2019 2018 03/28/2016 - 4/14/2017 2016 Maximum Inc. Limits SchedulePlaced in Service Date On or before 12/31/2008 Rent schedules at https://www.huduser.gov/portal/pdrdatas_landing.html for additional information as well as the various income schedules. Please also refer to www.treasurer.ca.gov/ctcac/2018/supplemental.asp 12/18/2013 - 03/05/2015 04/14/2017 to 3/31/18 2017 20126/1/2011 - 11/30/2011 2012 Rent Calcuations - The following is the assumed family size for each unit: Studio:1 person 1-BR:1.5 persons 2-BR:3 3-BR: 4.5 4-BR:6 Maximum affordable rent based on 30% of monthly income and all utlilites paid by landlord unless further adjusted by HUD. Utliity allowances for tenant-paid utliites may be established by Housing Authority of County of San Mateo Section 8 Program. 2009 5/14/2010 - 5/31/2011 12/01/2011 - 11/30/2012 2012 1/1/2009 to 5/13/2010 2018 HERA Special City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:19-1013 Agenda Date:3/11/2020 Version:1 Item #:5a. Resolution making findings and approving amendments to previous entitlements,including a Density Bonus and Incentives Request,at 418 Linden Avenue,in the Downtown Transit Core District,and 201-219 Grand Avenue,in the Grand Avenue Core District,and determination that the projects continue to be consistent with the Downtown Station Area Specific Plan Environmental Impact Report. WHEREAS,the City of South San Francisco (“City”)is the owner of certain real property located in the City of South San Francisco,California,known as County Assessor’s Parcel Number 012-314-010 (“418 Linden Avenue”); and, WHEREAS,the City is also the owner of former Redevelopment Agency property located in the City of South San Francisco,California,known as County Assessor’s Parcel Number 012-316-110 (201 Grand Avenue),012- 316-100 (207 Grand Avenue),012-316-090 and 012-316-080 (217-219 Grand Avenue)(collectively,the “201- 219 Grand Avenue”); and, WHEREAS,in December 2015 the City approved entitlements for a residential project at 418 Linden Avenue and a mixed-use project at 201-219 Grand Avenue (“Project”); and, WHEREAS,in December 2016 the City and Agency selected a developer,ROEM Development Corporation (“Developer”), to develop the Project encompassing 418 Linden Avenue and 201-219 Grand Avenue; and, WHEREAS,in September 2017 the City approved a Development Agreement and a Purchase and Sale Agreement with the Developer related to the Project encompassing 418 Linden Avenue and 201-219 Grand Avenue; and, WHEREAS,the applicant seeks approval of a Density Bonus (DB20-0001),Fourth Amendment to the Development Agreement (DAA19-0001),Fourth Amendment to the Purchase and Sale Agreements,Loan Agreements, and Affordable Housing Agreements (AHA19-0001) for the Project; and WHEREAS,the City Council certified an Environmental Impact Report (“EIR”)on January 28,2015 (State Clearinghouse number 2013102001)in accordance with the provisions of CEQA and CEQA Guidelines,which analyzed the potential environmental impacts of the development of the Downtown Station Area Specific Plan; and, WHEREAS,the 418 Linden Avenue and 201-219 Grand Avenue sites are both within the Downtown Station Area Specific Plan (“DSASP”)area and were found to be within the parameters analyzed within the DSASPCity of South San Francisco Printed on 3/18/2020Page 1 of 3 powered by Legistar™ File #:19-1013 Agenda Date:3/11/2020 Version:1 Item #:5a. Area Specific Plan (“DSASP”)area and were found to be within the parameters analyzed within the DSASP EIR; and, WHEREAS,the Project will not result in any new significant environmental effects or a substantial increase in the severity of any previously identified effects beyond those disclosed and analyzed in the DSASP EIR,and wound not constitute a change in circumstances that would require additional environmental review; and, WHEREAS,on February 12,2020,the City Council for the City of South San Francisco held a lawfully noticed public hearing to solicit public comment and consider the proposed entitlements and environmental effects of the Project and take public testimony. NOW,THEREFORE,BE IT RESOLVED that based on the entirety of the record before it,which includes without limitation,the California Environmental Quality Act,Public Resources Code §21000,et seq. (“CEQA”)and the CEQA Guidelines,14 California Code of Regulations §15000,et seq.;the South San Francisco General Plan and General Plan EIR;the Downtown Station Area Specific Plan and associated EIR; the South San Francisco Municipal Code;the Project applications;all site plans,and all reports,minutes,and public testimony submitted as part of the City Council’s duly noticed February 12,2020 meeting;and any other evidence (within the meaning of Public Resources Code §21080(e)and §21082.2),the City Council of the City of South San Francisco hereby finds as follows: SECTION 1 FINDINGS General 1.The foregoing recitals are true and correct and made a part of this Resolution. 2.The documents and other material constituting the record for these proceedings are located at the Planning Division for the City of South San Francisco,315 Maple Avenue,South San Francisco,CA 94080, and in the custody of the Planning Manager, Sailesh Mehra. 3.The Project encompassing 418 Linden Avenue and 201-219 Grand Avenue is consistent with the General Plan by creating a mixed-use environment that emphasizes pedestrian-activity with buildings built up to the property line on Linden Avenue and Grand Avenue,respectively,provide well-articulated and visually engaging development that implements the goals of the Downtown Station Area Specific Plan,are consistent with the City’s Design Guidelines as they relate to building design,form and articulation and,in the case of 201-219 Grand Avenue,provide commercial uses along both Grand and Cypress Avenues Density Bonus Request Finding 1.The Project will provide 84 residential units,all of which will be affordable to moderate-and low- income households.The total percentage of affordable housing set aside for low income households City of South San Francisco Printed on 3/18/2020Page 2 of 3 powered by Legistar™ File #:19-1013 Agenda Date:3/11/2020 Version:1 Item #:5a. income households.The total percentage of affordable housing set aside for low income households constitutes more than twenty percent (20%)of the total number of Project units.Therefore,the Project is entitled to receive a thirty-five percent (35%) density bonus under Government Code section 65915. SECTION 2 DETERMINATION NOW,THEREFORE,BE IT FURTHER RESOLVED that the City Council of the City of South San Francisco hereby makes the findings contained in this Resolution and approves a Density Bonus and Incentives Request for the Grand and Linden Project. BE IT FURTHER RESOLVED that the approvals stated herein are conditioned upon the City Council’s approval and execution of the Development Agreement between the City of South San Francisco and ROEM Development Corporation. BE IT FURTHER RESOLVED that this Resolution shall become effective immediately upon its passage and adoption. ***** City of South San Francisco Printed on 3/18/2020Page 3 of 3 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-22 Agenda Date:3/11/2020 Version:1 Item #:5b. Resolution approving the Fourth Amendment to the Development Agreement for 201-219 Grand Avenue and 418 Linden Avenue properties with ROEM Development Corporation. WHEREAS,the City of South San Francisco (“City”)is the owner of certain real property located in the City of South San Francisco,California,with the address of 418 Linden Avenue,known as County Assessor’s Parcel Numbers (“APN”) 012-314-010 (“418 Linden”); and WHEREAS,the City is also the owner of former Redevelopment Agency property located in the City of South San Francisco,California,with the address of 201-219 Grand Avenue,known as APNs 012-316-100,012-316- 110, 012-316-080 and 012-316-090 (collectively, “201 Grand Avenue”); and WHEREAS,in December 2015 the City approved entitlements for a residential project at 418 Linden Avenue and a mixed-use project at 201 Grand Avenue (“Project”); and, WHEREAS,in December 2016,following a competitive process,the City and Agency selected a developer, ROEM Development Corporation (“Developer”),to develop the 418 Linden Avenue and 201 Grand Avenue Projects; and, WHEREAS,pursuant to City Council Ordinance No.1541-2017 (“DA Ordinance”),the City entered into a Development Agreement between City and Developer (“Development Agreement”)for the development of a residential project at 418 Linden Avenue and a mixed-use project at 201-219 Grand Avenue (together,the “Project”). WHEREAS,on March 28,2018,Developer and City entered into that certain First Administrative Amendment to Development Agreement (“First Amendment”),whereby the parties agreed to adjust the deadlines within the Performance Schedule contained within the Development Agreement by 120 days in order to provide sufficient time to undertake the complex demolition presented at 201-219 Grand Avenue.On August 23,2018,Developer and City entered into a Second Amendment to the Development Agreement (“Second Amendment”)to further adjust the deadlines within the Schedule of Performance contained in the First Amendment to the Development Agreement and First Amendment to the Purchase and Sale Agreements for the Project by 90 days. WHEREAS,on March 21,2019,Developer and City entered into that certain Third Amendment to the Development Agreement (“Third Amendment”),whereby the parties agreed to adjust the deadlines within the Performance Schedule contained in the Development Agreement in order to secure the necessary affordable housing funding sources and modify the number of below market rate units within the Project to render the Project one-hundred percent (100%)affordable conditioned upon Developer’s completion of certain pre- construction activities,specifically causing improvements and structures located on the Grand Property to be demolished.The parties agreement regarding Developer’s completion of pre-construction activities was set forth in that certain Pre-Construction Activity Right of Access Agreement (“Pre-Construction Agreement”) attached as Exhibit A to the Third Amendment which Exhibit C thereto governed the Schedule of PerformanceCity of South San Francisco Printed on 3/18/2020Page 1 of 3 powered by Legistar™ File #:20-22 Agenda Date:3/11/2020 Version:1 Item #:5b. attached as Exhibit A to the Third Amendment which Exhibit C thereto governed the Schedule of Performance of such pre-construction activities. WHEREAS,because the additional time requested adjusted the overall Project completion date by one year,the City determined that the Third Amendment required notice and public hearing,and approval by ordinance pursuant to Section 7.2(b) of the Development Agreement. WHEREAS,therefore,on January 13,2019,following a duly noticed public hearing,the Planning Commission adopted Resolution No.2841-2019 recommending that the City Council approve the Third Amendment.With the Planning Commission’s recommendation set forth in its Resolution No.2841-2019,the City Council,after conducting a duly noticed public hearing,found that the Third Amendment was consistent with the General Plan and Zoning Ordinance and conducted all necessary proceedings in accordance with the City’s rules and regulations for the approval of the Third Amendment.In accordance with SSFMC section 19.60.120,the City Council,at a duly noticed public hearing,adopted Ordinance No.1571-2019,approving and authorizing the execution of the Third Amendment. WHEREAS,on October 1,2019,Developer requested an extension of the deadline to demolish the existing buildings on 201-219 Grand Avenue by September 11,2019 as required by the Schedule of Performance contained in the Pre-Construction Agreement.On October 10,2019,the City conditionally approved Developer’s request to extend this deadline to April, 2020 via a response letter from the City Manager. WHEREAS,in particular,the City conditioned its approval on Developer’s completion of accomplish certain tasks by November 11,2019.In conformance with the City’s conditional approval,Developer has now completed the tasks identified in the City’s October 10,2019 letter approving the extension of the demolish deadline to April,2020.The proposed amendment to Exhibit E to the Development Agreement set forth herein reflects the City’s prior approval of modification to this deadline. WHEREAS,on December 3,2019,Developer requested a fourth amendment to the Development Agreement (“Fourth Amendment”)to further extend the deadlines within the Schedule of Performance contained in the Third Amendment to the Development Agreement and Third Amendment to the Purchase and Sale Agreements for the Project by 200 days in order to secure the necessary affordable housing funding sources. WHEREAS,the City and the Developer have determined that the Schedule of Performance attached to the Third Amendment as Exhibit E does not provide sufficient time to secure the necessary affordable housing funding sources. WHEREAS,the additional time requested in the Fourth Amendment to secure the necessary affordable housing funding sources adjusts the overall Project completion date by 200 days.Pursuant to Section 7.2 of the Development Agreement,the City has determined that the amendment is minor and does not substantially affect the existing term and schedule of performance,and the Fourth Amendment does not require notice or public hearing and may be approved by City resolution. NOW THEREFORE IT BE RESOLVED that the City Council of the City of South San Francisco does hereby resolve as follows: 1.Determines that the recitals are true and correct. 2.Approves the Fourth Amendment to the Development Agreement for 201-219 Grand Avenue and 418 City of South San Francisco Printed on 3/18/2020Page 2 of 3 powered by Legistar™ File #:20-22 Agenda Date:3/11/2020 Version:1 Item #:5b. 2.Approves the Fourth Amendment to the Development Agreement for 201-219 Grand Avenue and 418 Linden Avenue properties with ROEM Development Corporation, attached hereto as Exhibit A. ***** Exhibit A:Fourth Amendment to the Development Agreement between ROEM Development Corporation and the City of South San Francisco City of South San Francisco Printed on 3/18/2020Page 3 of 3 powered by Legistar™ Recording Requested by and when Recorded, return to: City of South San Francisco 400 Grand Ave South San Francisco, CA 94080 EXEMPT FROM RECORDING FEES PER GOVERNMENT CODE §§6103, 27383 (SPACE ABOVE THIS LINE RESERVED FOR RECORDER’S USE) FOURTH AMENDMENT TO DEVELOPMENT AGREEMENT This Fourth Amendment to Development Agreement (“Fourth Amendment”) is entered into by and between ROEM Development Corporation, a California corporation (“Developer”) and the CITY OF SOUTH SAN FRANCISCO, a municipal corporation (“City”) on this _____ day of _________________, 2020. RECITALS A. Pursuant to City Council Ordinance No. 1541-2017 (“DA Ordinance”), the City entered into a Development Agreement between City and Developer (“Development Agreement”) for the development of a residential project at 418 Linden Avenue and a mixed-use project at 201-219 Grand Avenue (together, the “Project”). B. On March 28, 2018, Developer and City entered into that certain First Administrative Amendment to Development Agreement (“First Amendment”), whereby the parties agreed to adjust the deadlines within the Performance Schedule contained within the Development Agreement by 120 days in order to provide sufficient time to undertake the complex demolition presented at 201-219 Grand Avenue. On August 23, 2018, Developer and City entered into a Second Amendment to the Development Agreement (“Second Amendment”) to further adjust the deadlines within the Schedule of Performance contained in the First Amendment to the Development Agreement and First Amendment to the Purchase and Sale Agreements for the Project by 90 days. C. On March 21, 2019, Developer and City entered into that certain Third Amendment to the Development Agreement (“Third Amendment”), whereby the parties agreed to adjust the deadlines within the Performance Schedule contained in the Development Agreement in order to secure the necessary affordable housing funding sources and modify the number of below market rate units within the Project to render the Project one-hundred percent (100%) affordable conditioned upon Developer’s completion of certain pre-construction activities, specifically causing improvements and structures located on the Grand Property to be demolished. The parties agreement regarding Developer’s completion of pre-construction activities was set forth in that certain Pre-Construction Activity Right of Access Agreement (“Pre-Construction Agreement”) attached as Exhibit A to the Third Amendment which Exhibit C thereto governed the Schedule of Performance of such pre- construction activities. D. Because the additional time requested adjusted the overall Project completion date by one year, the City determined that the Third Amendment required notice and public hearing, and approval by ordinance pursuant to Section 7.2(b) of the Development Agreement. E. Therefore, on January 13, 2019, following a duly noticed public hearing, the Planning Commission adopted Resolution No. 2841-2019 recommending that the City Council approve the Third Amendment. With the Planning Commission’s recommendation set forth in its Resolution No. 2841-2019, the City Council, after conducting a duly noticed public hearing, found that the Third Amendment was consistent with the General Plan and Zoning Ordinance and conducted all necessary proceedings in accordance with the City’s rules and regulations for the approval of the Third Amendment. In accordance with SSFMC section 19.60.120, the City Council, at a duly noticed public hearing, adopted Ordinance No. 1571-2019, approving and authorizing the execution of the Third Amendment. F. On October 1, 2019, Developer requested an extension of the deadline to demolish the existing buildings on 201-219 Grand Avenue by September 11, 2019 as required by the Schedule of Performance contained in the Pre-Construction Agreement. On October 10, 2019, the City conditionally approved Developer’s request to extend this deadline to April, 2020 via a response letter from the City Manager. G. In particular, the City conditioned its approval on Developer’s completion of accomplish certain tasks by November 11, 2019. In conformance with the City’s conditional approval, Developer has now completed the tasks identified in the City’s October 10, 2019 letter approving the extension of the demolish deadline to April, 2020. The proposed amendment to Exhibit E to the Development Agreement set forth herein reflects the City’s prior approval of modification to this deadline. H. On December 3, 2019, Developer requested a fourth amendment to the Development Agreement (“Fourth Amendment”) to further extend the deadlines within the Schedule of Performance contained in the Third Amendment to the Development Agreement and Third Amendment to the Purchase and Sale Agreements for the Project by 200 days in order to secure the necessary affordable housing funding sources. I. The City and the Developer have determined that the Schedule of Performance attached to the Third Amendment as Exhibit E does not provide sufficient time to secure the necessary affordable housing funding sources. J. The additional time requested in the Fourth Amendment to secure the necessary affordable housing funding sources adjusts the overall Project completion date by 200 days. Pursuant to Section 7.2 of the Development Agreement, the City has determined that the amendment is minor and does not substantially affect the existing term and schedule of performance, and the Fourth Amendment does not require notice or public hearing and may be approved by City resolution. NOW, THEREFORE, in consideration of the mutual covenants and promises of the parties herein contained, the City and Developer agree as follows: AMENDMENT TO AGREEMENT 1. Recitals. The foregoing recitals are true and correct and hereby incorporated herein. 2. Defined Terms. All capitalized terms not defined herein shall have the meanings ascribed to them in the Development Agreement. 3. Amendment to Section 3.6. Section 3.6 to the Development Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 4. 3.6 Affordable Housing. Developer acknowledges that as required by density bonus requirements and the City’s provision of financial assistance, upon Developer's acquisition of the Properties, the Properties will be subject to recorded covenants that will restrict use of the Properties for a term of not less than fifty-five (55) years, commencing upon the issuance of a final certificate of occupancy for the Project, as further set forth in the Linden Affordable Housing Agreement (“Linden AHA”) and the Grand Affordable Housing Agreement (“Grand AHA''), each substantially in the forms attached hereto as Exhibits C and D (the “AHAs''), each of which shall be recorded in the Official Records on the date that Developer acquires the Project Site. The AHAs shall provide that not less than twenty percent (20%) of the residential units in the Project as a whole shall be rented at an affordable cost (as defined in the respective AHA) and also shall ensure that use of any city financial assistance shall be utilized by Developer in a manner consistent with those terms imposed on the use of said City financial assistance. The AHAs shall provide that one hundred percent (100%) of the residential units in the Project not used as a “manger unit” shall be rented at an affordable cost (as defined in the respective AHA).Amendment to Section 6.12. Section 6.12 to the Development Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 6.2 No Condominium Conversion. City acknowledges and agrees that the residential component of the Project, other than the manager’s units the Below Market Rate (BMR) units, is proposed for, approved as, and will be constructed as market-rate rental Below Market Rate (BMR) housing. Developer shall not convert the residential units in the Project to condominium or cooperative ownership or sell condominium or cooperative rights to the residential portion of the Project or any part thereof unless Developer obtains the City's consent and meets the City’s affordability requirements in effect at the time. City prior written consent shall be required with respect to the sale or condominium conversion of the retail/commercial portion of the Project or any part thereof, and shall not be unreasonably withheld, conditioned or delayed provided that Developer meets all applicable requirements. 5. Further Amendment to Exhibit E. Exhibit E to the Development Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough as set forth below. Upon request of the Developer, the City Manager may extend any of the dates set forth on Exhibit E in the City Manager’s reasonable discretion up to an additional 90 days: EXHIBIT E Developer’s Project Schedule of Performance Milestone Deadline 1 50% Construction Drawings (CDs) and Proforma May 15, 2018 (Completed) 2 100% CDs submitted for building permits and Updated Proforma July 14, 2018 (Completed) 3 Construction Financing Secured and Construction Contract Executed June 18, 2020 November 30, 2019 4 If building permit application and 100% CDs were completed in #2, building permit ready for issuance June 29, 2020 December 11, 2019 5 Close of Escrow and Property Conveyance By July 8, 2020 By December 21, 2019 Within Ten (10) Days from Satisfaction of All Contingencies 6a Grand Avenue Demolition Start May 14, 2019 (Completed) 6b Grand Avenue Demolition Complete on or before October 22, 2020 September 11, 2019 7 Construction Start October 22, 2020 April 5, 2020 8 Construction Completion March 17, 2022 August 31, 2021 6. Effect of Fourth Amendment. Except as expressly modified by this Fourth Amendment, the Development Agreement shall continue in full force and effect according to its terms, and Developer and City hereby ratify and affirm all their respective rights and obligations under the Development Agreement, including but not limited to Developer’s indemnification obligations as set forth in Section 13 of the Development Agreement. In the event of any conflict between the Fourth Amendment or the Development Agreement, the provisions of this Fourth Amendment shall govern. 7. Binding Agreement. This Fourth Amendment shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors in interest, and assigns of each of the parties hereto. Any reference in this Fourth Amendment to a specifically named party shall be deemed to apply to any successor, administrator, executor, or assign of such party who has acquired an interest in compliance with the terms of this Fourth Amendment or under law. 8. Recordation. The City shall record a copy of this Fourth Amendment together with recordation of the Development Agreement. 9. Counterparts. This Fourth Amendment may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, when taken together, shall constitute the same document. 10. California Law. This Fourth Amendment shall be governed by and interpreted in accordance with the laws of the State of California. Any action to enforce or interpret this Agreement shall be filed and heard in the Superior Court of San Mateo County, California. 11. Invalidity. Any provision of this Fourth Amendment that is determined by a court of competent jurisdiction to be invalid or unenforceable shall be deemed severed from this Fourth Amendment, and the remaining provisions shall remain in full force and effect as if the invalid or unenforceable provision had not been a part hereof 12. Headings. The headings used in this Fourth Amendment are for convenience only and shall be disregarded in interpreting the substantive provisions of this Fourth Amendment. IN WITNESS WHEREOF, this Fourth Amendment has been entered into by and between Developer and City as of the date and year first above written. [SIGNATURES ON THE FOLLOWING PAGE] ROEM Development Corporation, a California Corporation By: ROEM Development Corporation, a California Corporation, President By: ______________________________________________________________ Name: ____________________________________________________________ Title: _____________________________________________________________ Date: _____________________________________________________________ CITY OF SOUTH SAN FRANCISCO By: Name: Charles Michael Futrell Title: City Manager Date: APPROVED AS TO FORM: By: ___________________ Sky Woodruff, City Attorney ATTEST: By: ____________________ Rosa Govea Acosta City Clerk 3490952.1 City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-54 Agenda Date:3/11/2020 Version:1 Item #:5c. Resolution approving the Fourth Amendment to the 418 Linden Purchase and Sale Agreement with ROEM Development Corporation WHEREAS,the City of South San Francisco (“Seller”)and ROEM Development Corporation (“Buyer”) entered into that certain Purchase and Sale Agreement dated November 14,2017 (the “Agreement”)with respect to that certain real property located at 418 Linden Avenue,South San Francisco,California (Assessor’s Parcel Numbers 012-314-010) (the “Property”); and, WHEREAS,on March 28,2018,Seller and Buyer entered into that certain First Amendment to Purchase and Sale Agreement (“First Amendment”),whereby the parties agreed to adjust the deadlines within the Buyer’s Schedule of Performance as set forth in Section 5 of the Agreement.On August 22,2018,Seller and Buyer entered into that certain Second Amendment to Purchase and Sale Agreement (“Second Amendment”),whereby the parties agreed to further adjust the deadlines within Buyer’s Schedule of Performance,as set forth therein; and, WHEREAS,on March 21,2019,Seller and Buyer entered into that certain Third Amendment to Purchase and Sale Agreement (“Third Amendment”)based upon Buyer’s proposal to modify the number of below market rate units within the Project which was desirable to the Seller and whereby the parties agreed to adjust the deadlines within the Buyer’s Schedule of Performance for an additional 12-month period to allow Buyer to seek additional financing for such proposal; and, WHEREAS,on December 3,2019,Developer requested a fourth amendment to the Purchase and Sale Agreement (“Fourth Amendment”)to further extend the deadlines Buyer’s Schedule of Performance contained in the Third Amendment to the Purchase and Sale Agreements for the Project by 200 days in order to secure the necessary affordable housing funding sources; and, WHEREAS,the Seller and Buyer have determined that Buyer’s Schedule of Performance does not provide sufficient time to secure the necessary affordable housing funding sources and now desire to amend certain provisions of the Agreement,as amended by the First and Second and Third Amendment,to reflect this understanding, as set forth in the Fourth Amendment, attached hereto as Exhibit A; and, WHEREAS,at the time the PSA was negotiated,Buyer offered Five Hundred Thousand Dollars ($500,000)for the purchase of the property and Seller committed grant funding of One Million Two Hundred and Twenty Five Thousand Dollars ($1,225,000.00)from the City’s Affordable Housing Asset Fund to assist in the construction of the affordable housing units (“City Grant”); and, WHEREAS,Buyer has requested that the City Grant be converted to a loan in order to leverage other funding; and, WHEREAS,Seller has agreed to a One Million and Fifty Thousand Dollars ($1,050,000.00)loan from theCity of South San Francisco Printed on 3/18/2020Page 1 of 2 powered by Legistar™ File #:20-54 Agenda Date:3/11/2020 Version:1 Item #:5c. WHEREAS,Seller has agreed to a One Million and Fifty Thousand Dollars ($1,050,000.00)loan from the City’s Affordable Housing Trust Fund; and, WHEREAS,Buyer has increased the number of Below Market Rate (”BMR”)units from eight to thirty-six and requested a City donation of the land (“Land Donation”); and, WHEREAS,in order to offset the loss of the Land Donation,Seller has agreed to forgive Five Hundred and Fifty Thousand Dollars ($550,000)with Five Hundred Thousand Dollars ($500,000)being repaid within five years; and, WHEREAS,Buyer and Seller wish to amend the Schedule of Performance that provides additional time to secure the necessary affordable housing funding sources and adjusts the overall Project completion date by 200 days., NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of South San Francisco as follows: 1.The foregoing recitals are true and correct and incorporated herein as part of this Resolution. 2.The Fourth Amendment to the Purchase and Sale Agreement is attached hereto as Exhibit A,and is incorporated herein and hereby approved. 3.The City Manager,or his designee,is authorized to execute the Fourth Amendment and any necessary related documents. 4.The City Manager,or his designee,is authorized take any and all other actions necessary to implement this intent of this Resolution, subject to approval as to form by the City Attorney. ***** Exhibit A: Fourth Amendment to the 418 Linden Purchase and Sale Agreement City of South San Francisco Printed on 3/18/2020Page 2 of 2 powered by Legistar™ FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT This Fourth Amendment to Purchase and Sale Agreement (this “Fourth Amendment”) is made effective as of _________, 2020 (“Effective Date”) by and between CITY OF SOUTH SAN FRANCISCO, a municipal corporation (“Seller”) and ROEM Development Corporation, a California Corporation (“Buyer”). Seller and Buyer are sometimes individually referred to herein as a “party” and collectively as “the parties.” RECITALS A. Seller and Buyer entered into that certain Purchase and Sale Agreement dated November 14, 2017 (the “Agreement”) with respect to that certain real property located at 418 Linden Avenue, South San Francisco, California (Assessor’s Parcel Numbers 012-314-010) (the “Property”); B. On March 28, 2018, Seller and Buyer entered into that certain First Amendment to Purchase and Sale Agreement (“First Amendment”), whereby the parties agreed to adjust the deadlines within the Buyer’s Schedule of Performance as set forth in Section 5 of the Agreement. On August 22, 2018, Seller and Buyer entered into that certain Second Amendment to Purchase and Sale Agreement (“Second Amendment”), whereby the parties agreed to further adjust the deadlines within Buyer’s Schedule of Performance, as set forth therein. C. On March 21, 2019, Seller and Buyer entered into that certain Third Amendment to Purchase and Sale Agreement (“Third Amendment”) based upon Buyer’s proposal to modify the number of below market rate units within the Project which was desirable to the Seller and whereby the parties agreed to adjust the deadlines within the Buyer’s Schedule of Performance for an additional 12-month period to allow Buyer to seek additional financing for such proposal. D. On December 3, 2019, Developer requested a fourth amendment to the Purchase and Sale Agreement (“Fourth Amendment”) to further extend the deadlines Buyer’s Schedule of Performance contained in the Third Amendment to the Purchase and Sale Agreements for the Project by 200 days in order to secure the necessary affordable housing funding sources. E. The Seller and Buyer have determined that Buyer’s Schedule of Performance does not provide sufficient time to secure the necessary affordable housing funding sources and now desire to amend certain provisions of the Agreement, as amended by the First and Second and Third Amendment, to reflect this understanding, as set forth herein. AGREEMENT NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and incorporating all of the above as FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT – 418 LINDEN AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA Page 2 of 8 though set forth in full herein and in consideration of all the recitals, conditions and agreements contained herein, the parties agree to amend the Agreement as follows: AMENDMENT TO AGREEMENT 1. Recitals. The foregoing recitals are true and correct and hereby incorporated herein. 2. Defined Terms. All capitalized terms not defined herein shall have the meanings ascribed to them in the Development Agreement. 3. Amendment to Recital B. Recital B of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: B. The City desires to sell the Linden Property to Buyer for the construction of a high density, 387-unit multi-family apartment building (the “Linden Project”), eight (8) thirty-six (36) units of which are required to be made available at below market rates as further described in the Linden Affordable Housing Agreement substantially in the form attached hereto as Exhibit B (the “AHA”). Development of the Linden Project is described and defined in the Development Agreement between the City and Buyer, substantially in the form attached hereto as Exhibit C (the “DA”). Upon Closing, the AHA and the DA will be recorded in the official records of San Mateo County. 4. Amendment to Recital C. Recital C of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: C. In order to assist in the construction of affordable units, upon Closing, Seller will provide Buyer a grant loan in the amount Five Hundred and Twenty Five Thousand Dollars ($525,000.00) One Million and Fifty Thousand Dollars ($1,050,000.00) from City Affordable Housing In-Lieu Fees, and a grant in the amount of One Million Two Hundred and Twenty Five Thousand ($1,225,000.00) from City Affordable Housing Bond Funds to partially finance the Project on the Linden Property (“City Grants Loan”), as set forth in this Agreement, the Loan Agreement between the City and Buyer substantially in the form attached hereto as Exhibit F (“Loan Agreement”) and the DA. The terms and conditions associated with Buyer’s use of the City Grant Loan after the Closing are set forth in the DA, the Loan Agreement and the AHA. 5. Amendment to Section 2.2. Section 2.2 of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 2.2 The purchase price for the Property to be paid by Buyer to City is five hundred thousand dollars one dollar ($500,0001.00), payable in all cash at Closing. 6. Amendment to Section 3.2. Section 3.2 of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT – 418 LINDEN AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA Page 3 of 8 3.2 Opening of Escrow; Effective Date. Within three (3) business days of the date that Seller has obtained approval of this executed Agreement by the City Council, approval of the sale price by the Oversight Board, and approval of the executed DA and the executed AHA by the City Council, Seller shall open an escrow account with Escrow Holder by depositing this executed Agreement, the executed DA and the executed AHA into Escrow. The date the executed Agreement, DA and AHA are received by Escrow Holder, as established and confirmed by Escrow Holder, shall be deemed the “Effective Date.” By such deposit Escrow Holder is authorized and instructed to act in accordance with the provisions of this Agreement, which Agreement shall constitute Escrow Holder’s escrow instructions. 7. Further Amendment to Section 5.1. Section 5.1 of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 5.1 Buyer’s Schedule of Performance. Subject to Force Majeure Delays (as defined in Section 8.4) and Buyer and Seller’s closing conditions (as set forth in Section 6.2 and 6.3), Buyer shall complete the following milestones in furtherance of the Closing, in accordance with the following schedule: FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT – 418 LINDEN AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA Page 4 of 8 Deadline Milestone (a) May 15, 2018 Buyer shall have completed 50% of the Construction Drawings and submitted the Financial Proforma to Seller (Completed) (b) July 14, 2018 Buyer shall have completed all Final Plans and submitted 100% construction drawings to the City for building permits, and submitted an Updated Proforma to Seller (Completed) (c) June 18, 2020 November 30, 2019 Buyer shall have secured Construction Financing and executed a contract with a general contractor for demolition and construction of the Project in accordance with the final plans (d) By July 8, 2020 December 21, 2019 Within 10 days from satisfaction of all contingencies on December 11, 2019 Buyer and Seller shall have satisfied (or waived in writing) all contingencies to Closing set forth in this Agreement, and be prepared to Close Escrow 8. Amendment to Section 6.1. Section 6.1 of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 6.1 Closing. The close of escrow (the “Closing” or “Close of Escrow”) shall be deemed to occur on the date the Grant Deed is recorded and Buyer’s funds are released to Seller and the City Grants Loan are is released to Buyer, which shall occur within ten (10) days of the date that all of Buyer’s contingencies to Closing set forth in Section 6.2 and Seller’s contingencies to Closing set forth in Section 6.3 have been satisfied, or waived in writing, or such other date that the Parties agree in writing, each in their sole discretion. FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT – 418 LINDEN AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA Page 5 of 8 9. Amendment to Section 6.2(e). Section 6.1(e) of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 6.2 (e) Seller has deposited the City Grants Loan into Escrow with instructions to release the City Grants Loan to Buyer, only upon the Closing. 10. Amendment to Section 6.4.1.1. Section 6.4.1.1 of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 6.4.1.1 Deliveries by Seller. At or before Closing, Seller shall deposit the following into escrow: (i) one (1) original executed and acknowledged Grant Deed; (ii) one (1) duly executed non-foreign certification for the Property in accordance with the requirements of Section 1445 of the Internal Revenue Code of 1986, as amended; (iii) one (1) duly executed California Form 593-W Certificate for the Property or comparable non- foreign person affidavit to satisfy the requirements of California Revenue and Taxation Code Section 18805(b) and 26131; (iv) title to all Bridging Documents; and (v) funds in the total amount of One Million Seven Hundred Fifty Thousand Dollars ($1,7050,000.00) for the City Grants Loan. 11. Amendment to Section 6.4.1.2. Section 6.4.1.2 of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 6.4.1.2 Condition to disbursement of City GrantsLoan. City’s obligation to provide Seller with City Grants Loan in the total amount of One Million Seven Hundred Fifty Thousand Dollars ($1,7050,000.00) at the Closing Date is conditioned upon Close of Escrow. If the Closing does not occur, for any reason whatsoever, the City has no obligation to deliver the City Grants Loan to Buyer. 12. Amendment to Section 6.4.3(d) Section 6.4.3(d) of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 6.4.3(d) Disburse to Buyer the City Grants Loan. 13. Amendment to Section 7.1(b). Section 7.1(b) of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 7.1(b) Encumbrances. Other than the approval and recordation of the DA, the Loan Agreement, Deed of Trust, Note and AHA at Closing, Seller has not alienated, encumbered, transferred, mortgaged, assigned, pledged, or otherwise conveyed its interest in the Property or any portion thereof, nor entered into any Agreement to do so, and there are no liens, encumbrances, mortgages, covenants, conditions, reservations, restrictions, easements or other matters affecting the Property, except for the Permitted Exceptions. Seller will not, directly or indirectly, alienate, encumber, transfer, mortgage, assign, pledge or otherwise convey its interest prior to the Close of Escrow, as long as this Agreement is in force. FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT – 418 LINDEN AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA Page 6 of 8 14. Amendment to Section 7.3(c). Section 7.3(c) of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 7.3(c). Buyer accepts and acknowledges that after the Closing, the Property will be subject to the DA, Loan Agreement, Deed of Trust, Note and AHA, which will be recorded against the Property at Closing. GENERAL PROVISIONS 1. No Interpretation Against Drafter. Each party has received independent legal advice from its attorneys with respect to the advisability of executing this Fourth Amendment and the meaning of the provisions hereof. The provisions of this Fourth Amendment shall be construed as to the fair meaning and not for or against any party based upon any attribution of such party as the sole source of the language in question. 2. Effect of Fourth Amendment. Except as expressly modified by this Fourth Amendment, the Agreement shall continue in full force and effect according to its terms, and Buyer and Seller hereby ratify and affirm all their respective rights and obligations under the Agreement, including but not limited to Buyer’s indemnification obligations as set forth in Sections 11 and 15.5 of the Agreement. In the event of any conflict between the Fourth Amendment or the Agreement, the provisions of this Fourth Amendment shall govern. 3. Binding Agreement. This Fourth Amendment shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors in interest, and assigns of each of the parties hereto. Any reference in this Fourth Amendment to a specifically named party shall be deemed to apply to any successor, administrator, executor, or assign of such party who has acquired an interest in compliance with the terms of this Fourth Amendment or under law. 4. Recordation. The City shall record a copy of this Fourth Amendment together with recordation of the Agreement. 5. Counterparts. This Fourth Amendment may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, when taken together, shall constitute the same document. 6. California Law. This Fourth Amendment shall be governed by and interpreted in accordance with the laws of the State of California. Any action to enforce or interpret this Agreement shall be filed and heard in the Superior Court of San Mateo County, California. 7. Invalidity. Any provision of this Fourth Amendment that is determined by a court of competent jurisdiction to be invalid or unenforceable shall be deemed severed from this Fourth Amendment, and the remaining provisions shall remain in full force and effect as if the invalid or unenforceable provision had not been a part hereof FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT – 418 LINDEN AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA Page 7 of 8 8. Headings. The headings used in this Fourth Amendment are for convenience only and shall be disregarded in interpreting the substantive provisions of this Fourth Amendment. [SIGNATURES ON THE FOLLOWING PAGE] FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT – 418 LINDEN AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA Page 8 of 8 IN WITNESS WHEREOF, the parties have executed this Fourth Amendment as of the Effective Date. BUYER: ROEM Development Corporation, a California corporation By: ______________________ Name: Alex Sanchez Its Executive Vice President SELLER: CITY OF SOUTH SAN FRANCISCO, a municipal corporation By: __________________________ Name: Charles Michael Futrell Its City Manager The Title Company has executed this Fourth Amendment to acknowledge its agreement to act in accordance with the terms of this Fourth Amendment. Chicago Title Insurance Company By: Name: Sherri Keller Title: Escrow Officer 3463896.1 City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-55 Agenda Date:3/11/2020 Version:1 Item #:5d. Resolution approving the Fourth Amendment to the 201-219 Grand Avenue Purchase and Sale Agreement with ROEM Development Corporation. WHEREAS,on June 29,2011,the Legislature of the State of California (“State”)adopted Assembly Bill x1 26 (“AB 26”),which amended provisions of the State’s Community Redevelopment Law (Health and Safety Code sections 33000 et seq.)(“Dissolution Law”),pursuant to which the former Redevelopment Agency of the City of South San Francisco (“City”) was dissolved on February 1, 2012; and WHEREAS,the City elected to become the Successor Agency to the Redevelopment Agency of the City of South San Francisco (“Successor Agency”); and WHEREAS,pursuant to Health and Safety Code Section 34191.5(c)(2)(C),property shall not be transferred to a successor agency,city,county or city and county,unless a Long Range Property Management Plan (“LRPMP”)has been approved by the Oversight Board and the California Department of Finance (“DOF”); and WHEREAS,in accordance with the Dissolution Law,the Successor Agency prepared a LRPMP,which was approved by a resolution of the Oversight Board for the Successor Agency to the Redevelopment Agency of the City of South San Francisco (“Oversight Board”)on May 21,2015,and was approved by the DOF on October 1, 2015; and WHEREAS,consistent with the Dissolution Law and the LRPMP,certain real properties located in the City of South San Francisco,that were previously owned by the former Redevelopment Agency,were transferred to the Successor Agency (“Agency Properties”); and WHEREAS,on October 18,2016,the City entered into an Amended and Restated Master Agreement for Taxing Entity Compensation (“Compensation Agreement”)with the various local agencies who receive shares of property tax revenues from the former redevelopment project area (“Taxing Entities”),which provides that upon approval by the Oversight Board of the sale price,and consistent with the LRPMP,the proceeds from the sale of any of the Agency Properties will be distributed to the Taxing Entities in accordance with their proportionate contributions to the Real Property Tax Trust Fund for the former Redevelopment Agency; and WHEREAS,on February 8,2017,the City adopted Resolution 16-2017 approving the transfer of the Agency Properties from the Successor Agency to the City and in accordance with the requirements set forth in the LRPMP,and on February 21,2017,the Oversight Board adopted a resolution approving the transfer of the redevelopment properties from the Successor Agency to the City; and WHEREAS,consistent with the LRPMP and the Oversight Board resolution,the Successor Agency and City City of South San Francisco Printed on 3/18/2020Page 1 of 3 powered by Legistar™ File #:20-55 Agenda Date:3/11/2020 Version:1 Item #:5d. executed and recorded grant deeds transferring the Agency Properties to the City; and WHEREAS,the City of South San Francisco (“City”)is also the owner of former Redevelopment Agency property located in the City of South San Francisco,California,with the address of 201-219 Grand Avenue, known as APNs 012-316-100,012-316-110,012-316-080 and 012-316-090 (collectively,“201 Grand Avenue”); and WHEREAS,on March 28,2018,Seller and Buyer entered into that certain First Amendment to Purchase and Sale Agreement (“First Amendment”),whereby the parties agreed to adjust the deadlines within the Buyer’s Schedule of Performance as set forth in Section 5 of the Agreement.On August 22,2018,Seller and Buyer entered into that certain Second Amendment to Purchase and Sale Agreement (“Second Amendment”),whereby the parties agreed to further adjust the deadlines within Buyer’s Schedule of Performance,as set forth therein; and, WHEREAS,on March 21,2019,Seller and Buyer entered into that certain Third Amendment to Purchase and Sale Agreement (“Third Amendment”)based upon Buyer’s proposal to modify the number of Below Market Rate (“BMR”)units within the Project which was desirable to the Seller and whereby the parties agreed to adjust the deadlines within the Buyer’s Schedule of Performance for an additional 12-month period to allow Buyer to seek additional financing for such proposal; and, WHEREAS,on December 3,2019,Developer requested a fourth amendment to the Purchase and Sale Agreement (“Fourth Amendment”)to further extend the deadlines Buyer’s Schedule of Performance contained in the Third Amendment to the Purchase and Sale Agreements for the Project by 200 days in order to secure the necessary affordable housing funding sources; and, WHEREAS,the Seller and Buyer have determined that Buyer’s Schedule of Performance does not provide sufficient time to secure the necessary affordable housing funding sources and now desire to amend certain provisions of the Agreement,as amended by the First and Second and Third Amendment,to reflect this understanding, as set forth in the Fourth Amendment, attached hereto as Exhibit A; and, WHEREAS,at the time the PSA was negotiated Seller committed grant funding of Two Million Four Hundred and Fifty Thousand Dollars ($2,450,000)from the City’s Affordable Housing Asset Fund to assist in the construction of the affordable housing units (“City Grant”); and, WHEREAS,Buyer has requested that the City Grant be converted to a loan in order to leverage other funding; and, WHEREAS,Seller has agreed to a Two Million Four Hundred and Fifty Thousand Dollars ($2,450,000)loan from the City’s Affordable Housing Asset Fund; and, WHEREAS,Buyer has increased the number of Below Market Rate (”BMR”)units from nine (9)to forty-six (46) and has not requested to change the purchase price of $1,200,000; and, WHEREAS,Buyer and Seller wish to amend the Schedule of Performance that provides additional time to secure the necessary affordable housing funding sources and adjusts the overall Project completion date by 200 days. City of South San Francisco Printed on 3/18/2020Page 2 of 3 powered by Legistar™ File #:20-55 Agenda Date:3/11/2020 Version:1 Item #:5d. NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of South San Francisco as follows: 1.The foregoing recitals are true and correct and incorporated herein as part of this Resolution. 2.The proposed actions in this Resolution are consistent with the Long Range Property Management Plan. 3.The Fourth Amendment to the Purchase and Sale Agreement is attached hereto as Exhibit A,and is incorporated herein and hereby approved. 4.The City Manager,or his designee,is authorized to execute the Fourth Amendment and any necessary related documents. 5.The City Manager,or his designee,is authorized take any and all other actions necessary to implement this intent of this Resolution, subject to approval as to form by the City Attorney. ***** Exhibit A: Fourth Amendment to the 201 Grand Purchase and Sale Agreement City of South San Francisco Printed on 3/18/2020Page 3 of 3 powered by Legistar™ FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT This Fourth Amendment to Purchase and Sale Agreement (this “Fourth Amendment”) is made effective as of _________, 2020 (“Effective Date”) by and between CITY OF SOUTH SAN FRANCISCO, a municipal corporation (“Seller”) and ROEM Development Corporation, a California Corporation (“Buyer”). Seller and Buyer are sometimes individually referred to herein as a “party” and collectively as “the parties.” RECITALS A. Seller and Buyer entered into that certain Purchase and Sale Agreement dated November 14, 2017 (the “Agreement”) with respect to that certain real property located at 201-219 Grand Avenue, South San Francisco, California (Assessor’s Parcel Numbers 012-316-110, 012-316-100, 012-316-090 and 012-316-080) (the “Property”); B. On March 28, 2018, Seller and Buyer entered into that certain First Amendment to Purchase and Sale Agreement (“First Amendment”), whereby the parties agreed to adjust the deadlines within the Buyer’s Schedule of Performance as set forth in Section 5 of the Agreement. On August 22, 2018, Seller and Buyer entered into that certain Second Amendment to Purchase and Sale Agreement (“Second Amendment”), whereby the parties agreed to further adjust the deadlines within Buyer’s Schedule of Performance, as set forth therein. C. On March 21, 2019, Seller and Buyer entered into that certain Third Amendment to Purchase and Sale Agreement (“Third Amendment”) based upon Buyer’s proposal to modify the number of below market rate units within the Project which was desirable to the Seller and whereby the parties agreed to adjust the deadlines within the Buyer’s Schedule of Performance for an additional 12-month period to allow Buyer to seek additional financing for such proposal. D. On December 3, 2019, Developer requested a fourth amendment to the Purchase and Sale Agreement (“Fourth Amendment”) to further extend the deadlines Buyer’s Schedule of Performance contained in the Third Amendment to the Purchase and Sale Agreements for the Project by 200 days in order to secure the necessary affordable housing funding sources. E. The Seller and Buyer have determined that Buyer’s Schedule of Performance does not provide sufficient time to secure the necessary affordable housing funding sources and now desire to amend certain provisions of the Agreement, as amended by the First and Second and Third Amendment, to reflect this understanding, as set forth herein. AGREEMENT NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and incorporating all of the above as FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT – 201-219 GRAND AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA Page 2 of 7 though set forth in full herein and in consideration of all the recitals, conditions and agreements contained herein, the parties agree to amend the Agreement as follows: AMENDMENT TO AGREEMENT 1. Recitals. The foregoing recitals are true and correct and hereby incorporated herein. 2. Defined Terms. All capitalized terms not defined herein shall have the meanings ascribed to them in the Development Agreement. 3. Amendment to Recital F. Recital F of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: F. The City desires to sell the Grand Property to Buyer for the construction of a high density, mixed use project including 467- residential units, nine (9) forty-six (46) of which are required to be made available at below market rates, and approximately 6,000 square feet of ground floor commercial units (the “Grand Project”) as further described in the Grand Affordable Housing Agreement substantially in the form attached hereto as Exhibit B (the “AHA”). Development of the Linden Project is described and defined in the Development Agreement between the City and Buyer, substantially in the form attached hereto as Exhibit C (the “DA”). Upon Closing, the AHA and the DA will be recorded in the official records of San Mateo County. 4. Amendment to Recital G. Recital G of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: G. In order to assist in the construction of affordable units, upon Closing, Seller will provide Buyer a grant loan in the amount Five Hundred and Twenty Five Thousand Dollars ($525,000.00) Two Million and Four Hundred and Fifty Thousand Dollars ($2,450,000.00) from City Affordable Housing In-Lieu Fees, and a grant in the amount of One Million Two Hundred and Twenty Five Thousand ($1,225,000.00) from City Affordable Housing Bond Funds to partially finance the Project on the Grand Property (“City Grants Loan”), as set forth in this Agreement, the Loan Agreement between the City and Buyer substantially in the form attached hereto as Exhibit F (“Loan Agreement”) and the DA. The terms and conditions associated with Buyer’s use of the City Grant Loan after the Closing are set forth in the DA, the Loan Agreement and the AHA. 5. Amendment to Section 2.2. Section 2.2 of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT – 201-219 GRAND AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA Page 3 of 7 6. Further Amendment to Section 5.1. Section 5.1 of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 5.1 Buyer’s Schedule of Performance. Subject to Force Majeure Delays (as defined in Section 8.4) and Buyer and Seller’s closing conditions (as set forth in Section 6.2 and 6.3), Buyer shall complete the following milestones in furtherance of the Closing, in accordance with the following schedule: Deadline Milestone (a) May 15, 2018 Buyer shall have completed 50% of the Construction Drawings and submitted the Financial Proforma to Seller (Completed) (b) July 14, 2018 Buyer shall have completed all Final Plans and submitted 100% construction drawings to the City for building permits, and submitted an Updated Proforma to Seller (Completed) (c) June 18, 2020 November 30, 2019 Buyer shall have secured Construction Financing and executed a contract with a general contractor for demolition and construction of the Project in accordance with the final plans (d) By July 8, 2020 December 21, 2019 Within 10 days from satisfaction of all contingencies on December 11, 2019 Buyer and Seller shall have satisfied (or waived in writing) all contingencies to Closing set forth in this Agreement, and be prepared to Close Escrow 7. Amendment to Section 6.1. Section 6.1 of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 6.1 Closing. The close of escrow (the “Closing” or “Close of Escrow”) shall be deemed to occur on the date the Grant Deed is recorded and Buyer’s funds are released to Seller and the City Grants Loan are is released to Buyer, which shall occur within ten (10) FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT – 201-219 GRAND AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA Page 4 of 7 days of the date that all of Buyer’s contingencies to Closing set forth in Section 6.2 and Seller’s contingencies to Closing set forth in Section 6.3 have been satisfied, or waived in writing, or such other date that the Parties agree in writing, each in their sole discretion. 8. Amendment to Section 6.2(e). Section 6.1(e) of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 6.2 (e) Seller has deposited the City Grants Loan into Escrow with instructions to release the City Grants Loan to Buyer, only upon the Closing. 9. Amendment to Section 6.4.1.1. Section 6.4.1.1 of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 6.4.1.1 Deliveries by Seller. At or before Closing, Seller shall deposit the following into escrow: (i) one (1) original executed and acknowledged Grant Deed; (ii) one (1) duly executed non-foreign certification for the Property in accordance with the requirements of Section 1445 of the Internal Revenue Code of 1986, as amended; (iii) one (1) duly executed California Form 593-W Certificate for the Property or comparable non- foreign person affidavit to satisfy the requirements of California Revenue and Taxation Code Section 18805(b) and 26131; (iv) title to all Bridging Documents; and (v) funds in the total amount of OneTwo Million Seven Hundred Four Hundred and Fifty Thousand Dollars ($12,7450,000.00) for the City Grants Loan. 10. Amendment to Section 6.4.1.2. Section 6.4.1.2 of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 6.4.1.2 Condition to disbursement of City GrantsLoan. City’s obligation to provide Seller with City Grants Loan in the total amount OneTwo Million Seven Hundred Four Hundred and Fifty Thousand Dollars ($12,7450,000.00) at the Closing Date is conditioned upon Close of Escrow. If the Closing does not occur, for any reason whatsoever, the City has no obligation to deliver the City Grants Loan to Buyer. 11. Amendment to Section 6.4.3(d) Section 6.4.3(d) of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 6.4.3(d) Disburse to Buyer the City Grants Loan. 12. Amendment to Section 7.1(b). Section 7.1(b) of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 7.1(b) Encumbrances. Other than the approval and recordation of the DA, the Loan Agreement, Deed of Trust, Note and AHA at Closing, Seller has not alienated, encumbered, transferred, mortgaged, assigned, pledged, or otherwise conveyed its interest in the Property or any portion thereof, nor entered into any Agreement to do so, and there are no liens, encumbrances, mortgages, covenants, conditions, reservations, restrictions, easements or other matters affecting the Property, except for the Permitted Exceptions. Seller will not, directly or indirectly, alienate, encumber, transfer, mortgage, assign, pledge FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT – 201-219 GRAND AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA Page 5 of 7 or otherwise convey its interest prior to the Close of Escrow, as long as this Agreement is in force. 13. Amendment to Section 7.3(c). Section 7.3(c) of the Agreement is revised to read as follows, with additions in double underline and deletions in strikethrough: 7.3(c). Buyer accepts and acknowledges that after the Closing, the Property will be subject to the DA, Loan Agreement, Deed of Trust, Note and AHA, which will be recorded against the Property at Closing. GENERAL PROVISIONS 1. No Interpretation Against Drafter. Each party has received independent legal advice from its attorneys with respect to the advisability of executing this Fourth Amendment and the meaning of the provisions hereof. The provisions of this Fourth Amendment shall be construed as to the fair meaning and not for or against any party based upon any attribution of such party as the sole source of the language in question. 2. Effect of Fourth Amendment. Except as expressly modified by this Fourth Amendment, the Agreement shall continue in full force and effect according to its terms, and Buyer and Seller hereby ratify and affirm all their respective rights and obligations under the Agreement, including but not limited to Buyer’s indemnification obligations as set forth in Sections 11 and 15.5 of the Agreement. In the event of any conflict between the Fourth Amendment or the Agreement, the provisions of this Fourth Amendment shall govern. 3. Binding Agreement. This Fourth Amendment shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors in interest, and assigns of each of the parties hereto. Any reference in this Fourth Amendment to a specifically named party shall be deemed to apply to any successor, administrator, executor, or assign of such party who has acquired an interest in compliance with the terms of this Fourth Amendment or under law. 4. Recordation. The City shall record a copy of this Fourth Amendment together with recordation of the Agreement. 5. Counterparts. This Fourth Amendment may be executed in multiple counterparts, each of which shall be deemed an original, but all of which, when taken together, shall constitute the same document. 6. California Law. This Fourth Amendment shall be governed by and interpreted in accordance with the laws of the State of California. Any action to enforce or interpret this Agreement shall be filed and heard in the Superior Court of San Mateo County, California. 7. Invalidity. Any provision of this Fourth Amendment that is determined by a court of competent jurisdiction to be invalid or unenforceable shall be deemed severed FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT – 201-219 GRAND AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA Page 6 of 7 from this Fourth Amendment, and the remaining provisions shall remain in full force and effect as if the invalid or unenforceable provision had not been a part hereof 8. Headings. The headings used in this Fourth Amendment are for convenience only and shall be disregarded in interpreting the substantive provisions of this Fourth Amendment. [SIGNATURES ON THE FOLLOWING PAGE] FOURTH AMENDMENT TO PURCHASE AND SALE AGREEMENT – 201-219 GRAND AVENUE, SOUTH SAN FRANCISCO, CALIFORNIA Page 7 of 7 IN WITNESS WHEREOF, the parties have executed this Fourth Amendment as of the Effective Date. BUYER: ROEM Development Corporation, a California corporation By: ______________________ Name: Alex Sanchez Its Executive Vice President SELLER: CITY OF SOUTH SAN FRANCISCO, a municipal corporation By: __________________________ Name: Charles Michael Futrell Its City Manager The Title Company has executed this Fourth Amendment to acknowledge its agreement to act in accordance with the terms of this Fourth Amendment. Chicago Title Insurance Company By: Name: Sherri Keller Title: Escrow Officer 3464066.1 City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-56 Agenda Date:3/11/2020 Version:1 Item #:5e. Resolution approving Budget Amendment Number 20.034 which appropriates $2,450,000 from the City of South San Francisco’s Housing Asset Fund (Fund 241)for a developer loan to ROEM Development Corporation for the development of 46 Below Market Rate units and one managers unit at 201-219 Grand Avenue. WHEREAS,on June 29,2011,the Legislature of the State of California (“State”)adopted Assembly Bill x1 26 (“AB 26”),which amended provisions of the State’s Community Redevelopment Law (Health and Safety Code sections 33000 et seq.)(“Dissolution Law”),pursuant to which the former Redevelopment Agency of the City of South San Francisco (“City”) was dissolved on February 1, 2012; and WHEREAS,the City elected to become the Successor Agency to the Redevelopment Agency of the City of South San Francisco (“Successor Agency”); and WHEREAS,pursuant to Health and Safety Code Section 34191.5(c)(2)(C),property shall not be transferred to a successor agency,city,county or city and county,unless a Long Range Property Management Plan (“LRPMP”)has been approved by the Oversight Board and the California Department of Finance (“DOF”); and WHEREAS,in accordance with the Dissolution Law,the Successor Agency prepared a LRPMP,which was approved by a resolution of the Oversight Board for the Successor Agency to the Redevelopment Agency of the City of South San Francisco (“Oversight Board”)on May 21,2015,and was approved by the DOF on October 1, 2015; and WHEREAS,consistent with the Dissolution Law and the LRPMP,certain real properties located in the City of South San Francisco,that were previously owned by the former Redevelopment Agency,were transferred to the Successor Agency (“Agency Properties”); and WHEREAS,on October 18,2016,the City entered into an Amended and Restated Master Agreement for Taxing Entity Compensation (“Compensation Agreement”)with the various local agencies who receive shares of property tax revenues from the former redevelopment project area (“Taxing Entities”),which provides that upon approval by the Oversight Board of the sale price,and consistent with the LRPMP,the proceeds from the sale of any of the Agency Properties will be distributed to the Taxing Entities in accordance with their proportionate contributions to the Real Property Tax Trust Fund for the former Redevelopment Agency; and WHEREAS,on February 8,2017,the City adopted Resolution 16-2017 approving the transfer of the Agency Properties from the Successor Agency to the City and in accordance with the requirements set forth in the LRPMP,and on February 21,2017,the Oversight Board adopted a resolution approving the transfer of the City of South San Francisco Printed on 3/18/2020Page 1 of 3 powered by Legistar™ File #:20-56 Agenda Date:3/11/2020 Version:1 Item #:5e. redevelopment properties from the Successor Agency to the City; and WHEREAS,consistent with the LRPMP and the Oversight Board resolution,the Successor Agency and City executed and recorded grant deeds transferring the Agency Properties to the City; and WHEREAS,the City of South San Francisco (“City”)is also the owner of former Redevelopment Agency property located in the City of South San Francisco,California,with the address of 201-219 Grand Avenue, known as APNs 012-316-100,012-316-110,012-316-080 and 012-316-090 (collectively,“201 Grand Avenue”); and WHEREAS,in December 2015 the City approved entitlements for a mixed-use project at 201-219 Grand Avenue (“Project”) and a residential project at 418 Linden Avenue (“Developments”); and, WHEREAS,in December 2016 the City and Agency selected a developer,ROEM Development Corporation (“Developer”), to build the Developments; and, WHEREAS,in September 2017 the City approved a Development Agreement (“DA”),a Purchase and Sale Agreement (“PSA”)for 418 Linden Avenue and a PSA for 201-219 Grand Avenue,an Affordable Housing Agreement (“AHA”)for eight (8)Below Market Rate (“BMR”)units at 418 Linden and an AHA for nine (9) BMR units at 201-219 Grand Avenue with Developer related to the Project; and, WHEREAS,Developer now wishes to amend the entitlements utilizing the Density Bonus Law (found in California Government Code Sections 65915 - 65918); and, WHEREAS,pursuant to Government Code Section 65915 and South San Francisco Municipal Code Chapter 20.390,the Project will result in forty-six (46)units being available to Eligible Households at an Affordable Rent and one (1) unit being the property manager’s unit; and, WHEREAS,Developer has,pursuant to Section 20.390.010.B.7,requested development standard waivers including;a reduction in parking from 58 spaces to 31 spaces,a reduction in the number of Electric Vehicle parking spaces to from 3 spaces to 1 space,reduction in the private storage space from 200 cubic square feet to 100 cubic square feet, and for permits and fees required by the City not to exceed $533,002; and, WHEREAS,at the time the PSA was negotiated Seller committed grant funding of Two Million Four Hundred and Fifty Thousand Dollars ($2,450,000)from the City’s Affordable Housing Asset Fund to assist in the construction of the affordable housing units (“City Grant”); and, WHEREAS,Buyer has requested that the City Grant be converted to a loan in order to leverage other funding; and, WHEREAS,Seller has agreed to a Two Million Four Hundred and Fifty Thousand Dollars ($2,450,000)loan from the City’s Affordable Housing Asset Fund; and, WHEREAS,Buyer has increased the number of Below Market Rate (”BMR”)units from nine (9)to forty-six (46) and has not requested to change the purchase price of $1,200,000; and, WHEREAS,the City is providing a loan to Borrower in the amount of Two Million,Four Hundred Fifty Thousand dollars ($2,450,000.00)purpose of developing the Project (“Loan”)which shall be evidenced by an City of South San Francisco Printed on 3/18/2020Page 2 of 3 powered by Legistar™ File #:20-56 Agenda Date:3/11/2020 Version:1 Item #:5e. Thousand dollars ($2,450,000.00)purpose of developing the Project (“Loan”)which shall be evidenced by an accompanying Promissory Note (“Note”); and, WHEREAS,as long as Developer complies with the Loan Agreement (“Agreement”)during the Compliance Period and no breach or default occurs,the City shall forgive the Loan at the termination of the Compliance Period; and, WHEREAS, the Loan and Note will be secured by a Deed of Trust (“DOT”). WHEREAS,as a condition of providing the Loan,the City imposes occupancy and affordability restrictions on the Property and Project for the Compliance Period to ensure the affordable units remain affordable to low income households and as required by the Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants (“Affordability Covenant”); and, WHEREAS,the Note,Deed of Trust,DA and Affordability Covenant shall collectively be referred to herein as “City Documents”. NOW THEREFORE IT BE RESOLVED by the City Council of the City of South San Francisco as follows: 1.The foregoing recitals are true and correct. 2.Budget Amendment 20.034,which appropriates $2,450,000 of the City of South San Francisco’s Housing Asset Fund (Fund 241)as a loan to ROEM Development Corporation for the development of 46 Below Market Rate units and one managers unit at 201 Grand Avenue is approved. 3.The Loan Agreement,Note,Deed of Trust and Affordability Covenant,in substantially the same form attached hereto as Exhibits A through D, respectively, are approved. 4.The City Manager or his designee is authorized to enter into and execute on behalf of the City Council the City Documents;to make any revisions,amendments or modifications deemed necessary to carry out the intent of this Resolution and which do not materially or substantially increase the City’s obligations thereunder. ***** Exhibit A: Loan Agreement between the City and Developer for $2,450,000 Exhibit B: Promissory Note for 201 Grand Exhibit C: Deed of Trust for 201 Grand Exhibit D: Affordability Covenant for 201 Grand City of South San Francisco Printed on 3/18/2020Page 3 of 3 powered by Legistar™ ‐1- LOAN AGREEMENT BETWEEN THE CITY OF SOUTH SAN FRANCISCO AND ROEM DEVELOPMENT CORPORATION This Loan Agreement (“Agreement”) is entered into effective as of [Date] day of [Month] , 2020 by and between the City of South San Francisco, a municipal corporation, (“City”) and Grand and Linden Family Apartments, L.P., a California limited partnership, (“Borrower”).City and Borrower are hereinafter collectively referred to as “Parties” and individually as “Party”. RECITALS A. City owns that certain real property located in the City of South San Francisco at 201-219 Grand Avenue, known as County Assessor's Parcel Numbers 012-316-110, 012-316-100, 012- 316-090 and 012-316-080 and more particularly described in Exhibit A attached hereto (“Property”). B. On June 29, 2011, the Legislature of the State of California (the “State”) adopted Assembly Bill x1 26 (“AB 26”), which amended provisions of the State’s Community Redevelopment Law (Health and Safety Code sections 33000 et seq) (the “Dissolution Law”), pursuant to which the former Redevelopment Agency of the City of South San Francisco was dissolved on February 1, 2012. The City became the Successor Agency to the Redevelopment Agency of the City of South San Francisco (“Successor Agency”), and in accordance with the Dissolution Law, the Successor Agency prepared a Long Range Property Management Plan (“LRPMP”), which was approved by a resolution of the Oversight Board for the Successor Agency to the Redevelopment Agency of the City of South San Francisco (“Oversight Board”) on May 21, 2015, and was approved by the Department of Finance (“DOF”) on October 1, 2015. C. Consistent with the Dissolution Law and the LRPMP, certain real properties located in the City of South San Francisco, that were previously owned by the former Redevelopment Agency was transferred to the Successor Agency (“Agency Properties”). On October 18, 2016, the City entered into an Amended and Restated Master Agreement for Taxing Entity Compensation (“Compensation Agreement”) with the various local agencies who receive shares of property tax revenues from the former redevelopment project area (“Taxing Entities”), which provides that upon approval by the Oversight Board of the sale price, and consistent with the LRPMP, the proceeds from the sale of any of the Agency Properties will be distributed to the Taxing Entities in accordance with their proportionate contributions to the Real Property Tax Trust Fund for the former Redevelopment Agency. D. On February 8, 2017, the City adopted Resolution 16-2017 approving the transfer of the Agency Properties from the Successor Agency to the City and in accordance with the requirements set forth in the LRPMP, and on February 21, 2017, the Oversight Board adopted a resolution approving the transfer of the Redevelopment Properties from the Successor Agency to the City. ‐2- E. Consistent with the LRPMP and the Oversight Board resolution, the Successor Agency and City executed and recorded grant deeds transferring the Agency Properties to the City. The Property is one of the Agency Properties and is subject to the provisions of the LRPMP and the Compensation Agreement. The Oversight Board adopted Resolution 05-2017 on 09/19/2017 approving the sale of the Property pursuant to the LRPMP and the Compensation Agreement. F. In accordance with that certain Development Agreement executed by and between the Parties and dated as of November 15, 2017 ( “DA”), a memorandum of which was recorded in the Official Records of San Mateo City (“Official Records”) on ________, City desires Borrower to purchase the Property and re-develop it into a mixed-use, high-density building consisting of forty- six (46) affordable residential units and one manager’s unit, and approximately 6,000 square feet of ground floor commercial units ( “Project”). Capitalized terms used and not defined in this Agreement have the meaning ascribed to them in the DA. G. To assist in the construction of affordable units at the Project, City authorized providing Borrower with a loan in the amount of Two Million, Four Hundred and Fifty Thousand dollars ($2,450,000.00) from the Housing Asset Fund on [insert date] in Resolution No. [insert Resolution #]. H. Through this Agreement and accompanying Exhibits, the City is providing a loan to Borrower in the amount of Two Million, Four Hundred and Fifty Thousand dollars ($2,450,000.00) purpose of developing the Project (“Loan”) which shall be evidenced by an accompanying Promissory Note (“Note”). As long Borrower complies with the Agreement during the Compliance Period as defined in Section 5 of Exhibit A and no breach or default occurs, the City may, in its sole and absolute discretion, forgive the Loan at the termination of the Compliance Period. The Loan and Note will be secured by a Deed of Trust. As a condition of providing the Loan, the City imposes occupancy and affordability restrictions on the Property and Project for the Compliance Period to ensure the affordable units remain affordable to low income households as set forth herein and as further required by the Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants (“Affordability Covenant”) executed concurrently herewith. The Note, Deed of Trust, DA and Affordability Covenant shall collectively be referred to herein as “City Documents”. In consideration of the mutual covenants and promises of the Parties herein contained, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is hereby agreed by the Parties hereto as follows: 1. Exhibits The following exhibits are attached to this Agreement and incorporated into this Agreement by this reference: Exhibit A– Project Description Exhibit B– Disbursement and Rates ‐3- Exhibit C– Funding Conditions Exhibit D– Project Sources and Uses Development Budget 2. Services to be Performed by Borrower In consideration for the funding assistance set forth herein and in Exhibit B, Borrower shall perform the services (“services” or “work”) necessary to implement the Project as described in Exhibit A. 3. Disbursements Subject to Borrower’s satisfactory performance of the terms and conditions set forth herein, including but not limited to Exhibit A, City shall disburse to Borrower in accordance with the rates and in the manner specified in Exhibit B. City reserves the right to withhold disbursements if City determines that Borrower’s performance of applicable terms and conditions is unacceptable or documentation evidencing performance is unacceptable; provided City shall provide Borrower with forty-five (45) days’ notice and opportunity to cure. In no event shall City’s total fiscal obligation under this Agreement exceed Two Million, Four Hundred and Fifty Thousand dollars ($2,450,000.00). 4. Security and Subordination The accompanying Note shall be secured by the Deed of Trust. Borrower hereby represents, warrants and covenants that with the exception of easements of record, absent the written consent of City, the Deed of Trust shall not be subordinated in priority to any lien (other than those pertaining to taxes or assessments), encumbrance, or other interest in the Property or the Project. If at the time the Deed of Trust is recorded, any interest, lien, or encumbrance has been recorded against the Project in position superior to the Deed of Trust, upon the request of City, Borrower hereby covenants and agrees to promptly undertake all action necessary to clear such matter from title or to subordinate such interest to this Agreement consistent with the intent of and in accordance with this Section 4, and to provide such evidence thereof as City may reasonably request. Notwithstanding the foregoing, the City agrees that pursuant to Health and Safety Code Section 33334.14(a)(4), the City will not withhold consent to reasonable requests for subordination of the Deed of Trust to deeds of trust provided for the benefit of lenders identified in the Financing Plan approved in connection with the DA, provided that the instruments effecting such subordination include reasonable protections to the City in the event of default consistent with the requirements of Health and Safety Code Section 33334.14(a)(4), including without limitation, extended notice and cure rights. Any subordination request shall be subject to a $2,000.00 fee payable by Borrower to City upon Borrower’s request for City to review instruments and other legal documents proposed to effect a subordination of the City Documents. Borrower hereby: (i) represents and warrants that they are not affiliated in any way with the lender identified in the Financing Plan approved in connection with the DA, and (ii) covenants that they will not become so affiliated by acquiring an interest in such lender, or an interest in its loan, or otherwise. ‐4- 5. Encumbrances Borrower agrees to use best efforts to ensure that all deeds of trust or other security instruments and any applicable subordination agreement recorded against the Property, the Project or part thereof for the benefit of a lender (“Lender”) shall contain each of the following provisions: (i) Lender shall use its best efforts to provide to City a copy of any notice of default issued to Borrower concurrently with provision of such notice to Borrower; and, (ii) City shall have the reasonable right, but not the obligation, to cure any default by Borrower within the same period of time provided to Borrower for such cure extended by an additional 90 days. Borrower agrees to provide to City a copy of any notice of default it receives from any Lender within thirty (30) business days following Borrower’s receipt thereof. 6. Conditions of Funding In addition to the terms detailed in Section 3 (Disbursements) above, City reserves the right to withhold disbursements if City determines that Borrower has not completed the conditions of funding, enumerated in Exhibit C of this Agreement. City acknowledges that upon execution of this Agreement, all conditions applicable to “Agreement Execution” set forth in Exhibit C have been completed to the satisfaction of City. 7. Term and Termination Subject to compliance with all terms and conditions, the term of this Agreement shall be from Project Completion as defined in Section 7 of Exhibit A through the later of 55 years from the first day of the Compliance Period or the Note Maturity set forth in the Note and Exhibit A. Borrower shall provide all notices and rights to tenants required to be given prior to and upon the expiration of the Compliance Period pursuant to Government Code Section 65863.10 or a successor statute. The Loan shall be repaid in full with the interest as set forth in Exhibit A by Borrower if an Event of Default occurs under this Agreement or City Documents. The Affordability Covenant shall remain in effect for the Compliance Period, regardless of any repayment of the Loan. 8. Availability of Funds Notwithstanding any other provision in this Agreement, City may terminate this Agreement or a portion of the services referenced in the Exhibits based upon unavailability of City funds by providing written notice to Borrower as soon as is reasonably possible after City learns of said unavailability of such funding. Relationship of Parties Nothing in this Agreement is intended to or shall establish the Parties as partners, co-venturers, or principal and agent with one another. Borrower agrees and understands that work/services performed pursuant this Agreement are performed by Borrower as conditions of receiving the Loan funding, and not as an employee or joint venture of City and that neither Borrower nor its employees acquire any of the rights, privileges, powers, or advantages of City employees. Nothing contained in this Agreement shall create or justify any claim against the City by any person that the Borrower may have employed or with whom the Borrower may have contracted ‐5- relative to the purchase of materials, supplies or equipment, or the furnishing or the performance of any work or services with respect to the purchase of the Property, or the construction or operation of the Project, and the Borrower shall include similar requirements in any contracts entered into for the such purposes. 9. Indemnity To the fullest extent permitted by law, Borrower shall indemnify, defend (with counsel approved by City) and hold City and its respective elected and appointed officers, officials, employees, agents, and representatives (collectively, the “Indemnitees”) harmless from and against all liability, loss, cost, expense (including without limitation attorneys’ fees and costs of litigation), claim, demand, action, suit, judicial or administrative proceeding, penalty, deficiency, fine, order, and damage (all of the foregoing collectively “Claims”) arising directly or indirectly, in whole or in part, as a result of or in connection with Borrower’s construction, management, or operation of the Property and the Project, the performance of any work or services required of Borrower under this Agreement, or Loan disbursement made pursuant to this Agreement or any failure to perform any obligation as and when required by this Agreement or the City Documents or any other loss or cost, including but not limited to that caused by the concurrent active or passive negligence of Indemnitees. Borrower’s indemnification obligations under this Section 10 shall survive the expiration or earlier termination of this Agreement. It is further agreed that City does not and shall not waive any rights against Borrower that it may have by reason of this indemnity and hold harmless agreement because of the acceptance by, or the deposit with City by Borrower, of any of the insurance policies described in this Agreement or the City Documents. However, Borrower’s duty to indemnify under this Section shall not apply to injuries or damage for which Indemnitees have been found in a court of competent jurisdiction to be solely liable by reason of their own gross negligence or willful misconduct 10. Assignability and Subcontracting Borrower hereby subjects its interest in the Property and the Project to the covenants and restrictions set forth in this Agreement and City Documents. The Parties hereby declare their express intent that the covenants and restrictions set forth herein, and the City Documents, shall be deemed covenants running with the land and shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors in interest, transferees, and assigns of the Parties, regardless of any sale, assignment, conveyance or transfer of the Property, the Project or any part thereof or interest therein. Any successor-in-interest to Borrower, including without limitation any purchaser, transferee or lessee of the Property or the Project (other than the Eligible Households of the individual dwelling units within the Project) shall be subject to all of the duties and obligations imposed hereby, and in the City Documents, for the full term of this Agreement. Each and every contract, deed, ground lease or other instrument affecting or conveying the Property or the Project or any part thereof, shall conclusively be held to have been executed, delivered and accepted subject to the covenants, restrictions, duties and obligations set forth herein and in the City Documents regardless of whether such covenants, restrictions, duties and obligations are set forth in such contract, deed, ground lease or other instrument. If any such contract, deed, ground lease or other instrument has been executed prior to the date hereof, ‐6- Borrower hereby covenants to obtain and deliver to City an instrument in recordable form signed by the parties to such contract, deed, ground lease or other instrument pursuant to which such parties acknowledge and accept this Agreement, and the City Documents and agree to be bound hereby. Except as permitted in the Deed of Trust or elsewhere in this Agreement, Borrower shall not assign this Agreement or any portion thereof to a third party or subcontract with a third party to provide services required by Borrower under this Agreement without the prior written consent of City. Any such assignment or subcontract without City’s prior written consent will give City the right to declare an Event of Default hereunder. Notwithstanding the foregoing restrictions, Borrower may, with City’s prior written consent, assign its rights and obligations under this Agreement to a limited partnership formed to develop and own the Project. In connection with such assignment, City and Borrower acknowledge and agree that this Agreement and any other loan documents shall be amended and restated to reflect such assignment. Borrower agrees for itself and for its successors that in the event that a court of competent jurisdiction determines that the covenants herein, or the City Documents do not run with the land, such covenants shall be enforced as equitable servitudes against the Property and the Project in favor of City. 11. Insurance Borrower shall not commence work or be required to commence work under this Agreement unless and until all insurance required under this Section has been obtained and such insurance has been approved by City’s Risk Manager, and Borrower shall use diligence to obtain such insurance and to obtain such approval. Borrower shall furnish City with certificates of insurance evidencing the required coverage, and there shall be a specific contractual liability endorsement extending Borrower’s coverage to include the contractual liability assumed by Borrower pursuant to this Agreement. These certificates shall specify or be endorsed to provide that thirty (30) days’ notice must be given, in writing, to City of any cancellation of the policy for reasons other than non- payment of premium, and ten (10) days’ notice of cancellation of the policy for non-payment of premium. Throughout the term of this Agreement, Borrower shall comply with the insurance requirements set forth in this Agreement and the City Documents, and shall, at Borrower’s expense, maintain in full force and effect insurance coverage as specified therein. 12. Compliance with Laws; Payments of Permits / Licenses All services to be performed by Borrower pursuant to this Agreement shall be performed in accordance with all applicable Federal, State, City, and municipal laws, ordinances, and regulations, including but not limited to the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and the Federal Regulations promulgated thereunder, as amended (if applicable), the Americans with Disabilities Act of 1990, as amended, and Section 504 of the Rehabilitation Act of 1973, which prohibits discrimination on the basis of handicap in programs and activities ‐7- receiving any Federal or City financial assistance. Such services shall also be performed in accordance with all applicable ordinances and regulations, including but not limited to appropriate licensure, certification regulations, provisions pertaining to confidentiality of records, and applicable quality assurance regulations. In the event of a conflict between the terms of this Agreement and any applicable State, Federal, City, or municipal law or regulation, the requirements of the applicable law or regulation will take precedence over the requirements set forth in this Agreement. Borrower will timely and accurately complete, sign, and submit all necessary documentation of compliance. 13. Non-Discrimination and Other Requirements A) General non-discrimination. Borrower shall not restrict the rental, sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property or Project, or any portion thereof, on the basis of race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national origin, ancestry, familial status, source of income, disability, or genetic information of any person. Borrower covenants for itself and all persons claiming under or through it, and this Agreement is made and accepted upon and subject to the condition that there shall be no discrimination against or segregation of any person or group of persons on account of any basis listed in subdivision (a) or (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 sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, Project or part thereof, nor shall Borrower or any person claiming under or through Borrower establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in, of, or for the Property, Project or part thereof. All deeds made or entered into by Borrower, its successors or assigns, as to any portion of the Property or Project shall contain the following language, and all leases or contracts made or entered into by Borrower, its successors or assigns, as to any portion of the Property or Project, shall reference this Section, and shall enforce the same diligently and in good faith: “(a) Borrower herein covenants by and for itself, its successors and assigns, and all persons claiming under or through it, that there shall be no discrimination against or segregation of a person or of a group of persons on account of any basis listed in subdivision (a) or (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 sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the property herein conveyed nor shall the Borrower or any person claiming under or through the Borrower establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in the property herein conveyed. The foregoing covenant shall run with the land. ‐8- (b) Notwithstanding paragraph (a), with respect to familial status, paragraph (a) shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in paragraph (1) shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, and 799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of Section 51 of the Civil Code and subdivisions (d) of Section 12955 of the Government Code shall apply to paragraph (a).” B) Equal employment opportunity. Borrower shall ensure equal employment opportunity based on objective standards of recruitment, classification, selection, promotion, compensation, performance evaluation, and management relations for all employees under this Agreement. Borrower’s equal employment policies shall be made available to City upon request. C) Section 504 of the Rehabilitation Act of 1973. Borrower shall comply with Section 504 of the Rehabilitation Act of 1973, as amended, which provides that no otherwise qualified handicapped individual shall, solely by reason of a disability, be excluded from the participation in, be denied the benefits of, or be subjected to discrimination in the performance of this Agreement. This Section applies only to Borrowers who are providing services to members of the public under this Agreement. D) Discrimination Against Individuals with Disabilities. Borrower shall comply fully with the nondiscrimination requirements of 41 C.F.R. § 60-741.5(a), which is incorporated herein as if fully set forth. E) History of Discrimination. Borrower must check one of the two following options, and by executing this Agreement, Borrower certifies that the option selected is accurate: ☐ No finding of discrimination has been issued in the past 365 days against Borrower by the Equal Employment Opportunity Commission, the Department of Fair Employment and Housing, or any other investigative entity. ☐ Finding(s) of discrimination have been issued against Borrower within the past 365 days by the Equal Employment Opportunity Commission, the Department of Fair Employment and Housing, or other investigative entity. If this box is checked, Borrower shall provide City with a written explanation of the outcome(s) or remedy for the discrimination. F) Violation of Non-discrimination provisions. Violation of the non-discrimination provisions of this Agreement shall be considered a breach of this Agreement and subject Borrower to penalties, to be determined by the City Manager, including but not limited to the following: i. termination of this Agreement; ‐9- ii. disqualification of Borrower from bidding on or being awarded a City contract for a period of up to 3 years; iii. liquidated damages of $2,500 per violation; and/or iv. imposition of other appropriate contractual and civil remedies and sanctions, as determined by the City Manager. To effectuate the provisions of this Section, the City Manager shall have the authority to examine Borrower’s employment records with respect to compliance with this Section and/or to set off all or any portion of the amount described in this Section against amounts due to Borrower under this Agreement or City Documents. Borrower shall report to the City Manager the filing by any person in any court of any complaint of discrimination or the filing by any person of any and all charges with the Equal Employment Opportunity Commission, the Department of Fair Employment and Housing, or any other entity charged with the investigation of allegations within 30 days of such filing, provided that within such 30 days such entity has not notified Borrower that such charges are dismissed or otherwise unfounded. Such notification shall include the name of the complainant, a copy of such complaint, and a description of the circumstance. Borrower shall provide City with a copy of their response to the Complaint when filed. 14. Retention of Records, Right to Monitor and Audit A) Borrower shall maintain all required records for five (5) years after City makes final payment and all other pending matters are closed, and Borrower shall be subject to the examination and/or audit by City. B) Reporting and Record Keeping: Borrower shall comply with all program and fiscal reporting requirements set forth by appropriate Federal, State, and local agencies, and as required by City. C) Borrower agrees upon reasonable notice to provide to City, to any Federal or State department having monitoring or review authority, to City’s authorized representatives, and/or to any of their respective audit agencies access to and the right to examine all records and documents necessary to determine compliance with relevant Federal, State, and local statutes, rules, and regulations, to determine compliance with this Agreement and City Documents, and to evaluate the quality, appropriateness, and timeliness of services performed. 15. Merger Clause and Amendments This Agreement, including the Exhibits and Attachments attached to this Agreement and incorporated herein by reference, constitutes the sole Agreement of the Parties to this Agreement and correctly states the rights, duties, and obligations of each Party as of this document’s date. In the event that any term, condition, provision, requirement, or specification set forth in the body of this Agreement conflicts with or is inconsistent with any term, condition, provision, requirement, or specification in any Exhibit and/or Attachment to this Agreement, the provisions of the body of ‐10- the Agreement shall prevail. Any prior agreement, promises, negotiations, or representations between the Parties not expressly stated in this document are not binding. All subsequent modifications or amendments shall be in writing, signed by the Parties and any request made for such shall be subject to a $2,000.00 fee payable by Borrower to City per modification or amendment request unless such amendment is required by the City. 16. Waiver of Terms and Conditions A Party may at its discretion waive in writing any of the terms and conditions of this Agreement, without completing an amendment to this Agreement. No waiver of any default or breach shall be implied from any omission by the non-breaching Party to take action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the waiver, and such waiver shall be operative only for the time and to the extent therein stated. Waivers of any covenant, term, or condition contained herein shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by a Party to or of any act by the other Party requiring further consent or approval shall not be deemed to waive or render unnecessary the consent or approval to or of any subsequent similar act. The exercise of any right, power, or remedy shall in no event constitute a cure or a waiver of any default under this Agreement, nor shall it invalidate any act done pursuant to notice of default, or prejudice the exercising Party in the exercise of any right, power, or remedy hereunder. 17. Controlling Law and Venue The validity of this Agreement and of its terms or provisions, the rights and duties of the Parties under this Agreement, the interpretation of this Agreement, the performance of this Agreement, and any other dispute of any nature arising out of this Agreement shall be governed by the laws of the State of California without regard to its choice of law rules. Any dispute arising out of this Agreement shall be venued either in the San Mateo County Superior Court or in the United States District Court for the Northern District of California. 18. Notices Except as otherwise specified herein, all notices to be sent pursuant to this Agreement shall be made in writing, and sent to the Parties at their respective addresses specified below or to such other address as a Party may designate by written notice delivered to the other parties in accordance with this Section. All such notices shall be sent by: (i) personal delivery, in which case notice is effective upon delivery; (ii) certified or registered mail, return receipt requested, in which case notice shall be deemed delivered upon receipt if delivery is confirmed by a return receipt; or (iii) nationally recognized overnight courier, with charges prepaid or charged to the sender’s account, in which case notice is effective on delivery if delivery is confirmed by the delivery service. ‐11- If to City, to: City of South San Francisco 400 Grand Avenue Attn: City Manager South San Francisco, CA 94080 Phone: (650) 877-8500 Mike.futrell@ssf.net With a Copy to: City of South San Francisco 400 Grand Avenue Attn: ECD Director South San Francisco, CA 94080 Phone: (650) 829-6622 Email: alex.greenwood@ssf.net With a Copy to: Meyers Nave Attn: Sky Woodruff 555 12th Street, Suite 1500 Oakland, CA 94607 Tel (510) 808-2000 Email sky@meyersnave.com If to Borrower: Grand and Linden Family Apartments, L.P. 1650 Lafayette Street Santa Clara, CA 95050 Attention: Alex Sanchez Telephone: (408) 984-5600 Email: asanchez@roemcorp.com With a Copy to: Bocarsly Emden Cowan Esmail & Arndt 633 W. Fifth Street 64th Floor Los Angeles, CA 90071 Attention: Kyle B. Arndt Telephone: 213-239-8048 Email: karndt@bocarsly.com 19. Action by the City Except as may be otherwise specifically provided herein, whenever any approval, notice, direction, consent or request by the City is required or permitted under this Agreement, such action shall be in writing, and such action may be given, made or taken by the City Manager or by any person who shall have been designated by the City Manager, without further approval by the City Council at the discretion of the City Manager. ‐12- 20. Non Liability of City Officials, Employees and Agents No member, official, employee or agent of the City shall be personally liable to Borrower or any successor in interest, in the event of any default or breach by the City, or for any amount of money which may become due to Borrower or its successor or for any obligation of City under this Agreement. 21. Discretion Retained by City The Borrower acknowledges that execution of this Agreement by the City does not constitute approval by the City of any required permits, applications, or allocations, for the Project, and in no way limits the discretion of the City in the permit allocation and approval process regarding the Property or Project. 22. Attorneys' Fees and Costs If any legal or administrative action is brought to interpret or enforce the terms of this Agreement, the prevailing party shall be entitled to recover all reasonable attorneys' fees and costs incurred in such action. 23. Electronic Signature If both City and Borrower wish to permit this Agreement and future documents relating to this Agreement to be digitally signed in accordance with California law, both boxes below must be checked. Any Party that agrees to allow digital signature of this Agreement may revoke such agreement at any time in relation to all future documents by providing notice pursuant to this Agreement. For City: ☐ If this box is checked by City, City consents to the use of electronic signatures in relation to this Agreement. For Borrower: ☐ If this box is checked by Borrower, Borrower consents to the use of electronic signatures in relation to this Agreement. THIS CONTRACT IS NOT VALID UNTIL SIGNED BY ALL PARTIES REST OF PAGE DELIBERATELY LEFT BLANK ‐13- IN WITNESS WHEREOF, this Agreement has been entered into by and between Borrower and City as of the date and year first above written. CITY OF SOUTH SAN FRANCISCO By: _______________________________ Name: Charles Michael Futrell Title: City Manager Date: APPROVED AS TO FORM: By: ___________________ Sky Woodruff, City Attorney ATTEST: By: ____________________ Rosa Govea Acosta City Clerk BORROWER: Grand and Linden Family Apartments, L.P., a California limited partnership By: _______________________________ Borrower’s Signature (blue ink only) Print Name: _______________________________ Print Title: _______________________________ Date: ‐14- ‐15- Exhibit A Project Description and Requirements In consideration of the payments set forth in Exhibit B and also described below, Borrower shall undertake the following activities and comply with the following restrictions and requirements: 1. Project Description Project Location / Address: 201-219 Grand Avenue, South San Francisco, CA Assessor’s Parcel Number(s): San Mateo County Assessor’s Parcel Nos. 012-316-110, 012-316-100, 012-316-090 and 012-316-080 Total # of Units Proposed: 47 Total # of Affordable Units Proposed: 46 Sources of Committed Funds: Fund 241: Housing Asset Fund Funding provided in this Agreement is from the following sources: City Housing Asset Fund FY 2019-20 TOTAL $2,450,000 $2,450,000 Project Sources & Uses Development Budget: The budget detailed in Exhibit D of this Agreement represents current financing projections for the Project and are subject to change as the Project design and program is further refined. 2. City Affordable Housing Asset Fund A. Determination of Restricted Units. “Restricted Unit” means a residential unit that is subject to rent and occupancy restrictions as a result of the financial assistance provided by City, as specified in the Loan Agreement and City Documents. This Section shall be amended to include the specific levels of affordability for each Restricted Unit once finally determined by the Parties. Under this Agreement, 46 units of the Project will be designated as Restricted Units. ‐16- In connection with this Agreement and prior to release of funds under this Agreement, Borrower shall execute and record the Affordability Covenant restricting units as described in Section 1 (Project Description) and Section 2 (City Affordable Housing Asset Fund) of Exhibit A. B. Affordability Requirements. All Restricted Units in the Project must remain affordable for a minimum of fifty-five (55) years. 1) Income Limits: All Restricted Units shall be offered for rent restricted and affordable to low income households. This Section shall be amended to include the specific levels of affordability for each Restricted Unit once finally determined by the Parties. All of these units shall be considered Restricted Units as defined in Section 2 of this Exhibit A. 2) Special Considerations for units with Project Based Section 8 Rental Assistance: If the Project receives an award of Project-Based Section 8 rental assistance, the units receiving the project-based vouchers (“PBVs”) shall be underwritten at the total subsidized rent for each unit paid by the project-based rental assistance and the tenant in sum. If PBVs are terminated, rents for any Restricted Units losing PBVs may be increased to the federally-permitted maximums in accordance with current California Tax Credit Allocation Committee (“CTCAC”) Regulations. If a PBV is terminated, and the current tenant is unable to pay the maximum CTCAC- allowable rent, Borrower may, upon advance written notice to City, transition targeted units detailed in Section 3.A (Unit Affordability Provisions) of this Exhibit A as follows: (a) First, to a household of the same targeted population that could afford to pay the maximum CTCAC rent allowed; and if there is no household that meets this criterion, (b) Second, to the next eligible household on Borrower’s waiting list that could afford to pay the maximum CTCAC rent allowed. For PBVs that are also HUD-Veterans Affairs Supportive Housing (VASH) vouchers, and if the current tenant is unable to pay the maximum CTCAC-allowable rent, Borrower may, upon advance written notice to City, transition to these units as follows: ‐17- (a) First, to a homeless veteran household for whom the maximum CTCAC rent allowed is affordable; and if there is no household that meets this criterion, (b) Second, to a homeless household for whom the maximum CTCAC rent allowed is affordable; and if there is no household who meets this criterion, (c) Third, to a veteran household for whom the maximum CTCAC rent allowed is affordable; and if there is no household who meets this criterion, (d) Fourth, to the next eligible household on Owner’s waiting list for whom the maximum CTCAC rent allowed is affordable. If PBVs are terminated, Borrower may request, and City may grant a reduction or waiver in writing of the homeless household requirements described above, upon submission of evidence that such requirements cause the Project to be financially infeasible. 3. Environmental Review All applicable California Environmental Quality Act (“CEQA”) requirements must be met for all projects that receive City funding. 4. Project Completion Project Completion is defined as completion of construction of the Project as evidenced by issuance of Final Certificate of Occupancy or some other document acceptable to City (“Project Completion Document”). 5. Compliance Period The Compliance Period is defined as the time frame beginning immediately upon Project Completion and ending on the later of fifty-five (55) years from the first day of the Compliance Period or the Note Maturity set forth in the Note. Borrower shall provide City with a Housing Completion Report, including final Project funding sources and uses, and tenant profile described below on forms acceptable to City within the first 180 days of the Compliance Period. Upon Borrower request to City, the due dates for these reports may be extended to accommodate a longer lease-up period if Borrower has demonstrated reasonable diligence and progress toward achieving 100% occupancy. 6. Property Standards Construction of the Project must fully comply with all applicable local and State building codes and regulations, and Borrower must operate and maintain the Property and Project in a manner that ensures the Property and Project will continue to comply with said codes and regulations. Borrower’s operations and maintenance of the Project must ensure that its appearance from all ‐18- public right-of-ways continually presents the Project in a high-quality manner and complies with provisions of the Affordability Covenant and Deed of Trust. 7. Contract Number All correspondence, invoices, payments, and reports must include the City contract number. The City will provide the contract number upon disposition of the Property to Borrower. 8. Rents and Occupancy Project financing is anticipated to include proceeds from Low-Income Housing Tax Credits (“LIHTC”). For LIHTC projects, City shall defer to income certification and calculation requirements imposed by tax credits. If project financing does not include tax credits, Borrower shall rely on income determination calculations set forth in 24 CFR Part 5 (i.e., the Section 8 Voucher Program). 9. Security/Term/Loan Terms Unless otherwise noted herein, funding is provided in the form of a loan or loans, in accordance with terms described in this Paragraph. Should funding provided in this Agreement include more than one City funding source, separate Note(s) and Deeds of Trust will be executed for each funding source. For each funding source, prior to any disbursement of funds, Borrower shall execute and deliver a Note in the amount indicated below and a Deed of Trust in favor of City to secure the performance of all terms and conditions of the Note and this Agreement. The Note will be non-recourse. The Deed of Trust will be recorded in the Office of the Recorder of the County of San Mateo upon Borrower’s acquisition of the Property. The Deed of Trust may be subordinate to the liens of any senior lenders. No interest will accrue on the Note unless Borrower commits and Event of Default under this Agreement or any of the City Documents. The City may, in the sole and absolute discretion of the City forgive the Loan at the Note Maturity if no Event of Default has occurred or is occurring. If an Event of Default has occurred, the entire outstanding balance of the Loan shall become immediately due and payable and such amount shall be deemed to have accrued simple interest at the rate of three percent (3%) per annum, commencing on the date of disbursement through the date of the Event of Default. Beginning as of the date of the Event of Default and continuing until such time as the Loan is repaid in full or default or breach is completely cured, the outstanding principal balance of the Loan shall accrue the default rate of the lesser of either ten percent (10%), compounded annually, or the highest rate permitted by law. The Note and Deed of Trust will be executed prior to any Funding Source Note Amount Deed of Trust Amount City Affordable Housing Asset Fund $2,450,000.00 $2,450,000.00 ‐19- disbursement of funds under this Agreement. Should there be a conflict in the language between the Note and this Agreement, the Note will prevail. 10. Repayment The provisions and requirements in this and foregoing sections will refer to each Note unless stated otherwise. Annual payments on the Note will be made from Project Operations, which begins on the first day of the month after the Project receives a Certificate of Occupancy, or some other document evidencing completion acceptable to City. Annual payments will equal 50% of Residual Receipts, with payment amount determined by disbursed amount of City funding provided in this Agreement as a proportion of all local funding requiring repayment (to be confirmed by City and Borrower in writing outside of this Agreement). In cases where the City is not the sole subsidy lender requiring Residual Receipt payments, the other subsidy lenders shall share their 50% portion of Residual Receipts in proportion to the size of each lenders’ total contribution. Where another subsidy lender requires payment based upon the subsidy lender’s sharing a greater percentage than fifty percent (50%) of the Residual Receipts, then the City’s share of Residual Receipts shall be adjusted to be equal to that lender’s greater percentage of Residual Receipts. Payment will be first applied to outstanding interest, if any, and then to principal until the Note is paid in full. In the event this payment is less than accumulated interest owed plus current interest, any unpaid interest will carry over to the following year. Interest will not compound on this interest carry-over. The entire outstanding principal balance plus any unpaid accrued interest will be due and payable upon an Event of Default. The first payment will be due no later than 120 days after the end of the Project’s first fiscal year after the project receiving a Certificate of Occupancy. A copy of the annual independent financial audit delineating Residual Receipts payment to City will also be delivered to City no later than 120 days after the end of each of the Project’s fiscal years. “Residual Receipts” means, with respect to the Project’s fiscal year, the amount by which Gross Revenue exceeds Annual Operating Expenses, as defined below. “Gross Revenue” means all rental and incidental income from the Project, except for tenant security deposits, loan proceeds and capital contributions insurance proceeds and any interest earned on said deposits. “Annual Operating Expenses” means costs reasonably and actually incurred for operations and maintenance of the Project to the extent that they are consistent with an annual independent audit performed by a certified public accountant using generally acceptable accounting principles. A ‐20- copy of the audit will be delivered with payment as specified above. Costs associated with the Project Operations and maintenance include the following: property and other taxes and assessments imposed on the Project; premiums for property damage and liability insurance; utility services not paid for directly by the tenants, including but not limited to water, sewer, trash collection, gas, and electricity; maintenance and repairs including but not limited to pest control, landscaping and grounds maintenance, painting and decorating, cleaning, common systems repairs, general repairs, janitorial supplies, and others; resident services; additional supportive services necessary to help residents maintain personal or household stability and housing status; any license or certificates of occupancy fees required for operation of the Project; general administrative expenses including but not limited to advertising, marketing, security services and systems, professional fees for legal, audit, accounting and tax returns, and other; property management fees and reimbursements including on-site manager expenses, not to exceed fees and reimbursements which are standard in the industry and pursuant to a management contract approved by City (which such approval will not be unreasonably withheld); resident services, additional supportive services necessary to help tenants maintain personal or household stability and housing status; annual cash deposited into a reserve for capital replacements of Project improvements in an amount of up to $500 dollars per unit per year (increasing by 3% per annum), provided any changes to the amount deposited into this replacement reserve will require City approval; cash deposited into an operating reserve for the Project and such other reserves as may be required by Borrower’s senior lender or tax credit investor; payments of any deferred developer fee up to the maximum Net Developer Fee permitted under Section 11 (Developer Fee) below; current and accrued general partner partnership management fee and current and accrued limited partner asset management fee in the amount set forth in Borrower’s limited partnership agreement (provided, however, following withdrawal of the investor limited partner from Borrower, the limited partner asset management fee shall no longer be included as an Annual Operating Expense for purposes of calculating Residual Receipts); and debt service payments of loans in senior position to this loan. For avoidance of doubt, any deferred developer fee remaining after payment of the Net Developer Fee may be paid only from Borrower's share of Residual Receipts. Prior to start of Project Operations, Borrower will confirm in writing with City all fee and reserve amounts to be included in the above calculations for Residual Receipts. Annual operating expenses will not include the following: depreciation, amortization, depletion, or other non-cash expenses, or any amount expended from a reserve account. 11. Developer Fee The maximum cumulative cash developer fee (net of any general partner capital contributions) that may be paid from development sources and/or as an operating expense shall not exceed the maximum amount allowed under TCAC regulations (the “Net Developer Fee”). Any amount of developer fee in excess of Net Developer Fee may be paid only from Borrower's share of Residual Receipts. ‐21- 12. Excess Construction Proceeds/Cost Savings “Surplus Construction Cash” is defined as the difference between total of all sources of funds received for the Project and the total cost of the Project. If Surplus Construction Cash remains after construction is completed and Borrower Form 8609 is filed, and all obligations to construction contractors, subcontractors, and lenders for construction period expenses are satisfied, Borrower shall reimburse City for its financial investment in the Project as set forth herein. Borrower shall prepare and submit to City a Cost Certification detailing the amount of Surplus Construction Cash, if any, at Project completion. City may, at its sole option, accept a Cost Audit required by another funding source as evidence of Surplus Construction Cash, if any. Borrower shall distribute Surplus Construction Cash among City and any other governmental agency/agencies requiring reimbursement/repayment in direct proportion to the share of total Project funds disbursed from each such agency funding the Project. These other agencies, and respective amounts disbursed will be confirmed in writing outside of this Agreement prior to start of construction of the Project. Any reimbursement to City will be counted toward repayment of the amount owed on City Note[s], with such payment first applied toward any interest accrued before reduction of the principal balance. Borrower may opt to retain up to 50% of the Surplus Construction Cash proceeds with the other 50% to be distributed to City and other applicable public/governmental agencies in the proportion described above. Should Borrower opt to retain a portion of the Surplus Construction Cash, its portion shall be used solely for ongoing Project Operations or for payment of deferred Developer Fees. In either case, Borrower shall inform City of its intent to retain up to 50% of the Surplus Construction Cash, and provide a detailed description of the intended use[s] of the Surplus Construction Cash, as well as the identity of any other public/governmental funding agencies, in writing, no later than the permanent loan closing date. 13. Prepayment Prepayments may be made at any time without penalty. 14. Due on Sale, Refinance, or Transfer of Title If Borrower sells, refinances or transfers the Property or Project or any interest therein without prior written consent of the City Manager or his/her designee, it shall be considered an Event of Default and the entire principal balance of the Note, including any accumulated interest accrued pursuant to Exhibit A, shall be immediately due and payable. However, (i) the transfer of limited partner interests in Borrower to a Low-Income Housing Tax Credit (“LIHTC”) investor, (ii) the subsequent transfer of such limited partner interests for the purpose of syndicating the LIHTC, or (iii) the granting of an option or right of first refusal by the City and any transfer pursuant to such option or right of first refusal as agreed to by the City shall not be considered a sale, refinance or transfer of the Project for purposes of this section. Replacement of a general partner of Borrower ‐22- with any other entity shall be subject to prior written approval of City, which shall not be unreasonably withheld. Borrower may transfer or assign all or any portion of its interest, right or obligations in the Property only as set forth in the City Documents and with City’s prior written consent, which consent City shall not withhold provided that (1) the Project is and shall continue to be operated in compliance with this Agreement and the City Documents; (2) the transferee expressly assumes all obligations of Borrower imposed by this Agreement and the City Documents; (3) the transferee executes all documents reasonably requested by the City with respect to the assumption of the Borrower’s obligations under this Agreement and the City Documents and upon City’s request, delivers to the City an opinion of its counsel to the effect that such document and this Agreement and the City Documents are valid, binding and enforceable obligations of such transferee; and (4) either (A) the transferee has at least three years’ experience in the ownership, operation and management of low- income multifamily rental housing projects of similar size to that of the Project, without any record of material violations of nondiscrimination provisions or other state or federal laws or regulations applicable to such projects, or (B) the transferee agrees to retain a property management firm with the experience and record described in sub-clause (A). Consent to any proposed Transfer may be given by the City Manager unless the City Manager, in his or her discretion, refers the matter of approval to the City Council. If a proposed Transfer has not been approved by City in writing within ninety (90) days following City’s receipt of written request by Borrower, it shall be deemed approved. Borrower shall reimburse City for all City costs, including but not limited to reasonable attorneys’ fees, incurred in reviewing instruments and other legal documents proposed to effect a Transfer under this Agreement, the City Documents and in reviewing the qualifications and financial resources of a proposed successor, assignee, or transferee within ten (10) days following City’s delivery of an invoice detailing such costs. 15. Events of Default The occurrence of any one or more of the following events shall constitute an Event of Default hereunder: A. Failure to Construct Project. A failure by the Borrower to commence or complete the construction of the Project in accordance with the terms of the City Documents which failure is not cured within 30 days of written notice from the City; B. Breach of Covenants. ‐23- Failure by the Borrower to duly perform, comply with, or observe any of the conditions, terms, or covenants of any of this Agreement or the City Documents which failure is not cured within 30 days of written notice from the City; C. Unauthorized Transfer. Any transfer other than as permitted pursuant to this Agreement; D. Representation or Warranty Incorrect. Any Borrower representation or warranty contained in this Agreement, or in any application, financial statement, certificate, or report submitted to the City in connection with Loan or City Documents, proving to have been incorrect in any material respect when made; E. Default Under Other Financing or DA. Failure to make any payment or perform any of the Borrower's covenants, agreements, or obligations under the documents evidencing and securing the financing for the Project or City Documents following expiration of all applicable notice and cure periods; F. Insolvency. A court having jurisdiction shall have made or entered any decree or order (i) adjudging the Borrower (or any general partner of the Borrower) to be bankrupt or insolvent, (ii) approving as properly filed a petition seeking reorganization of the Borrower (or any general partner of the Borrower) or seeking any arrangement for the Borrower under the bankruptcy law or any other applicable debtor's relief law or statute of the United States or any state or other jurisdiction, (iii) appointing a receiver, trustee, liquidator, or assignee of the Borrower (or any general partner of the Borrower) in bankruptcy or insolvency or for any of their properties, or (iv) directing the winding up or liquidation of the Borrower (or any general partner of the Borrower), if any such decree or order described in clauses (i) to (iv), inclusive, shall have continued unstayed or undischarged for a period of ninety (90) days; or the Borrower (or any general partner of the Borrower) shall have admitted in writing its inability to pay its debts as they fall due or shall have voluntarily submitted to or filed a petition seeking any decree or order of the nature described in clauses (i) to (iv), inclusive; G. Assignment; Attachment. The Borrower (or any general partner of the Borrower) shall have assigned its assets for the benefit of its creditors or suffered a sequestration or attachment of or execution on any ‐24- substantial part of its property, unless the property so assigned, sequestered, attached or executed upon shall have been returned or released within ninety (90) days after such event or prior to sooner sale pursuant to such sequestration, attachment, or execution; H. Suspension. The Borrower (or any general partner of the Borrower) shall have voluntarily suspended its business; I. Liens. There shall be filed any claim of lien (other than liens approved in writing by the City) against the Property or Project or any part thereof, or any interest or right made appurtenant thereto, or the service of any notice to withhold proceeds of the Loan and the continued maintenance of said claim of lien or notices to withhold for a period of twenty (20) days without discharge or satisfaction thereof or provision therefore satisfactory to the City; J. Condemnation. The condemnation, seizure, or appropriation of all or, in the opinion of the City, a substantial part of the Property or Project; or K. Insurance. Borrower’s failure to maintain insurance on the Property and the Project as required hereunder or under City Documents, and the failure of Owner to cure such default within thirty (30) days of written notice from City; L. Taxes and Assessments. Subject to Owner’s right to contest the following charges, Borrower’s failure to pay taxes or assessments due on the Property or the Project or failure to pay any other charge that may result in a lien on the Property or the Project, and Owner’s failure to cure such default within sixty (60) days of delinquency; M. Other Default. Occurrence of any other event (whether termed default, event of default, or otherwise) which under the terms of this Agreement or City Documents will entitle City to exercise rights or remedies. 16. Remedies The occurrence of any Event of Default will either, at the option of the City or automatically where so specified, relieve the City of any obligation to make the Loan and shall give the City the right to proceed with any and all remedies set forth in this Agreement, including but not limited to the following: A. Repayment of Loan. ‐25- The City shall have the right to require immediate repayment of the outstanding principal balance of the Loan and such amount shall be deemed to have accrued simple interest at the rate of three percent (3%) per annum, commencing on the date of disbursement through the date of the Event of Default. Beginning as of the date of the Event of Default and continuing until such time as the Loan is repaid in full or default or breach is completely cured, the outstanding principal balance of the Loan shall accrue the default rate of the lesser of either ten percent (10%), compounded annually, or the highest rate permitted by law. Borrower waives all right to presentment, demand, protest or notice of protest or dishonor. The City may proceed to enforce repayment of the Loan and to exercise any or all rights afforded to the City as a creditor and secured party under the law including the Uniform Commercial Code, including foreclosure under the City Deed of Trust. The Borrower shall be liable to pay the City on demand all reasonable expenses, costs and fees (including, without limitation, reasonable attorney's fees and expenses) paid or incurred by the City in connection with the collection of the Loan and the preservation, maintenance, protection, sale, or other disposition of the security given for the Loan. B. Specific Performance. Bring an action for equitable relief seeking the specific performance of the terms and conditions of this Agreement or City Documents, and/or enjoining, abating, or preventing any violation of such terms and conditions, and/or seeking declaratory relief. C. LIQUIDATED DAMAGES. FOR VIOLATIONS OF OBLIGATIONS WITH RESPECT TO RENTS FOR RESTRICTED UNITS, THE CITY SHALL HAVE THE RIGHT TO IMPOSE AS LIQUIDATED DAMAGES A CHARGE IN AN AMOUNT EQUAL TO THE ACTUAL AMOUNT COLLECTED BY OWNER OR OWNER’S REPRESENTATIVE IN EXCESS OF THE AFFORDABLE RENT. THE PARTIES AGREE THAT, IN SUCH INSTANCE, SUCH EXCESS RENT REPRESENTS A REASONABLE APPROXIMATION OF THE CITY’S DAMAGES AND IS NOT INTENDED AS A FORFEITURE OR PENALTY BUT RATHER AN ENFORCEABLE LIQUIDATED DAMAGES PROVISION PURSUANT TO CALIFORNIA CIVIL CODE SECTION 1671, ET SEQ. OWNER SHALL PAY ANY LIQUIDATED DAMAGES ASSESSED BY THE CITY WITHIN TEN (10) DAYS. City’s Initials Owner’s Initials D. Other Remedies. Pursue any other remedy allowed at law or in equity. ‐26- E. Right to Cure at Borrower's Expense. The City shall have the right (but not the obligation) to cure any monetary default by the Borrower under a loan secured by the Property. The Borrower agrees to reimburse the City for any funds advanced by the City to cure a monetary default by the Borrower upon demand therefore, together with interest thereon at the lesser of ten percent (10%) per annum or the maximum rate permitted by law, from the date of expenditure until the date of reimbursement. F. Right of Contest. The Borrower shall have the right to contest in good faith any claim, demand, levy, or assessment the assertion of which would constitute an Event of Default hereunder. Any such contest shall be prosecuted diligently and in a manner unprejudicial to the City or the rights of the City hereunder. G. Remedies Cumulative. No right, power, or remedy given to a party by the terms of this Agreement is intended to be exclusive of any other right, power, or remedy; and each and every such right, power, or remedy shall be cumulative and in addition to every other right, power, or remedy given to the Party. Neither the failure nor any delay on the part of a Party to exercise any such rights and remedies shall operate as a waiver thereof, nor shall any single or partial exercise by a Party of any such right or remedy preclude any other or further exercise of such right or remedy, or any other right or remedy. 17. Title Policy If funds provided in this Agreement are to assist in Property acquisition, Borrower shall open an escrow account with a mutually acceptable title company. City as a lender shall provide instructions to record its Deed of Trust and Affordability Covenant. For all loans secured by a Deed of Trust, at the close of escrow, Borrower shall obtain for City’s benefit, an ALTA extended coverage lender’s policy of title insurance in an amount not less than the face value of the Note, clear of any title defects which would prevent the operation of the proposed Project. Borrower shall be responsible for paying all recording fees, escrow fees, the premium for the title insurance policy, all fees and cost for any new financing, and shall pay any applicable transfer taxes. 18. Fire and Extended Coverage Borrower at its costs shall maintain for the Project a policy of standard fire and extended coverage during the life of the Note and Deed of Trust securing this Agreement, or any subsequently executed document which replaces the Note and Deed of Trust, with vandalism and malicious mischief endorsements, in the amount of at least the full replacement value of the improvements ‐27- which are part of the Project. The insurance policy must be issued in the names of Borrower and City as their interests appear. The insurance policy must contain a lender’s loss payment endorsement, providing that any proceeds will be payable to City as its interests appear and may be subject to the interest of senior lenders. 19. Property Damage or Destruction If any part of the Project is damaged or destroyed, Borrower shall repair or restore the same, consistent with the occupancy and rent restriction requirements set forth in this Agreement and City Documents. Such work shall be commenced as soon as reasonably practicable after the damage or loss occurs and shall be completed within one year thereafter or as soon as reasonably practicable, provided that insurance proceeds are available to be applied to such repairs or restoration within such period and the repair or restoration is financially feasible. During such time that lenders or low-income housing tax credit investors providing financing for the Project impose requirements that differ from the requirements of this Section the requirements of such lenders and investors shall prevail. 20. Nonrecourse Obligation. Notwithstanding anything to the contrary set forth herein, the Loan evidenced by this Agreement shall be a nonrecourse obligation of Borrower and its Partners. ‐28- Exhibit B Disbursement and Rates Funding provided in this Agreement is to be used to support work scope activity and delivery costs enumerated in Exhibit A. None of the funding shall be used to support Borrower’s general administration costs. Subject to the terms of the Agreement, City shall disburse loan funds to Borrower based on the following fee schedule and terms: City shall deposit funds into an escrow held by a title company mutually approved by City and Borrower, in accordance with City enabling instructions. City funds deposited into escrow will be used by the title company to consummate the transaction. ‐29- In consideration of the payments set forth in Exhibit B, Borrower shall undertake the following activities as conditions for funding provided in this Agreement: 1) Prior to award of funds provided and detailed in this Agreement, Borrower must satisfy the following conditions: a) Borrower shall deliver to the City copies of insurance policies described in Section 12 which name the City as additional insured. b) Borrower shall execute and Escrow Agent shall deliver to the City the Note. c) Borrower shall execute the Deed of Trust securing the Note. The Deed of Trust shall be recorded against the Property at the time the Borrower acquires it with Loan proceeds. d) Borrower shall execute the Affordability Covenant which shall be recorded against the Property at the time the Borrower acquires it with Loan proceeds. City acknowledges that the above-stated conditions have been addressed to City’s satisfaction. 2) Prior to Property conveyance, Borrower must satisfy the following conditions: a) Meet all closing obligations, pursuant to Section 6: Closing and Payment of Purchase Price of the Purchase and Sale Agreement City reserves the right to waive, delay, or otherwise modify funding conditions stated above, except those conditions detailed in Sections 1 and 2 of this Exhibit. Exhibit C Funding Conditions ‐30- Exhibit D Project Sources and Uses Development Budget 3471812.1   DO NOT DESTROY THIS NOTE. WHEN THIS NOTE IS FULLY PAID, IT MUST BE SURRENDERED TO THE  TRUSTEE ALONG WITH THE ORIGINAL DEED OF TRUST FOR CANCELLATION AND ISSUANCE OF A  RECONVEYANCE.    PROMISSORY NOTE  Secured by a Deed of Trust    $2,450,000.00    South San Francisco, California     , 2020    FOR VALUE RECEIVED, Grand and Linden Family Apartments, L.P. (“Borrower”), promises to pay to the  City of South San Francisco, a municipal corporation, (“City”) the sum of Two Million Four Hundred Fifty  Thousand Dollars ($2,450,000.00) plus interest (the “Loan”). All payments on this Note shall be made to  City at 400 Grand Avenue, South San Francisco, CA 94080 or such other place as City shall designate to  Borrower in writing, or by wire transfer of immediately available funds to an account designated by City  in writing.     This Secured Promissory Note (this "Note") has been executed and delivered pursuant to a Loan  Agreement dated as of the date hereof by and between Borrower and City (the "Loan Agreement"), and  is subject to the terms and conditions of the Loan Agreement, which are by this reference incorporated  herein and made a part hereof. Capitalized terms used but not defined herein shall have the meaning  ascribed to such terms in the Loan Agreement.     This Note is secured by a Leasehold Deed of Trust, Assignment of Rents, Security Agreement and Fixture  Filing ("Deed of Trust") dated as of the date hereof, executed by Borrower for the benefit of City and  encumbering Borrower's interest in the property described therein. City shall be entitled to the benefits  of the security provided by the Deed of Trust and shall have the right to enforce the covenants and  agreements contained herein, in the Deed of Trust, and the Loan Agreement.    Use of Loan Funds: Proceeds for this Loan come from the City’s Housing Trust Fund. Said proceeds will be  used for the purchase of 201‐219 Grand Avenue, known as County Assessor's Parcel Numbers 012‐316‐ 110, 012‐316‐100, 012‐316‐090 and 012‐316‐080 (the “Property”) and re‐development of the Property  into a mixed use, high‐density, residential apartment building of forty‐six (46) affordable residential units  and one manager’s unit and approximately 6,000 square feet of ground floor commercial units (the  “Project”). The terms and conditions of the Loan are more specifically described in the “Loan Agreement  Between the City of South San Francisco and Grand and Linden Family Apartments, L.P.” (the  “Agreement”) by Resolution No.[add #], [add date] and the “Affordable Housing Regulatory Agreement  and Declaration of Restrictive Covenants between the City of South San Francisco and Grand and Linden  Family Apartments, L.P.” (“Affordability Covenant”) dated     , 2020.    Term: The term of this Note shall be from execution and shall mature fifty‐five (55) years from date of  Project Completion, as defined by issuance of a Final Certificate of Occupancy, or some other document  acceptable to the City, for the Project (the “Note Maturity”).    Repayment/Interest Rate: The principal amount under the Note shall bear no interest unless an Event of  Default occurs under this Note, the Agreement, Deed of Trust or Affordability Covenant (collectively “City  Documents”). In the City’s sole and absolute discretion, the Loan may be forgiven by the City at Note  210-219 Grand Avenue Promissory Note $2,450,000.00 Page 2 Maturity so long as no Event of Default has occurred or is occurring under the Note or City Documents. If  an Event of Default has occurred, the entire outstanding balance of the Loan shall become immediately  due and payable and such amount shall be deemed to have accrued simple interest at the rate of three  percent (3%) per annum, commencing on the date of disbursement through the date of the Event of  Default.    Beginning as of the date of the Event of Default and continuing until such time as the Loan is repaid in full  or default or breach is completely cured, the outstanding principal balance of the Loan shall accrue the  default rate of the lesser of either ten percent (10%), compounded annually, or the highest rate permitted  by law. The City Documents shall be executed prior to any disbursement of funds under the Agreement.  The Deed of Trust shall be recorded as described in the section below entitled “Security.”    If payment is due, payment will first be applied to outstanding interest and then to any outstanding  principal until the Note is paid as set forth herein. In the event this payment is less than accumulated  interest owed plus current interest, any unpaid interest shall carry over to the following year. Interest  shall not compound on this interest carry‐over.     Due on Sale, Refinance or Transfer of Title: Notwithstanding the foregoing, in the event of a sale,  refinance or transfer of the Project or Property or any interest therein by Borrower without prior written  consent of the City and in accordance with the terms of the City Documents, the entire principal balance  of this Note, including any accumulated interest, shall be immediately due and payable. However, (i) the  transfer of limited partner interests in Borrower to a Low‐Income Housing Tax Credit (“LIHTC”) investor,  (ii) the subsequent transfer of such limited partner interests for the purpose of syndicating the LIHTC, or  (iii) the granting of an option or right of first refusal by the City and any transfer pursuant to such option  or right of first refusal as agreed to by the City shall not be considered a sale, refinance or transfer of the  Project for purposes of this section. Replacement of a general partner of Borrower with any other entity  shall be subject to prior written approval of City, which shall not be unreasonably withheld.      Borrower may transfer or assign all or any portion of its interest, right or obligations in the Property only  as set forth in this Note and the City Documents and with City’s prior written consent, which consent City  shall not withhold provided that (1) the Project is and shall continue to be operated in compliance with  this Note and the City Documents; (2) the transferee expressly assumes all obligations of Borrower  imposed by this Note and the City Documents; (3) the transferee executes all documents reasonably  requested by the City with respect to the assumption of the Borrower’s obligations under this Note and  the City Documents, and upon City’s request, delivers to the City an opinion of its counsel to the effect  that such document and this Note and the City Documents are valid, binding and enforceable obligations  of such transferee; and (4) either (A) the transferee has at least three years’ experience in the ownership,  operation and management of low‐income multifamily rental housing projects of similar size to that of  the Project, without any record of material violations of nondiscrimination provisions or other state or  federal laws or regulations applicable to such projects, or (B) the transferee agrees to retain a property  management firm with the experience and record described in sub‐clause (A).    Consent to any proposed Transfer may be given by the City’s City Manager unless the City Manager, in his  or her discretion, refers the matter of approval to the City Council. If a proposed Transfer has not been  approved by City in writing within ninety (90) days following City’s receipt of written request by Borrower,  it shall be deemed approved.      210-219 Grand Avenue Promissory Note $2,450,000.00 Page 3 Borrower shall reimburse City for all City costs, including but not limited to reasonable attorneys’ fees,  incurred in reviewing instruments and other legal documents proposed to effect a Transfer under this  Note and the City Documents and in reviewing the qualifications and financial resources of a proposed  successor, assignee, or transferee within ten (10) days following City’s delivery of an invoice detailing such  costs.    Default: In the event Borrower commits an Event of Default pursuant to the Agreement and Affordability  Covenant, Borrower shall be in default under of the terms and conditions of this Note and the Deed of  Trust, and City may demand immediate and full payment of the total outstanding principal amount of the  Note and any accrued interest under the Agreement or Affordability Covenant, and/or may initiate  foreclosure proceedings under the Deed of Trust.     Nonrecourse: This Note shall be non‐recourse to Borrower and its partners.      Security. This Note will be secured by the Deed of Trust recorded against Borrower’s fee simple estate in  the Property.     Other. Should there be a conflict relating to repayment terms between the Agreement and this Note, the  latter will prevail.      IN WITNESS WHEREOF, Borrower has executed and delivered this Note as of the date first written  above.    BORROWER:     Grand and Linden Family Apartments, L.P.       By:           Title:           Date:           3470570.1 ROEM Development Corporation  Page 1       RECORDING REQUESTED BY :    City of South San Francisco    WHEN RECORDED, MAIL TO :    400 Grand Avenue  South San Francisco, CA  94080  Attn:  City Manager                      Exempt from Recording Fees pursuant to  Section 27383 of the Government Code  (This Space for Recorder's Use Only)  DEED OF TRUST AND ASSIGNMENT OF RENTS    This Deed of Trust, made this         __             day            , 2020 between    ROEM DEVELOPMENT CORPORATION     herein called “Trustor,” whose mailing address is     Grand and Linden Family Apartments, L.P.  1650 Lafayette Street  Santa Clara, CA 95050    and Chicago Title Company “Trustee", and    City of South San Francisco, herein called “Beneficiary” or “City”    RECITALS    Witnesseth:    That Trustor IRREVOCABLY GRANTS, TRANSFERS, AND ASSIGNS TO TRUSTEE IN TRUST, WITH POWER OF SALE, that  property in County of San Mateo, State of California, described in "Exhibit A" attached hereto together with all  the improvements now or hereafter erected on the property, and all easements, rights, appurtenances, rents  (subject, however, to the rights and authorities given to Beneficiary to collect and apply such rents), royalties,  mineral, oil and gas rights and profits, water, water rights, and water stock, and all fixtures now or hereafter  attached to the property, including but not limited to all gas and electric fixtures, radiators, heaters, furnaces, air  conditioners, heat pumps, stoves, ranges, bathtubs, sinks, water closets, basins, pipes, faucets and other  plumbing and heating, venting and air conditioning equipment, cabinets, mantels, cooking apparatus and  appurtenances, shades, awnings, screens, venetian blinds and other furnishings, all of which, including  replacements and additions thereto, which shall be deemed to be and remain a part of the property covered by  this Deed of Trust; and all of the foregoing, together with said property  are referred to as (the “Property”).      Trustor hereby represents, warrants and covenants that with the exception of easements of record, absent the  written consent of City, this Deed of Trust shall not be subordinated in priority to any lien (other than those  pertaining to taxes or assessments), encumbrance, or other interest in the Property. If at the time this Deed of  Trust is recorded, any interest, lien, or encumbrance has been recorded against the Property in position superior  to this Deed of Trust, upon the request of City, Trustor hereby covenants and agrees to promptly undertake all  action necessary to clear such matter from title or to subordinate such interest to this Deed of Trust consistent  with the intent of and in accordance with this Deed of Trust, and to provide such evidence thereof as City may  reasonably request. Notwithstanding the foregoing, the City agrees that pursuant to Health and Safety Code  ROEM Development Corporation  Page 2         Section 33334.14(a)(4), the City will not withhold consent to reasonable requests for subordination of this Deed  of Trust to deeds of trust provided for the benefit of lenders identified in the Financing Plan approved in  connection with the certain Development Agreement executed by and between the Parties and dated as of  November 15, 2017 ( “DA”), provided that the instruments effecting such subordination include reasonable  protections to the City in the event of default consistent with the requirements of Health and Safety Code Section  33334.14(a)(4), including without limitation, extended notice and cure rights.    Any subordination request shall be subject to a $2,000.00 fee payable by Trustor to City upon Trustor’s request  for City to review instruments and other legal documents proposed to effect a subordination under this Deed of  Trust.    Trustor hereby: (i) represents and warrants that it is not affiliated in any way with the lender identified in the  Financing Plan approved in connection with the DA, and (ii) covenants that it will not become so affiliated by  acquiring an interest in such lender, or an interest in its loan, or otherwise.     Trustor covenants that it is lawfully seized of the estate conveyed by this Deed of Trust and has the right to grant  and convey the Property, and that Trustor will warrant and defend generally the title of the Property against all  claims and demands, subject to any declarations, easements or restrictions listed in a schedule of exceptions to  coverage in any title insurance policy insuring Beneficiary's interest in the Property. In the event the Property or  any part thereof, or any interest therein is sold, agreed to be sold, conveyed or alienated by the Trustor, or by  the operation of law or otherwise, all obligations secured by this instrument, irrespective of the maturity date  expressed therein, at the option of the holder hereof, and without demand or notice shall become due and  payable.  TOGETHER with the rents, issues and profits thereof, SUBJECT HOWEVER, to the right, power and authority given to  and conferred upon Beneficiary by paragraph 10 of the provisions incorporated herein by reference to collect  and apply such rents, issues and profits, for the purpose of securing  1)  Performance of each agreement of  Trustor incorporated by reference or contained herein;  2)  Payment of the indebtedness evidenced by one  Promissory Note (“Note”) of even date herewith, and any extension or renewal thereof, in the principal amount  of $2,450,000.00 executed by Trustor in favor of Beneficiary (the “Loan”);  3)  Payment of such further sums as  the then record owner of said Property hereinafter may borrow from Beneficiary, when evidenced by another  Note (or Notes) reciting it so secured;  4) Performance of the terms and conditions of that certain “Loan  Agreement between the City of South San Francisco and Grand and Linden Family Apartments, L.P.” (the  “Agreement”), dated     2020, approved by the South San Francisco City Council Resolution No.  [insert resolution #], [insert date]; and 5) Performance of the terms and conditions of that certain “Affordable  Housing Regulatory Agreement and Declaration of Restrictive Covenants between the City of South San Francisco  and Grand and Linden Family Apartments, L.P.” (“Affordability Covenant”) dated __________________ 2020  (collectively the Note, Agreement and Affordability Covenant shall be referred herein as “City Documents”).  Any  Event of Default pursuant to City Documents, shall be grounds for a declaration of an Event of Default hereunder,  and Beneficiary may, at its option, demand full payment of any outstanding principal and interest due Beneficiary,  under the Note secured by this Deed of Trust, and said Agreement.  To protect the security of this Deed of Trust, Trustor agrees:    (1) Covenants, Conditions and Restrictions. The following covenants, conditions and restrictions are to run  with the land and shall be binding on all parties and all persons claiming under them. The Property and all parts  or parcels of the Property shall be subject to these restrictions and shall pass with the Property and shall bind the  respective successors in interest of the Beneficiary. In the event of any breach of the covenants, conditions and  restrictions contained in this Deed of Trust, the Beneficiary, in addition to any other remedies available to it, may  institute or prosecute any suit which it may consider advisable in order to compel and obtain a decree for specific  performance of any obligation of any Trustor to use and maintain the Property in conformity with these  ROEM Development Corporation  Page 3       covenants. The forgoing provisions do not limit the right of the Beneficiary to foreclose or otherwise enforce any  other provision of the City Documents and Deed of Trust; provided, however, that in the event of any foreclosure  under any such mortgage, deed of trust or other lien or encumbrance, or sale pursuant to any power of sale  included in any such mortgage or deed of trust, the purchaser or purchasers and their successors and assigns and  the Property shall be, and shall continue to be, subject to all of the conditions, covenants and restrictions  contained in this Deed of Trust.     a. Use and Transfer Restrictions.  During the fifty‐five (55) year period commencing with the date of the  issuance of a Final Certificate of Occupancy for the residential portion of the Project, or some other document  acceptable to Beneficiary, for the residential portion of the Project, and subject to Section 18 hereof, Trustor  shall comply with the following restrictions unless Trustor has first obtained the written approval of the  Beneficiary:    i. Trustor shall not convey, transfer or encumber any of the Property or permit the conveyance,  transfer, or encumbrance of such Property unless such assignee, transferee or encumbrancer has agreed, in  writing and in a form suitable for recordation, to be bound by the terms of the City Documents; and    ii. Trustor shall not add to, reconstruct, or demolish any part of the Property or improvements,  except as provided by the City Documents.   (2) Affordability Requirements. Pursuant to the City Documents, the Property shall remain affordable to  persons and families of low income, as designated and described in the Affordability Covenant, for not less than  fifty‐five (55) years commencing with the date of the issuance of a Final Certificate of Occupancy for the  residential portion of the Project, or some other document acceptable to Beneficiary, for the residential portion  of the Project.    (3) Maintenance of Property. To maintain the Property and the Project in good physical condition  (reasonable wear and tear excepted), in good repair, and in decent, safe, sanitary, habitable and tenantable living  conditions in conformity with all applicable state, federal, and local laws, ordinances, codes,  regulations and City  Documents. Without limiting the foregoing, Trustor agrees to maintain the Project and the Property (including  without limitation, the residential units, common areas, meeting rooms, landscaping, driveways, parking areas  and walkways) in a condition free of all waste, nuisance, debris, unmaintained landscaping, graffiti, disrepair,  abandoned vehicles/appliances, and illegal activity, and shall take all reasonable steps to prevent the same from  occurring on the Property or at the Project. Trustor shall prevent and/or rectify any physical deterioration of the  Property and the Project and shall make all repairs, renewals and replacements necessary to keep the Property  and the improvements located thereon in good condition and repair. Trustor shall provide adequate security  services for occupants of the Project.   In the event that Trustor breaches any of the covenants in this Section 3, and such default continues for a period  of thirty (30) days after written notice from City, then City, in addition to any other remedy it may have under  this Agreement or at law or in equity, shall have the right, but not the obligation, to enter upon the Property and  perform all acts and work necessary to protect, maintain, and preserve the improvements and the landscaped  areas on the Property.    All costs expended by City in connection with the foregoing shall be paid by Trustor to City upon demand.  Failure  to pay all such sums remaining within thirty (30) days following delivery of City’s invoice therefor shall constitute  an Event of Default and shall bear interest at the lesser of 8% per annum or the highest rate permitted by  applicable law and Beneficiary may add the amount thereof to the principal balance of the Note hereby secured.  Notwithstanding anything to the contrary set forth in this Section, City agrees that it will provide Owner with not  less than thirty (30) days’ written notice prior to undertaking any work for which Owner will incur a financial  obligation.  ROEM Development Corporation  Page 4          (4) Insurance. To provide, maintain and deliver to Beneficiary fire insurance satisfactory to and with loss  payable to Beneficiary.  Notwithstanding anything contained in any of the documents evidencing the Loan from  Beneficiary to Trustor, unless Beneficiary and Trustor otherwise agree in writing, insurance proceeds shall be  applied to restoration or repair of the Property consistent with the occupancy and rent restriction requirements  set forth in the City Documents. Such work shall be commenced as soon as reasonably practicable after the  damage or loss occurs and shall be completed within one year thereafter or as soon as reasonably practicable,  provided that insurance proceeds are available to be applied to such repairs or restoration within such period  and the repair or restoration is financially feasible. During such time that lenders or low‐income housing tax credit  investors providing financing for the Project impose requirements that differ from the requirements of this  Section the requirements of such lenders and investors shall prevail.   If such restoration or repair is not economically feasible or if a default exists after expiration of all applicable  cure periods, the insurance proceeds shall be applied to the sums secured by this Deed of Trust, with the excess,  if any, paid to Trustor. In the event funds for such work are insufficient, Beneficiary may, at its option, advance  such additional funds as may be necessary to allow the Property to be repaired or restored, and may add the  amount thereof to the principal balance of the Note hereby secured.   (5) Protection of Beneficiary’s Security: To appear in and defend any action or proceeding purporting to  affect the security hereof or the rights or powers of Beneficiary or Trustee; and to pay all costs and expenses,  including costs of evidence of title and attorney's fees. If Trustor fails to perform the covenants and agreements  contained in this Deed of Trust, or if any action or proceeding is commenced which materially affects Beneficiary's  interest in the Property, including, but not limited to, foreclosure, involuntary sale, eminent domain, insolvency,  code enforcement, or arrangements or proceedings involving a bankrupt or decedent, then Beneficiary, at its  option, upon notice to Trustor, may make such appearances, disburse such sums and take such action as is  necessary to protect Beneficiary's interest. Nothing contained in this Section 5 shall require Beneficiary to incur  any expense or take any action.   (6) Charges and Liens. To pay at least ten days before delinquency all taxes and assessments affecting the  Property, including assessments on appurtenant water stock; when due, all encumbrances, charges and liens,  with interest, on the Property or any part hereof, which appear to be prior or superior hereto; all costs, fees and  expenses of this Trust.   Should Trustor fail to make any payment or to do any act as herein provided, then Beneficiary or Trustee,  but without obligation to do so and without notice to or demand upon Trustor and without releasing Trustor  from any obligation hereof, may:  make or do the same in such manner and to such extent as either may deem  necessary to protect the security hereof, Beneficiary or Trustee being authorized to enter upon the Property for  such purposes; appear in and defend any action or proceeding purporting to affect the security hereof or the  rights or powers of Beneficiary or Trustee; pay purchase, contest or compromise any encumbrance charge or lien  which in the judgment of either appears to be prior or superior hereto; and in exercising any such powers, pay  necessary expenses, employ counsel and pay his/her reasonable fees.   (7) Timely Payment.  To pay immediately and without demand all sums so expended by Beneficiary or  Trustee, with interest from date of expenditure at the amount allowed by law in effect at the date hereof, and  to pay for any statement provided for by law in effect at the date hereof regarding the obligation secured hereby  any amount demanded by the Beneficiary not to exceed the maximum allowed by law at the time when said  statement is demanded.   (8) Awards for Damages.  That the proceeds of any award or claim for damages, direct or consequential, in  connection with a total condemnation or taking of the Property, shall be applied to the sums secured by this  Deed of Trust, with the excess, if any, paid to Trustor, unless Trustor and Beneficiary otherwise agree in writing.   In the event of a partial condemnation or taking, the proceeds shall be applied to the restoration or repair of the  ROEM Development Corporation  Page 5       Property consistent with the occupancy and rent restriction requirements set forth in the City Documents. Such  work shall be commenced as soon as reasonably practicable after the partial condemnation or taking occurs and  shall be completed within one year thereafter or as soon as reasonably practicable, provided that condemnation  proceeds are available to be applied to such repairs or restoration within such period and the repair or restoration  is financially feasible. During such time that lenders or low‐income housing tax credit investors providing  financing for the Project impose requirements that differ from the requirements of this Section the requirements  of such lenders and investors shall prevail.  If such restoration or repair is not economically feasible or if a default exists after expiration of all applicable cure  periods, the condemnation proceeds shall be applied to the sums secured by this Deed of Trust, with the excess,  if any, paid to Trustor.  In the event funds for such work are insufficient, Beneficiary may, at its option, advance  such additional funds as may be necessary to allow the Property to be repaired or restored, and may add the  amount thereof to the principal balance of the Note hereby secured.   (9) Waiver.  That by accepting payment of any sum secured hereby after its due date, Beneficiary does not  waive its right to require prompt payment when due of all other sums so secured or to declare default for failure  so to pay.   (10) Trustee Reconveyance. That at any time or from time to time, without liability therefor and without  notice, upon written request of Beneficiary and presentation of this Deed and said note for endorsement, and  without affecting the personal liability of any person for payment of the indebtedness secured hereby, Trustee  may reconvey any part of the Property; consent to the making of any map or plot thereof; join in granting any  easement thereon; or join in any extension agreement of any agreement subordinating the lien or charge hereof.   (11) Reconveyance.  That upon written request of Beneficiary stating that all sums secured hereby have  been paid and the affordability covenants compliance period herein described has terminated, and upon  surrender of this Deed and said Note to Trustee for cancellation and retention and upon payment of its fees,  Trustee shall reconvey, without warranty, the Property then held hereunder.  The recitals in such reconveyance  of any matters or facts shall be conclusive proof of the truthfulness thereof.  The grantee in such reconveyance  may be described as "the person or persons legally entitled thereto."  Five years after issuance of such full  reconveyance, Trustee may destroy said Note and this Deed (unless directed in such request to retain them).   (12) Rents.  That as additional security and subject to the rights of senior lenders, Trustor hereby gives to  and confers upon Beneficiary the right, power and authority, during the continuance of these Trusts, to collect  the rents, issues and profits of the Property, reserving unto Trustor the right, prior to any default by Trustor in  payment of any indebtedness secured hereby or in performance of any agreement hereunder, to collect and  retain such rents, issues and profits as they become due and payable.  Upon any such default, Beneficiary may at  any time without notice, either in person, by agent or by a receiver to be appointed by a court, and without  regard to the adequacy of any security for the indebtedness hereby secured, enter upon and take possession of  the Property or any part thereof, in its own name sue or otherwise collect such rents, issues and profits, including  those past due and unpaid, and apply the same, less costs and expenses of operation and collection, including  reasonable attorney's fees, upon any indebtedness secured hereby and in such order as Beneficiary may  determine.  The entering upon and taking possession of the Property, the collection of such rents, issues and  profits and the application thereof as aforesaid, shall not cure or waive any default or notice of default hereunder  or invalidate any act done pursuant to such notice.   (13) Acceleration Upon Default. That upon default by Trustor in payment of any indebtedness secured  hereby or in the performance of any agreement hereunder or an Event of Default under the City Documents,  Beneficiary may declare all sums secured hereby immediately due and payable by delivery to Trustee of written  declaration of default and demand for sale and of written notice of default and of election to cause the Property  ROEM Development Corporation  Page 6         to be sold, which notice Trustee shall cause to be filed for record.  Beneficiary also shall deposit with Trustee this  Deed of Trust, said note and all documents evidencing expenditures secured hereby.   After the lapse of such time as may then be required by law following the recordation of said notice of  default, and notice of sale having been given as then required by law, Trustee, without demand on Trustor, shall  sell the Property at the time and place fixed by it in said notice of sale, either as a whole or in separate parcels,  and in such order as it may determine, at public auction to the highest bidder for cash in lawful money of the  United States made payable at time of sale.  Trustee may postpone sale of all or any portion of the Property by  public announcement at such time and place of sale, and from time to time thereafter may postpone such sale  by public announcement at the time fixed by the preceding postponement.  Trustee shall deliver to such purchase  its deed conveying the Property so sold, but without any covenant or warranty, express or implied.  The recitals  in such deed of any matters or facts shall be conclusive proof of the truthfulness thereof.  Any person, including  Trustor, Trustee or Beneficiary as hereinafter defined, may purchase at such sale.  Beneficiary shall be entitled to  collect from the Trustor, or sale proceeds, if any, all reasonable costs and expenses incurred in pursuing the  remedies provided in this Section, including, but not limited to reasonable attorney's fees.   After deducting all costs, fees and expenses of Trustee and of the Trust, including costs of evidence of title  in connection with sale, Trustee shall apply the proceeds of sale to payments of:  all sums expended under the  terms hereof, not then repaid, with accrued interest at the amount allowed by law in effect at the date hereof;  all other sums then secured hereby; and the remainder, if any, to the person or persons legally entitled thereto.    (14) Successor Trustee. That Beneficiary, or any successor in ownership of any indebtedness secured hereby,  may from time to time, by instrument in writing, substitute a successor or successors to any Trustee named  herein or acting hereunder, which instrument, executed by Beneficiary and duly acknowledged and recorded in  the office of the recorder of the county where the Property is situated, shall be conclusive proof of proper  substitution of such successor Trustee or Trustees, who shall, without conveyance from Trustee predecessor,  succeed to all its title, estate, rights, powers and duties.  Said instrument must contain the name of the original  Trustor, Trustee and Beneficiary hereunder, the book and page where this Deed is recorded and the name and  address of new Trustee.   (15) Binding on Successors.  That this Deed applies to, inures to the benefit of, and binds all parties hereto,  their heirs, legatees, devisees, administrator, executors, successors and assigns.  The term Beneficiary shall mean  the owner and holder, including pledges of the note secured hereby, whether or not named as Beneficiary herein.   In this Deed, whenever the content so requires, the masculine gender includes the feminine and/or neuter, and  the singular number includes the plural.   (16) Trustee Acceptance.  That Trustee accepts this Trust when this Deed of Trust, duly executed and  acknowledged, is made a public record as provide by law.  Trustee is not obligated to notify any party hereto of  pending sale under any other deed of trust or of any action or proceeding in which Trustor, Beneficiary or Trustee  shall be a party unless brought by Trustee.   (17) Low‐Income Tenant Protection.  That notwithstanding anything to the contrary contained herein or in  any documents secured by this Deed of Trust or contained in any subordination agreement, Beneficiary  acknowledges and agrees that in the event of a foreclosure or deed‐in‐lieu of foreclosure (collectively,  “Foreclosure”) with respect to the Property encumbered by this Deed of Trust, the following rule contained in  Section 42(h)(6)(E)(ii) of the Internal Revenue Code of 1986, as amended, shall apply:     For a period of three (3) years from the date of Foreclosure, with respect to any unit that had been regulated  by a regulatory agreement with the California Tax Credit Allocation Committee, (a) none of the tenants occupying  such units at the time of Foreclosure may be evicted or their tenancy terminated (other than for good cause), (b)  nor may any rent be increased except as otherwise permitted under Section 42 of the Code.  ROEM Development Corporation  Page 7        (18) Due on Sale, Refinance, or Transfer of Title: IN THE EVENT OF A  SALE, REFINANCE OR  TRANSFER OF ALL OR ANY PORTION OF THE PROPERTY DESCRIBED HEREIN BY TRUSTOR WITHOUT  PRIOR WRITTEN CONSENT OF BENEFICIARY AND IN ACCORDANCE WITH THE CITY DOCUMENTS, THE  ENTIRE PRINCIPAL BALANCE OF THE NOTE, INCLUDING ANY ACCUMULATED INTEREST DUE UNDER  THE AGREEMENT OR AFFORDABILITY COVENANT, SHALL BE IMMEDIATELY DUE AND PAYABLE.  HOWEVER, (I) THE TRANSFER OF LIMITED PARTNER INTERESTS IN TRUSTOR TO A  LIHTC INVESTOR,  (II) THE SUBSEQUENT TRANSFER OF SUCH LIMITED PARTNER INTERESTS FOR THE PURPOSE OF  SYNDICATING THE LIHTC, OR (III) THE GRANTING OF AN OPTION OR RIGHT OF FIRST REFUSAL BY THE  CITY AND ANY TRANSFER PURSUANT TO SUCH OPTION OR RIGHT OF FIRST REFUSAL AS AGREED TO  BY THE CITY SHALL NOT BE CONSIDERED A  SALE, REFINANCE OR TRANSFER OF THE PROPERTY FOR  PURPOSES OF THIS SECTION.  REPLACEMENT OF THE GENERAL PARTNER OF TRUSTOR WITH ANY  OTHER ENTITY SHALL BE SUBJECT TO PRIOR WRITTEN APPROVAL OF CITY, WHICH SHALL NOT BE  UNREASONABLY WITHHELD.      Trustor may transfer or assign all or any portion of its interest, right or obligations in the Property only as set  forth in this Deed of Trust and the City Documents and with City’s prior written consent, which consent City shall  not withhold provided that (1) the Project is and shall continue to be operated in compliance with this Deed of  Trust and the City Documents; (2) the transferee expressly assumes all obligations of Trustor imposed by this  Deed of Trust and the City Documents; (3) the transferee executes all documents reasonably requested by the  City with respect to the assumption of the Trustor’s obligations under this Deed of Trust  and the City Documents,  and upon City’s request, delivers to the City an opinion of its counsel to the effect that such document and this  Deed of Trust and the City Documents are valid, binding and enforceable obligations of such transferee; and (4)  either (A) the transferee has at least three years’ experience in the ownership, operation and management of  low‐income multifamily rental housing projects of similar size to that of the Project, without any record of  material violations of nondiscrimination provisions or other state or federal laws or regulations applicable to such  projects, or (B) the transferee agrees to retain a property management firm with the experience and record  described in sub‐clause (A).    Consent to any proposed Transfer may be given by the City’s City Manager unless the City Manager, in his or her  discretion, refers the matter of approval to the City Council. If a proposed Transfer has not been approved by  City in writing within ninety (90) days following City’s receipt of written request by Trustor, it shall be deemed  approved.      Trustor shall reimburse City for all City costs, including but not limited to reasonable attorneys’ fees, incurred in  reviewing instruments and other legal documents proposed to effect a Transfer under this Deed of Trust and the  City Documents and in reviewing the qualifications and financial resources of a proposed successor, assignee, or  transferee within ten (10) days following City’s delivery of an invoice detailing such costs.    Accordingly, the undersigned acknowledges and agrees that, consistent with applicable law, City may accelerate  the maturity date of the principal and accrued interest on the Note in the event that the Property is sold,  conveyed or alienated, except as may be prohibited by law, including section 2924.6 of the California Civil Code.   (19) Request for Notice.  City requests that copies of any notices of default and notice of sale be sent to City  at the address set forth above.   (20) Priority.  This Deed of Trust, regardless of order of recordation, is junior and subordinate to the  Affordability Covenant recorded contemporaneously herewith.  All obligations hereunder are non‐recourse. The limited partner(s) shall have the same right as Trustor to cure or  remedy any default hereunder within the cure period provided to Trustor extended by an additional sixty (60)  ROEM Development Corporation  Page 8         days; provided however, if the default is of such nature that the limited partners reasonably determine that it is  necessary to replace the general partner of Trustor in order to cure such default, then the cure period shall be  extended until the date  sixty (60) days following the removal of the general partner of Trustor.        [Signature Page Follows]                            SIGNATURES MUST BE NOTARIZED        ROEM Development Corporation     By: [Add Clause]        By:             Title:  __________________________________________________       ROEM Development Corporation  Page 9          State of California ) ) ss. County of ________________________) On ___________________ before me, _________________________________, Notary Public, personally appeared ___________________________________________________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) 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. _______________________________________ Place Notary seal above      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. ROEM Development Corporation  Page 10             Exhibit A    LEGAL DESCRIPTION  201 Grand Avenue  For APN/Parcel ID(s): 012‐316‐110    THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF SOUTH SAN FRANCISCO, COUNTY OF SAN  MATEO, STATE OF CALIFORNIA AND IS DESCRIBED AS FOLLOWS:    LOT 29 IN BLOCK 140, AS SHOWN ON THAT CERTAIN MAP ENTITLED, "SOUTH SAN FRANCISCO, SAN MATEO  COUNTY, CALIFORNIA, PLAT NO. 1", FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN MATEO COUNTY,  STATE OF CALIFORNIA, ON MARCH 1, 1892 IN BOOK "B" OF MAPS AT PAGE(S) 6, AND A COPY ENTERED IN  BOOK 2 OF MAPS AT PAGE 52.    207 Grand Avenue  For APN/Parcel ID(s): 012‐316‐100    THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF SOUTH SAN FRANCISCO, COUNTY OF SAN  MATEO, STATE OF CALIFORNIA AND IS DESCRIBED AS FOLLOWS:    LOT 28, IN BLOCK 140, AS DESIGNATED ON THE MAP ENTITLED “SOUTH SAN FRANCISCO, SAN MATEO CO. CAL,  PLAT NO. 1”, WHICH MAP WAS FILED IN THE OFFICE OF THE RECORDER OF THE COUNTY OF SAN MATEO, STATE  OF CALIFORNIA ON MARCH 1, 1892 IN BOOK “B” OF MAPS, AT PAGE 6, AND A COPY ENTERED IN BOOK 2 OF  MAPS, AT PAGE 52.    217‐219 Grand Avenue  For APN/Parcel ID(s):  012‐316‐080   012‐316‐090    THE LAND REFERRED TO HEREIN IS SITUATED IN THE STATE OF CALIFORNIA, COUNTY OF SAN MATEO, CITY OF  SOUTH SAN FRANCISCO, AND DESCRIBED AS FOLLOWS:     LOTS 25, 26 AND 27 IN BLOCK 140, AS DESIGNATED ON THE MAP ENTITLED “SOUTH SAN FRANCISCO, SAN  MATEO CO. CAL, PLAT NO. 1”, WHICH MAP WAS FILED IN THE OFFICE OF THE RECORDER OF THE COUNTY OF  SAN MATEO, STATE OF CALIFORNIA ON MARCH 1, 1892 IN BOOK “B” OF MAPS, AT PAGE 6, AND A COPY  ENTERED IN BOOK 2 OF MAPS, AT PAGE 52.       3470598.1 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: City of South San Francisco 400 Grand Avenue South San Francisco, CA 94080 Attn: City Manager EXEMPT FROM RECORDING FEES PER GOVERNMENT CODE §§6103, 27383 Space above this line for Recorder’s use. AFFORDABLE HOUSING REGULATORY AGREEMENT AND DECLARATION OF RESTRICTIVE COVENANTS for 201-219 Grand Avenue, South San Francisco by and between THE CITY OF SOUTH SAN FRANCISCO and GRAND AND LINDEN FAMILY APARTMENTS, L.P. 2 This Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants (this “Agreement”) is entered into effective as of _____________, 2020 (“Effective Date”) by and between the City of South San Francisco, a municipal corporation (“City”) and GRAND AND LINDEN FAMILY APARTMENTS, L.P. (“Owner”). City and Owner are hereinafter collectively referred to as the “Parties.” RECITALS A. Owner owns that certain real property located in the City of South San Francisco at 201-219 Grand Avenue, known as San Mateo County Assessor’s Parcel Nos. 012-316-110, 012- 316-100, 012-316-090 and 012-316-080 and more particularly described in Exhibit A attached hereto (the “Property”). B. In accordance with that certain Development Agreement executed by and between the Parties and dated as of ____________ (the “DA”), a memorandum of which was recorded in the Official Records of San Mateo County (“Official Records”) on ________, Owner will re- develop the Property into a mixed use, high-density, residential apartment building of forty-six (46) affordable residential units and one manager’s unit and approximately 6,000 square feet of ground floor commercial units (the “Project”). Capitalized terms used and not defined in this Agreement have the meaning ascribed to them in the DA. C. Pursuant to Government Code Section 65915 and South San Francisco Municipal Code Chapter 20.390, Owner has agreed that the Project will result in forty-six (46) units being available to Eligible Households at an Affordable Rent as those terms are defined herein in Section 1. Furthermore, Owner has, pursuant to Section 20.390.010.B.7, requested development standard waivers including; a reduction in parking from 58 spaces to 31 spaces, reduction in the number of Electric Vehicle parking spaces to 1 space from 3 spaces, a reduction in the private storage space requirement from 200 cubic feet to 100 cubic feet per unit and, a for permits and fees required by the City not to exceed $533,002. D. To assist in the construction of affordable units at the Project, City provided Owner with a loan in the amount of Two Million, Four Hundred and Fifty Thousand Dollars ($2,450,000.00) from City Affordable Housing Asset Fund (Fund 241), to partially finance the Project (“Loan”), as further set forth in the DA and the Loan Agreement entered into between the Parties (“Loan Agreement”) concurrently herewith. E. As required by the DA, density bonus requirements and as a condition to its agreement to provide the Loan, the City requires the Property to be subject to the terms, conditions and restrictions set forth herein, specifically, the City requires that for a period of not less than fifty-five (55) years, forty-six (46) residential units in the Project be rented at Affordable Rents to Eligible Households (“Restricted Units”). The City requires Restricted Units assisted with funds from the City’s Affordable Housing Asset Fund (Fund 241) to remain affordable for the longest feasible time. F. The Parties have agreed to enter into and record this Agreement in order to satisfy the conditions described in the foregoing Recitals. The purpose of this Agreement is to regulate and restrict the occupancy and rents of the Project’s Restricted Units for the benefit of the occupants of the 3 Project. The Parties intend the covenants set forth in this Agreement to run with the land and to be binding upon Owner and Owner’s successors and assigns for the full term of this Agreement. NOW THEREFORE, in consideration of the foregoing, and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows. AGREEMENT 1. Definitions. The following terms have the meanings set forth in this Section wherever used in this Agreement or the attached exhibits. “Actual Household Size" means the actual number of persons in the applicable household. “Adjusted for Family Size Appropriate for the Unit” shall be determined consistent with Section 50052.5(h) of the California Health and Safety Code and applicable federal rules (if any) and as defined below: Studio – 1 person One Bedroom – 1.5 people Two Bedroom – 3 people Three Bedroom – 4.5 people “Affordable Rent” means the following amounts, less a utility allowance and such other adjustments as required pursuant to the California Redevelopment Law: (i) for units that are restricted for rental to households with incomes of not more than eighty percent (80%) of AMI (“80% Units”), a monthly rent that does not exceed one-twelfth (1/12) of thirty percent (30%) of eighty percent (80%) of AMI, Adjusted for Family Size Appropriate for the Unit, and (ii) for units that are restricted for rental to households with incomes of not more than one hundred twenty percent (120%) of AMI (“120% Units”), a monthly rent that does not exceed one-twelfth of thirty percent (30%) of one hundred twenty percent (120%) of Area Median Income, Adjusted for Family Size Appropriate for the Unit. “Area Median Income” or “AMI” means the median income for San Mateo County, California, adjusted for Actual Household Size, as determined by the U.S. Department of Housing and Urban Development (“HUD”) pursuant to Section 8 of the United States Housing Act of 1937 and as published from time to time by the State of California Department of Housing and Community Development (“HCD”) in Section 6932 of Title 25 of the California Code of Regulations or successor provision published pursuant to California Health and Safety Code Section 50093(c). “Claims” is defined in Section 10. “Eligible Household” means a household for which gross household income does not exceed the applicable maximum income level for a Restricted Unit as specified in Section 2.1 and Exhibit B. “Indemnitees” is defined in Section 10. 4 “Low-Income” or “Lower Income” means an annual gross household income that is less than or equal to the qualifying limits for households of Lower Income adjusted for actual household size, as determined periodically by HUD on the basis of gross annual household income and published by HCD in the Regulations for San Mateo County. If HUD ceases to make such determination, “Lower Income” shall be defined as not greater than 80% of Area Median Income adjusted for actual household size, as published by HCD in the Regulations. If both HCD and HUD cease to make such determinations, City in its reasonable discretion may designate another definition of “Lower Income” used by any other federal or state agency so long as such definition is no more restrictive than that set forth herein. “Moderate-Income” means an annual gross household income that is less than or equal to 120% of AMI, adjusted for actual household size as determined periodically by HCD on the basis of gross annual household income and published in the Regulations for San Mateo County. “Regulations” means Title 25 of the California Code of Regulations. “Rent-Restricted” means a dwelling unit for which the gross rent charged for such unit does not exceed the Affordable Rent, as adjusted for assumed household size in accordance with the Department of Housing and Community Development (“HCD”) guidelines. “Restricted Unit” means a dwelling unit which is reserved for occupancy at an Affordable Rent by a household of not more than a specified household income in accordance with and as set forth in Sections 2.1 and 2.2 and Exhibit B. 2. Use and Affordability Restrictions. Owner hereby covenants and agrees, for itself and its successors and assigns, that the Property shall be used solely for the operation of a multifamily rental housing development in compliance with the DA, Loan Agreement, City Promissory Note and City Deed of Trust and the requirements set forth herein (“City Documents”). Owner represents and warrants that it has not entered into any agreement that would restrict or compromise its ability to comply with the occupancy and affordability restrictions set forth in this Agreement or other City Documents, and Owner covenants that it shall not enter into any agreement that is inconsistent with such restrictions without the express written consent of City. 2.1 Affordability Requirements. 2.1.1 For a term of fifty-five (55) years commencing upon the date of issuance of a final certificate of occupancy for the residential portion of the Project, not less than forty-six (46) of the residential units of the Project shall be both Rent Restricted (as defined below) and occupied (or if vacant, available for occupancy), available at Affordable Rents to Eligible Households. This Section 2.1 shall be amended to include the specific levels of affordability for each Restricted Unit once finally determined by the Parties. The forty-six (46) residential units subject to this Agreement shall also be Rent Restricted and occupied by Eligible Households and allocated across unit type as specified in Exhibit B once finally determined by the Parties. 2.1.2 Special Considerations for units with Project Based Section 8 Rental Assistance: If the Project receives an award of Project-Based Section 8 rental assistance, the units 5 receiving the project-based vouchers (“PBVs”) shall be underwritten at the total subsidized rent for each unit paid by the project-based rental assistance and the tenant in sum. If PBVs are terminated, rents for any Restricted Units losing PBVs may be increased to the federally-permitted maximums in accordance with current California Tax Credit Allocation Committee (“CTCAC”) regulations. If a PBV is terminated, and the current tenant is unable to pay the maximum CTCAC-allowable rent, Owner may, upon advance written notice to City, transition targeted units detailed in Exhibit B as follows: (a) First, to a household of the same targeted population that could afford to pay the maximum CTCAC rent allowed; and if there is no household that meets this criterion, (b) Second, to the next eligible household on Owner’s waiting list that could afford to pay the maximum CTCAC rent allowed. For PBVs that are also HUD-Veterans Affairs Supportive Housing (VASH) vouchers, and if the current tenant is unable to pay the maximum CTCAC-allowable rent, Borrower may, upon advance written notice to City, transition to these units as follows: (a) First, to a homeless veteran household for whom the maximum CTCAC rent allowed is affordable; and if there is no household that meets this criterion, (b) Second, to a homeless household for whom the maximum CTCAC rent allowed is affordable; and if there is no household who meets this criterion, (c) Third, to a veteran household for whom the maximum CTCAC rent allowed is affordable; and if there is no household who meets this criterion, (d) Fourth, to the next eligible household on Owner’s waiting list for whom the maximum CTCAC rent allowed is affordable. If PBVs are terminated, Borrower may request, and City may grant a reduction or waiver in writing of the homeless household requirements described above, upon submission of evidence that such requirements cause the Project to be financially infeasible. 2.1.3 Recertification. In the event that recertification of Eligible Household incomes indicates that the number of Restricted Units actually occupied by Eligible Households falls below the number reserved for each income group as specified in this Section 2.1 and Exhibit B, Owner shall rectify the condition by renting the next available dwelling unit(s) in the Project to Eligible Household(s) until the required income mix is achieved. If the income of a household occupying an extremely-low income unit (“ELI Unit”) increases to or beyond 50% of the AMI at recertification, the unit will no longer qualify as an ELI Unit for purposes of compliance with this Agreement and the Loan Agreement. In that scenario, the next vacancy in a unit of similar size 6 shall be filled with a household earning up to 30% AMI, qualifying that unit as an ELI Unit for purposes of compliance. 2.2 Rents for Restricted Units. Rents for Restricted Units shall be limited to Affordable Rents for households of the applicable income limit in accordance with Section 2.1 and Exhibit B. Notwithstanding the foregoing, no Eligible Household qualifying for a Restricted Unit shall be denied continued occupancy of a unit in the Project because, after admission, such Eligible Household's adjusted income increases to exceed the qualifying limit for such Restricted Unit except as specified in this Section 2.2. If, upon recertification of the income of a Resident of a Unit, the Owner determines that the Resident has an Adjusted Income exceeding the maximum qualifying income for the Unit, such Resident shall be permitted to continue occupying the Unit upon expiration of the Resident's lease, and upon sixty (60) days written notice, the Rent shall be increased to thirty percent (30%) of the Resident's Adjusted Income, subject to the maximum rent allowed pursuant to other funding restrictions. 2.2.1 Termination of Occupancy of Restricted Unit by Eligible Household. Upon termination of occupancy of a Restricted Unit by an Eligible Household, Owner shall rent the Unit shall to another Eligible Household at Affordable Rents in accordance with Section 2.1 and Exhibit B within thirty (30) days of termination of occupancy by the former Eligible Household. 2.3 Unit Sizes, Design and Location. The Restricted Units shall be of comparable design quality as unrestricted units in the Project and among the different affordability categories set forth in Exhibit B. Eligible Households of Restricted Units shall have access to all common facilities of the Project equal to that of Eligible Households of units in the Project that are not Restricted Units and among the affordability categories set forth in Exhibit B. The Restricted Units shall be allocated among affordability categories as set forth in Exhibit B. 2.4 City Loan Funds. Owner shall ensure that all City Loan Funds are used for the construction of the Project in a manner consistent with the applicable City Loan Funds requirements and City Documents’ terms, which at a minimum, requires residential rental units assisted with funds from the City’s Affordable Housing Asset Fund (Fund 241) to remain affordable for the longest feasible time. 2.5 No Condominium Conversion. Owner shall not convert the residential units in the Project to condominium or cooperative ownership or sell condominium or cooperative rights to the residential portion of the Project or any part thereof unless Owner obtains the City's consent and meets which consent shall be conditioned upon Owner's agreement to ensure that the Restricted Units remain available as affordable housing. Prior to conveyance of any Restricted Unit(s), the buyer(s) of the for-sale Restricted Units shall enter into an affordable housing agreement, in a form approved by the City Manager and City Attorney, that maintains the affordability of the unit for the minimum term set forth in this Agreement, the City Documents or in California law whichever is greater.. 2.6 Non-Discrimination; Compliance with Fair Housing Laws. 2.6.1 Preferences. In order to ensure that there is an adequate supply of affordable 7 housing within the City for City residents and employees of businesses located within the City, to the extent permitted by law and consistent with the program regulations for funding sources used for development of the Project, at initial lease up, Owner shall give a preference in the rental of the residential units in the Project to Eligible Households that include at least one member who lives or works in the City of South San Francisco. Notwithstanding the foregoing, in the event of a conflict between this provision and the provisions of Section 42 of the Internal Revenue Code of 1986, as amended, the provisions of such Section 42 shall control. 2.6.2 Fair Housing. Owner shall comply with state and federal fair housing laws in the marketing and rental of the units in the Project. Owner shall accept as Eligible Households, on the same basis as all other prospective Eligible Households, persons who are recipients of federal certificates or vouchers for rent subsidies pursuant to the existing Section 8 program or any successor thereto. 2.6.3 Non-Discrimination. Owner shall not restrict the rental, sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property or Project, or any portion thereof, on the basis of race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national origin, ancestry, familial status, source of income, disability, or genetic information of any person. Owner covenants for itself and all persons claiming under or through it, and this Agreement is made and accepted upon and subject to the condition that there shall be no discrimination against or segregation of any person or group of persons on account of any basis listed in subdivision (a) or (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 sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, Project or part thereof, nor shall Owner or any person claiming under or through Owner establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in, of, or for the Property, Project or part thereof. All deeds made or entered into by Owner, its successors or assigns, as to any portion of the Property or Project shall contain the following language, and all leases or contracts made or entered into by Owner, its successors or assigns, as to any portion of the Property or Project, shall reference this Section, and shall enforce the same diligently and in good faith: “(a) Owner herein covenants by and for itself, its successors and assigns, and all persons claiming under or through it, that there shall be no discrimination against or segregation of a person or of a group of persons on account of any basis listed in subdivision (a) or (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 sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the property herein conveyed nor shall the Owner or any person claiming under or through the Owner establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in the property herein conveyed. The foregoing covenant shall run with the land. 8 “(b) Notwithstanding paragraph (a), with respect to familial status, paragraph (a) shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in paragraph (1) shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, and 799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of Section 51 of the Civil Code and subdivisions (d) of Section 12955 of the Government Code shall apply to paragraph (a).” Violation of the non-discrimination provisions of this Agreement shall be considered a breach of this Agreement and subject Owner to penalties, to be determined by the City Manager, including but not limited to the following: i. termination of this Agreement; ii. disqualification of Owner from bidding on or being awarded a City contract for a period of up to 3 years; iii. liquidated damages of $2,500 per violation; and/or imposition of other appropriate contractual and civil remedies and sanctions, as determined by the City Manager. To effectuate the provisions of this Section, the City Manager shall have the authority to examine Owner’s employment records with respect to compliance with this Section and/or to set off all or any portion of the amount described in this Section against amounts due to Owner under this Agreement or City Documents. Owner shall report to the City Manager the filing by any person in any court of any complaint of discrimination or the filing by any person of any and all charges with the Equal Employment Opportunity Commission, the Department of Fair Employment and Housing, or any other entity charged with the investigation of allegations within 30 days of such filing, provided that within such 30 days such entity has not notified Owner that such charges are dismissed or otherwise unfounded. Such notification shall include the name of the complainant, a copy of such complaint, and a description of the circumstance. Owner shall provide City with a copy of their response to the Complaint when filed. 3. Reporting Requirements. 3.1. Eligible Household Certification. Project financing is anticipated to include proceeds from Low-Income Housing Tax Credits (“LIHTC”). If the Project is awarded LIHTC, City shall defer to income certification and calculation requirements imposed by tax credits. If the Project financing does not include tax credits, Owner shall rely on income determination calculations set forth in 24 CFR Part 5 (i.e., the Section 8 Voucher Program). Owner or Owner’s authorized agent shall obtain from each household prior to initial occupancy of each Restricted Unit, and on every anniversary thereafter, a written certificate containing all of the following in such format and with such supporting documentation as City may reasonably require: (a) The identity of each household member; and 9 (b) The total gross household income; Owner shall retain such certificates for not less than three (3) years, and upon City’s request, shall make the certificates available for City inspection. 3.2 Annual Report; Inspections. By not later than April 30th of each year during the term of this Agreement, Owner shall submit an annual report (“Annual Report”) to the City in form satisfactory to City, together with a certification that the Project is in compliance with the requirements of this Agreement. The Annual Report shall, at a minimum, include the following information for each dwelling unit in the Project: (i) unit number; (ii) number of bedrooms; (iii) current rent and other charges; (iv) dates of any vacancies during the previous year; (v) number of people residing in the unit; (vi) total gross household income of residents; (vii) documentation of source of household income; and (viii) the information required by Section 3.1. Owner shall include with the Annual Report, an income recertification for each household, documentation verifying Eligible Household eligibility, and such additional information as City may reasonably request from time to time in order to demonstrate compliance with this Agreement. The Annual Report shall conform to the format requested by City; provided however, during such time that the Project is subject to a regulatory agreement restricting occupancy and/or rents pursuant to requirements imposed in connection with the use of state or federal low-income housing tax credits, Owner may satisfy the requirements of this Section by providing City with a copy of compliance reports required in connection with such financing. 3.3 On-site Inspection. Owner shall permit representatives of City to enter and inspect the Property and the Project during reasonable business hours in order to monitor compliance with this Agreement upon 48-hours advance notice of such visit to Owner or to Owner's management agent. 3.4 Additional Information. Owner shall provide any additional information reasonably requested by City. The City shall have the right to examine and make copies of all books, records, or other documents of the Owner which pertain to the Project. 3.5 Records. The Owner shall maintain complete, accurate and current records pertaining to the Property and Project, shall comply with all program and fiscal reporting requirements set forth by appropriate Federal, State, and local agencies, and as required by City, and shall permit any duly authorized representative of the Federal, State, local agencies and City to inspect records, including records pertaining to income and household size of Eligible Households. All Eligible Household lists, applications and waiting lists relating to the Project shall at all times be kept separate and identifiable from any other business of the Owner and shall be maintained in a reasonable condition for proper audit and subject to examination during business hours by representatives of the City. Owner agrees upon reasonable notice to provide to City or any Federal or State or local department having monitoring or review authority, to City’s authorized representatives, and/or to any of their respective audit agencies access to and the right to examine all records and documents necessary to determine compliance with relevant Federal, State, and local statutes, rules, and regulations, to determine compliance with this Agreement and the City Documents, and to evaluate the quality, appropriateness, and timeliness of services performed. The Owner shall retain copies of all materials obtained or produced with respect to occupancy of the Restricted Units for a period of at least five (5) years, and for any period during 10 which there is an audit undertaken by the City pursuant to the City Documents. 4. Term of Agreement. 4.1 Term of Restrictions. Unless extended by mutual agreement of the Parties, upon the 55th anniversary of issuance of the final certificate of occupancy for the residential portion of the Project, this Agreement shall automatically terminate and be of no further force or effect. Owner shall provide all notices and rights to tenants required to be given prior to and upon the expiration of affordability covenants pursuant to Government Code Section 65863.10 or a successor statute. 4.2 Effectiveness Succeeds Conveyance of Property and Repayment of Loan. This Agreement shall remain effective and fully binding for the full term hereof, as such may be extended pursuant to Section 4.1, regardless of any repayment of the Loan, sale, assignment, transfer, or conveyance of the Property or the Project or any part thereof or interest therein. 4.3 Reconveyance. Upon the expiration of this Agreement, the Parties agree to execute and record appropriate instruments to release and discharge this Agreement; provided, however, the execution and recordation of such instruments shall not be necessary or a prerequisite to evidence the expiration of this Agreement, or to evidence the release and discharge of this Agreement as a matter of title. 5. Binding Upon Successors; Covenants to Run with the Land. Owner hereby subjects its interest in the Property and the Project to the covenants and restrictions set forth in this Agreement and the City Documents. The Parties hereby declare their express intent that the covenants and restrictions set forth in such Agreements shall be deemed covenants running with the land and shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors in interest, transferees, and assigns of the Parties, regardless of any sale, assignment, conveyance or transfer of the Property, the Project or any part thereof or interest therein. Any successor-in-interest to Owner, including without limitation any purchaser, transferee or lessee of the Property or the Project (other than the Eligible Households of the individual dwelling units or retail/commercial space within the Project) shall be subject to all of the duties and obligations imposed hereby and in the City Documents for the full term of this Agreement. Each and every contract, deed, ground lease or other instrument affecting or conveying the Property or the Project or any part thereof, shall conclusively be held to have been executed, delivered and accepted subject to the covenants, restrictions, duties and obligations set forth herein and the City Documents, regardless of whether such covenants, restrictions, duties and obligations are set forth in such contract, deed, ground lease or other instrument. If any such contract, deed, ground lease or other instrument has been executed prior to the date hereof, Owner hereby covenants to obtain and deliver to City an instrument in recordable form signed by the parties to such contract, deed, ground lease or other instrument pursuant to which such parties acknowledge and accept this Agreement and the City Documents and agree to be bound hereby. Owner agrees for itself and for its successors that in the event that a court of competent jurisdiction determines that the covenants herein or in the City Documents do not run with the land, such covenants shall be enforced as equitable servitudes against the Property and the Project in favor of City. 11 6. Property Management; Repair and Maintenance; Marketing. 6.1 Management Responsibilities. Owner, or Owner’s designee, shall be responsible for all management functions with respect to the Property and the Project, including without limitation the selection of Eligible Households, certification and recertification of household income and eligibility, evictions, collection of rents and deposits, maintenance, landscaping, routine and extraordinary repairs, replacement of capital items, and security. City shall have no responsibility for management or maintenance of the Property or the Project. 6.2 Repair, Maintenance and Security. Throughout the term of this Agreement, Owner, or Owner’s designee, shall at its own expense, maintain the Property and the Project in good physical condition, in good repair (reasonable wear and tear excepted), and in decent, safe, sanitary, habitable and tenantable living conditions in conformity with all applicable state, federal, and local laws, ordinances, codes, regulations and City Documents. Without limiting the foregoing, Owner agrees to maintain the Project and the Property (including without limitation, the residential units, common areas, meeting rooms, landscaping, driveways, parking areas and walkways) in a condition free of all waste, nuisance, debris, unmaintained landscaping, graffiti, disrepair, abandoned vehicles/appliances, and illegal activity, and shall take all reasonable steps to prevent the same from occurring on the Property or at the Project. Owner shall prevent and/or rectify any physical deterioration of the Property and the Project and shall make all repairs, renewals and replacements necessary to keep the Property and the improvements located thereon in good condition and repair. Owner shall provide adequate security services for occupants of the Project. 6.2.1 City’s Right to Perform Maintenance. In the event that Owner breaches any of the covenants contained in Section 6.2, and such default continues for a period of thirty (30) days after written notice from City, then City, in addition to any other remedy it may have under this Agreement or at law or in equity, shall have the right, but not the obligation, to enter upon the Property and perform all acts and work necessary to protect, maintain, and preserve the improvements and the landscaped areas on the Property. 6.2.2 Costs. All costs expended by City in connection with the foregoing Section 6.2.1, shall be paid by Owner to City upon demand. The failure to pay all such sums within thirty (30) days following delivery of City’s invoice therefor shall constitute and Event of Default hereunder and shall bear interest at the lesser of 8% per annum or the highest rate permitted by applicable law. Notwithstanding anything to the contrary set forth in this Section, City agrees that it will provide Owner with not less than thirty (30) days’ written notice prior to undertaking any work for which Owner will incur a financial obligation. 6.3 Marketing and Management Plan. Within 180 days following the Effective Date of this Agreement, Owner shall submit for City review and approval, a plan for marketing and managing the Property (“Marketing and Management Plan” or “Plan”). The Marketing and Management Plan shall address in detail how Owner plans to market the Restricted Units to prospective Eligible Households in accordance with fair housing laws and this Agreement, Owner’s Eligible Household selection criteria, and how Owner plans to certify the eligibility of Eligible Households. The Plan shall also describe the management team and shall address how the Owner and the management entity plan to manage and maintain the Property and the Project. The Plan shall include the proposed management agreement and the form of rental agreement that Owner 12 proposes to enter into with Project Eligible Households. Owner shall abide by the terms of the Marketing and Management Plan in marketing, managing, and maintaining the Property and the Project, and throughout the term of this Agreement. 6.4 Approval of Amendments. If City has not responded to any submission of the Management and Marketing Plan, the proposed management entity, or a proposed amendment or change to any of the foregoing within sixty (60) days following City’s receipt of such plan, proposal or amendment, the plan, proposal or amendment shall be deemed approved by City. 6.5 Fees, Taxes, and Other Levies. Owner shall be responsible for payment of all fees, assessments, taxes, charges, liens and levies applicable to the Property or the Project, including without limitation possessory interest taxes, if applicable, imposed by any public entity, and shall pay such charges prior to delinquency. However, Owner shall not be required to pay any such charge so long as (a) Owner is contesting such charge in good faith and by appropriate proceedings, (b) Owner maintains reserves adequate to pay any contested liabilities, and (c) on final determination of the proceeding or contest, Owner immediately pays or discharges any decision or judgment rendered against it, together with all costs, charges and interest. Nothing in this Section 6.6 is intended to prohibit Owner from applying for any exemption from property taxes and fees that may be available to the owners of low-income housing. 6.6 Insurance Coverage. Throughout the term of this Agreement, Owner shall comply with the insurance requirements set forth in the City Documents, and shall, at Owner’s expense, maintain in full force and effect insurance coverage as specified in the City Documents. 6.7 Property Damage or Destruction. If any part of the Project is damaged or destroyed, Owner shall repair or restore the same, consistent with the occupancy and rent restriction requirements set forth in this Agreement and City Documents. Such work shall be commenced as soon as reasonably practicable after the damage or loss occurs and shall be completed within one year thereafter or as soon as reasonably practicable, provided that insurance proceeds are available to be applied to such repairs or restoration within such period and the repair or restoration is financially feasible. During such time that lenders or low-income housing tax credit investors providing financing for the Project impose requirements that differ from the requirements of this Section the requirements of such lenders and investors shall prevail. 7. Recordation; Subordination. This Agreement shall be recorded in the Official Records of San Mateo County. Owner hereby represents, warrants and covenants that with the exception of easements of record, absent the written consent of City, this Agreement shall not be subordinated in priority to any lien (other than those pertaining to taxes or assessments), encumbrance, or other interest in the Property or the Project. If at the time this Agreement is recorded, any interest, lien, or encumbrance has been recorded against the Project in position superior to this Agreement, upon the request of City, Owner hereby covenants and agrees to promptly undertake all action necessary to clear such matter from title or to subordinate such interest to this Agreement consistent with the intent of and in accordance with this Section 7, and to provide such evidence thereof as City may reasonably request. Notwithstanding the foregoing, the City agrees that pursuant to Health and Safety Code Section 33334.14(a)(4), the City will not withhold consent to reasonable requests for subordination of this Agreement to deeds of trust provided for the benefit of lenders identified in the Financing Plan approved in connection with the DA, provided that the instruments effecting 13 such subordination include reasonable protections to the City in the event of default consistent with the requirements of Health and Safety Code Section 33334.14(a)(4), including without limitation, extended notice and cure rights. Any subordination request shall be subject to a $2,000.00 fee payable by Owner to City upon Owner’s request for City to review instruments and other legal documents proposed to effect a subordination under this Agreement. Owner hereby: (i) represents and warrants that it is not affiliated in any way with the lender identified in the Financing Plan approved in connection with the DA, and (ii) covenants that it will not become so affiliated by acquiring an interest in such lender, or an interest in its loan, or otherwise. 8. Transfer and Encumbrance. 8.1 Restrictions on Transfer and Encumbrance. If Owner sells, refinances or transfers the Property or Project or any interest therein without prior written consent of the City, it shall be considered an Event of Default and the entire principal balance of the Note, including any accumulated interest accrued pursuant to Exhibit A of the Loan Agreement, shall be immediately due and payable. However, (i) the transfer of limited partner interests in Owner to a LIHTC investor, (ii) the subsequent transfer of such limited partner interests for the purpose of syndicating the LIHTC, or (iii) the granting of an option or right of first refusal by the City and any transfer pursuant to such option or right of first refusal as agreed to by the City shall not be considered a sale, refinance or transfer of the Project for purposes of this section. Replacement of the general partner of Borrower with any other entity shall be subject to prior written approval of City, which shall not be unreasonably withheld. Owner may transfer or assign all or any portion of its interest, right or obligations in the Property only as set forth in this Agreement and the City Documents and with City’s prior written consent, which consent City shall not withhold provided that (1) the Project is and shall continue to be operated in compliance with this Agreement and the City Documents; (2) the transferee expressly assumes all obligations of Owner imposed by this Agreement and the City Documents; (3) the transferee executes all documents reasonably requested by the City with respect to the assumption of the Owner’s obligations under this Agreement and the City Documents, and upon City’s request, delivers to the City an opinion of its counsel to the effect that such document and this Agreement and the City Documents are valid, binding and enforceable obligations of such transferee; and (4) either (A) the transferee has at least three years’ experience in the ownership, operation and management of low-income multifamily rental housing projects of similar size to that of the Project, without any record of material violations of nondiscrimination provisions or other state or federal laws or regulations applicable to such projects, or (B) the transferee agrees to retain a property management firm with the experience and record described in sub-clause (A). Consent to any proposed Transfer may be given by the City’s City Manager unless the City Manager, in his or her discretion, refers the matter of approval to the City Council. If a proposed Transfer has not been approved by City in writing within ninety (90) days following City’s receipt of written request by Owner, it shall be deemed approved. 14 Owner shall reimburse City for all City costs, including but not limited to reasonable attorneys’ fees, incurred in reviewing instruments and other legal documents proposed to effect a Transfer under this Agreement and the City Documents and in reviewing the qualifications and financial resources of a proposed successor, assignee, or transferee within ten (10) days following City’s delivery of an invoice detailing such costs. 8.3 Encumbrances. Owner agrees to use best efforts to ensure that all deeds of trust or other security instruments and any applicable subordination agreement recorded against the Property, the Project or part thereof for the benefit of a lender (“Lender”) shall contain each of the following provisions: (i) Lender shall use its best efforts to provide to City a copy of any notice of default issued to Owner concurrently with provision of such notice to Owner; and, (ii) City shall have the reasonable right, but not the obligation, to cure any default by Owner within the same period of time provided to Owner for such cure extended by an additional 90 days. Owner agrees to provide to City a copy of any notice of default Owner receives from any Lender within thirty (30) business days following Owner’s receipt thereof. 8.4 Mortgagee Protection. No violation of any provision contained herein shall defeat or render invalid the lien of any mortgage or deed of trust made in good faith and for value upon all or any portion of the Project or the Property, and the purchaser at any trustee’s sale or foreclosure sale shall not be liable for any violation of any provision hereof occurring prior to the acquisition of title by such purchaser. Such purchaser shall be bound by and subject to this Agreement from and after such trustee’s sale or foreclosure sale. Promptly upon determining that a violation of this Agreement has occurred, City shall give written notice to the holders of record of any mortgages or deeds of trust encumbering the Project or the Property that such violation has occurred. 9. Default and Remedies. 9.1 Events of Default. The occurrence of any one or more of the following events shall constitute an event of default hereunder (“Event of Default”): (a) Failure to Construct Project. A failure by the Borrower to commence or complete the construction of the Project in accordance with the terms of the City Documents which failure is not cured within 30 days of written notice from the City; (b) Breach of Covenants. Failure by the Borrower to duly perform, comply with, or observe any of the conditions, terms, or covenants of any of this Agreement and the City Documents which failure is not cured within 30 days of written notice from the City; (c) Unauthorized Transfer. Any transfer other than as permitted pursuant to this Agreement; (d) Representation or Warranty Incorrect. Any Owner representation or warranty contained in this Agreement, or in any application, financial statement, certificate, or report submitted to the City in connection with the Loan or City Documents, proving to have been incorrect in any material respect when made; 15 (e) Default Under Project Financing and City Documents. Failure to make any payment or perform any of the Owner's covenants, agreements, or obligations under the documents evidencing and securing the financing for the Project or City Documents following expiration of all applicable notice and cure periods; (f) Insolvency. A court having jurisdiction shall have made or entered any decree or order (i) Owner (or any general partner of Owner) to be bankrupt or insolvent, (ii) approving as properly filed a petition seeking reorganization of Owner (or any general partner of Owner) or seeking any arrangement for the Owner under the bankruptcy law or any other applicable debtor's relief law or statute of the United States or any state or other jurisdiction, (iii) appointing a receiver, trustee, liquidator, or assignee of Owner (or any general partner of the Owner) in bankruptcy or insolvency or for any of their properties, or (iv) directing the winding up or liquidation of the Owner (or any general partner of the Owner), if any such decree or order described in clauses (i) to (iv), inclusive, shall have continued unstayed or undischarged for a period of ninety (90) days; or Owner (or any general partner of the Owner) shall have admitted in writing its inability to pay its debts as they fall due or shall have voluntarily submitted to or filed a petition seeking any decree or order of the nature described in clauses (i) to (iv), inclusive; (g) Assignment; Attachment. The Owner (or any general partner of the Owner) shall have assigned its assets for the benefit of its creditors or suffered a sequestration or attachment of or execution on any substantial part of its property, unless the property so assigned, sequestered, attached or executed upon shall have been returned or released within ninety (90) days after such event or prior to sooner sale pursuant to such sequestration, attachment, or execution. (h) Suspension. The Owner (or any general partner of the Owner) shall have voluntarily suspended its business; (i) Liens. There shall be filed any claim of lien (other than liens approved in writing by the City) against the Property or Project or any part thereof, or any interest or right made appurtenant thereto, or the service of any notice to withhold proceeds of the Loan pursuant to City Documents and the continued maintenance of said claim of lien or notices to withhold for a period of twenty (20) days without discharge or satisfaction thereof or provision therefore satisfactory to the City; (j) Condemnation. The condemnation, seizure, or appropriation of all or, in the opinion of the City, a substantial part of the Property or Project; or (k) Insurance. Owner’s failure to maintain insurance on the Property and the Project as required hereunder or under City Documents, and the failure of Owner to cure such default within thirty (30) days of written notice from City; (l) Taxes and Assessments. Subject to Owner’s right to contest the following charges, Owner’s failure to pay taxes or assessments due on the Property or the Project or failure to pay any other charge that may result in a lien on the Property or the Project, and Owner’s failure to cure such default within sixty (60) days of delinquency; 16 (m) Other Default. Occurrence of any other event (whether termed default, event of default, or otherwise) which under the terms of this Agreement or the City Documents entitle City to exercise its rights or remedies. 9.2 Remedies. Upon the occurrence of an Event of Default and its continuation beyond any applicable cure period, City may proceed with any of the following remedies: A. Repayment of Loan. The City shall have the right to require immediate repayment of the total outstanding amount of the Loan, together with any accrued interest thereon as set forth in Exhibit A of the Loan Agreement. Owner waives all right to presentment, demand, protest or notice of protest or dishonor. The City may proceed to enforce repayment of the Loan and to exercise any or all rights afforded to the City as a creditor and secured party under the law including the Uniform Commercial Code, including foreclosure under the City Deed of Trust. The Borrower shall be liable to pay the City on demand all reasonable expenses, costs and fees (including, without limitation, reasonable attorney's fees and expenses) paid or incurred by the City in connection with the collection of the Loan and the preservation, maintenance, protection, sale, or other disposition of the security given for the Loan. B. Specific Performance. Bring an action for equitable relief seeking the specific performance of the terms and conditions of this Agreement or City Documents, and/or enjoining, abating, or preventing any violation of such terms and conditions, and/or seeking declaratory relief; C. LIQUIDATED DAMAGES. FOR VIOLATIONS OF OBLIGATIONS WITH RESPECT TO RENTS FOR RESTRICTED UNITS, THE CITY SHALL HAVE THE RIGHT TO IMPOSE AS LIQUIDATED DAMAGES A CHARGE IN AN AMOUNT EQUAL TO THE ACTUAL AMOUNT COLLECTED BY OWNER OR OWNER’S REPRESENTATIVE IN EXCESS OF THE AFFORDABLE RENT. THE PARTIES AGREE THAT, IN SUCH INSTANCE, SUCH EXCESS RENT REPRESENTS A REASONABLE APPROXIMATION OF THE CITY’S DAMAGES AND IS NOT INTENDED AS A FORFEITURE OR PENALTY BUT RATHER AN ENFORCEABLE LIQUIDATED DAMAGES PROVISION PURSUANT TO CALIFORNIA CIVIL CODE SECTION 1671, ET SEQ. OWNER SHALL PAY ANY LIQUIDATED DAMAGES ASSESSED BY THE CITY WITHIN TEN (10) DAYS. City’s Initials Owner’s Initials D. Other Remedies. Pursue any other remedy allowed at law or in equity; E. Right to Cure at Owner's Expense. The City shall have the right (but not the 17 obligation) to cure any monetary default by the Owner under a loan secured by the Property. The Owner agrees to reimburse the City for any funds advanced by the City to cure a monetary default by the Owner upon demand therefore, together with interest thereon at the lesser of ten percent (10%) per annum or the maximum rate permitted by law, from the date of expenditure until the date of reimbursement; F. Right of Contest. The Owner shall have the right to contest in good faith any claim, demand, levy, or assessment the assertion of which would constitute an Event of Default hereunder. Any such contest shall be prosecuted diligently and in a manner unprejudicial to the City or the rights of the City hereunder. G. Remedies Cumulative. No right, power, or remedy given to a party by the terms of this Agreement is intended to be exclusive of any other right, power, or remedy; and each and every such right, power, or remedy shall be cumulative and in addition to every other right, power, or remedy given to the Party. Neither the failure nor any delay on the part of a Party to exercise any such rights and remedies shall operate as a waiver thereof, nor shall any single or partial exercise by a Party of any such right or remedy preclude any other or further exercise of such right or remedy, or any other right or remedy. 10. Indemnity. To the fullest extent permitted by law, Owner shall indemnify, defend (with counsel approved by City) and hold City and its respective elected and appointed officers, officials, employees, agents, and representatives (collectively, the “Indemnitees”) harmless from and against all liability, loss, cost, expense (including without limitation attorneys’ fees and costs of litigation), claim, demand, action, suit, judicial or administrative proceeding, penalty, deficiency, fine, order, and damage (all of the foregoing collectively “Claims”) arising directly or indirectly, in whole or in part, as a result of or in connection with Owner’s construction, management, or operation of the Property and the Project, the performance of any work or services required of Owner under this Agreement, or Loan disbursement made pursuant to the Loan Agreement or any failure to perform any obligation as and when required by this Agreement or the City Documents or any other loss or cost, including but not limited to that caused by the concurrent active or passive negligence of Indemnitees. Owner’s indemnification obligations under this Section 10 shall survive the expiration or earlier termination of this Agreement. It is further agreed that City does not and shall not waive any rights against Owner that it may have by reason of this indemnity and hold harmless agreement because of the acceptance by, or the deposit with City by Owner, of any of the insurance policies described in this Agreement or the City Documents. However, Owner’s duty to indemnify under this Section shall not apply to injuries or damage for which Indemnitees have been found in a court of competent jurisdiction to be solely liable by reason of their own gross negligence or willful misconduct. 11. Miscellaneous. 11.1 Amendments. This Agreement may be amended or modified only by a written instrument signed by both Parties and any request for such shall be subject to a $2,000.00 fee payable by Owner to City per modification or amendment request unless such amendment is required by the City. 18 11.2 Waiver of Terms and Conditions. A Party may at its discretion waive in writing any of the terms and conditions of this Agreement, without completing an amendment to this Agreement. No waiver of any default or breach shall be implied from any omission by the non- breaching Party to take action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the waiver, and such waiver shall be operative only for the time and to the extent therein stated. Waivers of any covenant, term, or condition contained herein shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by a Party to or of any act by the other Party requiring further consent or approval shall not be deemed to waive or render unnecessary the consent or approval to or of any subsequent similar act. The exercise of any right, power, or remedy shall in no event constitute a cure or a waiver of any default under this Agreement, nor shall it invalidate any act done pursuant to notice of default, or prejudice the exercising Party in the exercise of any right, power, or remedy hereunder. 11.3 Notices. Except as otherwise specified herein, all notices to be sent pursuant to this Agreement shall be made in writing, and sent to the Parties at their respective addresses specified below or to such other address as a Party may designate by written notice delivered to the other parties in accordance with this Section. All such notices shall be sent by: (i) personal delivery, in which case notice is effective upon delivery; (ii) certified or registered mail, return receipt requested, in which case notice shall be deemed delivered upon receipt if delivery is confirmed by a return receipt; or (iii) nationally recognized overnight courier, with charges prepaid or charged to the sender’s account, in which case notice is effective on delivery if delivery is confirmed by the delivery service. If to City, to: City of South San Francisco 400 Grand Avenue Attn: City Manager South San Francisco, CA 94080 Phone: (650) 877-8500 With a Copy to: City of South San Francisco 400 Grand Avenue Attn: ECD Director South San Francisco, CA 94080 Phone: (650) 829-6622 Email: alex.greenwood@ssf.net 19 With a Copy to: Meyers Nave Attn: Sky Woodruff 555 12th Street, Suite 1500 Oakland, CA 94607 Tel (510) 808-2000 Fax (510) 444-1108 Email swoodruff@meyersnave.com If to Owner: Grand and Linden Family Apartments, L.P. 1650 Lafayette Street Santa Clara, CA 95050 Attention: Alex Sanchez Telephone: (408) 984-5600 Email: asanchez@roemcorp.com With a Copy to: Bocarsly Emden Cowan Esmail & Arndt 633 W. Fifth Street 64th Floor Los Angeles, CA 90071 Attention: Kyle B. Arndt Telephone: 213-239-8048 Email: karndt@bocarsly.com 11.4 Further Assurances. The Parties shall execute, acknowledge and deliver to the other such other documents and instruments, and take such other actions, as either shall reasonably request as may be necessary to carry out the intent of this Agreement. 11.5 Parties Not Co-Venturers. Nothing in this Agreement is intended to or shall establish the Parties as partners, co-venturers, or principal and agent with one another. Owner agrees and understands that work/services performed pursuant this Agreement are performed by Owner as conditions of receiving the Loan funding, and not as an employee or joint venture of City and that neither Owner nor its employees acquire any of the rights, privileges, powers, or advantages of City employees. Nothing contained in this Agreement shall create or justify any claim against the City by any person that the Owner may have employed or with whom the Owner may have contracted relative to the purchase of materials, supplies or equipment, or the furnishing or the performance of any work or services with respect to the purchase of the Property, or the construction or operation of the Project, and the Owner shall include similar requirements in any contracts entered into for the such purposes. 11.6 Action by the City. Except as may be otherwise specifically provided herein, whenever any approval, notice, direction, consent or request by the City is required or permitted under this Agreement, such action shall be in writing, and such action may be given, made or taken by the City Manager or by any person who shall have been designated by the City Manager, without further approval by the City Council at the discretion of the City Manager. 20 11.7 Non-Liability of City Officials, Employees and Agents. No member, official, employee or agent of the City shall be personally liable to Owner or any successor in interest, in the event of any default or breach by the City, or for any amount of money which may become due to Owner or its successor or for any obligation of City under this Agreement. 11.8 Headings; Construction. The headings of the sections and paragraphs of this Agreement are for convenience only and shall not be used to interpret this Agreement. The language of this Agreement shall be construed as a whole according to its fair meaning and not strictly for or against any Party. 11.9 Time is of the Essence. Time is of the essence in the performance of this Agreement. 11.10 Governing Law. This Agreement shall be construed in accordance with the laws of the State of California without regard to principles of conflicts of law. 11.11 Attorneys' Fees and Costs. If any legal or administrative action is brought to interpret or enforce the terms of this Agreement, the prevailing party shall be entitled to recover all reasonable attorneys' fees and costs incurred in such action. 11.12 Severability. If any provision of this Agreement is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not be affected or impaired thereby. 11.13 Entire Agreement; Exhibits. This Agreement, together with the other City Documents contains the entire agreement of Parties with respect to the subject matter hereof, and supersedes all prior oral or written agreements between the Parties with respect thereto. Exhibits A and B, attached hereto are incorporated herein by this reference. 11.14 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be an original and all of which together shall constitute one agreement. 11.15 Nonrecourse Obligation. Notwithstanding anything to the contrary set forth herein, the Loan shall be nonrecourse obligation of Borrower and its Partners. 11.16 Limited Partner Provisions. The City shall provide copies of any notice delivered to Owner hereunder or under Loan Document to the Owner’s Limited Partner (the “Limited Partner”). The Limited Partner shall have the same right as the Owner to cure or remedy and default hereunder within the cure period provided to Owner extended by an additional sixty (60) days’ provided, however, if the default is of such nature that the Limited Partner reasonably determines that it is necessary to replace a general partner of Owner in order to cure such default, then the cure period shall be extended until the date sixty (60) days following the removal of said general partner of Owner. SIGNATURES ON FOLLOWING PAGE. 21 IN WITNESS WHEREOF, the Parties have executed this Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants as of the date first written above. CITY THE CITY OF SOUTH SAN FRANCISCO, a municipal corporation By: __________________________________ Name: Michael Futrell Title: City Manager ATTEST: By: _________________________________ Rosa Acosta, City Clerk APPROVED AS TO FORM: By: _________________________________ Sky Woodruff, City Attorney OWNER GRAND AND LINDEN FAMILY APARTMENTS, L.P. a California limited partnership By: ______________________________ Its: _______________________________ SIGNATURES MUST BE NOTARIZED. 22 STATE OF CALIFORNIA ) ) COUNTY OF SAN MATEO ) On , 20__, before me, ______________________, (here insert name and title of the officer), personally appeared , who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) 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 _______________________________ (Seal) STATE OF CALIFORNIA ) ) COUNTY OF SAN MATEO ) On , 20__, before me, ______________________, (here insert name and title of the officer), personally appeared , who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) 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. 23 WITNESS my hand and official seal. Signature _______________________________ (Seal) 24 Exhibit A 201 Grand Avenue For APN/Parcel ID(s): 012-316-110 THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF SOUTH SAN FRANCISCO, COUNTY OF SAN MATEO, STATE OF CALIFORNIA AND IS DESCRIBED AS FOLLOWS: LOT 29 IN BLOCK 140, AS SHOWN ON THAT CERTAIN MAP ENTITLED, "SOUTH SAN FRANCISCO, SAN MATEO COUNTY, CALIFORNIA, PLAT NO. 1", FILED IN THE OFFICE OF THE COUNTY RECORDER OF SAN MATEO COUNTY, STATE OF CALIFORNIA, ON MARCH 1, 1892 IN BOOK "B" OF MAPS AT PAGE(S) 6, AND A COPY ENTERED IN BOOK 2 OF MAPS AT PAGE 52. 207 Grand Avenue For APN/Parcel ID(s): 012-316-100 THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF SOUTH SAN FRANCISCO, COUNTY OF SAN MATEO, STATE OF CALIFORNIA AND IS DESCRIBED AS FOLLOWS: LOT 28, IN BLOCK 140, AS DESIGNATED ON THE MAP ENTITLED “SOUTH SAN FRANCISCO, SAN MATEO CO. CAL, PLAT NO. 1”, WHICH MAP WAS FILED IN THE OFFICE OF THE RECORDER OF THE COUNTY OF SAN MATEO, STATE OF CALIFORNIA ON MARCH 1, 1892 IN BOOK “B” OF MAPS, AT PAGE 6, AND A COPY ENTERED IN BOOK 2 OF MAPS, AT PAGE 52. 217-219 Grand Avenue For APN/Parcel ID(s): 012-316-080 012-316-090 THE LAND REFERRED TO HEREIN IS SITUATED IN THE STATE OF CALIFORNIA, COUNTY OF SAN MATEO, CITY OF SOUTH SAN FRANCISCO, AND DESCRIBED AS FOLLOWS: LOTS 25, 26 AND 27 IN BLOCK 140, AS DESIGNATED ON THE MAP ENTITLED “SOUTH SAN FRANCISCO, SAN MATEO CO. CAL, PLAT NO. 1”, WHICH MAP WAS FILED IN THE OFFICE OF THE RECORDER OF THE COUNTY OF SAN MATEO, STATE OF CALIFORNIA ON MARCH 1, 1892 IN BOOK “B” OF MAPS, AT PAGE 6, AND A COPY ENTERED IN BOOK 2 OF MAPS, AT PAGE 52. 25 Exhibit B Number of Units by Unit Size and Targeted Area Median Income (AMI) Levels Maximum Household Income Up to 60% AMI 60% - 80% AMI 80% -120% AMI Total Studio 1-Bedroom 2-Bedroom 3-Bedroom Total 46 3467454.1 City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-57 Agenda Date:3/11/2020 Version:1 Item #:5f. Resolution approving Budget Amendment Number 20.033 which appropriates $1,050,000 of the City of South San Francisco’s Housing Trust Fund (Fund 205)as a loan to ROEM Development Corporation for the development of 36 Below Market Rate units and one managers unit at 418 Linden Avenue. WHEREAS,the City of South San Francisco (“City”)is the owner of certain real property located in the City of South San Francisco,California,known as County Assessor’s Parcel Number 012-314-010 (“418 Linden Avenue”); and, WHEREAS,in December 2015 the City approved entitlements for a residential project at 418 Linden Avenue (“Project”) and a mixed-use project at 201-219 Grand Avenue (“Developments”); and, WHEREAS,in December 2016 the City and Agency selected a developer,ROEM Development Corporation (“Developer”), to build the Developments; and, WHEREAS,in September 2017 the City approved a Development Agreement (“DA”),a Purchase and Sale Agreement (“PSA”)for 418 Linden Avenue and a PSA for 201-219 Grand Avenue,an Affordable Housing Agreement (“AHA”)for eight (8)Below Market Rate (“BMR”)units at 418 Linden and an AHA for nine (9) BMR units at 201-219 Grand Avenue with Developer related to the Project; and, WHEREAS,Developer now wishes to amend the entitlements utilizing the Density Bonus Law (found in California Government Code Sections 65915 - 65918); and, WHEREAS,pursuant to Government Code Section 65915 and South San Francisco Municipal Code Chapter 20.390,the Project will result in thirty-six (36)units being available to Eligible Households at an Affordable Rent and one (1) unit being the property manager’s unit; and, WHEREAS,Developer has,pursuant to Section 20.390.010.B.7,requested development standard waivers including;a reduction in parking from 47 spaces to 23 spaces,a reduction in the number of Electric Vehicle parking spaces to from 3 spaces to 1 space,removal of the private storage spaces,and for permits and fees required by the City not to exceed $512,916; and, WHEREAS,at the time the PSA was negotiated,Developer offered Five Hundred Thousand Dollars ($500,000)for the purchase of the property and City committed grant funding of One Million Two Hundred and Twenty Five Thousand Dollars ($1,225,000.00)from the City’s Affordable Housing Funds to assist in the construction of the affordable housing units (“City Grant”); and, WHEREAS,Developer has requested that the City Grant be converted to a loan in order to leverage other City of South San Francisco Printed on 3/18/2020Page 1 of 3 powered by Legistar™ File #:20-57 Agenda Date:3/11/2020 Version:1 Item #:5f. funding; and, WHEREAS,Buyer has increased the number of Below Market Rate (”BMR”)units from 8 to 36 and requested a City donation of the land (“Land Donation”); and, WHEREAS,the City is providing a loan to Borrower in the amount of One Million,Fifty Thousand dollars ($1,050,000.00)for the purpose of developing the Project (“Loan”)which shall be evidenced by an accompanying Promissory Note (“Note”); and, WHEREAS,as long as Developer complies with the Loan Agreement (“Agreement”)during the Compliance Period and no breach or default occurs,the City shall forgive $550,000.00 of the Loan at the termination of the Compliance Period; and, WHEREAS, the remaining $500,000.00 shall be repaid to the City within five (5) years; and, WHEREAS, the Loan and Note will be secured by a Deed of Trust (“DOT”). WHEREAS,as a condition of providing the Loan,the City imposes occupancy and affordability restrictions on the Property and Project for the Compliance Period to ensure the affordable units remain affordable to low income households and as required by the Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants (“Affordability Covenant”); and, WHEREAS,the Note,Deed of Trust,DA and Affordability Covenant shall collectively be referred to herein as “City Documents”. NOW THEREFORE IT BE RESOLVED by the City Council of the City of South San Francisco as follows: 1.The foregoing recitals are true and correct. 2.Budget Amendment 20.033,which appropriates $1,050,000 of the City of South San Francisco’s Housing Trust Fund (Fund 205)as a loan to ROEM Development Corporation for the development of 36 Below Market Rate units and one managers unit at 418 Linden Avenue, is approved. 3.The Loan Agreement,Note,Deed of Trust and Affordability Covenant,in substantially the same form attached hereto as Exhibits A through D, respectively, are approved. 4.The City Manager or his designee is authorized to enter into and execute on behalf of the City Council the City Documents;to make any revisions,amendments or modifications deemed necessary to carry out the intent of this Resolution and which do not materially or substantially increase the City’s obligations thereunder. ***** Exhibit A: Loan Agreement between the City and Developer for $1,050,000 City of South San Francisco Printed on 3/18/2020Page 2 of 3 powered by Legistar™ File #:20-57 Agenda Date:3/11/2020 Version:1 Item #:5f. Exhibit B: Promissory Note for 418 Linden Exhibit C: Deed of Trust for 418 Linden Exhibit D: Affordability Covenant for 418 Linden City of South San Francisco Printed on 3/18/2020Page 3 of 3 powered by Legistar™ ‐1- LOAN AGREEMENT BETWEEN THE CITY OF SOUTH SAN FRANCISCO AND GRAND AND LINDEN FAMILY APARTMENTS, L.P. This Loan Agreement (“Agreement”) is entered into effective as of [Date] day of [Month] , 2020 by and between the City of South San Francisco, a municipal corporation, (“City”) and Grand and Linden Family Apartments, L.P., a California limited partnership (“Borrower”). City and Borrower are hereinafter collectively referred to as “Parties” and individually as “Party”. RECITALS A. City owns that certain real property located in the City of South San Francisco at 418 Linden Avenue, known as County Assessor's Parcel Number 012-314-010 and more particularly described in Exhibit A attached hereto (“Property”). B. In accordance with that certain Development Agreement executed by and between the Parties and dated as of November 15, 2017 ( “DA”), a memorandum of which was recorded in the Official Records of San Mateo City (“Official Records”) on ________, City desires Borrower to purchase the Property and re-develop it into a high-density building consisting of thirty-six (36) affordable residential units and one manager’s unit ( “Project”). Capitalized terms used and not defined in this Agreement have the meaning ascribed to them in the DA. C. To assist in the construction of affordable units at the Project, City authorized providing Borrower with a loan in the amount of One Million, and Fifty Thousand dollars ($1,050,000.00) from the Housing Trust Fund on [insert date] in Resolution No. [insert Resolution #]. D. Through this Agreement and accompanying Exhibits, the City is providing a loan to Borrower in the amount of One Million, Fifty Thousand dollars ($1,050,000.00) purpose of developing the Project (“Loan”) which shall be evidenced by an accompanying Promissory Note (“Note”). As long Borrower complies with the Agreement during the Compliance Period as defined in Section 5 of Exhibit A and no breach or default occurs, the City may, in its sole and absolute discretion, forgive $550,000.00 of the Loan at the termination of the Compliance Period. The remaining $500,000.00 shall be repaid to the City within fifteen (15) years from date the Project achieves permanent loan conversion (but in no event prior to the maturity of the Project’s permanent loan. The Loan and Note will be secured by a Deed of Trust. As a condition of providing the Loan, the City imposes occupancy and affordability restrictions on the Property and Project for the Compliance Period to ensure the affordable units remain affordable to low income households as set forth herein and as further required by the Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants (“Affordability Covenant”) executed concurrently herewith. The Note, Deed of Trust, DA and Affordability Covenant shall collectively be referred to herein as “City Documents”. ‐2- In consideration of the mutual covenants and promises of the Parties herein contained, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is hereby agreed by the Parties hereto as follows: 1. Exhibits The following exhibits are attached to this Agreement and incorporated into this Agreement by this reference: Exhibit A– Project Description Exhibit B– Disbursement and Rates Exhibit C– Funding Conditions Exhibit D– Project Sources and Uses Development Budget 2. Services to be Performed by Borrower In consideration for the funding assistance set forth herein and in Exhibit B, Borrower shall perform the services (“services” or “work”) necessary to implement the Project as described in Exhibit A. 3. Disbursements Subject to Borrower’s satisfactory performance of the terms and conditions set forth herein, including but not limited to Exhibit A, City shall disburse to Borrower in accordance with the rates and in the manner specified in Exhibit B. City reserves the right to withhold disbursements if City determines that Borrower’s performance of applicable terms and conditions is unacceptable or documentation evidencing performance is unacceptable; provided City shall provide Borrower with forty-five (45) days’ notice and opportunity to cure. In no event shall City’s total fiscal obligation under this Agreement exceed One million, and Fifty Thousand dollars ($1,050,000.00). 4. Security and Subordination The accompanying Note shall be secured by the Deed of Trust. Borrower hereby represents, warrants and covenants that with the exception of easements of record, absent the written consent of City, the Deed of Trust shall not be subordinated in priority to any lien (other than those pertaining to taxes or assessments), encumbrance, or other interest in the Property or the Project. If at the time the Deed of Trust is recorded, any interest, lien, or encumbrance has been recorded against the Project in position superior to the Deed of Trust, upon the request of City, Borrower hereby covenants and agrees to promptly undertake all action necessary to clear such matter from title or to subordinate such interest to this Agreement consistent with the intent of and in accordance with this Section 4, and to provide such evidence thereof as City may reasonably request. Notwithstanding the foregoing, the City agrees that pursuant to Health and Safety Code Section 33334.14(a)(4), the City will not withhold consent to reasonable requests for subordination of the Deed of Trust to deeds of trust provided for the benefit of lenders identified in the Financing Plan approved in connection with the DA, provided that the instruments effecting such subordination include reasonable protections to the City in the event of default consistent with the requirements of Health and Safety Code Section 33334.14(a)(4), including without limitation, ‐3- extended notice and cure rights. Any subordination request shall be subject to a $2,000.00 fee payable by Borrower to City upon Borrower’s request for City to review instruments and other legal documents proposed to effect a subordination of the City Documents. Borrower hereby: (i) represents and warrants that they are not affiliated in any way with the lender identified in the Financing Plan approved in connection with the DA, and (ii) covenants that they will not become so affiliated by acquiring an interest in such lender, or an interest in its loan, or otherwise. 5. Encumbrances Borrower agrees to use best efforts to ensure that all deeds of trust or other security instruments and any applicable subordination agreement recorded against the Property, the Project or part thereof for the benefit of a lender (“Lender”) shall contain each of the following provisions: (i) Lender shall use its best efforts to provide to City a copy of any notice of default issued to Borrower concurrently with provision of such notice to Borrower; and, (ii) City shall have the reasonable right, but not the obligation, to cure any default by Borrower within the same period of time provided to Borrower for such cure extended by an additional 90 days. Borrower agrees to provide to City a copy of any notice of default it receives from any Lender within thirty (30) business days following Borrower’s receipt thereof. 6. Conditions of Funding In addition to the terms detailed in Section 3 (Disbursements) above, City reserves the right to withhold disbursements if City determines that Borrower has not completed the conditions of funding, enumerated in Exhibit C of this Agreement. City acknowledges that upon execution of this Agreement, all conditions applicable to “Agreement Execution” set forth in Exhibit C have been completed to the satisfaction of City. 7. Term and Termination Subject to compliance with all terms and conditions, the term of this Agreement shall be from Project Completion as defined in Section 7 of Exhibit A through the later of 55 years from the first day of the Compliance Period or the Note Maturity set forth in the Note and Exhibit A. Borrower shall provide all notices and rights to tenants required to be given prior to and upon the expiration of the Compliance Period pursuant to Government Code Section 65863.10 or a successor statute. The Loan shall be repaid in full with the interest as set forth in Exhibit A by Borrower if an Event of Default occurs under this Agreement or City Documents. The Affordability Covenant shall remain in effect for the Compliance Period, regardless of any repayment of the Loan. 8. Availability of Funds Notwithstanding any other provision in this Agreement, City may terminate this Agreement or a portion of the services referenced in the Exhibits based upon unavailability of City funds by providing written notice to Borrower as soon as is reasonably possible after City learns of said unavailability of such funding. ‐4- 9. Relationship of Parties Nothing in this Agreement is intended to or shall establish the Parties as partners, co-venturers, or principal and agent with one another. Borrower agrees and understands that work/services performed pursuant this Agreement are performed by Borrower as conditions of receiving the Loan funding, and not as an employee or joint venture of City and that neither Borrower nor its employees acquire any of the rights, privileges, powers, or advantages of City employees. Nothing contained in this Agreement shall create or justify any claim against the City by any person that the Borrower may have employed or with whom the Borrower may have contracted relative to the purchase of materials, supplies or equipment, or the furnishing or the performance of any work or services with respect to the purchase of the Property, or the construction or operation of the Project, and the Borrower shall include similar requirements in any contracts entered into for the such purposes. 10. Indemnity To the fullest extent permitted by law, Borrower shall indemnify, defend (with counsel approved by City) and hold City and its respective elected and appointed officers, officials, employees, agents, and representatives (collectively, the “Indemnitees”) harmless from and against all liability, loss, cost, expense (including without limitation attorneys’ fees and costs of litigation), claim, demand, action, suit, judicial or administrative proceeding, penalty, deficiency, fine, order, and damage (all of the foregoing collectively “Claims”) arising directly or indirectly, in whole or in part, as a result of or in connection with Borrower’s construction, management, or operation of the Property and the Project, the performance of any work or services required of Borrower under this Agreement, or Loan disbursement made pursuant to this Agreement or any failure to perform any obligation as and when required by this Agreement or the City Documents or any other loss or cost, including but not limited to that caused by the concurrent active or passive negligence of Indemnitees. Borrower’s indemnification obligations under this Section 10 shall survive the expiration or earlier termination of this Agreement. It is further agreed that City does not and shall not waive any rights against Borrower that it may have by reason of this indemnity and hold harmless agreement because of the acceptance by, or the deposit with City by Borrower, of any of the insurance policies described in this Agreement or the City Documents. However, Borrower’s duty to indemnify under this Section shall not apply to injuries or damage for which Indemnitees have been found in a court of competent jurisdiction to be solely liable by reason of their own gross negligence or willful misconduct 11. Assignability and Subcontracting Borrower hereby subjects its interest in the Property and the Project to the covenants and restrictions set forth in this Agreement and City Documents. The Parties hereby declare their express intent that the covenants and restrictions set forth herein, and the City Documents, shall be deemed covenants running with the land and shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors in interest, transferees, and assigns of the Parties, regardless of any sale, assignment, conveyance or transfer of the Property, the Project or any part thereof or interest therein. Any successor-in-interest to Borrower, including without limitation ‐5- any purchaser, transferee or lessee of the Property or the Project (other than the Eligible Households of the individual dwelling units within the Project) shall be subject to all of the duties and obligations imposed hereby, and in the City Documents, for the full term of this Agreement. Each and every contract, deed, ground lease or other instrument affecting or conveying the Property or the Project or any part thereof, shall conclusively be held to have been executed, delivered and accepted subject to the covenants, restrictions, duties and obligations set forth herein and in the City Documents regardless of whether such covenants, restrictions, duties and obligations are set forth in such contract, deed, ground lease or other instrument. If any such contract, deed, ground lease or other instrument has been executed prior to the date hereof, Borrower hereby covenants to obtain and deliver to City an instrument in recordable form signed by the parties to such contract, deed, ground lease or other instrument pursuant to which such parties acknowledge and accept this Agreement, and the City Documents and agree to be bound hereby. Except as permitted in the Deed of Trust or elsewhere in this Agreement, Borrower shall not assign this Agreement or any portion thereof to a third party or subcontract with a third party to provide services required by Borrower under this Agreement without the prior written consent of City. Any such assignment or subcontract without City’s prior written consent will give City the right to declare an Event of Default hereunder. Notwithstanding the foregoing restrictions, Borrower may, with City’s prior written consent, assign its rights and obligations under this Agreement to a limited partnership formed to develop and own the Project. In connection with such assignment, City and Borrower acknowledge and agree that this Agreement and any other loan documents shall be amended and restated to reflect such assignment. Borrower agrees for itself and for its successors that in the event that a court of competent jurisdiction determines that the covenants herein, or the City Documents do not run with the land, such covenants shall be enforced as equitable servitudes against the Property and the Project in favor of City. 12. Insurance Borrower shall not commence work or be required to commence work under this Agreement unless and until all insurance required under this Section has been obtained and such insurance has been approved by City’s Risk Manager, and Borrower shall use diligence to obtain such insurance and to obtain such approval. Borrower shall furnish City with certificates of insurance evidencing the required coverage, and there shall be a specific contractual liability endorsement extending Borrower’s coverage to include the contractual liability assumed by Borrower pursuant to this Agreement. These certificates shall specify or be endorsed to provide that thirty (30) days’ notice must be given, in writing, to City of any cancellation of the policy for reasons other than non- payment of premium, and ten (10) days’ notice of cancellation of the policy for non-payment of premium. ‐6- Throughout the term of this Agreement, Borrower shall comply with the insurance requirements set forth in this Agreement and the City Documents, and shall, at Borrower’s expense, maintain in full force and effect insurance coverage as specified therein. 13. Compliance with Laws; Payments of Permits / Licenses All services to be performed by Borrower pursuant to this Agreement shall be performed in accordance with all applicable Federal, State, City, and municipal laws, ordinances, and regulations, including but not limited to the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and the Federal Regulations promulgated thereunder, as amended (if applicable), the Americans with Disabilities Act of 1990, as amended, and Section 504 of the Rehabilitation Act of 1973, which prohibits discrimination on the basis of handicap in programs and activities receiving any Federal or City financial assistance. Such services shall also be performed in accordance with all applicable ordinances and regulations, including but not limited to appropriate licensure, certification regulations, provisions pertaining to confidentiality of records, and applicable quality assurance regulations. In the event of a conflict between the terms of this Agreement and any applicable State, Federal, City, or municipal law or regulation, the requirements of the applicable law or regulation will take precedence over the requirements set forth in this Agreement. Borrower will timely and accurately complete, sign, and submit all necessary documentation of compliance. 14. Non-Discrimination and Other Requirements A) General non-discrimination. Borrower shall not restrict the rental, sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property or Project, or any portion thereof, on the basis of race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national origin, ancestry, familial status, source of income, disability, or genetic information of any person. Borrower covenants for itself and all persons claiming under or through it, and this Agreement is made and accepted upon and subject to the condition that there shall be no discrimination against or segregation of any person or group of persons on account of any basis listed in subdivision (a) or (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 sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, Project or part thereof, nor shall Borrower or any person claiming under or through Borrower establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in, of, or for the Property, Project or part thereof. All deeds made or entered into by Borrower, its successors or assigns, as to any portion of the Property or Project shall contain the following language, and all leases or contracts made or entered into by Borrower, its successors or assigns, as to any portion of the Property or Project, shall reference this Section, and shall enforce the same diligently and in good faith: ‐7- “(a) Borrower herein covenants by and for itself, its successors and assigns, and all persons claiming under or through it, that there shall be no discrimination against or segregation of a person or of a group of persons on account of any basis listed in subdivision (a) or (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 sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the property herein conveyed nor shall the Borrower or any person claiming under or through the Borrower establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in the property herein conveyed. The foregoing covenant shall run with the land. (b) Notwithstanding paragraph (a), with respect to familial status, paragraph (a) shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in paragraph (1) shall be construed to affect Sections 51.2, 51.3, 51.4, 51.10, and 799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of Section 51 of the Civil Code and subdivisions (d) of Section 12955 of the Government Code shall apply to paragraph (a).” B) Equal employment opportunity. Borrower shall ensure equal employment opportunity based on objective standards of recruitment, classification, selection, promotion, compensation, performance evaluation, and management relations for all employees under this Agreement. Borrower’s equal employment policies shall be made available to City upon request. C) Section 504 of the Rehabilitation Act of 1973. Borrower shall comply with Section 504 of the Rehabilitation Act of 1973, as amended, which provides that no otherwise qualified handicapped individual shall, solely by reason of a disability, be excluded from the participation in, be denied the benefits of, or be subjected to discrimination in the performance of this Agreement. This Section applies only to Borrowers who are providing services to members of the public under this Agreement. D) Discrimination Against Individuals with Disabilities. Borrower shall comply fully with the nondiscrimination requirements of 41 C.F.R. § 60-741.5(a), which is incorporated herein as if fully set forth. E) History of Discrimination. Borrower must check one of the two following options, and by executing this Agreement, Borrower certifies that the option selected is accurate: ☐ No finding of discrimination has been issued in the past 365 days against Borrower by the Equal Employment Opportunity Commission, the Department of Fair Employment and Housing, or any other investigative entity. ‐8- ☐ Finding(s) of discrimination have been issued against Borrower within the past 365 days by the Equal Employment Opportunity Commission, the Department of Fair Employment and Housing, or other investigative entity. If this box is checked, Borrower shall provide City with a written explanation of the outcome(s) or remedy for the discrimination. F) Violation of Non-discrimination provisions. Violation of the non-discrimination provisions of this Agreement shall be considered a breach of this Agreement and subject Borrower to penalties, to be determined by the City Manager, including but not limited to the following: i. termination of this Agreement; ii. disqualification of Borrower from bidding on or being awarded a City contract for a period of up to 3 years; iii. liquidated damages of $2,500 per violation; and/or iv. imposition of other appropriate contractual and civil remedies and sanctions, as determined by the City Manager. To effectuate the provisions of this Section, the City Manager shall have the authority to examine Borrower’s employment records with respect to compliance with this Section and/or to set off all or any portion of the amount described in this Section against amounts due to Borrower under this Agreement or City Documents. Borrower shall report to the City Manager the filing by any person in any court of any complaint of discrimination or the filing by any person of any and all charges with the Equal Employment Opportunity Commission, the Department of Fair Employment and Housing, or any other entity charged with the investigation of allegations within 30 days of such filing, provided that within such 30 days such entity has not notified Borrower that such charges are dismissed or otherwise unfounded. Such notification shall include the name of the complainant, a copy of such complaint, and a description of the circumstance. Borrower shall provide City with a copy of their response to the Complaint when filed. 15. Retention of Records, Right to Monitor and Audit A) Borrower shall maintain all required records for five (5) years after City makes final payment and all other pending matters are closed, and Borrower shall be subject to the examination and/or audit by City. B) Reporting and Record Keeping: Borrower shall comply with all program and fiscal reporting requirements set forth by appropriate Federal, State, and local agencies, and as required by City. C) Borrower agrees upon reasonable notice to provide to City, to any Federal or State department having monitoring or review authority, to City’s authorized representatives, and/or to any of their respective audit agencies access to and the right to examine all records and documents necessary to determine compliance with relevant Federal, State, and local statutes, ‐9- rules, and regulations, to determine compliance with this Agreement and City Documents, and to evaluate the quality, appropriateness, and timeliness of services performed. 16. Merger Clause and Amendments This Agreement, including the Exhibits and Attachments attached to this Agreement and incorporated herein by reference, constitutes the sole Agreement of the Parties to this Agreement and correctly states the rights, duties, and obligations of each Party as of this document’s date. In the event that any term, condition, provision, requirement, or specification set forth in the body of this Agreement conflicts with or is inconsistent with any term, condition, provision, requirement, or specification in any Exhibit and/or Attachment to this Agreement, the provisions of the body of the Agreement shall prevail. Any prior agreement, promises, negotiations, or representations between the Parties not expressly stated in this document are not binding. All subsequent modifications or amendments shall be in writing, signed by the Parties and any request made for such shall be subject to a $2,000.00 fee payable by Borrower to City per modification or amendment request unless such amendment is required by the City. 17. Waiver of Terms and Conditions A Party may at its discretion waive in writing any of the terms and conditions of this Agreement, without completing an amendment to this Agreement. No waiver of any default or breach shall be implied from any omission by the non-breaching Party to take action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the waiver, and such waiver shall be operative only for the time and to the extent therein stated. Waivers of any covenant, term, or condition contained herein shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by a Party to or of any act by the other Party requiring further consent or approval shall not be deemed to waive or render unnecessary the consent or approval to or of any subsequent similar act. The exercise of any right, power, or remedy shall in no event constitute a cure or a waiver of any default under this Agreement, nor shall it invalidate any act done pursuant to notice of default, or prejudice the exercising Party in the exercise of any right, power, or remedy hereunder. 18. Controlling Law and Venue The validity of this Agreement and of its terms or provisions, the rights and duties of the Parties under this Agreement, the interpretation of this Agreement, the performance of this Agreement, and any other dispute of any nature arising out of this Agreement shall be governed by the laws of the State of California without regard to its choice of law rules. Any dispute arising out of this Agreement shall be venued either in the San Mateo County Superior Court or in the United States District Court for the Northern District of California. 19. Notices ‐10- Except as otherwise specified herein, all notices to be sent pursuant to this Agreement shall be made in writing, and sent to the Parties at their respective addresses specified below or to such other address as a Party may designate by written notice delivered to the other parties in accordance with this Section. All such notices shall be sent by: (i) personal delivery, in which case notice is effective upon delivery; (ii) certified or registered mail, return receipt requested, in which case notice shall be deemed delivered upon receipt if delivery is confirmed by a return receipt; or (iii) nationally recognized overnight courier, with charges prepaid or charged to the sender’s account, in which case notice is effective on delivery if delivery is confirmed by the delivery service. If to City, to: City of South San Francisco 400 Grand Avenue Attn: City Manager South San Francisco, CA 94080 Phone: (650) 877-8500 Mike.futrell@ssf.net With a Copy to: City of South San Francisco 400 Grand Avenue Attn: ECD Director South San Francisco, CA 94080 Phone: (650) 829-6622 Email: alex.greenwood@ssf.net With a Copy to: Meyers Nave Attn: Sky Woodruff 555 12th Street, Suite 1500 Oakland, CA 94607 Tel (510) 808-2000 Email sky@meyersnave.com If to Borrower: Grand and Linden Family Apartments, L.P. 1650 Lafayette Street Santa Clara, CA 95050 Attention: Alex Sanchez Telephone: (408) 984-5600 Email: asanchez@roemcorp.com With a Copy to: Bocarsly Emden Cowan Esmail & Arndt LLP 633 W. Fifth Street, 64th Floor Los Angeles, CA 90071 ‐11- Attention: Kyle Arndt, Esq. Telephone: (213) 239-8048 Email: karndt@bocarsly.com 20. Action by the City Except as may be otherwise specifically provided herein, whenever any approval, notice, direction, consent or request by the City is required or permitted under this Agreement, such action shall be in writing, and such action may be given, made or taken by the City Manager or by any person who shall have been designated by the City Manager, without further approval by the City Council at the discretion of the City Manager. 21. Non Liability of City Officials, Employees and Agents No member, official, employee or agent of the City shall be personally liable to Borrower or any successor in interest, in the event of any default or breach by the City, or for any amount of money which may become due to Borrower or its successor or for any obligation of City under this Agreement. 22. Discretion Retained by City The Borrower acknowledges that execution of this Agreement by the City does not constitute approval by the City of any required permits, applications, or allocations, for the Project, and in no way limits the discretion of the City in the permit allocation and approval process regarding the Property or Project. 23. Attorneys' Fees and Costs If any legal or administrative action is brought to interpret or enforce the terms of this Agreement, the prevailing party shall be entitled to recover all reasonable attorneys' fees and costs incurred in such action. 24. Electronic Signature If both City and Borrower wish to permit this Agreement and future documents relating to this Agreement to be digitally signed in accordance with California law, both boxes below must be checked. Any Party that agrees to allow digital signature of this Agreement may revoke such agreement at any time in relation to all future documents by providing notice pursuant to this Agreement. For City: ☐ If this box is checked by City, City consents to the use of electronic signatures in relation to this Agreement. For Borrower: ☐ If this box is checked by Borrower, Borrower consents to the use of electronic signatures in relation to this Agreement. ‐12- THIS CONTRACT IS NOT VALID UNTIL SIGNED BY ALL PARTIES REST OF PAGE DELIBERATELY LEFT BLANK ‐13- IN WITNESS WHEREOF, this Agreement has been entered into by and between Borrower and City as of the date and year first above written. CITY OF SOUTH SAN FRANCISCO By: _______________________________ Name: Charles Michael Futrell Title: City Manager Date: APPROVED AS TO FORM: By: ___________________ Sky Woodruff, City Attorney ATTEST: By: ____________________ Rosa Govea Acosta City Clerk BORROWER: Grand and Linden Family Apartments, L.P., a California limited partnership By: _______________________________ Borrower’s Signature (blue ink only) Print Name: _______________________________ Print Title: _______________________________ Date: ‐14- Exhibit A Project Description and Requirements In consideration of the payments set forth in Exhibit B and also described below, Borrower shall undertake the following activities and comply with the following restrictions and requirements: 1. Project Description Project Location / Address: 418 Linden Avenue, South San Francisco, CA Assessor’s Parcel Number(s): San Mateo County Assessor’s Parcel No. 012-314-010 Total # of Units Proposed: 37 Total # of Affordable Units Proposed: 36 Sources of Committed Funds: Fund 205: Housing Trust Fund Funding provided in this Agreement is from the following sources: City Housing Trust Fund FY 2019-20 TOTAL $1,050,000 $1,050,000 Project Sources & Uses Development Budget: The budget detailed in Exhibit D of this Agreement represents current financing projections for the Project and are subject to change as the Project design and program is further refined. 2. City Affordable Housing Trust Fund A. Determination of Restricted Units. “Restricted Unit” means a residential unit that is subject to rent and occupancy restrictions as a result of the financial assistance provided by City, as specified in the Loan Agreement and City Documents. This Section shall be amended to include the specific levels of affordability for each Restricted Unit once finally determined by the Parties. Under this Agreement, 36 units of the Project will be designated as Restricted Units. In connection with this Agreement and prior to release of funds under this Agreement, Borrower shall execute and record the Affordability Covenant restricting units as described ‐15- in Section 1 (Project Description) and Section 2 (City Affordable Housing Trust Fund) of Exhibit A. B. Affordability Requirements. All Restricted Units in the Project must remain affordable for a minimum of fifty-five (55) years. 1) Income Limits: All Restricted Units shall be offered for rent restricted and affordable to low income households. This Section shall be amended to include the specific levels of affordability for each Restricted Unit once finally determined by the Parties. All of these units shall be considered Restricted Units as defined in Section 2 of this Exhibit A. 2) Special Considerations for units with Project Based Section 8 Rental Assistance: If the Project receives an award of Project-Based Section 8 rental assistance, the units receiving the project-based vouchers (“PBVs”) shall be underwritten at the total subsidized rent for each unit paid by the project-based rental assistance and the tenant in sum. If PBVs are terminated, rents for any Restricted Units losing PBVs may be increased to the federally-permitted maximums in accordance with current California Tax Credit Allocation Committee (“CTCAC”) Regulations. If a PBV is terminated, and the current tenant is unable to pay the maximum CTCAC- allowable rent, Borrower may, upon advance written notice to City, transition targeted units detailed in Section 3.A (Unit Affordability Provisions) of this Exhibit A as follows: (a) First, to a household of the same targeted population that could afford to pay the maximum CTCAC rent allowed; and if there is no household that meets this criterion, (b) Second, to the next eligible household on Borrower’s waiting list that could afford to pay the maximum CTCAC rent allowed. For PBVs that are also HUD-Veterans Affairs Supportive Housing (VASH) vouchers, and if the current tenant is unable to pay the maximum CTCAC-allowable rent, Borrower may, upon advance written notice to City, transition to these units as follows: ‐16- (a) First, to a homeless veteran household for whom the maximum CTCAC rent allowed is affordable; and if there is no household that meets this criterion, (b) Second, to a homeless household for whom the maximum CTCAC rent allowed is affordable; and if there is no household who meets this criterion, (c) Third, to a veteran household for whom the maximum CTCAC rent allowed is affordable; and if there is no household who meets this criterion, (d) Fourth, to the next eligible household on Owner’s waiting list for whom the maximum CTCAC rent allowed is affordable. If PBVs are terminated, Borrower may request, and City may grant a reduction or waiver in writing of the homeless household requirements described above, upon submission of evidence that such requirements cause the Project to be financially infeasible. 3. Environmental Review All applicable California Environmental Quality Act (“CEQA”) requirements must be met for all projects that receive City funding. 4. Project Completion Project Completion is defined as completion of construction of the Project as evidenced by issuance of Final Certificate of Occupancy or some other document acceptable to City (“Project Completion Document”). 5. Compliance Period The Compliance Period is defined as the time frame beginning immediately upon Project Completion and ending on the later of fifty-five (55) years from the first day of the Compliance Period or the Note Maturity set forth in the Note. Borrower shall provide City with a Housing Completion Report, including final Project funding sources and uses, and tenant profile described below on forms acceptable to City within the first 180 days of the Compliance Period. Upon Borrower request to City, the due dates for these reports may be extended to accommodate a longer lease-up period if Borrower has demonstrated reasonable diligence and progress toward achieving 100% occupancy. 6. Property Standards Construction of the Project must fully comply with all applicable local and State building codes and regulations, and Borrower must operate and maintain the Project in a manner that ensures the Project will continue to comply with said codes and regulations. Borrower’s operations and maintenance of the Project must ensure that its appearance from all public right-of-ways ‐17- continually presents the Project in a high-quality manner and complies with provisions of the Affordability Covenant and Deed of Trust. 7. Contract Number All correspondence, invoices, payments, and reports must include the City contract number. The City will provide the contract number upon disposition of the Property to Borrower. 8. Rents and Occupancy Project financing is anticipated to include proceeds from Low-Income Housing Tax Credits (“LIHTC”). For LIHTC projects, City shall defer to income certification requirements imposed by tax credits. If project financing does not include tax credits, Borrower shall rely on income determination calculations set forth in 24 CFR Part 5 (i.e., the Section 8 Voucher Program). 9. Security/Term/Loan Terms Unless otherwise noted herein, funding is provided in the form of a loan or loans, in accordance with terms described in this Paragraph. Should funding provided in this Agreement include more than one City funding source, separate Note(s) and Deeds of Trust will be executed for each funding source. For each funding source, prior to any disbursement of funds, Borrower shall execute and deliver a Note in the amount indicated below and a Deed of Trust in favor of City to secure the performance of all terms and conditions of the Note and this Agreement. The Note will be non-recourse. The Deed of Trust will be recorded in the Office of the Recorder of the County of San Mateo upon Borrower’s acquisition of the Property. The Deed of Trust may be subordinate to the liens of any senior lenders. No interest will accrue on the Note unless Borrower commits an Event of Default under this Agreement or any of the City Documents. Payment of $500,000.00 of the Note will be due and payable fifteen (15) years from date the Project achieves permanent loan conversion (but in no event prior to the maturity of the Project’s permanent loan. The City may, in its sole and absolute discretion, forgive the remaining $550,000.00 of the Note at the Note Maturity if no Event of Default has occurred or is occurring. The Note and Deed of Trust will be executed prior to any disbursement of funds under this Agreement. Should there be a conflict in the language between the Note and this Agreement, the Note will prevail. 10. Repayment Funding Source Note Amount Deed of Trust Amount City Affordable Housing Trust Fund $1,050,000.00 $1,050,000.00 ‐18- The provisions and requirements in this and foregoing sections will refer to each Note unless stated otherwise. Annual payments on the Note will be made from Project Operations, which begins on the first day of the month after the Project receives a Certificate of Occupancy, or some other document evidencing completion acceptable to City. Annual payments will equal 50% of Residual Receipts, with payment amount determined by disbursed amount of City funding provided in this Agreement as a proportion of all local funding requiring repayment (to be confirmed by City and Borrower in writing outside of this Agreement). In cases where the City is not the sole subsidy lender requiring Residual Receipt payments, the other subsidy lenders shall share their 50% portion of Residual Receipts in proportion to the size of each lenders’ total contribution. Where another subsidy lender requires payment based upon the subsidy lender’s sharing a greater percentage than fifty percent (50%) of the Residual Receipts, then the City’s share of Residual Receipts shall be adjusted to be equal to that lender’s greater percentage of Residual Receipts. Payment will be first applied to outstanding interest, if any, and then to principal until the Note is paid in full. In the event this payment is less than accumulated interest owed plus current interest, any unpaid interest will carry over to the following year. Interest will not compound on this interest carry-over. The entire outstanding principal balance plus any unpaid accrued interest will be due and payable upon a Note Maturity. The first payment will be due no later than 120 days after the end of the Project’s first fiscal year after the project receiving a Certificate of Occupancy. A copy of the annual independent financial audit delineating Residual Receipts payment to City will also be delivered to City no later than 120 days after the end of each of the Project’s fiscal years. “Residual Receipts” means, with respect to the Project’s fiscal year, the amount by which Gross Revenue exceeds Annual Operating Expenses, as defined below. “Gross Revenue” means all rental and incidental income from the Project, except for tenant security deposits, loan proceeds and capital contributions and any interest earned on said deposits. “Annual Operating Expenses” means costs reasonably and actually incurred for operations and maintenance of the Project to the extent that they are consistent with an annual independent audit performed by a certified public accountant using generally acceptable accounting principles. A copy of the audit will be delivered with payment as specified above. Costs associated with the Project Operations and maintenance include the following: property and other taxes and assessments imposed on the Project; premiums for property damage and liability insurance; utility services not paid for directly by the tenants, including but not limited to water, sewer, trash collection, gas, and electricity; maintenance and repairs including but not limited to pest control, ‐19- landscaping and grounds maintenance, painting and decorating, cleaning, common systems repairs, general repairs, janitorial supplies, and others; resident services; additional supportive services necessary to help residents maintain personal or household stability and housing status; any license or certificates of occupancy fees required for operation of the Project; general administrative expenses including but not limited to advertising, marketing, security services and systems, professional fees for legal, audit, accounting and tax returns, and other; property management fees and reimbursements including on-site manager expenses, not to exceed fees and reimbursements which are standard in the industry and pursuant to a management contract approved by City (which such approval will not be unreasonably withheld); resident services, additional supportive services necessary to help tenants maintain personal or household stability and housing status; annual cash deposited into a reserve for capital replacements of Project improvements in an amount of up to $500 dollars per unit per year (increasing by 3% per annum), provided any changes to the amount deposited into this replacement reserve will require City approval; cash deposited into an operating reserve for the Project and such other reserves as may be required by Borrower’s senior lender or tax credit investor; payments of any deferred developer fee up to the maximum Net Developer Fee permitted under Section 11 (Developer Fee) below; current and accrued general partner partnership management fee and current and accrued limited partner asset management fee in the amount set forth in Borrower’s limited partnership agreement (provided, however, following withdrawal of the investor limited partner from Borrower, the limited partner asset management fee shall no longer be included as an Annual Operating Expense for purposes of calculating Residual Receipts); and debt service payments of loans in senior position to this loan. For avoidance of doubt, any deferred developer fee remaining after payment of the Net Developer Fee may be paid only from Borrower's share of Residual Receipts. Prior to start of Project Operations, Borrower will confirm in writing with City all fee and reserve amounts to be included in the above calculations for Residual Receipts. Annual operating expenses will not include the following: depreciation, amortization, depletion, or other non-cash expenses, or any amount expended from a reserve account. 11. Developer Fee The maximum cumulative cash developer fee (net of any general partner capital contributions) that may be paid from development sources and/or as an operating expense shall not exceed the maximum amount allowed under TCAC regulations (the “Net Developer Fee”). The remaining developer fee may be paid only from Borrower's share of Residual Receipts. 12. Excess Construction Proceeds/Cost Savings “Surplus Construction Cash” is defined as the difference between total of all sources of funds received for the Project and the total cost of the Project. If Surplus Construction Cash remains after construction is completed and Borrower Form 8609 is filed, and all obligations to construction contractors, subcontractors, and lenders for construction period expenses are satisfied, Borrower shall reimburse City for its financial investment in the Project as set forth ‐20- herein. Borrower shall prepare and submit to City a Cost Certification detailing the amount of Surplus Construction Cash, if any, at Project completion. City may, at its sole option, accept a Cost Audit required by another funding source as evidence of Surplus Construction Cash, if any. Borrower shall distribute Surplus Construction Cash among City and any other governmental agency/agencies requiring reimbursement/repayment in direct proportion to the share of total Project funds disbursed from each such agency funding the Project. These other agencies, and respective amounts disbursed will be confirmed in writing outside of this Agreement prior to start of construction or the Project. Any reimbursement to City will be counted toward repayment of the amount owed on City Note[s], with such payment first applied toward any interest accrued before reduction of the principal balance. Borrower may opt to retain up to 50% of the Surplus Construction Cash proceeds with the other 50% to be distributed to City and other applicable public/governmental agencies in the proportion described above. Should Borrower opt to retain a portion of the Surplus Construction Cash, its portion shall be used solely for ongoing Project Operations or for payment of deferred Developer Fees. In either case, Borrower shall inform City of its intent to retain up to 50% of the Surplus Construction Cash, and provide a detailed description of the intended use[s] of the Surplus Construction Cash, as well as the identity of any other public/governmental funding agencies, in writing, no later than the permanent loan closing date. 13. Prepayment Prepayments may be made at any time without penalty. 14. Due on Sale, Refinance, or Transfer of Title If Borrower sells, refinances or transfers the Property or Project or any interest therein without prior written consent of the City Manager or his/her designee, it shall be considered an Event of Default and the entire principal balance of the Note, including any accumulated interest accrued pursuant to Exhibit A, shall be immediately due and payable. However, (i) the transfer of limited partner interests in Borrower to a Low-Income Housing Tax Credit (“LIHTC”) investor, (ii) the subsequent transfer of such limited partner interests for the purpose of syndicating the LIHTC, or (iii) the granting of an option or right of first refusal by the City and any transfer pursuant to such option or right of first refusal as agreed to by the City shall not be considered a sale, refinance or transfer of the Project for purposes of this section. Replacement of a general partner of Borrower with any other entity shall be subject to prior written approval of City, which shall not be unreasonably withheld. Borrower may transfer or assign all or any portion of its interest, right or obligations in the Property only as set forth in the City Documents and with City’s prior written consent, which consent City shall not withhold provided that (1) the Project is and shall continue to be operated in compliance ‐21- with this Agreement and the City Documents; (2) the transferee expressly assumes all obligations of Borrower imposed by this Agreement and the City Documents; (3) the transferee executes all documents reasonably requested by the City with respect to the assumption of the Borrower’s obligations under this Agreement and the City Documents and upon City’s request, delivers to the City an opinion of its counsel to the effect that such document and this Agreement and the City Documents are valid, binding and enforceable obligations of such transferee; and (4) either (A) the transferee has at least three years’ experience in the ownership, operation and management of low- income multifamily rental housing projects of similar size to that of the Project, without any record of material violations of nondiscrimination provisions or other state or federal laws or regulations applicable to such projects, or (B) the transferee agrees to retain a property management firm with the experience and record described in sub-clause (A). Consent to any proposed Transfer may be given by the City Manager unless the City Manager, in his or her discretion, refers the matter of approval to the City Council. If a proposed Transfer has not been approved by City in writing within ninety (90) days following City’s receipt of written request by Borrower, it shall be deemed approved. Borrower shall reimburse City for all City costs, including but not limited to reasonable attorneys’ fees, incurred in reviewing instruments and other legal documents proposed to effect a Transfer under this Agreement, the City Documents and in reviewing the qualifications and financial resources of a proposed successor, assignee, or transferee within ten (10) days following City’s delivery of an invoice detailing such costs. 15. Events of Default The occurrence of any one or more of the following events shall constitute an Event of Default hereunder: A. Failure to Construct Project. A failure by the Borrower to commence or complete the construction of the Project in accordance with the terms of the City Documents which failure is not cured within 30 days of written notice from the City; B. Breach of Covenants. Failure by the Borrower to duly perform, comply with, or observe any of the conditions, terms, or covenants of any of this Agreement or the City Documents which failure is not cured within 30 days of written notice from the City; C. Unauthorized Transfer. Any transfer other than as permitted pursuant to this Agreement; D. Representation or Warranty Incorrect. ‐22- Any Borrower representation or warranty contained in this Agreement, or in any application, financial statement, certificate, or report submitted to the City in connection with Loan or City Documents, proving to have been incorrect in any material respect when made; E. Default Under Other Financing or DA. Failure to make any payment or perform any of the Borrower's covenants, agreements, or obligations under the documents evidencing and securing the financing for the Project or City Documents following expiration of all applicable notice and cure periods; F. Insolvency. A court having jurisdiction shall have made or entered any decree or order (i) adjudging the Borrower (or any general partner of the Borrower) to be bankrupt or insolvent, (ii) approving as properly filed a petition seeking reorganization of the Borrower (or any general partner of the Borrower) or seeking any arrangement for the Borrower under the bankruptcy law or any other applicable debtor's relief law or statute of the United States or any state or other jurisdiction, (iii) appointing a receiver, trustee, liquidator, or assignee of the Borrower (or any general partner of the Borrower) in bankruptcy or insolvency or for any of their properties, or (iv) directing the winding up or liquidation of the Borrower (or any general partner of the Borrower), if any such decree or order described in clauses (i) to (iv), inclusive, shall have continued unstayed or undischarged for a period of ninety (90) days; or the Borrower (or any general partner of the Borrower) shall have admitted in writing its inability to pay its debts as they fall due or shall have voluntarily submitted to or filed a petition seeking any decree or order of the nature described in clauses (i) to (iv), inclusive; G. Assignment; Attachment. The Borrower (or any general partner of the Borrower) shall have assigned its assets for the benefit of its creditors or suffered a sequestration or attachment of or execution on any substantial part of its property, unless the property so assigned, sequestered, attached or executed upon shall have been returned or released within ninety (90) days after such event or prior to sooner sale pursuant to such sequestration, attachment, or execution; H. Suspension. The Borrower (or any general partner of the Borrower) shall have voluntarily suspended its business; ‐23- I. Liens. There shall be filed any claim of lien (other than liens approved in writing by the City) against the Property or Project or any part thereof, or any interest or right made appurtenant thereto, or the service of any notice to withhold proceeds of the Loan and the continued maintenance of said claim of lien or notices to withhold for a period of twenty (20) days without discharge or satisfaction thereof or provision therefore satisfactory to the City; J. Condemnation. The condemnation, seizure, or appropriation of all or, in the opinion of the City, a substantial part of the Property or Project; or K. Insurance. Borrower’s failure to maintain insurance on the Property and the Project as required hereunder or under City Documents, and the failure of Owner to cure such default within thirty (30) days of written notice from City; L. Taxes and Assessments. Subject to Owner’s right to contest the following charges, Borrower’s failure to pay taxes or assessments due on the Property or the Project or failure to pay any other charge that may result in a lien on the Property or the Project, and Owner’s failure to cure such default within sixty (60) days of delinquency; M. Other Default. Occurrence of any other event (whether termed default, event of default, or otherwise) which under the terms of this Agreement or City Documents will entitle City to exercise rights or remedies. 16. Remedies The occurrence of any Event of Default will either, at the option of the City or automatically where so specified, relieve the City of any obligation to make the Loan and shall give the City the right to proceed with any and all remedies set forth in this Agreement, including but not limited to the following: A. Repayment of Loan. The City shall have the right to require immediate repayment of the outstanding principal balance of the Loan and such amount shall be deemed to have accrued simple interest at the rate of three percent (3%) per annum, commencing on the date of disbursement through the date of the Event of Default. Beginning as of the date of the Event of Default and continuing until such time as the Loan is repaid in full or default or breach is completely cured, the outstanding principal balance ‐24- of the Loan shall accrue the default rate of the lesser of either ten percent (10%), compounded annually, or the highest rate permitted by law. Borrower waives all right to presentment, demand, protest or notice of protest or dishonor. The City may proceed to enforce repayment of the Loan and to exercise any or all rights afforded to the City as a creditor and secured party under the law including the Uniform Commercial Code, including foreclosure under the City Deed of Trust. The Borrower shall be liable to pay the City on demand all reasonable expenses, costs and fees (including, without limitation, reasonable attorney's fees and expenses) paid or incurred by the City in connection with the collection of the Loan and the preservation, maintenance, protection, sale, or other disposition of the security given for the Loan. B. Specific Performance. Bring an action for equitable relief seeking the specific performance of the terms and conditions of this Agreement or City Documents, and/or enjoining, abating, or preventing any violation of such terms and conditions, and/or seeking declaratory relief. C. LIQUIDATED DAMAGES. FOR VIOLATIONS OF OBLIGATIONS WITH RESPECT TO RENTS FOR RESTRICTED UNITS, THE CITY SHALL HAVE THE RIGHT TO IMPOSE AS LIQUIDATED DAMAGES A CHARGE IN AN AMOUNT EQUAL TO THE ACTUAL AMOUNT COLLECTED BY OWNER OR OWNER’S REPRESENTATIVE IN EXCESS OF THE AFFORDABLE RENT. THE PARTIES AGREE THAT, IN SUCH INSTANCE, SUCH EXCESS RENT REPRESENTS A REASONABLE APPROXIMATION OF THE CITY’S DAMAGES AND IS NOT INTENDED AS A FORFEITURE OR PENALTY BUT RATHER AN ENFORCEABLE LIQUIDATED DAMAGES PROVISION PURSUANT TO CALIFORNIA CIVIL CODE SECTION 1671, ET SEQ. OWNER SHALL PAY ANY LIQUIDATED DAMAGES ASSESSED BY THE CITY WITHIN TEN (10) DAYS. City’s Initials Owner’s Initials D. Other Remedies. Pursue any other remedy allowed at law or in equity. E. Right to Cure at Borrower's Expense. The City shall have the right (but not the obligation) to cure any monetary default by the Borrower under a loan secured by the Property. The Borrower agrees to reimburse the City for any funds advanced by the City to cure a monetary default by the Borrower upon demand therefore, together with interest thereon at the lesser of ten percent (10%) per annum or the ‐25- maximum rate permitted by law, from the date of expenditure until the date of reimbursement. F. Right of Contest. The Borrower shall have the right to contest in good faith any claim, demand, levy, or assessment the assertion of which would constitute an Event of Default hereunder. Any such contest shall be prosecuted diligently and in a manner unprejudicial to the City or the rights of the City hereunder. G. Remedies Cumulative. No right, power, or remedy given to a party by the terms of this Agreement is intended to be exclusive of any other right, power, or remedy; and each and every such right, power, or remedy shall be cumulative and in addition to every other right, power, or remedy given to the Party. Neither the failure nor any delay on the part of a Party to exercise any such rights and remedies shall operate as a waiver thereof, nor shall any single or partial exercise by a Party of any such right or remedy preclude any other or further exercise of such right or remedy, or any other right or remedy. 17. Title Policy If funds provided in this Agreement are to assist in Property acquisition, Borrower shall open an escrow account with a mutually acceptable title company. City as a lender shall provide instructions to record its Deed of Trust and Affordability Covenant. For all loans secured by a Deed of Trust, at the close of escrow, Borrower shall obtain for City’s benefit, an ALTA extended coverage lender’s policy of title insurance in an amount not less than the face value of the Note, clear of any title defects which would prevent the operation of the proposed Project. Borrower shall be responsible for paying all recording fees, escrow fees, the premium for the title insurance policy, all fees and cost for any new financing, and shall pay any applicable transfer taxes. 18. Fire and Extended Coverage Borrower at its costs shall maintain for the Project a policy of standard fire and extended coverage during the life of the Note and Deed of Trust securing this Agreement, or any subsequently executed document which replaces the Note and Deed of Trust, with vandalism and malicious mischief endorsements, in the amount of at least the full replacement value of the improvements which are part of the Project. The insurance policy must be issued in the names of Borrower and City as their interests appear. The insurance policy must contain a lender’s loss payment endorsement, providing that any proceeds will be payable to City as its interests appear and may be subject to the interest of senior lenders. 19. Property Damage or Destruction ‐26- If any part of the Project is damaged or destroyed, Borrower shall repair or restore the same, consistent with the occupancy and rent restriction requirements set forth in this Agreement and City Documents. Such work shall be commenced as soon as reasonably practicable after the damage or loss occurs and shall be completed within one year thereafter or as soon as reasonably practicable, provided that insurance proceeds are available to be applied to such repairs or restoration within such period and the repair or restoration is financially feasible. During such time that lenders or low-income housing tax credit investors providing financing for the Project impose requirements that differ from the requirements of this Section the requirements of such lenders and investors shall prevail. 20. Nonrecourse Obligation. Notwithstanding anything to the contrary set forth herein, the Loan evidenced by this Agreement shall be a nonrecourse obligation of Borrower and its Partners. ‐27- Exhibit B Disbursement and Rates Funding provided in this Agreement is to be used to support work scope activity and delivery costs enumerated in Exhibit A. None of the funding shall be used to support Borrower’s general administration costs. Subject to the terms of the Agreement, City shall disburse loan funds to Borrower based on the following fee schedule and terms: City shall deposit funds into an escrow held by a title company mutually approved by City and Borrower, in accordance with City enabling instructions. City funds deposited into escrow will be used by the title company to consummate the transaction. ‐28- In consideration of the payments set forth in Exhibit B, Borrower shall undertake the following activities as conditions for funding provided in this Agreement: 1) Prior to award of funds provided and detailed in this Agreement, Borrower must satisfy the following conditions: a) Borrower shall deliver to the City copies of insurance policies described in Section 12 which name the City as additional insured. b) Borrower shall execute and Escrow Agent shall deliver to the City the Note. c) Borrower shall execute the Deed of Trust securing the Note. The Deed of Trust shall be recorded against the Property at the time the Borrower acquires it with Loan proceeds. d) Borrower shall execute the Affordability Covenant which shall be recorded against the Property at the time the Borrower acquires it with Loan proceeds. City acknowledges that the above-stated conditions have been addressed to City’s satisfaction. 2) Prior to Property conveyance, Borrower must satisfy the following conditions: a) Meet all closing obligations, pursuant to Section 6: Closing and Payment of Purchase Price of the Purchase and Sale Agreement City reserves the right to waive, delay, or otherwise modify funding conditions stated above, except those conditions detailed in Sections 1 and 2 of this Exhibit. Exhibit C Funding Conditions ‐29- Exhibit D Project Sources and Uses Development Budget   3471925.1   DO NOT DESTROY THIS NOTE. WHEN THIS NOTE IS FULLY PAID, IT MUST BE SURRENDERED TO THE  TRUSTEE ALONG WITH THE ORIGINAL DEED OF TRUST FOR CANCELLATION AND ISSUANCE OF A  RECONVEYANCE.    PROMISSORY NOTE  Secured by a Deed of Trust    $1,050,000.00    South San Francisco, California     , 2020    FOR VALUE RECEIVED, Grand and Linden Family Apartments, L.P.  (“Borrower”), promises to pay to the  City of South San Francisco, a municipal corporation, (“City”) the sum of One Million Fifty Thousand Dollars  ($1,050,000.00) plus interest (the “Loan”). All payments on this Note shall be made to City at 400 Grand  Avenue, South San Francisco, CA 94080 or such other place as City shall designate to Borrower in writing,  or by wire transfer of immediately available funds to an account designated by City in writing.     This Secured Promissory Note (this "Note") has been executed and delivered pursuant to an Owner  Participation and Loan Agreement dated as of the date hereof by and between Borrower and City (the  "Loan Agreement"), and is subject to the terms and conditions of the Loan Agreement, which are by this  reference incorporated herein and made a part hereof. Capitalized terms used but not defined herein  shall have the meaning ascribed to such terms in the Loan Agreement.     This Note is secured by a Leasehold Deed of Trust, Assignment of Rents, Security Agreement and Fixture  Filing ("Deed of Trust") dated as of the date hereof, executed by Borrower for the benefit of City and  encumbering Borrower's interest in the property described therein. City shall be entitled to the benefits  of the security provided by the Deed of Trust and shall have the right to enforce the covenants and  agreements contained herein, in the Deed of Trust, and the Loan Agreement.    Use of Loan Funds: Proceeds for this Loan come from the City’s Housing Trust Fund. Said proceeds will be  used for the purchase of 418 Linden Avenue, known as County Assessor's Parcel Number 012‐314‐010  (the “Property”) and re‐development of the Property into a high‐density, residential apartment building  of thirty‐six (36) affordable residential units and one manager’s unit (the “Project”). The terms and  conditions of the Loan are more specifically described in the “Loan Agreement Between the City of South  San Francisco and Grand and Linden Family Apartments, L.P.” (the “Agreement”) by Resolution No.[add  #], [add date] and the “Affordable Housing Regulatory Agreement and Declaration of Restrictive  Covenants between the City of South San Francisco and Grand and Linden Family Apartments, L.P.”  (“Affordability Covenant”) dated     , 2020.    Term: The term of this Note shall be from execution and shall mature fifty‐five (55) years from date of  Project Completion, as defined by issuance of a Final Certificate of Occupancy, or some other document  acceptable to the City, for the Project (the “Note Maturity”).    Repayment/ Interest Rate: The principal amount under the Note shall bear no interest unless an Event of  Default occurs under this Note, the Agreement, Deed of Trust or Affordability Covenant (collectively “City  Documents”).  Five Hundred Thousand dollars ($500,000.00) of the Note shall be due no later than fifteen  (15) years from date the Project achieves permanent loan conversion (but in no event prior to the maturity  of the Project’s permanent loan) and the remaining Five Hundred and Fifty Thousand dollars  210-219 Grand Avenue Promissory Note $1,050,000.00 Page 2 ($550,000.00) may, in the sole and absolute discretion of the City, be forgiven by the City at Note Maturity  so long as no Event of Default has occurred or is occurring under the City Documents. The City Documents  shall be executed prior to any disbursement of funds under the Agreement.  The Deed of Trust shall be  recorded as described in the section below entitled “Security.”    Annual payments shall be made from the Project’s Residual Receipts (defined below), which begin the  first day of the first month after the Project receives a Final Certificate of Occupancy or other document  evidencing completion acceptable to the City. Annual payments shall begin no later than the first day of  the fiscal year following the first full fiscal year after issuance of  the Final Certificate of Occupancy for the  Project, and shall be equal to the lesser of: (a) fifty percent (50%) of Residual Receipts, as defined below,  multiplied by the fraction resulting from the principal amount of this Note divided by the total principal  amounts of all loan funds received by Borrower from City and any other public lenders (City and Borrower  will amend this Note to identify any other public lenders to be included for this calculation); or (b) equal  annual payments amortized to pay $500,000.00 no later than five (5) years from Note execution, including  any associated fees charged by City. The first payment will be due 120 days after the end of the Project’s  fiscal year, and annually thereafter. A copy of the annual independent financial audit shall also be  delivered to City no later than 120 days after the end of the Project’s fiscal year, beginning with the first  full year of occupancy. The audit will set forth the Project’s Residual Receipts and payment owed City for  the applicable fiscal year.     Payment will first be applied to outstanding interest, if any, and then to any outstanding principal until  the Note is paid as set forth herein. In the event this payment is less than accumulated interest owed plus  current interest, any unpaid interest shall carry over to the following year.  Interest shall not compound  on this interest carry‐over. The entire outstanding principal balance plus any unpaid accrued interest shall  be due and payable upon an Event of Default under the City Documents.    Residual Receipts:  “Residual Receipts” means, with respect to the Project’s fiscal year, the amount by which “Gross Revenue”  exceeds “Annual Operating Expenses,” as defined below.     “Gross Revenue” means all rental and incidental income from the Project, but excluding tenant security  deposits, loan proceeds and capital contributions and any interest earned on said deposits.    "Annual Operating Expenses" means reasonable costs actually incurred for operations and maintenance  of the Project to the extent that they are consistent with an annual independent audit performed by a  certified public accountant using generally accepted accounting principles. A copy of the audit will be  delivered with payment as specified above. Costs associated with the Project operations and maintenance  include the following: property and other taxes and assessments imposed on the Project; premiums for  property damage and liability insurance; utility services not paid for directly by the tenants, including but  not limited to water, sewer, trash collection, gas, and electricity; maintenance and repairs, including but  not limited to pest control, landscaping and grounds maintenance, painting and decorating, cleaning,  common systems repairs, general repairs, janitorial supplies, and others; and license or certificates of  occupancy fees required for operation of the Project; general administrative expenses, including but not  limited to advertising, marketing, security services and systems, professional fees for legal, audit,  accounting and tax returns, and other services; property management fees and reimbursements,  including on‐site manager expenses, not to exceed fees and reimbursements which are standard in the  industry and pursuant to a management contract approved by City (which such approval will not be  210-219 Grand Avenue Promissory Note $1,050,000.00 Page 3 unreasonable withheld); resident services; annual cash deposited into a reserve for capital replacements  of the Project improvements in an amount of $500 per unit per year (increasing by 3% per annum),  provided any changes to the amount deposited into this replacement reserve will require City approval;  cash deposited into an operating reserve for the Project and such other reserves as may be required by  Borrower’s senior lender or tax credit investor; payments of any deferred developer fee up to the  maximum Net Developer Fee, defined as the maximum cumulative cash developer fee (net of any general  partner capital contributions) that may be paid from development sources and/or as an operating expense  which shall not exceed the maximum amount allowed under TCAC regulations,  permitted under the  Agreement; current and accrued; general partner partnership management fee and current and accrued  limited partner asset management fee in the amount set forth in Borrower’s limited partnership  agreement (provided, however, following withdrawal of the investor limited partner from Borrower, the  limited partner asset management fee shall no longer be included as an Annual Operating Expense for  purposes of calculating Residual Receipts), and debt service payments of loans in senior position to this  loan. For avoidance of doubt, any deferred developer fee remaining after payment of the Net Developer  Fee may be paid only from Borrower’s share of Residual Receipts.    Prepayment: Prepayments may be made at any time without penalty.      Due on Sale, Refinance or Transfer of Title: Notwithstanding the foregoing, in the event of a sale,  refinance or transfer of the Project or Property or any interest therein by Borrower without prior written  consent of the City and in accordance with the terms of the City Documents, the entire principal balance  of this Note, including any accumulated interest, shall be immediately due and payable. However, (i) the  transfer of limited partner interests in Borrower to a Low‐Income Housing Tax Credit (“LIHTC”) investor,  (ii) the subsequent transfer of such limited partner interests for the purpose of syndicating the LIHTC, or  (iii) the granting of an option or right of first refusal by the City and any transfer pursuant to such option  or right of first refusal as agreed to by the City shall not be considered a sale, refinance or transfer of the  Project for purposes of this section. Replacement of a general partner of Borrower with any other entity  shall be subject to prior written approval of City, which shall not be unreasonably withheld.      Default: In the event Borrower commits an Event of Default pursuant to the Agreement and Affordability  Covenant, Borrower shall be in default under of the terms and conditions of this Note and the Deed of  Trust, and City may demand immediate and full payment of any outstanding principal amount of the Note  and any accrued interest under the Agreement or Affordability Covenant, and/or may initiate foreclosure  proceedings under the Deed of Trust.     Maturity: Unless Borrower has committed or is committing an Event of Default pursuant to the City  Documents, upon maturity of the Note under its terms, City may, in its sole and absolute discretion,  forgive the outstanding $550,000.00 remaining on the Note.   Nonrecourse: This Note shall be non‐recourse to Borrower and its partners.    Security. This Note will be secured by the Deed of Trust recorded against Borrower’s fee simple estate in  the Property.      Other. Should there be a conflict relating to repayment terms between the Agreement and this Note, the  latter will prevail.    210-219 Grand Avenue Promissory Note $1,050,000.00 Page 4     IN WITNESS WHEREOF, Borrower has executed and delivered this Note as of the date first written  above.    BORROWER:     Grand and Linden Family Apartments, L.P.       By:           Title:           Date:               3467836.1 ROEM Development Corporation  Page 1       RECORDING REQUESTED BY :    City of South San Francisco    WHEN RECORDED, MAIL TO :    400 Grand Avenue  South San Francisco, CA  94080  Attn:  City Manager                      Exempt from Recording Fees pursuant to  Section 27383 of the Government Code  (This Space for Recorder's Use Only)  DEED OF TRUST AND ASSIGNMENT OF RENTS    This Deed of Trust, made this         __             day            , 2020 between    GRAND AND LINDEN FAMILY APARTMENTS, L.P.     herein called “Trustor,” whose mailing address is     Grand and Linden Family Apartments, L.P.  1650 Lafayette Street  Santa Clara, CA 95050    and Chicago Title Company “Trustee", and    City of South San Francisco, herein called “Beneficiary” or “City”    RECITALS    Witnesseth:    That Trustor IRREVOCABLY GRANTS, TRANSFERS, AND ASSIGNS TO TRUSTEE IN TRUST, WITH POWER OF SALE, that  property in County of San Mateo, State of California, described in "Exhibit A" attached hereto together with all  the improvements now or hereafter erected on the property, and all easements, rights, appurtenances, rents  (subject, however, to the rights and authorities given to Beneficiary to collect and apply such rents), royalties,  mineral, oil and gas rights and profits, water, water rights, and water stock, and all fixtures now or hereafter  attached to the property, including but not limited to all gas and electric fixtures, radiators, heaters, furnaces, air  conditioners, heat pumps, stoves, ranges, bathtubs, sinks, water closets, basins, pipes, faucets and other  plumbing and heating, venting and air conditioning equipment, cabinets, mantels, cooking apparatus and  appurtenances, shades, awnings, screens, venetian blinds and other furnishings, all of which, including  replacements and additions thereto, which shall be deemed to be and remain a part of the property covered by  this Deed of Trust; and all of the foregoing, together with said property  are referred to as (the “Property”).    Trustor hereby represents, warrants and covenants that with the exception of easements of record, absent the  written consent of City, this Deed of Trust shall not be subordinated in priority to any lien (other than those  pertaining to taxes or assessments), encumbrance, or other interest in the Property. If at the time this Deed of  Trust is recorded, any interest, lien, or encumbrance has been recorded against the Property in position superior  to this Deed of Trust, upon the request of City, Trustor hereby covenants and agrees to promptly undertake all  action necessary to clear such matter from title or to subordinate such interest to this Deed of Trust consistent  with the intent of and in accordance with this Deed of Trust, and to provide such evidence thereof as City may  reasonably request. Notwithstanding the foregoing, the City agrees that pursuant to Health and Safety Code  ROEM Development Corporation  Page 2         Section 33334.14(a)(4), the City will not withhold consent to reasonable requests for subordination of this Deed  of Trust to deeds of trust provided for the benefit of lenders identified in the Financing Plan approved in  connection with the certain Development Agreement executed by and between the Parties and dated as of  November 15, 2017 ( “DA”), provided that the instruments effecting such subordination include reasonable  protections to the City in the event of default consistent with the requirements of Health and Safety Code Section  33334.14(a)(4), including without limitation, extended notice and cure rights.  Any subordination request shall be subject to a $2,000.00 fee payable by Trustor to City upon Trustor’s request  for City to review instruments and other legal documents proposed to effect a subordination under this Deed of  Trust.  Trustor hereby: (i) represents and warrants that it is not affiliated in any way with the lender identified in the  Financing Plan approved in connection with the DA, and (ii) covenants that it will not become so affiliated by  acquiring an interest in such lender, or an interest in its loan, or otherwise.   Trustor covenants that it is lawfully seized of the estate conveyed by this Deed of Trust and has the right to grant  and convey the Property, and that Trustor will warrant and defend generally the title of the Property against all  claims and demands, subject to any declarations, easements or restrictions listed in a schedule of exceptions to  coverage in any title insurance policy insuring Beneficiary's interest in the Property. In the event the Property or  any part thereof, or any interest therein is sold, agreed to be sold, conveyed or alienated by the Trustor, or by  the operation of law or otherwise, all obligations secured by this instrument, irrespective of the maturity date  expressed therein, at the option of the holder hereof, and without demand or notice shall become due and  payable.  TOGETHER with the rents, issues and profits thereof, SUBJECT HOWEVER, to the right, power and authority given to  and conferred upon Beneficiary by paragraph 10 of the provisions incorporated herein by reference to collect  and apply such rents, issues and profits, for the purpose of securing  1)  Performance of each agreement of  Trustor incorporated by reference or contained herein;  2)  Payment of the indebtedness evidenced by one  Promissory Note (“Note”) of even date herewith, and any extension or renewal thereof, in the principal amount  of $1,050,000.00 executed by Trustor in favor of Beneficiary (the “Loan”);  3)  Payment of such further sums as  the then record owner of said Property hereinafter may borrow from Beneficiary, when evidenced by another  Note (or Notes) reciting it so secured;  4) Performance of the terms and conditions of that certain “Loan  Agreement between the City of South San Francisco and Grand and Linden Family Apartments, L.P.” ( the  “Agreement”), dated     2020, approved by the South San Francisco City Council Resolution No.  [insert resolution #], [insert date]; and 5) Performance of the terms and conditions of that certain “Affordable  Housing Regulatory Agreement and Declaration of Restrictive Covenants between the City of South San Francisco  and Grand and Linden Family Apartments, L.P.” (“Affordability Covenant”) dated __________________ 2020  (collectively the Note, Agreement and Affordability Covenant shall be referred herein as “City Documents”).  Any  Event of Default pursuant to City Documents, shall be grounds for a declaration of an Event of Default hereunder,  and Beneficiary may, at its option, demand full payment of any outstanding principal and interest due Beneficiary,  under the Note secured by this Deed of Trust, and said Agreement.  To protect the security of this Deed of Trust, Trustor agrees:    (1) Covenants, Conditions and Restrictions. The following covenants, conditions and restrictions are to  run with the land and shall be binding on all parties and all persons claiming under them. The Property and all  parts or parcels of the Property shall be subject to these restrictions and shall pass with the Property and shall  bind the respective successors in interest of the Beneficiary. In the event of any breach of the covenants,  conditions and restrictions contained in this Deed of Trust, the Beneficiary, in addition to any other remedies  available to it, may institute or prosecute any suit which it may consider advisable in order to compel and obtain  a decree for specific performance of any obligation of any Trustor to use and maintain the Property in conformity  ROEM Development Corporation  Page 3       with these covenants. The forgoing provisions do not limit the right of the Beneficiary to foreclose or otherwise  enforce any other provision of the City Documents and Deed of Trust; provided, however, that in the event of  any foreclosure under any such mortgage, deed of trust or other lien or encumbrance, or sale pursuant to any  power of sale included in any such mortgage or deed of trust, the purchaser or purchasers and their successors  and assigns and the Property shall be, and shall continue to be, subject to all of the conditions, covenants and  restrictions contained in this Deed of Trust.     a. Use and Transfer Restrictions.  During the fifty‐five (55) year period commencing with the date of the  issuance of a Final Certificate of Occupancy, or some other document acceptable to Beneficiary, Trustor shall  comply with the following restrictions unless Trustor has first obtained the written approval of the Beneficiary:    i. Trustor shall not convey, transfer or encumber any of the Property or permit the conveyance,  transfer, or encumbrance of such Property unless such assignee, transferee or encumbrancer has agreed, in  writing and in a form suitable for recordation, to be bound by the terms of the City Documents;    ii. Trustor shall not add to, reconstruct, or demolish any part of the Property or improvements,  except as provided by the City Documents;    (2) Affordability Requirements. Pursuant to the City Documents, the Property shall remain affordable to  persons and families of low income, as designated and described in the Affordability Covenant, for not less than  fifty‐five (55) years commencing with the date of the issuance of a Final Certificate of Occupancy, or some other  document acceptable to Beneficiary.    (3) Maintenance of Property. To maintain the Property and the Project in good physical condition  (reasonable wear and tear excepted), in good repair, and in decent, safe, sanitary, habitable and tenantable living  conditions in conformity with all applicable state, federal, and local laws, ordinances, codes,  regulations and City  Documents. Without limiting the foregoing, Trustor agrees to maintain the Project and the Property (including  without limitation, the residential units, common areas, meeting rooms, landscaping, driveways, parking areas  and walkways) in a condition free of all waste, nuisance, debris, unmaintained landscaping, graffiti, disrepair,  abandoned vehicles/appliances, and illegal activity, and shall take all reasonable steps to prevent the same from  occurring on the Property or at the Project. Trustor shall prevent and/or rectify any physical deterioration of the  Property and the Project and shall make all repairs, renewals and replacements necessary to keep the Property  and the improvements located thereon in good condition and repair. Trustor shall provide adequate security  services for occupants of the Project.   In the event that Trustor breaches any of the covenants in this Section 3, and such default continues for a period  of thirty (30) days after written notice from City, then City, in addition to any other remedy it may have under  this Agreement or at law or in equity, shall have the right, but not the obligation, to enter upon the Property and  perform all acts and work necessary to protect, maintain, and preserve the improvements and the landscaped  areas on the Property.    All costs expended by City in connection with the foregoing shall be paid by Trustor to City upon demand.  Failure  to pay all such sums remaining within thirty (30) days following delivery of City’s invoice therefor shall constitute  an Event of Default and shall bear interest at the lesser of 8% per annum or the highest rate permitted by  applicable law and Beneficiary may add the amount thereof to the principal balance of the Note hereby secured.  Notwithstanding anything to the contrary set forth in this Section, City agrees that it will provide Owner with not  less than thirty (30) days’ written notice prior to undertaking any work for which Owner will incur a financial  obligation.   (4) Insurance. To provide, maintain and deliver to Beneficiary fire insurance satisfactory to and with loss  payable to Beneficiary.  Notwithstanding anything contained in any of the documents evidencing the Loan from  Beneficiary to Trustor, unless Beneficiary and Trustor otherwise agree in writing, insurance proceeds shall be  ROEM Development Corporation  Page 4         applied to restoration or repair of the Property consistent with the occupancy and rent restriction requirements  set forth in the City Documents. Such work shall be commenced as soon as reasonably practicable after the  damage or loss occurs and shall be completed within one year thereafter or as soon as reasonably practicable,  provided that insurance proceeds are available to be applied to such repairs or restoration within such period  and the repair or restoration is financially feasible. During such time that lenders or low‐income housing tax credit  investors providing financing for the Project impose requirements that differ from the requirements of this  Section the requirements of such lenders and investors shall prevail.   If such restoration or repair is not economically feasible or if a default exists after expiration of all applicable  cure periods, the insurance proceeds shall be applied to the sums secured by this Deed of Trust, with the excess,  if any, paid to Trustor. In the event funds for such work are insufficient, Beneficiary may, at its option, advance  such additional funds as may be necessary to allow the Property to be repaired or restored, and may add the  amount thereof to the principal balance of the Note hereby secured.   (5) Protection of Beneficiary’s Security: To appear in and defend any action or proceeding purporting to  affect the security hereof or the rights or powers of Beneficiary or Trustee; and to pay all costs and expenses,  including costs of evidence of title and attorney's fees. If Trustor fails to perform the covenants and agreements  contained in this Deed of Trust, or if any action or proceeding is commenced which materially affects Beneficiary's  interest in the Property, including, but not limited to, foreclosure, involuntary sale, eminent domain, insolvency,  code enforcement, or arrangements or proceedings involving a bankrupt or decedent, then Beneficiary, at its  option, upon notice to Trustor, may make such appearances, disburse such sums and take such action as is  necessary to protect Beneficiary's interest. Nothing contained in this Section 5 shall require Beneficiary to incur  any expense or take any action.   (6) Charges and Liens. To pay at least ten days before delinquency all taxes and assessments affecting  the Property, including assessments on appurtenant water stock; when due, all encumbrances, charges and liens,  with interest, on the Property or any part hereof, which appear to be prior or superior hereto; all costs, fees and  expenses of this Trust.   Should Trustor fail to make any payment or to do any act as herein provided, then Beneficiary or Trustee,  but without obligation to do so and without notice to or demand upon Trustor and without releasing Trustor  from any obligation hereof, may:  make or do the same in such manner and to such extent as either may deem  necessary to protect the security hereof, Beneficiary or Trustee being authorized to enter upon the Property for  such purposes; appear in and defend any action or proceeding purporting to affect the security hereof or the  rights or powers of Beneficiary or Trustee; pay purchase, contest or compromise any encumbrance charge or lien  which in the judgment of either appears to be prior or superior hereto; and in exercising any such powers, pay  necessary expenses, employ counsel and pay his/her reasonable fees.   (7) Timely Payment.  To pay immediately and without demand all sums so expended by Beneficiary or  Trustee, with interest from date of expenditure at the amount allowed by law in effect at the date hereof, and  to pay for any statement provided for by law in effect at the date hereof regarding the obligation secured hereby  any amount demanded by the Beneficiary not to exceed the maximum allowed by law at the time when said  statement is demanded.   (8) Awards for Damages.  That the proceeds of any award or claim for damages, direct or consequential,  in connection with a total condemnation or taking of the Property, shall be applied to the sums secured by this  Deed of Trust, with the excess, if any, paid to Trustor, unless Trustor and Beneficiary otherwise agree in writing.   In the event of a partial condemnation or taking, the proceeds shall be applied to the restoration or repair of the  Property consistent with the occupancy and rent restriction requirements set forth in the City Documents. Such  work shall be commenced as soon as reasonably practicable after the partial condemnation or taking occurs and  shall be completed within one year thereafter or as soon as reasonably practicable, provided that condemnation  ROEM Development Corporation  Page 5       proceeds are available to be applied to such repairs or restoration within such period and the repair or restoration  is financially feasible. During such time that lenders or low‐income housing tax credit investors providing  financing for the Project impose requirements that differ from the requirements of this Section the requirements  of such lenders and investors shall prevail.  If such restoration or repair is not economically feasible or if a default exists after expiration of all applicable cure  periods, the condemnation proceeds shall be applied to the sums secured by this Deed of Trust, with the excess,  if any, paid to Trustor.  In the event funds for such work are insufficient, Beneficiary may, at its option, advance  such additional funds as may be necessary to allow the Property to be repaired or restored, and may add the  amount thereof to the principal balance of the Note hereby secured.   (9) Waiver.  That by accepting payment of any sum secured hereby after its due date, Beneficiary does  not waive its right to require prompt payment when due of all other sums so secured or to declare default for  failure so to pay.   (10) Trustee Reconveyance. That at any time or from time to time, without liability therefor and without  notice, upon written request of Beneficiary and presentation of this Deed and said note for endorsement, and  without affecting the personal liability of any person for payment of the indebtedness secured hereby, Trustee  may reconvey any part of the Property; consent to the making of any map or plot thereof; join in granting any  easement thereon; or join in any extension agreement of any agreement subordinating the lien or charge hereof.   (11) Reconveyance.  That upon written request of Beneficiary stating that all sums secured hereby have  been paid and the affordability covenants compliance period herein described has terminated, and upon  surrender of this Deed and said Note to Trustee for cancellation and retention and upon payment of its fees,  Trustee shall reconvey, without warranty, the Property then held hereunder.  The recitals in such reconveyance  of any matters or facts shall be conclusive proof of the truthfulness thereof.  The grantee in such reconveyance  may be described as "the person or persons legally entitled thereto."  Five years after issuance of such full  reconveyance, Trustee may destroy said Note and this Deed (unless directed in such request to retain them).   (12) Rents.  That as additional security and subject to the rights of senior lenders, Trustor hereby gives  to and confers upon Beneficiary the right, power and authority, during the continuance of these Trusts, to collect  the rents, issues and profits of the Property, reserving unto Trustor the right, prior to any default by Trustor in  payment of any indebtedness secured hereby or in performance of any agreement hereunder, to collect and  retain such rents, issues and profits as they become due and payable.  Upon any such default, Beneficiary may at  any time without notice, either in person, by agent or by a receiver to be appointed by a court, and without  regard to the adequacy of any security for the indebtedness hereby secured, enter upon and take possession of  the Property or any part thereof, in its own name sue or otherwise collect such rents, issues and profits, including  those past due and unpaid, and apply the same, less costs and expenses of operation and collection, including  reasonable attorney's fees, upon any indebtedness secured hereby and in such order as Beneficiary may  determine.  The entering upon and taking possession of the Property, the collection of such rents, issues and  profits and the application thereof as aforesaid, shall not cure or waive any default or notice of default hereunder  or invalidate any act done pursuant to such notice.   (13) Acceleration Upon Default. That upon default by Trustor in payment of any indebtedness secured  hereby or in the performance of any agreement hereunder or an Event of Default under the City Documents,  Beneficiary may declare all sums secured hereby immediately due and payable by delivery to Trustee of written  declaration of default and demand for sale and of written notice of default and of election to cause the Property  to be sold, which notice Trustee shall cause to be filed for record.  Beneficiary also shall deposit with Trustee this  Deed of Trust, said note and all documents evidencing expenditures secured hereby.  ROEM Development Corporation  Page 6          After the lapse of such time as may then be required by law following the recordation of said notice of  default, and notice of sale having been given as then required by law, Trustee, without demand on Trustor, shall  sell the Property at the time and place fixed by it in said notice of sale, either as a whole or in separate parcels,  and in such order as it may determine, at public auction to the highest bidder for cash in lawful money of the  United States made payable at time of sale.  Trustee may postpone sale of all or any portion of the Property by  public announcement at such time and place of sale, and from time to time thereafter may postpone such sale  by public announcement at the time fixed by the preceding postponement.  Trustee shall deliver to such purchase  its deed conveying the Property so sold, but without any covenant or warranty, express or implied.  The recitals  in such deed of any matters or facts shall be conclusive proof of the truthfulness thereof.  Any person, including  Trustor, Trustee or Beneficiary as hereinafter defined, may purchase at such sale.  Beneficiary shall be entitled to  collect from the Trustor, or sale proceeds, if any, all reasonable costs and expenses incurred in pursuing the  remedies provided in this Section, including, but not limited to reasonable attorney's fees.   After deducting all costs, fees and expenses of Trustee and of the Trust, including costs of evidence of  title in connection with sale, Trustee shall apply the proceeds of sale to payments of:  all sums expended under  the terms hereof, not then repaid, with accrued interest at the amount allowed by law in effect at the date  hereof; all other sums then secured hereby; and the remainder, if any, to the person or persons legally entitled  thereto.    (14) Successor Trustee. That Beneficiary, or any successor in ownership of any indebtedness secured  hereby, may from time to time, by instrument in writing, substitute a successor or successors to any Trustee  named herein or acting hereunder, which instrument, executed by Beneficiary and duly acknowledged and  recorded in the office of the recorder of the county where the Property is situated, shall be conclusive proof of  proper substitution of such successor Trustee or Trustees, who shall, without conveyance from Trustee  predecessor, succeed to all its title, estate, rights, powers and duties.  Said instrument must contain the name of  the original Trustor, Trustee and Beneficiary hereunder, the book and page where this Deed is recorded and the  name and address of new Trustee.   (15) Binding on Successors.  That this Deed applies to, inures to the benefit of, and binds all parties  hereto, their heirs, legatees, devisees, administrator, executors, successors and assigns.  The term Beneficiary  shall mean the owner and holder, including pledges of the note secured hereby, whether or not named as  Beneficiary herein.  In this Deed, whenever the content so requires, the masculine gender includes the feminine  and/or neuter, and the singular number includes the plural.   (16) Trustee Acceptance.  That Trustee accepts this Trust when this Deed of Trust, duly executed and  acknowledged, is made a public record as provide by law.  Trustee is not obligated to notify any party hereto of  pending sale under any other deed of trust or of any action or proceeding in which Trustor, Beneficiary or Trustee  shall be a party unless brought by Trustee.   (17) Low‐Income Tenant Protection.  That notwithstanding anything to the contrary contained herein or  in any documents secured by this Deed of Trust or contained in any subordination agreement, Beneficiary  acknowledges and agrees that in the event of a foreclosure or deed‐in‐lieu of foreclosure (collectively,  “Foreclosure”) with respect to the Property encumbered by this Deed of Trust, the following rule contained in  Section 42(h)(6)(E)(ii) of the Internal Revenue Code of 1986, as amended, shall apply:     For a period of three (3) years from the date of Foreclosure, with respect to any unit that had been  regulated by a regulatory agreement with the California Tax Credit Allocation Committee, (a) none of the tenants  occupying such units at the time of Foreclosure may be evicted or their tenancy terminated (other than for good  cause), (b) nor may any rent be increased except as otherwise permitted under Section 42 of the Code.  ROEM Development Corporation  Page 7        (18) Due on Sale, Refinance, or Transfer of Title: IN THE EVENT OF A  SALE, REFINANCE OR  TRANSFER OF ALL OR ANY PORTION OF THE PROPERTY DESCRIBED HEREIN BY TRUSTOR WITHOUT  PRIOR WRITTEN CONSENT OF BENEFICIARY AND IN ACCORDANCE WITH THE CITY DOCUMENTS, THE  ENTIRE PRINCIPAL BALANCE OF THE NOTE, INCLUDING ANY ACCUMULATED INTEREST DUE UNDER  THE AGREEMENT OR AFFORDABILITY COVENANT, SHALL BE IMMEDIATELY DUE AND PAYABLE.  HOWEVER, (I) THE TRANSFER OF LIMITED PARTNER INTERESTS IN TRUSTOR TO A  LIHTC INVESTOR,  (II) THE SUBSEQUENT TRANSFER OF SUCH LIMITED PARTNER INTERESTS FOR THE PURPOSE OF  SYNDICATING THE LIHTC, OR (III) THE GRANTING OF AN OPTION OR RIGHT OF FIRST REFUSAL BY THE  CITY AND ANY TRANSFER PURSUANT TO SUCH OPTION OR RIGHT OF FIRST REFUSAL AS AGREED TO  BY THE CITY SHALL NOT BE CONSIDERED A  SALE, REFINANCE OR TRANSFER OF THE PROPERTY FOR  PURPOSES OF THIS SECTION.  REPLACEMENT OF THE GENERAL PARTNER OF TRUSTOR WITH ANY  OTHER ENTITY SHALL BE SUBJECT TO PRIOR WRITTEN APPROVAL OF CITY, WHICH SHALL NOT BE  UNREASONABLY WITHHELD.    Trustor may transfer or assign all or any portion of its interest, right or obligations in the Property only as set  forth in this Deed of Trust and the City Documents and with City’s prior written consent, which consent City shall  not withhold provided that (1) the Project is and shall continue to be operated in compliance with this Deed of  Trust and the City Documents; (2) the transferee expressly assumes all obligations of Trustor imposed by this  Deed of Trust and the City Documents; (3) the transferee executes all documents reasonably requested by the  City with respect to the assumption of the Trustor’s obligations under this Deed of Trust  and the City Documents,  and upon City’s request, delivers to the City an opinion of its counsel to the effect that such document and this  Deed of Trust and the City Documents are valid, binding and enforceable obligations of such transferee; and (4)  either (A) the transferee has at least three years’ experience in the ownership, operation and management of  low‐income multifamily rental housing projects of similar size to that of the Project, without any record of  material violations of nondiscrimination provisions or other state or federal laws or regulations applicable to such  projects, or (B) the transferee agrees to retain a property management firm with the experience and record  described in sub‐clause (A).  Consent to any proposed Transfer may be given by the City’s City Manager unless the City Manager, in his or her  discretion, refers the matter of approval to the City Council. If a proposed Transfer has not been approved by  City in writing within ninety (90) days following City’s receipt of written request by Trustor, it shall be deemed  approved.    Trustor shall reimburse City for all City costs, including but not limited to reasonable attorneys’ fees, incurred in  reviewing instruments and other legal documents proposed to effect a Transfer under this Deed of Trust and the  City Documents and in reviewing the qualifications and financial resources of a proposed successor, assignee, or  transferee within ten (10) days following City’s delivery of an invoice detailing such costs.  Accordingly, the undersigned acknowledges and agrees that, consistent with applicable law, City may accelerate  the maturity date of the principal and accrued interest on the Note in the event that the Property is sold,  conveyed or alienated, except as may be prohibited by law, including section 2924.6 of the California Civil Code.   (19) Request for Notice.  City requests that copies of any notices of default and notice of sale be sent to  City at the address set forth above.   (20) Priority.  This Deed of Trust, regardless of order of recordation, is junior and subordinate to the  Affordability Covenant recorded contemporaneously herewith.  All obligations hereunder are non‐recourse. The limited partner(s) shall have the same right as Trustor to cure or  remedy any default hereunder within the cure period provided to Trustor extended by an additional sixty (60)  days; provided however, if the default is of such nature that the limited partners reasonably determine that it is  ROEM Development Corporation  Page 8         necessary to replace the general partner of Trustor in order to cure such default, then the cure period shall be  extended until the date  sixty (60) days following the removal of the general partner of Trustor.                        [Signature Page Follows]                                   Grand and Linden Family Apartments, L.P.     By: [Add Clause]        By:             Title:  __________________________________________________       ROEM Development Corporation  Page 9       SIGNATURES MUST BE NOTARIZED ROEM Development Corporation  Page 10          State of California ) ) ss. County of ________________________) On ___________________ before me, _________________________________, Notary Public, personally appeared ___________________________________________________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) 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. _______________________________________ Place Notary seal above      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. ROEM Development Corporation  Page 11           Exhibit A    LEGAL DESCRIPTION  For APN/Parcel ID(s): 012‐314‐010  THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF SOUTH SAN FRANCISCO, COUNTY OF SAN  MATEO, STATE OF CALIFORNIA AND IS DESCRIBED AS FOLLOWS:    LOTS 10 AND 11, BLOCK 138, AS DELINEATED UPON THAT CERTAIN MAP ENTITLED "SOUTH SAN FRANCISCO,  SAN MATEO CO., CAL. PLAT NO. 1", FILED FOR RECORD IN THE OFFICE OF THE RECORDER OF THE COUNTY OF  SAN MATEO, STATE OF CALIFORNIA, ON MARCH 1ST, 1892 IN BOOK  "B" OF MAPS, AT PAGE 6 AND COPIED INTO BOOK 2 OF MAPS AT PAGE 52    3471917.1 RECORDING REQUESTED BY AND WHEN RECORDED MAIL TO: City of South San Francisco 400 Grand Avenue South San Francisco, CA 94080 Attn: City Manager EXEMPT FROM RECORDING FEES PER GOVERNMENT CODE §§6103, 27383 Space above this line for Recorder’s use. AFFORDABLE HOUSING REGULATORY AGREEMENT AND DECLARATION OF RESTRICTIVE COVENANTS for 418 Linden Avenue, South San Francisco by and between THE CITY OF SOUTH SAN FRANCISCO and GRAND AND LINDEN FAMILY APARTMENTS, L.P. 2 This Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants (this “Agreement”) is entered into effective as of _____________, 2020 (“Effective Date”) by and between the City of South San Francisco, a municipal corporation (“City”) and Grand and Linden Family Apartments, L.P., a California limited partnership (“Owner”). City and Owner are hereinafter collectively referred to as the “Parties.” RECITALS A. Owner owns that certain real property located in the City of South San Francisco at 418 Linden Avenue, known as San Mateo County Assessor’s Parcel No. 012-314-010 and more particularly described in Exhibit A attached hereto (the “Property”). B. In accordance with that certain Development Agreement executed by and between the Parties and dated as of ____________ (the “DA”), a memorandum of which was recorded in the Official Records of San Mateo County (“Official Records”) on ________, Owner will re- develop the Property into a residential apartment building of thirty-six (36) affordable residential units and one manager’s unit (the “Project”). Capitalized terms used and not defined in this Agreement have the meaning ascribed to them in the DA. C. Pursuant to Government Code Section 65915 and South San Francisco Municipal Code Chapter 20.390, Owner has agreed that the Project will result in thirty-six (36) units being available to Eligible Households at an Affordable Rent as those terms are defined herein in Section 1. Furthermore, Owner has, pursuant to Section 20.390.010.B.7, requested development standard waivers including; a reduction in parking from 47 spaces to 23 spaces and a reduction, a reduction in the number of Electric Vehicle parking spaces to from 3 spaces to 1 space, the removal of the private storage space requirement and for fees not to exceed $512,916. D. To assist in the construction of affordable units at the Project, City provided Owner with a loan in the amount of One Million, and Fifty Thousand Dollars ($1,050,000.00) from City Affordable Housing Trust Fund, to partially finance the Project (“Loan”), as further set forth in the DA and the Loan Agreement entered into between the Parties (“Loan Agreement”) concurrently herewith. E. As required by the DA, density bonus requirements and as a condition to its agreement to provide the Loan, the City requires the Property to be subject to the terms, conditions and restrictions set forth herein, specifically, the City requires that for a period of not less than fifty-five (55) years, thirty-six (36) residential units in the Project be rented at Affordable Rents to Eligible Households (“Restricted Units”). The City requires Restricted Units assisted with funds from the City’s Affordable Housing Trust Fund to remain affordable for the longest feasible time. F. The Parties have agreed to enter into and record this Agreement in order to satisfy the conditions described in the foregoing Recitals. The purpose of this Agreement is to regulate and restrict the occupancy and rents of the Project’s Restricted Units for the benefit of the occupants of the Project. The Parties intend the covenants set forth in this Agreement to run with the land and to be binding upon Owner and Owner’s successors and assigns for the full term of this Agreement. NOW THEREFORE, in consideration of the foregoing, and other valuable consideration, 3 the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows. AGREEMENT 1. Definitions. The following terms have the meanings set forth in this Section wherever used in this Agreement or the attached exhibits. “Actual Household Size" means the actual number of persons in the applicable household. “Adjusted for Family Size Appropriate for the Unit” shall be determined consistent with Section 50052.5(h) of the California Health and Safety Code and applicable federal rules (if any) and as defined below: Studio – 1 person One Bedroom – 1.5 people Two Bedroom – 3 people Three Bedroom – 4.5 people “Affordable Rent” means the following amounts, less a utility allowance and such other adjustments as required pursuant to the California Redevelopment Law: (i) for units that are restricted for rental to households with incomes of not more than eighty percent (80%) of AMI (“80% Units”), a monthly rent that does not exceed one-twelfth (1/12) of thirty percent (30%) of eighty percent (80%) of AMI, Adjusted for Family Size Appropriate for the Unit, and (ii) for units that are restricted for rental to households with incomes of not more than one hundred twenty percent (120%) of AMI (“120% Units”), a monthly rent that does not exceed one-twelfth of thirty percent (30%) of one hundred twenty percent (120%) of Area Median Income, Adjusted for Family Size Appropriate for the Unit. “Area Median Income” or “AMI” means the median income for San Mateo County, California, adjusted for Actual Household Size, as determined by the U.S. Department of Housing and Urban Development (“HUD”) pursuant to Section 8 of the United States Housing Act of 1937 and as published from time to time by the State of California Department of Housing and Community Development (“HCD”) in Section 6932 of Title 25 of the California Code of Regulations or successor provision published pursuant to California Health and Safety Code Section 50093(c). “Claims” is defined in Section 10. “Eligible Household” means a household for which gross household income does not exceed the applicable maximum income level for a Restricted Unit as specified in Section 2.1 and Exhibit B. “Indemnitees” is defined in Section 10. “Low-Income” or “Lower Income” means an annual gross household income that is less than or equal to the qualifying limits for households of Lower Income adjusted for actual household size, as determined periodically by HUD on the basis of gross annual household income and 4 published by HCD in the Regulations for San Mateo County. If HUD ceases to make such determination, “Lower Income” shall be defined as not greater than 80% of Area Median Income adjusted for actual household size, as published by HCD in the Regulations. If both HCD and HUD cease to make such determinations, City in its reasonable discretion may designate another definition of “Lower Income” used by any other federal or state agency so long as such definition is no more restrictive than that set forth herein. “Moderate-Income” means an annual gross household income that is less than or equal to 120% of AMI, adjusted for actual household size as determined periodically by HCD on the basis of gross annual household income and published in the Regulations for San Mateo County. “Regulations” means Title 25 of the California Code of Regulations. “Rent-Restricted” means a dwelling unit for which the gross rent charged for such unit does not exceed the Affordable Rent, as adjusted for assumed household size in accordance with the Department of Housing and Community Development (“HCD”) guidelines. “Restricted Unit” means a dwelling unit which is reserved for occupancy at an Affordable Rent by a household of not more than a specified household income in accordance with and as set forth in Sections 2.1 and 2.2 and Exhibit B. 2. Use and Affordability Restrictions. Owner hereby covenants and agrees, for itself and its successors and assigns, that the Property shall be used solely for the operation of a multifamily rental housing development in compliance with the DA, Loan Agreement, City Promissory Note and City Deed of Trust and the requirements set forth herein (“City Documents”). Owner represents and warrants that it has not entered into any agreement that would restrict or compromise its ability to comply with the occupancy and affordability restrictions set forth in this Agreement or other City Documents, and Owner covenants that it shall not enter into any agreement that is inconsistent with such restrictions without the express written consent of City. 2.1 Affordability Requirements. 2.1.1 For a term of fifty-five (55) years commencing upon the date of issuance of a final certificate of occupancy for the residential portion of the Project, not less than thirty-six (36) of the residential units of the Project shall be both Rent Restricted (as defined below) and occupied (or if vacant, available for occupancy), available at Affordable Rents to Eligible Households. This Section 2.1 shall be amended to include the specific levels of affordability for each Restricted Unit once finally determined by the Parties. The thirty-six (36) residential units subject to this Agreement shall also be Rent Restricted and occupied by Eligible Households and allocated across unit type as specified in Exhibit B once finally determined by the Parties. 2.1.2 Special Considerations for units with Project Based Section 8 Rental Assistance: If the Project receives an award of Project-Based Section 8 rental assistance, the units receiving the project-based vouchers (“PBVs”) shall be underwritten at the total subsidized rent for each unit paid by the project-based rental assistance and the tenant in sum. If PBVs are terminated, rents for any Restricted Units losing PBVs may be increased to the federally-permitted maximums in accordance with current California Tax Credit Allocation Committee (“CTCAC”) 5 regulations. If a PBV is terminated, and the current tenant is unable to pay the maximum CTCAC-allowable rent, Owner may, upon advance written notice to City, transition targeted units detailed in Exhibit B as follows: (a) First, to a household of the same targeted population that could afford to pay the maximum CTCAC rent allowed; and if there is no household that meets this criterion, (b) Second, to the next eligible household on Owner’s waiting list that could afford to pay the maximum CTCAC rent allowed. For PBVs that are also HUD-Veterans Affairs Supportive Housing (VASH) vouchers, and if the current tenant is unable to pay the maximum CTCAC-allowable rent, Borrower may, upon advance written notice to City, transition to these units as follows: (a) First, to a homeless veteran household for whom the maximum CTCAC rent allowed is affordable; and if there is no household that meets this criterion, (b) Second, to a homeless household for whom the maximum CTCAC rent allowed is affordable; and if there is no household who meets this criterion, (c) Third, to a veteran household for whom the maximum CTCAC rent allowed is affordable; and if there is no household who meets this criterion, (d) Fourth, to the next eligible household on Owner’s waiting list for whom the maximum CTCAC rent allowed is affordable. If PBVs are terminated, Borrower may request, and City may grant a reduction or waiver in writing of the homeless household requirements described above, upon submission of evidence that such requirements cause the Project to be financially infeasible. 2.1.3 Recertification. In the event that recertification of Eligible Household incomes indicates that the number of Restricted Units actually occupied by Eligible Households falls below the number reserved for each income group as specified in this Section 2.1 and Exhibit B, Owner shall rectify the condition by renting the next available dwelling unit(s) in the Project to Eligible Household(s) until the required income mix is achieved. If the income of a household occupying an extremely-low income unit (“ELI Unit”) increases to or beyond 50% of the AMI at recertification, the unit will no longer qualify as an ELI Unit for purposes of compliance with this Agreement and the Loan Agreement. In that scenario, the next vacancy in a unit of similar size shall be filled with a household earning up to 30% AMI, qualifying that unit as an ELI Unit for purposes of compliance. 6 2.2 Rents for Restricted Units. Rents for Restricted Units shall be limited to Affordable Rents for households of the applicable income limit in accordance with Section 2.1 and Exhibit B. Notwithstanding the foregoing, no Eligible Household qualifying for a Restricted Unit shall be denied continued occupancy of a unit in the Project because, after admission, such Eligible Household's adjusted income increases to exceed the qualifying limit for such Restricted Unit except as specified in this Section 2.2. If, upon recertification of the income of a Resident of a Unit, the Owner determines that the Resident has an Adjusted Income exceeding the maximum qualifying income for the Unit, such Resident shall be permitted to continue occupying the Unit upon expiration of the Resident's lease, and upon sixty (60) days written notice, the Rent shall be increased to thirty percent (30%) of the Resident's Adjusted Income, subject to the maximum rent allowed pursuant to other funding restrictions. 2.2.1 Termination of Occupancy of Restricted Unit by Eligible Household. Upon termination of occupancy of a Restricted Unit by an Eligible Household, Owner shall rent the Unit shall to another Eligible Household at Affordable Rents in accordance with Section 2.1 and Exhibit B within thirty (30) days of termination of occupancy by the former Eligible Household. 2.3 Unit Sizes, Design and Location. The Restricted Units shall be of comparable design quality as unrestricted units in the Project and among the different affordability categories set forth in Exhibit B. Eligible Households of Restricted Units shall have access to all common facilities of the Project equal to that of Eligible Households of units in the Project that are not Restricted Units and among the affordability categories set forth in Exhibit B. The Restricted Units shall be allocated among affordability categories as set forth in Exhibit B. 2.4 City Loan Funds. Owner shall ensure that all City Loan Funds are used for the construction of the Project in a manner consistent with the applicable City Loan Funds requirements and City Documents’ terms, which at a minimum, requires residential rental units assisted with funds from the City’s Affordable Housing Trust Fund to remain affordable for the longest feasible time. 2.5 No Condominium Conversion. Owner shall not convert the residential units in the Project to condominium or cooperative ownership or sell condominium or cooperative rights to the residential portion of the Project or any part thereof unless Owner obtains the City's consent and meets which consent shall be conditioned upon Owner's agreement to ensure that the Restricted Units remain available as affordable housing. Prior to conveyance of any Restricted Unit(s), the buyer(s) of the for-sale Restricted Units shall enter into an affordable housing agreement, in a form approved by the City Manager and City Attorney, that maintains the affordability of the unit for the minimum term set forth in this Agreement, the City Documents or in California law whichever is greater. 2.6 Non-Discrimination; Compliance with Fair Housing Laws. 2.6.1 Preferences. In order to ensure that there is an adequate supply of affordable housing within the City for City residents and employees of businesses located within the City, to the extent permitted by law and consistent with the program regulations for funding sources used for development of the Project, at initial lease up, Owner shall give a preference in the rental of 7 the residential units in the Project to Eligible Households that include at least one member who lives or works in the City of South San Francisco. Notwithstanding the foregoing, in the event of a conflict between this provision and the provisions of Section 42 of the Internal Revenue Code of 1986, as amended, the provisions of such Section 42 shall control. 2.6.2 Fair Housing. Owner shall comply with state and federal fair housing laws in the marketing and rental of the units in the Project. Owner shall accept as Eligible Households, on the same basis as all other prospective Eligible Households, persons who are recipients of federal certificates or vouchers for rent subsidies pursuant to the existing Section 8 program or any successor thereto. 2.6.3 Non-Discrimination. Owner shall not restrict the rental, sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property or Project, or any portion thereof, on the basis of race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national origin, ancestry, familial status, source of income, disability, or genetic information of any person. Owner covenants for itself and all persons claiming under or through it, and this Agreement is made and accepted upon and subject to the condition that there shall be no discrimination against or segregation of any person or group of persons on account of any basis listed in subdivision (a) or (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 sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, Project or part thereof, nor shall Owner or any person claiming under or through Owner establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in, of, or for the Property, Project or part thereof. All deeds made or entered into by Owner, its successors or assigns, as to any portion of the Property or Project shall contain the following language, and all leases or contracts made or entered into by Owner, its successors or assigns, as to any portion of the Property or Project, shall reference this Section, and shall enforce the same diligently and in good faith: “(a) Owner herein covenants by and for itself, its successors and assigns, and all persons claiming under or through it, that there shall be no discrimination against or segregation of a person or of a group of persons on account of any basis listed in subdivision (a) or (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 sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the property herein conveyed nor shall the Owner or any person claiming under or through the Owner establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sub lessees or vendees in the property herein conveyed. The foregoing covenant shall run with the land. “(b) Notwithstanding paragraph (a), with respect to familial status, paragraph (a) shall not be construed to apply to housing for older persons, as defined in Section 12955.9 of the Government Code. With respect to familial status, nothing in paragraph (1) shall be construed to 8 affect Sections 51.2, 51.3, 51.4, 51.10, and 799.5 of the Civil Code, relating to housing for senior citizens. Subdivision (d) of Section 51 of the Civil Code and subdivisions (d) of Section 12955 of the Government Code shall apply to paragraph (a).” Violation of the non-discrimination provisions of this Agreement shall be considered a breach of this Agreement and subject Owner to penalties, to be determined by the City Manager, including but not limited to the following: i. termination of this Agreement; ii. disqualification of Owner from bidding on or being awarded a City contract for a period of up to 3 years; iii. liquidated damages of $2,500 per violation; and/or iv. imposition of other appropriate contractual and civil remedies and sanctions, as determined by the City Manager. To effectuate the provisions of this Section, the City Manager shall have the authority to examine Owner’s employment records with respect to compliance with this Section and/or to set off all or any portion of the amount described in this Section against amounts due to Owner under this Agreement or City Documents. Owner shall report to the City Manager the filing by any person in any court of any complaint of discrimination or the filing by any person of any and all charges with the Equal Employment Opportunity Commission, the Department of Fair Employment and Housing, or any other entity charged with the investigation of allegations within 30 days of such filing, provided that within such 30 days such entity has not notified Owner that such charges are dismissed or otherwise unfounded. Such notification shall include the name of the complainant, a copy of such complaint, and a description of the circumstance. Owner shall provide City with a copy of their response to the Complaint when filed. 3. Reporting Requirements. 3.1. Eligible Household Certification. Project financing is anticipated to include proceeds from Low-Income Housing Tax Credits (“LIHTC”). If the Project is awarded LIHTC, City shall defer to income certification and calculation requirements imposed by tax credits. If the Project financing does not include tax credits, Owner shall rely on income determination calculations set forth in 24 CFR Part 5 (i.e., the Section 8 Voucher Program). Owner or Owner’s authorized agent shall obtain from each household prior to initial occupancy of each Restricted Unit, and on every anniversary thereafter, a written certificate containing all of the following in such format and with such supporting documentation as City may reasonably require: (a) The identity of each household member; and (b) The total gross household income; Owner shall retain such certificates for not less than three (3) years, and upon City’s 9 request, shall make the certificates available for City inspection. 3.2 Annual Report; Inspections. By not later than April 30th of each year during the term of this Agreement, Owner shall submit an annual report (“Annual Report”) to the City in form satisfactory to City, together with a certification that the Project is in compliance with the requirements of this Agreement. The Annual Report shall, at a minimum, include the following information for each dwelling unit in the Project: (i) unit number; (ii) number of bedrooms; (iii) current rent and other charges; (iv) dates of any vacancies during the previous year; (v) number of people residing in the unit; (vi) total gross household income of residents; (vii) documentation of source of household income; and (viii) the information required by Section 3.1. Owner shall include with the Annual Report, an income recertification for each household, documentation verifying Eligible Household eligibility, and such additional information as City may reasonably request from time to time in order to demonstrate compliance with this Agreement. The Annual Report shall conform to the format requested by City; provided however, during such time that the Project is subject to a regulatory agreement restricting occupancy and/or rents pursuant to requirements imposed in connection with the use of state or federal low-income housing tax credits, Owner may satisfy the requirements of this Section by providing City with a copy of compliance reports required in connection with such financing. 3.3 On-site Inspection. Owner shall permit representatives of City to enter and inspect the Property and the Project during reasonable business hours in order to monitor compliance with this Agreement upon 48-hours advance notice of such visit to Owner or to Owner's management agent. 3.4 Additional Information. Owner shall provide any additional information reasonably requested by City. The City shall have the right to examine and make copies of all books, records, or other documents of the Owner which pertain to the Project. 3.5 Records. The Owner shall maintain complete, accurate and current records pertaining to the Property and Project, shall comply with all program and fiscal reporting requirements set forth by appropriate Federal, State, and local agencies, and as required by City, and shall permit any duly authorized representative of the Federal, State, local agencies and City to inspect records, including records pertaining to income and household size of Eligible Households. All Eligible Household lists, applications and waiting lists relating to the Project shall at all times be kept separate and identifiable from any other business of the Owner and shall be maintained in a reasonable condition for proper audit and subject to examination during business hours by representatives of the City. Owner agrees upon reasonable notice to provide to City or any Federal or State or local department having monitoring or review authority, to City’s authorized representatives, and/or to any of their respective audit agencies access to and the right to examine all records and documents necessary to determine compliance with relevant Federal, State, and local statutes, rules, and regulations, to determine compliance with this Agreement and the City Documents, and to evaluate the quality, appropriateness, and timeliness of services performed. The Owner shall retain copies of all materials obtained or produced with respect to occupancy of the Restricted Units for a period of at least five (5) years, and for any period during which there is an audit undertaken by the City pursuant to the City Documents. 4. Term of Agreement. 10 4.1 Term of Restrictions. Unless extended by mutual agreement of the Parties, upon the 55th anniversary of issuance of the final certificate of occupancy, this Agreement shall automatically terminate and be of no further force or effect. Owner shall provide all notices and rights to tenants required to be given prior to and upon the expiration of affordability covenants pursuant to Government Code Section 65863.10 or a successor statute. 4.2 Effectiveness Succeeds Conveyance of Property and Repayment of Loan. This Agreement shall remain effective and fully binding for the full term hereof, as such may be extended pursuant to Section 4.1, regardless of any repayment of the Loan, sale, assignment, transfer, or conveyance of the Property or the Project or any part thereof or interest therein. 4.3 Reconveyance. Upon the expiration of this Agreement, the Parties agree to execute and record appropriate instruments to release and discharge this Agreement; provided, however, the execution and recordation of such instruments shall not be necessary or a prerequisite to evidence the expiration of this Agreement, or to evidence the release and discharge of this Agreement as a matter of title. 5. Binding Upon Successors; Covenants to Run with the Land. Owner hereby subjects its interest in the Property and the Project to the covenants and restrictions set forth in this Agreement and the City Documents. The Parties hereby declare their express intent that the covenants and restrictions set forth in such Agreements shall be deemed covenants running with the land and shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors in interest, transferees, and assigns of the Parties, regardless of any sale, assignment, conveyance or transfer of the Property, the Project or any part thereof or interest therein. Any successor-in-interest to Owner, including without limitation any purchaser, transferee or lessee of the Property or the Project (other than the Eligible Households of the individual dwelling units) shall be subject to all of the duties and obligations imposed hereby and in the City Documents for the full term of this Agreement. Each and every contract, deed, ground lease or other instrument affecting or conveying the Property or the Project or any part thereof, shall conclusively be held to have been executed, delivered and accepted subject to the covenants, restrictions, duties and obligations set forth herein and the City Documents, regardless of whether such covenants, restrictions, duties and obligations are set forth in such contract, deed, ground lease or other instrument. If any such contract, deed, ground lease or other instrument has been executed prior to the date hereof, Owner hereby covenants to obtain and deliver to City an instrument in recordable form signed by the parties to such contract, deed, ground lease or other instrument pursuant to which such parties acknowledge and accept this Agreement and the City Documents and agree to be bound hereby. Owner agrees for itself and for its successors that in the event that a court of competent jurisdiction determines that the covenants herein or in the City Documents do not run with the land, such covenants shall be enforced as equitable servitudes against the Property and the Project in favor of City. 6. Property Management; Repair and Maintenance; Marketing. 6.1 Management Responsibilities. Owner, or Owner’s designee, shall be responsible for all management functions with respect to the Property and the Project, including without limitation the selection of Eligible Households, certification and recertification of household 11 income and eligibility, evictions, collection of rents and deposits, maintenance, landscaping, routine and extraordinary repairs, replacement of capital items, and security. City shall have no responsibility for management or maintenance of the Property or the Project. 6.2 Repair, Maintenance and Security. Throughout the term of this Agreement, Owner, or Owner’s designee, shall at its own expense, maintain the Property and the Project in good physical condition, in good repair (reasonable wear and tear excepted), and in decent, safe, sanitary, habitable and tenantable living conditions in conformity with all applicable state, federal, and local laws, ordinances, codes, regulations and City Documents. Without limiting the foregoing, Owner agrees to maintain the Project and the Property (including without limitation, the residential units, common areas, meeting rooms, landscaping, driveways, parking areas and walkways) in a condition free of all waste, nuisance, debris, unmaintained landscaping, graffiti, disrepair, abandoned vehicles/appliances, and illegal activity, and shall take all reasonable steps to prevent the same from occurring on the Property or at the Project. Owner shall prevent and/or rectify any physical deterioration of the Property and the Project and shall make all repairs, renewals and replacements necessary to keep the Property and the improvements located thereon in good condition and repair. Owner shall provide adequate security services for occupants of the Project. 6.2.1 City’s Right to Perform Maintenance. In the event that Owner breaches any of the covenants contained in Section 6.2, and such default continues for a period of thirty (30) days after written notice from City, then City, in addition to any other remedy it may have under this Agreement or at law or in equity, shall have the right, but not the obligation, to enter upon the Property and perform all acts and work necessary to protect, maintain, and preserve the improvements and the landscaped areas on the Property. 6.2.2 Costs. All costs expended by City in connection with the foregoing Section 6.2.1, shall be paid by Owner to City upon demand. The failure to pay all such sums within thirty (30) days following delivery of City’s invoice therefor shall constitute and Event of Default hereunder and shall bear interest at the lesser of 8% per annum or the highest rate permitted by applicable law. Notwithstanding anything to the contrary set forth in this Section, City agrees that it will provide Owner with not less than thirty (30) days’ written notice prior to undertaking any work for which Owner will incur a financial obligation. 6.3 Marketing and Management Plan. Within 180 days following the Effective Date of this Agreement, Owner shall submit for City review and approval, a plan for marketing and managing the Property (“Marketing and Management Plan” or “Plan”). The Marketing and Management Plan shall address in detail how Owner plans to market the Restricted Units to prospective Eligible Households in accordance with fair housing laws and this Agreement, Owner’s Eligible Household selection criteria, and how Owner plans to certify the eligibility of Eligible Households. The Plan shall also describe the management team and shall address how the Owner and the management entity plan to manage and maintain the Property and the Project. The Plan shall include the proposed management agreement and the form of rental agreement that Owner proposes to enter into with Project Eligible Households. Owner shall abide by the terms of the Marketing and Management Plan in marketing, managing, and maintaining the Property and the Project, and throughout the term of this Agreement. 6.4 Approval of Amendments. If City has not responded to any submission of the 12 Management and Marketing Plan, the proposed management entity, or a proposed amendment or change to any of the foregoing within sixty (60) days following City’s receipt of such plan, proposal or amendment, the plan, proposal or amendment shall be deemed approved by City. 6.5 Fees, Taxes, and Other Levies. Owner shall be responsible for payment of all fees, assessments, taxes, charges, liens and levies applicable to the Property or the Project, including without limitation possessory interest taxes, if applicable, imposed by any public entity, and shall pay such charges prior to delinquency. However, Owner shall not be required to pay any such charge so long as (a) Owner is contesting such charge in good faith and by appropriate proceedings, (b) Owner maintains reserves adequate to pay any contested liabilities, and (c) on final determination of the proceeding or contest, Owner immediately pays or discharges any decision or judgment rendered against it, together with all costs, charges and interest. Nothing in this Section 6.6 is intended to prohibit Owner from applying for any exemption from property taxes and fees that may be available to the owners of low-income housing. 6.6 Insurance Coverage. Throughout the term of this Agreement, Owner shall comply with the insurance requirements set forth in the City Documents, and shall, at Owner’s expense, maintain in full force and effect insurance coverage as specified in the City Documents. 6.7 Property Damage or Destruction. If any part of the Project is damaged or destroyed, Owner shall repair or restore the same, consistent with the occupancy and rent restriction requirements set forth in this Agreement and City Documents. Such work shall be commenced as soon as reasonably practicable after the damage or loss occurs and shall be completed within one year thereafter or as soon as reasonably practicable, provided that insurance proceeds are available to be applied to such repairs or restoration within such period and the repair or restoration is financially feasible. During such time that lenders or low-income housing tax credit investors providing financing for the Project impose requirements that differ from the requirements of this Section the requirements of such lenders and investors shall prevail. 7. Recordation; Subordination. This Agreement shall be recorded in the Official Records of San Mateo County. Owner hereby represents, warrants and covenants that with the exception of easements of record, absent the written consent of City, this Agreement shall not be subordinated in priority to any lien (other than those pertaining to taxes or assessments), encumbrance, or other interest in the Property or the Project. If at the time this Agreement is recorded, any interest, lien, or encumbrance has been recorded against the Project in position superior to this Agreement, upon the request of City, Owner hereby covenants and agrees to promptly undertake all action necessary to clear such matter from title or to subordinate such interest to this Agreement consistent with the intent of and in accordance with this Section 7, and to provide such evidence thereof as City may reasonably request. Notwithstanding the foregoing, the City agrees that pursuant to Health and Safety Code Section 33334.14(a)(4), the City will not withhold consent to reasonable requests for subordination of this Agreement to deeds of trust provided for the benefit of lenders identified in the Financing Plan approved in connection with the DA, provided that the instruments effecting such subordination include reasonable protections to the City in the event of default consistent with the requirements of Health and Safety Code Section 33334.14(a)(4), including without limitation, extended notice and cure rights. Any subordination request shall be subject to a $2,000.00 fee payable by Owner to City upon 13 Owner’s request for City to review instruments and other legal documents proposed to effect a subordination under this Agreement. Owner hereby: (i) represents and warrants that it is not affiliated in any way with the lender identified in the Financing Plan approved in connection with the DA, and (ii) covenants that it will not become so affiliated by acquiring an interest in such lender, or an interest in its loan, or otherwise. 8. Transfer and Encumbrance. 8.1 Restrictions on Transfer and Encumbrance. If Owner sells, refinances or transfers the Property or Project or any interest therein without prior written consent of the City, it shall be considered an Event of Default and the entire principal balance of the Note, including any accumulated interest accrued pursuant to Exhibit A of the Loan Agreement, shall be immediately due and payable. However, (i) the transfer of limited partner interests in Owner to a LIHTC investor, (ii) the subsequent transfer of such limited partner interests for the purpose of syndicating the LIHTC, or (iii) the granting of an option or right of first refusal by the City and any transfer pursuant to such option or right of first refusal as agreed to by the City shall not be considered a sale, refinance or transfer of the Project for purposes of this section. Replacement of the general partner of Borrower with any other entity shall be subject to prior written approval of City, which shall not be unreasonably withheld. Owner may transfer or assign all or any portion of its interest, right or obligations in the Property only as set forth in this Agreement and the City Documents and with City’s prior written consent, which consent City shall not withhold provided that (1) the Project is and shall continue to be operated in compliance with this Agreement and the City Documents; (2) the transferee expressly assumes all obligations of Owner imposed by this Agreement and the City Documents; (3) the transferee executes all documents reasonably requested by the City with respect to the assumption of the Owner’s obligations under this Agreement and the City Documents, and upon City’s request, delivers to the City an opinion of its counsel to the effect that such document and this Agreement and the City Documents are valid, binding and enforceable obligations of such transferee; and (4) either (A) the transferee has at least three years’ experience in the ownership, operation and management of low-income multifamily rental housing projects of similar size to that of the Project, without any record of material violations of nondiscrimination provisions or other state or federal laws or regulations applicable to such projects, or (B) the transferee agrees to retain a property management firm with the experience and record described in sub-clause (A). Consent to any proposed Transfer may be given by the City’s City Manager unless the City Manager, in his or her discretion, refers the matter of approval to the City Council. If a proposed Transfer has not been approved by City in writing within ninety (90) days following City’s receipt of written request by Owner, it shall be deemed approved. Owner shall reimburse City for all City costs, including but not limited to reasonable attorneys’ fees, incurred in reviewing instruments and other legal documents proposed to effect a Transfer under this Agreement and the City Documents and in reviewing the qualifications and financial resources of a proposed successor, assignee, or transferee within ten (10) days following City’s delivery of an invoice detailing such costs. 14 8.3 Encumbrances. Owner agrees to use best efforts to ensure that all deeds of trust or other security instruments and any applicable subordination agreement recorded against the Property, the Project or part thereof for the benefit of a lender (“Lender”) shall contain each of the following provisions: (i) Lender shall use its best efforts to provide to City a copy of any notice of default issued to Owner concurrently with provision of such notice to Owner; and, (ii) City shall have the reasonable right, but not the obligation, to cure any default by Owner within the same period of time provided to Owner for such cure extended by an additional 90 days. Owner agrees to provide to City a copy of any notice of default Owner receives from any Lender within thirty (30) business days following Owner’s receipt thereof. 8.4 Mortgagee Protection. No violation of any provision contained herein shall defeat or render invalid the lien of any mortgage or deed of trust made in good faith and for value upon all or any portion of the Project or the Property, and the purchaser at any trustee’s sale or foreclosure sale shall not be liable for any violation of any provision hereof occurring prior to the acquisition of title by such purchaser. Such purchaser shall be bound by and subject to this Agreement from and after such trustee’s sale or foreclosure sale. Promptly upon determining that a violation of this Agreement has occurred, City shall give written notice to the holders of record of any mortgages or deeds of trust encumbering the Project or the Property that such violation has occurred. 9. Default and Remedies. 9.1 Events of Default. The occurrence of any one or more of the following events shall constitute an event of default hereunder (“Event of Default”): (a) Failure to Construct Project. A failure by the Borrower to commence or complete the construction of the Project in accordance with the terms of the City Documents which failure is not cured within 30 days of written notice from the City; (b) Breach of Covenants. Failure by the Borrower to duly perform, comply with, or observe any of the conditions, terms, or covenants of any of this Agreement and the City Documents which failure is not cured within 30 days of written notice from the City; (c) Unauthorized Transfer. Any transfer other than as permitted pursuant to this Agreement; (d) Representation or Warranty Incorrect. Any Owner representation or warranty contained in this Agreement, or in any application, financial statement, certificate, or report submitted to the City in connection with the Loan or City Documents, proving to have been incorrect in any material respect when made; (e) Default Under Project Financing and City Documents. Failure to make any payment or perform any of the Owner's covenants, agreements, or obligations under the documents evidencing and securing the financing for the Project or City Documents following expiration of all applicable notice and cure periods; 15 (f) Insolvency. A court having jurisdiction shall have made or entered any decree or order (i) Owner (or any general partner of Owner) to be bankrupt or insolvent, (ii) approving as properly filed a petition seeking reorganization of Owner (or any general partner of Owner) or seeking any arrangement for the Owner under the bankruptcy law or any other applicable debtor's relief law or statute of the United States or any state or other jurisdiction, (iii) appointing a receiver, trustee, liquidator, or assignee of Owner (or any general partner of the Owner) in bankruptcy or insolvency or for any of their properties, or (iv) directing the winding up or liquidation of the Owner (or any general partner of the Owner), if any such decree or order described in clauses (i) to (iv), inclusive, shall have continued unstayed or undischarged for a period of ninety (90) days; or Owner (or any general partner of the Owner) shall have admitted in writing its inability to pay its debts as they fall due or shall have voluntarily submitted to or filed a petition seeking any decree or order of the nature described in clauses (i) to (iv), inclusive; (g) Assignment; Attachment. The Owner (or any general partner of the Owner) shall have assigned its assets for the benefit of its creditors or suffered a sequestration or attachment of or execution on any substantial part of its property, unless the property so assigned, sequestered, attached or executed upon shall have been returned or released within ninety (90) days after such event or prior to sooner sale pursuant to such sequestration, attachment, or execution. (h) Suspension. The Owner (or any general partner of the Owner) shall have voluntarily suspended its business; (i) Liens. There shall be filed any claim of lien (other than liens approved in writing by the City) against the Property or Project or any part thereof, or any interest or right made appurtenant thereto, or the service of any notice to withhold proceeds of the Loan pursuant to City Documents and the continued maintenance of said claim of lien or notices to withhold for a period of twenty (20) days without discharge or satisfaction thereof or provision therefore satisfactory to the City; (j) Condemnation. The condemnation, seizure, or appropriation of all or, in the opinion of the City, a substantial part of the Property or Project; or (k) Insurance. Owner’s failure to maintain insurance on the Property and the Project as required hereunder or under City Documents, and the failure of Owner to cure such default within thirty (30) days of written notice from City; (l) Taxes and Assessments. Subject to Owner’s right to contest the following charges, Owner’s failure to pay taxes or assessments due on the Property or the Project or failure to pay any other charge that may result in a lien on the Property or the Project, and Owner’s failure to cure such default within sixty (60) days of delinquency; (m) Other Default. Occurrence of any other event (whether termed default, event of default, or otherwise) which under the terms of this Agreement or the City Documents entitle City to exercise its rights or remedies. 9.2 Remedies. Upon the occurrence of an Event of Default and its continuation beyond any applicable cure period, City may proceed with any of the following remedies: 16 A. Repayment of Loan. The City shall have the right to require immediate repayment of the total outstanding amount of the Loan, together with any accrued interest thereon as set forth in Exhibit A of the Loan Agreement. Owner waives all right to presentment, demand, protest or notice of protest or dishonor. The City may proceed to enforce repayment of the Loan and to exercise any or all rights afforded to the City as a creditor and secured party under the law including the Uniform Commercial Code, including foreclosure under the City Deed of Trust. The Borrower shall be liable to pay the City on demand all reasonable expenses, costs and fees (including, without limitation, reasonable attorney's fees and expenses) paid or incurred by the City in connection with the collection of the Loan and the preservation, maintenance, protection, sale, or other disposition of the security given for the Loan. B. Specific Performance. Bring an action for equitable relief seeking the specific performance of the terms and conditions of this Agreement or City Documents, and/or enjoining, abating, or preventing any violation of such terms and conditions, and/or seeking declaratory relief; C. LIQUIDATED DAMAGES. FOR VIOLATIONS OF OBLIGATIONS WITH RESPECT TO RENTS FOR RESTRICTED UNITS, THE CITY SHALL HAVE THE RIGHT TO IMPOSE AS LIQUIDATED DAMAGES A CHARGE IN AN AMOUNT EQUAL TO THE ACTUAL AMOUNT COLLECTED BY OWNER OR OWNER’S REPRESENTATIVE IN EXCESS OF THE AFFORDABLE RENT. THE PARTIES AGREE THAT, IN SUCH INSTANCE, SUCH EXCESS RENT REPRESENTS A REASONABLE APPROXIMATION OF THE CITY’S DAMAGES AND IS NOT INTENDED AS A FORFEITURE OR PENALTY BUT RATHER AN ENFORCEABLE LIQUIDATED DAMAGES PROVISION PURSUANT TO CALIFORNIA CIVIL CODE SECTION 1671, ET SEQ. OWNER SHALL PAY ANY LIQUIDATED DAMAGES ASSESSED BY THE CITY WITHIN TEN (10) DAYS. City’s Initials Owner’s Initials D. Other Remedies. Pursue any other remedy allowed at law or in equity; E. Right to Cure at Owner's Expense. The City shall have the right (but not the obligation) to cure any monetary default by the Owner under a loan secured by the Property. The Owner agrees to reimburse the City for any funds advanced by the City to cure a monetary default by the Owner upon demand therefore, together with interest thereon at the lesser of ten percent (10%) per annum or the maximum rate permitted by law, from the date of expenditure until the date of reimbursement; F. Right of Contest. The Owner shall have the right to contest in good faith any claim, 17 demand, levy, or assessment the assertion of which would constitute an Event of Default hereunder. Any such contest shall be prosecuted diligently and in a manner unprejudicial to the City or the rights of the City hereunder. G. Remedies Cumulative. No right, power, or remedy given to a party by the terms of this Agreement is intended to be exclusive of any other right, power, or remedy; and each and every such right, power, or remedy shall be cumulative and in addition to every other right, power, or remedy given to the Party. Neither the failure nor any delay on the part of a Party to exercise any such rights and remedies shall operate as a waiver thereof, nor shall any single or partial exercise by a Party of any such right or remedy preclude any other or further exercise of such right or remedy, or any other right or remedy. 10. Indemnity. To the fullest extent permitted by law, Owner shall indemnify, defend (with counsel approved by City) and hold City and its respective elected and appointed officers, officials, employees, agents, and representatives (collectively, the “Indemnitees”) harmless from and against all liability, loss, cost, expense (including without limitation attorneys’ fees and costs of litigation), claim, demand, action, suit, judicial or administrative proceeding, penalty, deficiency, fine, order, and damage (all of the foregoing collectively “Claims”) arising directly or indirectly, in whole or in part, as a result of or in connection with Owner’s construction, management, or operation of the Property and the Project, the performance of any work or services required of Owner under this Agreement, or Loan disbursement made pursuant to the Loan Agreement or any failure to perform any obligation as and when required by this Agreement or the City Documents or any other loss or cost, including but not limited to that caused by the concurrent active or passive negligence of Indemnitees. Owner’s indemnification obligations under this Section 10 shall survive the expiration or earlier termination of this Agreement. It is further agreed that City does not and shall not waive any rights against Owner that it may have by reason of this indemnity and hold harmless agreement because of the acceptance by, or the deposit with City by Owner, of any of the insurance policies described in this Agreement or the City Documents. However, Owner’s duty to indemnify under this Section shall not apply to injuries or damage for which Indemnitees have been found in a court of competent jurisdiction to be solely liable by reason of their own gross negligence or willful misconduct. 11. Miscellaneous. 11.1 Amendments. This Agreement may be amended or modified only by a written instrument signed by both Parties and any request for such shall be subject to a $2,000.00 fee payable by Owner to City per modification or amendment request unless such amendment is required by the City. 11.2 Waiver of Terms and Conditions. A Party may at its discretion waive in writing any of the terms and conditions of this Agreement, without completing an amendment to this Agreement. No waiver of any default or breach shall be implied from any omission by the non- breaching Party to take action on account of such default if such default persists or is repeated, and no express waiver shall affect any default other than the default specified in the waiver, and such waiver shall be operative only for the time and to the extent therein stated. 18 Waivers of any covenant, term, or condition contained herein shall not be construed as a waiver of any subsequent breach of the same covenant, term, or condition. The consent or approval by a Party to or of any act by the other Party requiring further consent or approval shall not be deemed to waive or render unnecessary the consent or approval to or of any subsequent similar act. The exercise of any right, power, or remedy shall in no event constitute a cure or a waiver of any default under this Agreement, nor shall it invalidate any act done pursuant to notice of default, or prejudice the exercising Party in the exercise of any right, power, or remedy hereunder. 11.3 Notices. Except as otherwise specified herein, all notices to be sent pursuant to this Agreement shall be made in writing, and sent to the Parties at their respective addresses specified below or to such other address as a Party may designate by written notice delivered to the other parties in accordance with this Section. All such notices shall be sent by: (i) personal delivery, in which case notice is effective upon delivery; (ii) certified or registered mail, return receipt requested, in which case notice shall be deemed delivered upon receipt if delivery is confirmed by a return receipt; or (iii) nationally recognized overnight courier, with charges prepaid or charged to the sender’s account, in which case notice is effective on delivery if delivery is confirmed by the delivery service. If to City, to: City of South San Francisco 400 Grand Avenue Attn: City Manager South San Francisco, CA 94080 Phone: (650) 877-8500 With a Copy to: City of South San Francisco 400 Grand Avenue Attn: ECD Director South San Francisco, CA 94080 Phone: (650) 829-6622 Email: alex.greenwood@ssf.net With a Copy to: Meyers Nave Attn: Sky Woodruff 555 12th Street, Suite 1500 Oakland, CA 94607 Tel (510) 808-2000 Fax (510) 444-1108 Email swoodruff@meyersnave.com 19 If to Owner: Grand and Linden Family Apartments, L.P. 1650 Lafayette Street Santa Clara, CA 95050 Attention: Alex Sanchez Telephone: (408) 984-5600 Email: asanchez@roemcorp.com With a Copy to: Bocarsly Emden Cowan Esmail & Arndt LLP 633 W. Fifth Street, 64th Floor Los Angeles, CA 90071 Attention: Kyle Arndt, Esq. Telephone: 213-239-8048 Email: karndt@bocarsly.com 11.4 Further Assurances. The Parties shall execute, acknowledge and deliver to the other such other documents and instruments, and take such other actions, as either shall reasonably request as may be necessary to carry out the intent of this Agreement. 11.5 Parties Not Co-Venturers. Nothing in this Agreement is intended to or shall establish the Parties as partners, co-venturers, or principal and agent with one another. Owner agrees and understands that work/services performed pursuant this Agreement are performed by Owner as conditions of receiving the Loan funding, and not as an employee or joint venture of City and that neither Owner nor its employees acquire any of the rights, privileges, powers, or advantages of City employees. Nothing contained in this Agreement shall create or justify any claim against the City by any person that the Owner may have employed or with whom the Owner may have contracted relative to the purchase of materials, supplies or equipment, or the furnishing or the performance of any work or services with respect to the purchase of the Property, or the construction or operation of the Project, and the Owner shall include similar requirements in any contracts entered into for the such purposes. 11.6 Action by the City. Except as may be otherwise specifically provided herein, whenever any approval, notice, direction, consent or request by the City is required or permitted under this Agreement, such action shall be in writing, and such action may be given, made or taken by the City Manager or by any person who shall have been designated by the City Manager, without further approval by the City Council at the discretion of the City Manager. 11.7 Non-Liability of City Officials, Employees and Agents. No member, official, employee or agent of the City shall be personally liable to Owner or any successor in interest, in the event of any default or breach by the City, or for any amount of money which may become due to Owner or its successor or for any obligation of City under this Agreement. 11.8 Headings; Construction. The headings of the sections and paragraphs of this Agreement are for convenience only and shall not be used to interpret this Agreement. The language of this Agreement shall be construed as a whole according to its fair meaning and not strictly for or against any Party. 20 11.9 Time is of the Essence. Time is of the essence in the performance of this Agreement. 11.10 Governing Law. This Agreement shall be construed in accordance with the laws of the State of California without regard to principles of conflicts of law. 11.11 Attorneys' Fees and Costs. If any legal or administrative action is brought to interpret or enforce the terms of this Agreement, the prevailing party shall be entitled to recover all reasonable attorneys' fees and costs incurred in such action. 11.12 Severability. If any provision of this Agreement is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not be affected or impaired thereby. 11.13 Entire Agreement; Exhibits. This Agreement, together with the other City Documents contains the entire agreement of Parties with respect to the subject matter hereof, and supersedes all prior oral or written agreements between the Parties with respect thereto. Exhibits A and B, attached hereto are incorporated herein by this reference. 11.14 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be an original and all of which together shall constitute one agreement. 11.15 Nonrecourse Obligation. Notwithstanding anything to the contrary set forth herein, the Loan shall be nonrecourse obligation of Borrower and its Partners. 11.16 Limited Partner Provisions. The City shall provide copies of any notice delivered to Borrower hereunder or under Loan Document to the Borrower’s Limited Partner (the “Limited Partner”). The Limited Partner shall have the same right as the Borrower to cure or remedy and default hereunder within the cure period provided to Borrower extended by an additional sixty (60) days’ provided, however, if the default is of such nature that the Limited Partner reasonably determines that it is necessary to replace a general partner of Borrower in order to cure such default, then the cure period shall be extended until the date sixty (60) days following the removal of said general partner of Borrower. SIGNATURES ON FOLLOWING PAGE. 21 IN WITNESS WHEREOF, the Parties have executed this Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants as of the date first written above. CITY THE CITY OF SOUTH SAN FRANCISCO, a municipal corporation By: __________________________________ Name: Michael Futrell Title: City Manager ATTEST: By: _________________________________ Rosa Acosta, City Clerk APPROVED AS TO FORM: By: _________________________________ Sky Woodruff, City Attorney OWNER GRAND AND LINDEN FAMILY APARTMENTS, L.P., a California limited partnership By: ______________________________ Its: _______________________________ SIGNATURES MUST BE NOTARIZED. STATE OF CALIFORNIA ) ) COUNTY OF SAN MATEO ) On , 20__, before me, ______________________, (here insert name and title of the officer), personally appeared , who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) 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 _______________________________ (Seal) STATE OF CALIFORNIA ) ) COUNTY OF SAN MATEO ) On , 20__, before me, ______________________, (here insert name and title of the officer), personally appeared , who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) 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 _______________________________ (Seal) Exhibit A For APN/Parcel ID(s): 012-314-010 THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF SOUTH SAN FRANCISCO, COUNTY OF SAN MATEO, STATE OF CALIFORNIA AND IS DESCRIBED AS FOLLOWS: LOTS 10 AND 11, BLOCK 138, AS DELINEATED UPON THAT CERTAIN MAP ENTITLED "SOUTH SAN FRANCISCO, SAN MATEO CO., CAL. PLAT NO. 1", FILED FOR RECORD IN THE OFFICE OF THE RECORDER OF THE COUNTY OF SAN MATEO, STATE OF CALIFORNIA, ON MARCH 1ST, 1892 IN BOOK "B" OF MAPS, AT PAGE 6 AND COPIED INTO BOOK 2 OF MAPS AT PAGE 52 Exhibit B Number of Units by Unit Size and Targeted Area Median Income (AMI) Levels Maximum Household Income Up to 60% AMI 60% - 80% AMI 80% -120% AMI Total Studio 1-Bedroom 2-Bedroom 3-Bedroom Total 36 3471902.1 City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-207 Agenda Date:3/11/2020 Version:1 Item #:6. Report regarding a resolution of the City Council of the City of South San Francisco proclaiming a local State of Emergency related to the Novel Coronavirus 2019 (COVID-19). (Sharon Ranals, Assistant City Manager) RECOMMENDATION It is recommended that the City Council adopt a resolution proclaiming a Local Health Emergency related to the 2019 Novel Coronavirus (COVID-19). BACKGROUND/DISCUSSION Both the State of California and the County of San Mateo have issued emergency declarations regarding the Novel Coronavirus (COVID-19)epidemic.Chapter 2.72 of the South San Francisco Municipal Code provides the authority to declare a local emergency in response to: …the actual or threatened existence of conditions of disaster or of extreme peril to the safety of persons and property within this city caused by such conditions as air pollution,fire,flood,storm,epidemic, riot,drought,sudden and severe energy shortage,plant or animal infestation or disease or earthquake, or other conditions,including conditions resulting from war or imminent threat of war,but other than conditions resulting from a labor controversy,which conditions are or are likely to be beyond the control of the services,personnel,equipment and facilities of this city,requiring the combined forces of other political subdivisions to combat. (Ord. 938 § 1, 1983; Ord. 622 § 2, 1971). Conditions of extreme peril to the safety of persons and property have arisen in South San Francisco due to the following facts.These facts warrant the declaration of a local emergency for the City of South San Francisco and are quoted directly from the County of San Mateo’s Declaration of Local Health Emergency Regarding the Novel Coronavirus (COVID-19), dated March 3, 2020: A novel coronavirus (named “COVID-19”by the World Health Organization)was first detected in Wuhan City,Hubei Province,China,in December 2019.The Centers for Disease Control and Prevention (“CDC”)has stated that COVID-19 is a serious public health threat,based on current information.Cases of COVID-19 have been diagnosed in the United States,primarily in individuals who have traveled to other countries,but there have been cases identified of “community spread”of COVID-19 involving individuals who have not traveled overseas and who have no known connections to overseas travel.In part,the virus is considered a very serious health threat because much is unknown. The exact modes of transmission,the factors facilitating human-to-human transmission,the extent of asymptomatic viral shedding,the groups most at risk of serious illness,the attack rate,and the case fatality rate all remain active areas of investigation. The best information to date suggests that the virus is spread between people primarily via respiratory droplets produced when an infected person coughs or sneezes.Symptoms of the virus include fever, cough,and shortness of breath,and infected individuals have experienced a range of outcomes,from City of South San Francisco Printed on 3/6/2020Page 1 of 3 powered by Legistar™ File #:20-207 Agenda Date:3/11/2020 Version:1 Item #:6. cough,and shortness of breath,and infected individuals have experienced a range of outcomes,from mild sickness to severe illness and death.The CDC believes at this time that symptoms appear two to fourteen days after exposure.Currently,there is no vaccine or specific antiviral treatment for COVID- 19. The number of reported cases of COVID-19 has escalated dramatically over a short period of time.As of March 1,2020,the World Health Organization has reported 87,137 confirmed cases of COVID-19, with 79,968 cases in China and the remaining 7,169 cases in 58 other countries.There have been 2,873 deaths in China due to COVID-19, and another 104 deaths in other countries. According to the CDC,as of March 2,2020,there have been 43 cases of COVID-19 detected,tested and confirmed in the United States (not including 48 individuals who returned to the United States from overseas on State Department-chartered flights).The World Health Organization has declared the outbreak to be a global health emergency. Actions are being taken to protect public health and limit the spread of COVID-19 in the United States. The CDC recommends that travelers avoid all nonessential travel to China,Iran,South Korea,and Italy. Moreover,media accounts report that the Federal Emergency Management Agency is preparing for the possibility that the President may make an emergency declaration at the federal level related to COVID- 19. Cases of COVID-19 have been identified in San Mateo County,as well as in other Bay Area counties and other counties,including the County of Santa Clara,the County of Solano,and the City and County of San Francisco,and these public entities have made declarations of local emergency and declarations of local health emergency. The County of San Mateo and other California counties,including the County of Santa Clara,the County of Solano,the County of and the City and County of San Francisco,and these public entities have similarly made declarations of local emergency and declarations of local health emergency. California Government Code section 8630 authorizes the City Council to declare a state of local emergency as defined by Government Code section 8558.Adopting the resolution would allow the City Council to declare such local emergency for the City. The proclamation of a local emergency in South San Francisco,if approved,will continue to exist until it is terminated by the City Council.As required by section 8630,the resolution will direct City staff to place this item back on the Council agenda at least every sixty (60)days from the effective date of the resolution to determine the need for continuing the local emergency. FISCAL IMPACT The declaration of local emergency and following the recommended actions could assist with receiving mutual aid resources from the State of California and neighboring jurisdictions to assist South San Francisco in containing the spread of COVID-19.The Governor has proclaimed a State of Emergency and requested a Presidential Declaration;the City of South San Francisco could be eligible for cost recovery funds related to response to the COVID-19 outbreak. City of South San Francisco Printed on 3/6/2020Page 2 of 3 powered by Legistar™ File #:20-207 Agenda Date:3/11/2020 Version:1 Item #:6. RELATIONSHIP TO STRATEGIC PLAN This action is related Priority Area 3.0,Public Safety,under the goal of disaster response and crisis communication. CONCLUSION Declaration of a local health emergency regarding the Novel Coronavirus (COVID-19)will align the City of South San Francisco with the County of San Mateo and the State of California,both of which have made emergency declarations,and help to establish partnerships and mutual aid to contain and mitigate the impacts of COVID-19.Emergency declaration could also strengthen South San Francisco’s eligibility for cost recovery funds related to response to the COVID-19 outbreak. ATTACHMENTS: 1.San Mateo County Health Officer Declaration of Local Health Emergency Regarding the Novel Coronavirus (COVID-19) 2.San Mateo County Director of Emergency Services Declaration of Local Health Emergency Regarding the Novel Coronavirus (COVID-19) 3. News Release relating to Opening of Public Call Centers City of South San Francisco Printed on 3/6/2020Page 3 of 3 powered by Legistar™ March 4, 2020 For Immediate Release County of San Mateo Opens COVID-19 Public Call Center Local emergencies announced to position resources for extended response Redwood City — The County of San Mateo today announced the opening of a public call center for residents with non-medical questions about COVID-19. The number is (650) 363-4422. The call center will open no later than noon Thursday, March 5. The center will take calls from 7 a.m. to 7 p.m. Monday through Friday and and use a three-way language line to help non-English speakers seeking information about the novel coronavirus. “We are receiving a tremendous number of calls to our emergency dispatchers and County Health from people seeking guidance on how they can prepare for and prevent the spread of the COVID-19 virus,” said County Manager Mike Callagy. “Opening the call center will both relieve those departments and connect the public with resources and information related to COVID-19 and its impact on our area.” The opening of the call center follows the proclamation of a local emergency in San Mateo County by Callagy and the declaration of a local health emergency by San Mateo County Health Officer Dr. Scott Morrow. If the state declares its own emergency, the County’s two emergency announcements makes the County eligible for reimbursement dating back to when the documents were signed. The County choses to take both actions because the COVID-19 response has the potential for countywide disruptions beyond the impact to public health. The Board of Supervisors is expected to ratify both documents at its March 10 regular meeting. Several other Bay Area counties have made similar proclamations. “The effort to protect our community’s health is a coordinated, countywide effort, and the Board’s expected ratification of these two documents places the County and its resources in the best position to respond,” Callagy said. “Our use of the term ‘emergency’ in the declarations is legally required and doesn’t suggest that the situation has escalated.” On Monday, March 2, the County of San Mateo activated its Emergency Operations Center (EOC) to support the local County Health response with coordinated resources and communication. The EOC will operate through Friday, March 6, at which time its need will be reassessed. Michelle Durand Chief Communications Officer County Government Center 400 County Center, 1st Floor Redwood City, CA 94063 650-363-4153 T 650-363-1916 F mdurand@smcgov.org www.smcgov.org County Health has reported that an adult resident of San Mateo County tested presumptively positive for COVID-19 and the case is pending confirmatory testing by the Centers for Disease Control and Prevention (CDC). This brings the county’s total cases to two; an earlier case is an individual repatriated to the United States by the CDC and currently in isolation. County Health is also actively monitoring other individuals based on CDC guidelines. General information about the novel coronavirus is available at www.cdc.gov or https://smchealth.org/coronavirus The Board of Supervisors meets at 9 a.m. Tuesday, March 10, 2020, in Board Chambers, 400 County Center, Redwood City. ### City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-215 Agenda Date:3/11/2020 Version:1 Item #:6a. Resolution of the City Council of the City of South San Francisco proclaiming a local State of Emergency related to the Novel Coronavirus 2019 (COVID-19). WHEREAS, Section 8630, Article 14, of the California Emergency Services Act empowers the City Council to proclaim the existence or threatened existence of a local emergency when the City of South San Francisco is affected or likely to be affected by a public calamity; and WHEREAS, Chapter 2.72 of the South San Francisco Municipal Code similarly empowers the City Manager, in their capacity as the Director of Emergency Services, to proclaim or request the City Council to proclaim the existence or threatened existence of a local emergency; and WHEREAS, the City Council has determined that present conditions warrant such proclamation of the existence of a local emergency and has been similarly requested by the Director of Emergency Services to proclaim the existence of a local emergency; and WHEREAS, the City Council does hereby find that conditions of extreme peril to the safety of persons and property have arisen within South San Francisco, caused by a novel coronavirus (named "COVID-19" by the World Health Organization); and WHEREAS, the finding is supported by the following facts, which are described in further detail in the accompanying staff report: a.A novel coronavirus (named “COVID-19” by the World Health Organization) was first detected in Wuhan City, Hubei Province, China, in December 2019. The Centers for Disease Control and Prevention (“CDC”) has stated that COVID-19 is a serious public health threat, based on current information. b.Cases of COVID-19 have been diagnosed in the United States, primarily in individuals who have traveled to other countries, but there have been cases identified of “community spread” of COVID-19 involving individuals who have not traveled overseas and who have no known connections to overseas travel. City of South San Francisco Printed on 3/12/2020Page 1 of 3 powered by Legistar™ File #:20-215 Agenda Date:3/11/2020 Version:1 Item #:6a. c.In part, the virus is considered a very serious health threat because much is unknown. The exact modes of transmission, the factors facilitating human-to-human transmission, the extent of asymptomatic viral shedding, the groups most at risk of serious illness, the attack rate, and the case fatality rate all remain active areas of investigation. d.The number of reported cases of COVID-19 has escalated dramatically over a short period of time. According to the CDC, as of March 2, 2020, there have been 43 cases of COVID-19 detected, tested and confirmed in the United States (not including 48 individuals who returned to the United States from overseas on State Department-chartered flights). The World Health Organization has declared the outbreak to be a global health emergency. e.Cases of COVID-19 have been identified in San Mateo County, as well as in other Bay Area counties and other counties, including the County of Santa Clara, the County of Solano, and the City and County of San Francisco, and these public entities have made declarations of local emergency and declarations of local health emergency. WHEREAS, the aforesaid conditions of extreme peril warrant and necessitate the proclamation of the existence of a local emergency. NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of South San Francisco hereby proclaims that a local emergency now exists throughout the City of South San Francisco, commencing on March 11, 2020. BE IT FURTHER RESOLVED AND ORDERED that during the existence of said local emergency the powers, functions, and duties of the City Manager, in their capacity as Director of Emergency Services, and the emergency organization of this City shall be those prescribed by state law and by the South San Francisco Municipal Code. BE IT FURTHER RESOLVED AND ORDERED that said local emergency shall be deemed to continue to exist until its termination is proclaimed by the City Council of the City of South San Francisco. BE IT FURTHER RESOLVED that City staff is directed to place an item on the agenda for review at least ever sixty (60) days from the effective date of this Resolution to determine the need for continuing the local emergency pursuant to section 8630, Article 14, of the California Emergency Services Act. BE IT FURTHER RESOLVED that this Resolution shall become effective immediately upon its passage and adoption. ****** City of South San Francisco Printed on 3/12/2020Page 2 of 3 powered by Legistar™ File #:20-215 Agenda Date:3/11/2020 Version:1 Item #:6a. City of South San Francisco Printed on 3/12/2020Page 3 of 3 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:19-1049 Agenda Date:3/11/2020 Version:1 Item #:7. Report regarding a Fleet Procurement Policy as it relates to Electric Vehicles (Dave Bockhaus,Deputy Director of Public Works) RECOMMENDATION It is recommended that the City Council receive this report reviewing the City of South San Francisco’s government fleet procurement policy relating to electric vehicles and analyzing the obstacles preventing implementation of such a policy,per the recommendations presented by the San Mateo County Civil Grand Jury in its report “Electric Vehicle Adoption in the Cities and Counties of San Mateo,”and provide direction to staff. BACKGROUND/DISCUSSION On August 12,2019,the San Mateo County Civil Grand Jury issued a report entitled,“Electric Vehicle Adoption in the Cities and County of San Mateo.”The report summarized the Grand Jury’s survey of the state of electric vehicles in the fleets of San Mateo County and the 20 cities within its boundaries.The report explored the Climate Action Plans of each jurisdiction and assessed whether the CAP addresses electric vehicles and the conversion of municipal fleets to all-electric. The Grand Jury Report made four recommendations: 1.To conduct a review of the City’s government fleet procurement policy relating to electric vehicles and present a report at a public meeting.The review should include an analysis of up-to-date life-cycle costs of commercially available electric vehicles and an up-to-date assessment of whether electric vehicles can meet the performance needs of local jurisdictions for power,range,battery life,and other relevant factors. 2.To conduct an analysis of the obstacles,if any,to the implementation of an EV government fleet procurement policy and present a report at a public meeting.This could include,for example,the availability of electric vehicle charging stations to serve the vehicle fleet and training of vehicle maintenance staff. 3.To review the “Roadmap for Municipal Green Fleets”toolkit from the San Mateo County Office of Sustainability, including information on the possibility of adopting an EV First Policy. 4.To investigate joining the Climate Mayors EV Purchasing Collaborative to take advantage of aggregate purchasing. Staff has prepared the following responses: 1.In July 2018,the Public Works Department provided City Council with a memo describing its Fleet Electrification and EV Charging Infrastructure Plan,Attachment 1.The plan lays the groundwork for a responsible and efficient transition to vehicle electrification and provides the necessary infrastructure to support such a switch.Staff worked with multiple consultants to research and develop plans for fleet electrification and the infrastructure to support such a fleet.Staff uses the plans to help guide decision City of South San Francisco Printed on 3/5/2020Page 1 of 4 powered by Legistar™ File #:19-1049 Agenda Date:3/11/2020 Version:1 Item #:7. electrification and the infrastructure to support such a fleet.Staff uses the plans to help guide decision making regarding electric vehicle infrastructure installation and vehicle replacement,while considering the fiscal constraints and optimization of existing resources and equipment.To support fleet electrification,it is critical that the City have the proper infrastructure in place to support those EVs.At the end of 2019,the City installed 34 Level-2 EV chargers at the Corporation Yard,through the PG&E EV Charge Network Program (EVCN);these chargers are available for City employee use and fleet use. The City worked with EVgo to install four high-speed chargers on the first floor of the Miller Parking Garage in 2019 and most recently completed the installation of 13 Level-2 chargers on the fourth floor of the garage through PG&E’s EVCN Program.The Miller Parking Garage chargers are available to fleet vehicles and the public,demonstrating the City’s commitment to supporting a broader transition to electrification and de-carbonization. The City of South San Francisco’s 2016 Fleet Rightsizing Study (study),Attachment 2,identified electric light-duty vehicles as the candidates for its initial EV fleet based on the limited availability of medium-and heavy-duty electric vehicles.The study used vehicle utilization and condition as the basis for replacement recommendations and identified just nine vehicles for replacement.Seventy-six of the City’s vehicles travel less than 3,000 miles per year and 55 percent of the fleet is underutilized.New generation EVs have an average range of 180 miles per full charge,indicating that range is not a major deterrent to the purchase of EVs.The study also evaluated the conditions of the fleet and found that 77 percent of the fleet is in good to excellent condition, with just 4 percent classified as poor condition. A cost comparison was also included in the study.Assumptions included that a vehicle is driven 12,500 miles/year and will last 8 years.The study found that the annual fuel costs for a Nissan Leaf would be approximately $250 as compared to $1,375 for a Chevy Malibu,demonstrating the fuel cost savings for an electric vehicle.Based on the values provided in a chart of the Fleet Study (Attachment 2),data shows that after approximately three years,the cost of a Nissan Leaf is lower compared to the purchase value of a Chevy Malibu.The City of South San Francisco’s Electric Vehicle Charging Master Plan (plan),Attachment 3,addresses initial vehicle costs as well as operations costs.While the 2018 median cost for an EV is $32,000 and depreciation is about 11 percent higher than traditional petroleum-fueled vehicles,the maintenance and fuel costs of EVs are 30 and 50 percent less respectively.Not only is the additional cost for the purchase recouped over the life of the vehicle,there are numerous rebate programs in place to assist jurisdictions in making the initial investment in an electric fleet. The major recommendation of the study and plan is to phase in electric vehicles as older vehicles are retired and new EV models are introduced to the market.Staff believes that light-duty EVs currently on the market will meet the needs of the fleet as the older vehicles reach the end of their life-cycle and are phased out. 2.An EV government fleet policy would articulate the City’s commitment to transitioning to an all-electric fleet.The City of San Francisco adopted its EV First Policy,which “requires that any new passenger vehicle procured for the City fleet be a Zero Emission Vehicle,absent a waiver,and that all passenger vehicles in the City fleet be Zero Emission Vehicles by December 31,2022;and to encourage selection of Zero Emission Vehicles in other vehicle classes as technology improves.”The City of South San City of South San Francisco Printed on 3/5/2020Page 2 of 4 powered by Legistar™ File #:19-1049 Agenda Date:3/11/2020 Version:1 Item #:7. of Zero Emission Vehicles in other vehicle classes as technology improves.”The City of South San Francisco’s current Vehicle Replacement,Upgrade,and Additions to the Fleet policy (Attachment 4), effective August 1,2005,has no mention of electric vehicles,as it predates the ready availability of the technology.The Grand Jury report identifies obstacles to prioritization of EV purchases as perceived cost,range anxiety,driver and dealer understanding,and mechanic preparation.Staff believes the biggest obstacle for the City of South San Francisco is the limited options for passenger vehicles complying with the City’s “Buy American”practice;and the perceived cost of such vehicles.As discussed in the July 2019 memo to Council,American-made electric vehicles are limited,with Chevrolet and Tesla leading the way. 3.In addition to assessing each jurisdiction’s state of electric conversion and electric-friendly policies,the Grand Jury investigated and provided sources of financial and technical assistance to aid jurisdictions in prioritizing fleet electrification.Sources included the pending Roadmap for Municipal Green Fleets (Roadmap)and an EV First Policy from the San Mateo County Office of Sustainability and the Climate Mayors EV Purchasing Collaborative. The Roadmap,funded by Peninsula Clean Energy,is a clean fuel toolkit to assist local governments in replacing traditional gas powered fleets with electric vehicle fleets.The Roadmap includes fleet telematics and electrification strategies; the Roadmap is currently in draft form. 4.The Climate Mayors EV Purchasing Collaborative (Collaborative),launched in September 2018,is a cohort of more than 185 cities,counties,and other public agencies who are committed to purchasing electric vehicles.Collaborative members leverage their collective buying power to accelerate the conversion of public fleets to EVs.Membership in the Collaborative provides access to a turnkey,one- stop,online procurement portal,providing public agencies equal access to competitively bid EVs and charging infrastructure, innovative finance options, best practices, and other forms of expertise. FISCAL IMPACT There is no fiscal impact to explore these options and develop new policies,other than the staff time expended to complete the projects.This cost is absorbed as part of the Department of Public Works staff’s regular job duties. RELATIONSHIP TO STRATEGIC PLAN This item relates to Priority Area 3 -Financial Stability,Initiative 3.1 -Pursue financial stability to support city operations,by reducing the overall cost of maintaining a fleet and Priority Area 5 -Economic Vitality,Initiative 5.5 -Sustainability/Climate Action Plan update by prioritizing beneficial electrification to reduce the City’s greenhouse gas emissions. CONCLUSION Staff recommends that City Council receive this report and provide direction on the development of an EV Government Fleet Procurement or EV First Policy,and/or the further exploration of the Roadmap for Municipal Green Fleets toolkit and the Climate Mayors EV Purchasing Collaborative. ATTACHMENTS: City of South San Francisco Printed on 3/5/2020Page 3 of 4 powered by Legistar™ File #:19-1049 Agenda Date:3/11/2020 Version:1 Item #:7. Attachment 1 - July 18, 2019 Thursday Memo to City Council Attachment 2 - 2016 Fleet Rightsizing Study Attachment 3 - 2016 Electric Vehicle Charging Master Plan City of South San Francisco Printed on 3/5/2020Page 4 of 4 powered by Legistar™ South San Francisco Fleet Electrification and EV Charging Infrastructure Plan In response to direction from City Council as well as state leadership, the Public Works Department has developed a fleet electrification and EV charging infrastructure plan. This plan lays the groundwork for a responsible and efficient transition to vehicle electrification and provides the necessary infrastructure to support such a switch. The move to electric vehicles and the associated infrastructure will help the City reduce its greenhouse gas emissions, which is an essential component of an effective Sustainability / Climate Action Plan. The plan supports the City’s strategic plan initiative of creating sustainable economic vitality by being an actionable first step towards an updated Climate Action Plan. BACKGROUND The City of South San Francisco and other jurisdictions across the Bay Area are exploring fleet electrification as California leads the way in decarbonization in the United States. California aims to rely entirely on zero-emission energy sources for its electricity by the year 2045 and former Governor Jerry Brown issued an executive order in 2018 calling for statewide carbon neutrality by 2045. This means that California will remove as much carbon dioxide from the atmosphere as it emits. To achieve this end, organizations and individuals must move away from traditional petroleum-fueled vehicles and toward vehicles fueled by clean technologies. California’s Zero-Emission Vehicle (ZEV) Program requires vehicle manufacturers to research, develop, and market electric vehicles based on a percentage of that manufacturer’s sales within the state. As manufacturers produce more electric vehicles (EVs) cities, counties, and the state must provide the infrastructure to support these vehicles. In early 2018, Governor Brown issued an executive order significantly expanding Electric Vehicle Supply Equipment (EVSE) infrastructure. The $2.5 billion initiative is helping to install 250,000 additional vehicle-charging stations throughout California by 2025. The initiative demonstrates the need to provide infrastructure that supports the increase in EVs. DISCUSSION South San Francisco has worked with multiple consultants to research and develop plans for fleet electrification and the infrastructure to support such a fleet. Both plans include recommendations and best practices for implementation. Staff is using the plans to help guide decision making regarding electric vehicle infrastructure installation and vehicle replacement, while considering fiscal constraints optimization of existing resources and equipment. ATTACHMENT 1 Fleet Electrification A 2016 fleet right-sizing study provided guidance on the potential electrification of the City’s fleet. The study identified cars or automobiles (such as those used by executive staff), small cart vehicles and vans as the most optimal vehicles eligible for electrification. Pending the success of commercial prototypes additional classes of vehicles, such as light to heavy-duty trucks may also be candidates for electrification. Readily available electric models of automobiles, small cart vehicles, and vans currently exist; however, American-made versions of these fully electric vehicles are limited. Candidates for electrification: *Protoypes for other vehicles types, such as trucks and heavy equipment, are currently in development and may be available in the near future. Phased Approach The plan recommends a phased approach to the electrification of the fleet to allow for installation of supporting infrastructure, to consider budgetary constraints while allowing the market to stabilize, to enable the city to maximize the life of existing vehicles, and to give emerging technology the opportunity to optimize vehicle types. Staff continues to operate existing vehicles until their condition and related maintenance expenditures warrant replacement. The phased approach also gives the City the flexibility to maintain a diverse fleet, which is essential to the City’s ongoing, daily functions. A diverse fleet also enables the City to respond in an emergency, such as a natural disaster, grid crash, or other crisis. The City’s Emergency Response teams may need to rely on traditionally fueled vehicles to clear debris, rescue community members, and repair infrastructure. Commercial electric versions of these types of vehicles do not currently exist. Vehicle Type* Vehicle Count No. of Potential EVs Comment Automobile 12 11 Hybrid / Plug-in EV Small cart vehicle 3 3 Electric Carts Full size van / wagon 11 2 Electric Vans Mini-vans 4 2 Electric Vans Tesla Model 3 Chevrolet Volt Vehicle Replacement When considering vehicle replacement, City staff evaluates vehicle condition, age, mileage, and repair and maintenance costs, among others. Vehicles identified for replacement in the next two years do not include any candidates for electrification. Staff estimates that vehicles suitable for electrification will become eligble for replacement beginning in 2021 – 2022. Electric Vehicle Charging Infrastructure The City has also developed an Electric Vehicle Charging Plan, which examines the infrastructure needed to support an electric fleet. Fleet electrification cannot be successful without the necessary infrastructure in place to support it. The plan evaluates City-owned facilities to determine which are most appropriate for electric vehicle charging infrastructure (EVSE) installation and prioritizes those sites by various criteria. Additional considerations when evaluating EVSE include charger quantity; charger type (Level 1, 2 or DC Fast Chargers); placement, accessibility and price (City- owned land vs. privately owned land but publicly available chargers; chargers accessible by City vehicles only, City employees’ vehicles, or public vehicles; free or at cost public chargers); installation and maintenance costs; and zoning and building codes. City EVSE Two Level-2 EV chargers currently exist at the City Hall Annex and the Corporation Yard. The City is currently working with EVgo to install four high-speed chargers on the first floor of the Miller Parking Garage. The spots at Miller Parking Garage provide public-facing charging stations, demonstrating the City’s commitment to supporting a broader, nationwide transition to electrification and de-carbonization. The City has also entered into an agreement with Pacific Gas and Electric (PG&E) on October 2018 to participate in its Electric Vehicle Charge Network (EVCN) program. The EVCN program aims to help accelerate California’s transition to a clean transportation future by offering electric vehicle charger installation at select locations in PG&E’s service territory. The City plans to install 44 EV chargers at two locations within the City: the Corporation Yard (34) and the Miller Avenue Parking Garage (10). To participate in EVCN, the Chevrolet Bolt City must grant PG&E a utility easement at each location to provide PG&E sufficient rights to access the equipment for proper maintenance to keep the equipment in safe working condition. The City Council will receive an item at its July 24, 2019 meeting, requesting approval of a utility easement to PG&E for the installation of these charging stations. Staff estimates these EVSE installations will be complete by 2020 – 2021. Future EVSE The design and development of the new Community Civic Campus is an ideal opportunity to increase EVSE, as the placement of the charging stations can be incorporated into the facility design. The design team has identified locations for EVSE that will be immediately available, as well as locations for future installation. Staff is also exploring a potential new parking garage in the Downtown Core with EVSE spaces. Initial designs suggest 50 electric vehicle charging spaces within the new garage. The Water Quality Control Plant currently has a Solar Photovoltaic System project, which will construct a solar PV carport system at the plant. Upon completion of this project, staff will explore installation of EVSE. Installation of EVSE at any of these sites will coincide with the existing projects’ timeline. Funding Sources In addition to the funding assistance provided by EVgo and PG&E, staff is exploring other options to defer the costs on EVSE and fleet electrification. There are a variety of state subsidies and incentives available for cities looking to install additional infrastructure or begin electrifying their fleets. Programs like PG&E’s EV Fleet and Bay Area Air Quality Management District’s (BAAQMD) Charge! provide funding for EVSE installation in support of organizations electrifying their fleets or wanting to provide EVSE for the public. Staff is also exploring programs available through Peninsula Clean Energy and granting organizations. Many of these programs focus on EVSE, because it is such a large financial obstacle when attempting to transition to electric vehicles. Securing funding assistance for EVSE will help free-up additional funds for electric vehicles. Fleet Study November 30, 2016 ATTACHMENT 2 Fleet Study November 2016 CST Background •CST Founded 2000 •Goal -being of service to fleets •Sharing our fleet knowledge and experiences Fleet Study November 2016 CST Company Focus Fleet Right Sizing Best Practice Evaluation Fleet Metric Comparisons Shop Consolidation Manpower Efficiency System Specifications •“What if……?”Modeling •Scenario Forecasting •Carbon Footprint Trending and Forecasting •Program Implementation •Strategic Vendor Partnerships Fleet Study November 2016 CST Approach to Fleet improvements Managing by Metrics Fleet Best Practice Evaluation Fleet Metric Comparisons Industry Standards (NAFA,APWA,SAE,TMC) NAFA –North America Fleet Association APWA, American Public Works Association SAE-Society of Automotive Engineers TMC –The Maintenance Council Past Fleet experiences Fleet Study November 2016 CST Government Customers •Arlington, VA •City of Bryan, TX •Chicago •College Station, TX •Cook County •Dallas •Dekalb County, GA •Detroit •Greensboro •Houston •State of Indiana •Indianapolis •New York City •Oklahoma •Raleigh •Richmond, VA •San Diego •Tulsa, OK Fleet Study November 2016 CST Past Projects -Fleet Savings Project Savings Chicago ~ 12% Detroit ~ 18% Houston ~ 12% Tulsa ~ 6% New York City $80 Million per Year Strategic Full City Fleet Strategy Fleet Study November 2016 Fleet Study Scope Perform a Tier 1 Right Sizing Analysis based on Utilization Perform Fleet Efficiency Review Identity Alternative Fuel options for units that are identified for purchase / replacement. Fleet Study November 2016 Current State –Size of Fleet City Area Square Miles Population Number of Vehicles Population to City Fleet ratio San Diego CA 372 1,400,000 4042 346/1 South San Francisco CA 30 68,000 213 319/1 Oakland CA 78 420,000 1500 280/1 Arlington Va 26 230,000 878 262/1 San Francisco CA 232 870,000 7000 124/1 South San Francisco’s fleet falls inline with comparable cities. A good metric indicator is the population served compared to city vehicles needed. This ratio is usually in the 250-350 to 1 range. The higher ratio is better. Fleet Study November 2016 Current State –Asset Age Green –OK, Yellow –Might be an Issue, Red –Look Into 43 vehicles 20% of Fleet is over 15 years old Fleet Study November 2016 Current State –Asset Utilization Green –OK, Yellow –Might be an Issue, Red –Look Into 76 Vehicles travel less than 3,000 miles per year. Note: In a small area (30 Square Miles) some low utilization is expected Fleet Study November 2016 Current State –Vehicle Condition This is a mathematical evaluation of the fleet and just tells us which vehicles may be in excellent to poor condition. Note: When using this method accidents and refurbishment of a vehicle may make it look bad mathematically but the vehicle could be in great shape. This just shows us where to begin to look. Green –OK, Yellow –Might be an Issue, Red –Look Into Fleet Study November 2016 Current State –Capital Purchases •For the last 8 years purchases needed were 12.1 million with 11.1 million spent. •3 years (2009, 2012, 2014) spending was very low •Capital Spending needs to increased about 10% each year Fleet Study November 2016 Tier 1 Right Sizing Analysis 1-Established equipment parameters for evaluation Vehicle Types:Life Years Expected Annual Miles Targeted Life Miles Targeted Downtime Targeted Shop Visits per Year Targeted CPM Ambu:Ambulance 15 10,000 150,000 20 3 $6.00 Auto:Automobile 10 10,000 100,000 10 3 $0.55 Boat:Boat 20 0 - 2 - $100.00 Cart:Small Cart Vehicle 15 3,000 45,000 2 1 $0.55 Elect:Electric Vehicle 15 1,500 22,500 5 1 $0.55 FireApp:Fire Apparatus 15 7,500 112,500 20 4 $25.00 FSV:Full Size Van/wagon (< or = 8500 lbs.)15 10,000 150,000 10 3 $0.55 HDT:Heavy Duty Truck 15 2,500 37,500 100 2 $5.00 LDPu:Light-Duty Pickup 15 10,000 150,000 10 3 $1.00 MDT:Medium Duty Truck 15 7,500 112,500 25 2 $2.50 Misc:Miscellanous Equip 15 10,000 150,000 40 3 $100.00 Moto:Motorcycle 10 6,000 60,000 50 2 $1.00 MVan:Mini Van 15 5,000 75,000 10 2 $0.55 patrol:Police Patrol 10 10,000 100,000 20 5 $0.85 PS:Police Sedan 7 15,000 105,000 30 8 $0.85 SUV:Sports Utility Vehicle 15 6,000 90,000 20 4 $0.75 Fleet Study November 2016 Tier 1 Right Sizing Analysis 2 –Evaluated Utilization % of Target Vehicles Very Underutilized 20%71 Underutilized 40%48 Targeted Utilization 80%66 High Utilization >=80%28 213 Annual Utilization Targets Set Groups of Utilization based on % of their targeted miles Fleet Study November 2016 Tier 1 Right Sizing Analysis 2 –Evaluated Utilization Fleet Study November 2016 Tier 1 Right Sizing Analysis 3 –Evaluated Condition Assigned condition scores to each vehicle based on 5 categories Fleet Study November 2016 Tier 1 Right Sizing Analysis 3 –Evaluated Condition We grouped the condition scores into groups by percentages. Highest score was 17 (worst vehicles) Lowest 0 ( best vehicles) Vehicles Scoring Model Condition % of Score Potential Score Low High Vehicles Excellent 0%0 0 34 16% Good 33%1 5 130 61% Fair 66%6 11 40 19% Poor 67% + 12 17 9 4% Scale 0 17 213 vehicles Score Range Fleet Study November 2016 Tier 1 Right Sizing Analysis 3 –Evaluated Condition Note 1: The scores above just tell us which vehicles to look at closer. Note 2: CST found the fleet to be in very good shape in the walk around inspections. Vehicles are kept in very good condition. Fleet Study November 2016 Tier 1 Right Sizing Analysis 4 –Recommendations based on Utilization and Condition Vehicles Recommendation (Based on Utilization and Condition) A recommendation has been given based on the utilization and condition of each vehicle. Decision Targets Number of Vehicles Keep >30%<50%101 Consider Replacement >30%>50%9 Consider Reassignment <30%<50%97 Consider Disposal <30%>50%6 213 Utilization Condition Score Low Med High Conservativ e Aggressive Goo d Fair Poor AggressiveConservative Utilization Threshold Condition Threshold Low Med High Conservativ e Aggressive Goo d Fair Poor AggressiveConservative Utilization Threshold Condition Threshold Fleet Study November 2016 Tier 1 Right Sizing Analysis 4 –Recommendations based on Utilization and Condition Empirical analysis of the historical data only leads us to the initial recommendations Keep 101 Consider Replacement 9 Consider Reassignment 97 Consider Disposal 6 213 Fleet Study November 2016 Tier 1 Right Sizing Analysis 5 –Factored in unit assignment Making fleet decisions just on fleet data can lead to poor fleet decisions. To refine these recommendations CST interviewed each department and documented the mission of each vehicle using the categories below Personal - Take Home Personal NON take home Crew\Route Vehicle Shared - Pool Vehicle Special Assignment Spare/Reserve Not Needed Fleet Study November 2016 Tier 1 Right Sizing Analysis 5 –Factored in unit assignment Taking into the “mission of the vehicle the recommendations were modified to the following: Number of Vehicles Keep Consider Replacement Consider Reassignment Consider Disposal Personal - Take Home 7 3 0 4 0 Personal NON take home 21 11 0 10 0 Crew\Route Vehicle 41 40 1 0 0 Shared - Pool Vehicle 44 27 1 14 2 Special Assignment 88 79 6 0 3 Spare/Reserve 7 3 0 3 1 Not Needed 5 0 1 4 0 213 163 9 35 6 Fleet Study November 2016 Fleet Efficiency Review •Shop space is good for vehicles supported •Mechanics are trained and knowledgeable on vehicles •Vehicles are maintained well by the shop •Shop and vehicles are clean and well kept •Shop is efficient in minimizing vehicle downtime. •Fleet is cooperative and supportive of using departments needs Fleet Study November 2016 Fleet Efficiency Review •CST performed a mechanic staffing analysis and bay analysis based on NAFA VEU Vehicle Equivalency Units. These results are below. Mechanics Needed 3.62 Current Mechanics 3.5 Bays Needed 6 Current Bays 6 Note: Mike is a working shop manager and is consider ½ to make the 3.5 mechanics Fleet Study November 2016 Fleet Efficiency Review For a fleet to be implementing ~70% of the best practices is very good. Number of Best Practices in place 83 69% Partially Implemented Best Practices 19 16% Number of Best Practices NOT in place 19 16% Fleet Best Practices Fleet Study November 2016 Fleet Efficiency Review Number of Vehicles Annual Capital needed City Council 1 $2,427.23 City Manager 2 $5,200.00 ECD 8 $15,202.38 Finance 1 $2,340.00 Fire 35 $704,909.87 IT 1 $2,503.67 Library 1 $7,563.20 Parks and Recreation 50 $134,057.94 Police 50 $184,888.19 Public Works 44 $361,512.96 WQCP 20 $39,268.74 213 $1,459,874.17 Capital Current Departments Annual Capital Contributions …….TBD What Departments should be contributing towards vehicle capital fund annually. Fleet Study November 2016 Alternative Fuel options 2015 Vehicle summary by fuel type 2015 vehicle Count 2015 Fuel Gallons Diesel 43 30,217.95 Electric 3 - Regular 167 77,806.23 213 108,024.18 Fleet Study November 2016 Alternative Fuel options E85 Mix of 85% Ethanol and 15% petroleum. Flexible fuel vehicles (FFVs) are the only vehicles that can use E85 Ethanol absorbs water,so some additional measures may need to be used to prevent any potential exposure to moisture. Advantages of E85 1.Readily Available 2.Easy to implement due to similarities with gasoline and there are many vehi cle options 3.Can be produced from domestically grown crops and waste 4.Has a higher octane number than gasoline,offering increased vehicle power and performance Disadvantages of E85 1.Has a lower energy content than gasoline,resulting in fewer miles per gallon 2.Based on energy content,there is minimal or no economic benefit with E85 Fleet Study November 2016 Alternative Fuel options Biodiesel (OEM Approved ) B5 (5%biodiesel and 95%petroleum diesel). B20 (20%biodiesel and 80%petroleum diesel).MAX approved by OEMS Advantages of Biodiesel 1.B20 produces 15%less carbon dioxide emissions than petroleum diesel 2.Safer to handle compared to petroleum diesel 3.Can be domestically produced from renewable resources 4.B20 reduces 3.52 lbs. carbon emissions per gallon of fuel. Disadvantages of Biodiesel 1.Lower fuel economy and power than petroleum diesel (10%lower for B100, 2%for B20) 2.Biodiesel will gel or solidify at low temperatures unless cold weather additives are used 3.Biodiesel is usually more expensive than petroleum diesel; have contracted for biodiesel at a cost less than ULSD and the use of RINS and tax incentives can make biodiesel over $1 per gallon less expensive. Fleet Study November 2016 Alternative Fuel options NON OEM Approved Biodiesel B25-R99 (25%and above biodiesel) Advantages of Biodiesel 1.Produces much less carbon dioxide emissions than petroleum diesel 2.Safer to handle compared to petroleum diesel 3.Can be domestically produced from renewable resources Disadvantages of Biodiesel 1.Not Approved by OEMS …….VOIDS WARRANTIES 2.Lower fuel economy and power than petroleum diesel 3.Biodiesel will gel or solidify at low temperatures unless cold weather additives are used 4.Biodiesel is usually more expensive than petroleum diesel; have contracted for biodiesel at a cost less than ULSD and the use of RINS and tax incentives can make biodiesel over $1 per gallon less expensive. *Note: several fleets are testing, the city of Oakland is reporting good results Fleet Study November 2016 Alternative Fuel options CNG/LNG Compressed natural gas (CNG) /Liquid Natural Gas (LNG) (is Methane stored at high pressure). CNG combustion produces fewer undesirable emissions. Advantages of CNG/LNG 1.94%of natural gas used in the U.S.is domestically produced 2.Much less expensive than gasoline 3.There are many commercially available retrofit and new vehicle options for natu ral gas 4.The pricing of CNG is less volatile than petroleum due to the extensive long- term supply availability in the USA and Canada. Disadvantages of CNG/LNG 1.Fueling infrastructure is limited and it is costly to build 2.CNG storage on the vehicle will take up additional space and increase the initial cost of the ve hicle 3.Facility modifications and specially trained technicians are needed to service nat ural gas vehicles Fleet Study November 2016 Alternative Fuel options Electric Vehicles are battery powered vehicles that run 100% on electric charge. EVs completely eliminate vehicle source emissions (emissions associated with electricity production vary depending on the local electric grid generation mixt ure)and therefore are optimal for reducing emissions on a per vehicle level. Advantages of electric vehicles 1.Reduction of gas purchased 2.Decline in greenhouse gas production 3.Electric charging cheaper than fuel 4.Maintenance should be less costly (until the battery fails) Disadvantages of electric vehicles 1.Tethers drivers to an electrical outlet (outlets are few) 2.Range is limited to less than 100 miles between charges 3.Much More costly than traditional vehicles 4.Batteries may need to be replaced 5.Performance in cold weather as well as when the user cranks up their stereo, air conditioner or heat declines Fleet Study November 2016 Alternative Fuel options Propane is a high energy and clean burning alternative fuel . Also known as liquefied petroleum gas (LPG). Propane is generally less expensive per gallon, but propane has lower energy content than gasoline, resulting in a lower fuel economy for propane vehicles. Vehicles must be converted to operate on propane and there is a cost premium. Both dedicated and bi‐fuel LPG configurations are available. Advantages of Propane 1.Fuel costs are lower than petroleum fuel by about half. 2.Propane is nontoxic and can produce lower amounts of greenhouse gases and ai r pollutants 3.The amount of time to fuel and the driving range is similar to conventional gasol ine vehicles 4.Fuel infrastructure cost is low and will usually be provided by the supplier. Disadvantages of Propane 1.Lower fuel economy than conventional gasoline vehicles 2.Higher cost premium for propane vehicles and retrofit vehicles 3.Limited vehicle fueling infrastructure Fleet Study November 2016 Alternative Fuel options Hybrid electric vehicles utilize both an internal combustion engine and an electric motor during driving. In most HEV configurations, the engine provides power directly to the drivetrain, the battery pack and electric motor allow HEVs to shut down the engine when stationary and most can use the electric motor to power the vehicle entirely under low speed conditions. This can be advantageous in stationary applications working in neighborhoods. For example, bucket trucks used in utility maintenance. Advantages of HEV 1.More fuel efficient tan a standard engine 2.Quiet 3.Recovers energy during braking and eliminate idling which saves fuel 4.Reduces tailpipe emissions Disadvantages of HEV 1.HEVs are more expensive than traditional gasoline vehicles 2.Onboard batteries add extra weight to the vehicle and take up space 3.Battery systems are costly to replace Fleet Study November 2016 Alternative Fuel options Hydrogen (H2) Fuel Cell Vehicles H2 is an alternative fuel that can be produced from domestic resources. Although in its market infancy as a transportation fuel, government and industry are working towards clean, economical, and safe hydrogen production and distribution for use in fuel cell electric vehicles (FCEVs). Advantages of FCEV 1.Runs on hydrogen emits water vapor and warm air as exhaust and is considered a zero-emission vehicle 2.Quiet Disadvantages of FCEV 1.Still in development 2.Not readily available Fleet Study November 2016 Alternative Fuel options Moving Forward Alt Fuel Option Moving forward Hydrogen (H2) Fuel Cell Vehicles Wait till technology develops Hybrid electric vehicles Good fit Plan where electic does not support Propane Hold off Electric Vehicles Good fit Plan usage Begin rollout CNG/LNG Hold off NON OEM Approved Biodiesel Watch what happens with City of Oakland testing Biodiesel (OEM Approved ) Investigate availability - could use year round E85 Hold off not enough benefit focus on electric Fleet Study November 2016 Alternative Fuel options Vehicle Count Avg Miles per Year Est Miles per Day Vehicles Traveling Less than 30 Miles per Day Number of Potential Electric Vehicles Comment Ambu:Ambulance 5 10,525.00 42 2 0 Auto:Automobile 12 2,651.37 11 11 11 electic auto Boat:Boat 1 - 0 1 0 Cart:Small Cart Vehicle 3 267.67 1 3 3 Electirc carts Elect:Electric Vehicle 3 6.67 0 3 3 Electric Carts FireApp:Fire Apparatus 11 4,706.68 19 10 0 FSV:Full Size Van/wagon (< or = 8500 lbs.)11 4,442.19 18 9 2 Electric vans HDT:Heavy Duty Truck 16 4,439.38 18 14 1 Prototype Vehicle LDPu:Light-Duty Pickup 68 3,135.80 13 63 63 Several companies are working on small vans/pickups MDT:Medium Duty Truck 10 2,611.60 10 10 1 Prototype Vehicle Misc:Miscellanous Equip 5 808.80 3 5 0 Moto:Motorcycle 6 8,837.50 35 4 4 Electric Motorcycles MVan:Mini Van 4 2,249.25 9 4 2 Electric vans patrol:Police Patrol 2 5,837.50 23 1 0 PS:Police Sedan 26 11,348.48 45 7 0 SUV:Sports Utility Vehicle 30 8,145.01 33 19 0 90 Fleet Study November 2016 Major Recommendations 1.Set consistent annual budgets for vehicle replacement around $1.5 million per year (If combine with right sizing number can be reduced slightly) 2.Establish a Fleet management Steering Committee 3.Phase in Electric vehicles 4.Implement right sizing recommendations and establish motor pool (Sharing) controlled by fleet Fleet Study November 2016 Major Recommendations 1.Set consistent annual budgets for vehicle replacement •Budgets should be around 1.5 million each year (Slightly less if right sizing is implemented) •Avoid large purchases in one year •Avoid few purchases in one year •Keeps the fleet more reliable and dependable Fleet Study November 2016 Major Recommendations 2.Establish a Fleet management Steering Committee •Works with the departments for all fleet acquisitions •Approve vehicle policies & procedures •Organizes sharing policies for vehicles •Chaired by Fleet Superintendent The FMSC Members are Representatives from: •Each Using Department •City Manager’s Office •Purchasing •Budget Fleet Study November 2016 Major Recommendations 3.Phase in Electric vehicles Vehicle Count Avg Miles per Year Est Miles per Day Vehicles Traveling Less than 30 Miles per Day Number of Potential Electric Vehicles Comment Ambu:Ambulance 5 10,525.00 42 2 0 Auto:Automobile 12 2,651.37 11 11 11 electic auto Boat:Boat 1 - 0 1 0 Cart:Small Cart Vehicle 3 267.67 1 3 3 Electirc carts Elect:Electric Vehicle 3 6.67 0 3 3 Electric Carts FireApp:Fire Apparatus 11 4,706.68 19 10 0 FSV:Full Size Van/wagon (< or = 8500 lbs.)11 4,442.19 18 9 2 Electric vans HDT:Heavy Duty Truck 16 4,439.38 18 14 1 Prototype Vehicle LDPu:Light-Duty Pickup 68 3,135.80 13 63 63 Several companies are working on small vans/pickups MDT:Medium Duty Truck 10 2,611.60 10 10 1 Prototype Vehicle Misc:Miscellanous Equip 5 808.80 3 5 0 Moto:Motorcycle 6 8,837.50 35 4 4 Electric Motorcycles MVan:Mini Van 4 2,249.25 9 4 2 Electric vans patrol:Police Patrol 2 5,837.50 23 1 0 PS:Police Sedan 26 11,348.48 45 7 0 SUV:Sports Utility Vehicle 30 8,145.01 33 19 0 90 Fleet Study November 2016 Major Recommendations 3.Phase in Electric vehicles Electric vehicles are good for the environment but what about the pocketbook? Fleet Study November 2016 Major Recommendations 3.Phase in Electric vehicles Cost Comparison: 12,500 Miles Driven per year 8 Years to keep vehicle Vehicle Type Nissan Chevy Leaf Malibu Vehicle Price 33,000 20,000 Charging Station 2000 (Fed Grants)8250 total cost 26750 20,000 efficiency 5 Miles/KWH 20 MPG fuel cost per year 250.00$ 1,375.00$ Electric Unleaded Fleet Study November 2016 Major Recommendations 3.Phase in Electric vehicles Cost Comparison: Fleet Study November 2016 Major Recommendations 3.Phase in Electric vehicles Steps to phase in electric vehicles 1)Determine locations of use 2)Set up charging stations (currently none) 3)Apply for grants for funding 4)Set plan for encouraging electric vehicle use 5)Purchase vehicles Fleet Study November 2016 Major Recommendations 4.Implement right sizing recommendations and establish motor pool (Sharing) controlled by fleet Number of Vehicles Keep Consider Replacement Consider Reassignment Consider Disposal Personal - Take Home 7 3 0 4 0 Personal NON take home 21 11 0 10 0 Crew\Route Vehicle 41 40 1 0 0 Shared - Pool Vehicle 44 27 1 14 2 Special Assignment 88 73 11 0 4 Spare/Reserve 7 3 0 3 1 Not Needed 5 0 0 5 0 213 157 13 36 7 Fleet Study November 2016 Major Recommendations 4.Implement right sizing recommendations and establish motor pool (Sharing) controlled by fleet Motor pool vehicles should be divided into 3 motor pool types based on need: 1-Central motor pool managed by fleet and reserved through fleet (for example a sedan for common use between all departments) 2 –Department motor pool managed by departments (for example a pickup truck for hauling specialized equipment) 3 –An individually assigned “pool” vehicle that is managed by the person assigned but available at certain times for sharing (For example a patrol car that could only be shared with other officers) Fleet Study November 2016 Potential Savings from Recommendations CST created a graduated implementation plan as shown below 2016 2017 2018 2019 2020 Vehicles to Replace Annually 17 17 17 17 17 Target % of Underutilized to Reassign 40%30%20%10%10% Number to Reassign 14 11 7 4 4 Reduction (Due to Reassignment) 4 3 2 1 1 Target % of Underutilized to Dispose 30%25%5%5%5% Reduction (Due to Disposal ) 6 0 0 0 0 Total Vehicles Reduced 10 3 2 1 1 Keep 203 200 198 197 195 Fleet Study November 2016 Potential Savings from Recommendations With this plan the fleet size would be gradually reduced and vehicles brought back within their recommended life cycle What if ….? Plan to bring fleet back into Life-Cycle compliance 2016 2017 2018 2019 2020 Number of Vehicles in Lifecycle 172 175 175 186 195 Vehicles Up for Replacement (Beyond Age of Lifecycle) 41 27 23 10 (1) Total Vehicles 213 202 198 196 194 % within Lifecycle 81%87%88%95%100% Fleet Study November 2016 Potential Savings from Recommendations Three categories of savings 1) Capital is eliminated from revolving fund (not 2016 budget reductions) 2) Maintenance eliminated on reductions 3) Vehicle sales are tangible savings Fleet Study November 2016 Moving Forward CST has provided all models included in this report as a tool to the City of South San Francisco. The models will be useful in adjusting the plan as the City moves forward. Fleet Study November 2016 Ron Hall 336 -287-8348 rhall@carolinast.com Thank You ATTACHMENT 3 Document Description Client City of South San Francisco DKS Project Number P17011-009 Project / Proposal Name South San Francisco Electric Vehicle Charging Masterplan Related Task / WBS Number NA Document Name South San Francisco Electric Vehicle Charging Masterplan File Path \\dksoakfs1\P\17\17011-009 SSF Electrical Vehicle Charging Station Masterplan\07 Deliverables\02 Reports\Draft Date Document Issued May 1, 2018 Version Control Version Number Date Description of Change Author 0-1 05/01/18 Initial Document MJU 0-2 06/20/18 SSF Review SSF 0-3 06/27/18 Comment responses MJU 0-4 09/27/18 Pre-final MJU 0-5 11/8/2018 Final MJU City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Shaping a Smarter Transportation Experience Table of Contents Executive Summary ____________________________________________________________________________ 4 1.0 Introduction ____________________________________________________________________________ 7 1.1 Background __________________________________________________________________________ 7 1.2 How to Use This Document ______________________________________________________________ 8 1.3 Mission, Vision, Goals and Objectives______________________________________________________ 8 1.4 Key Questions _______________________________________________________________________ 10 1.5 Key Performance Indicators ____________________________________________________________ 14 2.0 Needs and Opportunities ________________________________________________________________ 15 2.1 Project Needs ________________________________________________________________________ 15 2.2 City Vehicle Needs ____________________________________________________________________ 17 2.3 Current and Future EVs ________________________________________________________________ 18 2.4 EVSE Types __________________________________________________________________________ 20 2.5 Available Funding Opportunities ________________________________________________________ 23 3.0 Charging Electric Vehicles on City Facilities __________________________________________________ 28 3.1 Priority Setting and Implementation Phasing ______________________________________________ 28 3.2 Charging for City-Operated Vehicles on City Facilities ________________________________________ 31 3.3 Charging for City Employees' Vehicles at City Worksites ______________________________________ 35 3.4 Charging for Public-Owned Vehicles at City Facilities ________________________________________ 37 3.5 Charging for City and Public-Owned Vehicles at Current and Planned City Facilities ________________ 41 4.0 Publicly Accessible Electric Vehicle Charging on Non-City Facilities ______________________________ 45 4.1 Publicly Accessible ESVE Locations _______________________________________________________ 45 4.2 Policy Guidance for Inclusion of Appropriate EVSE in Development Projects ______________________ 49 4.3 Incentives to Encourage EV Usage and Sales _______________________________________________ 52 5.0 BIBLIOGRAPHY ________________________________________________________________________ 53 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Shaping a Smarter Transportation Experience List of Figures Figure 1: South San Francisco Existing & Proposed EVSE Locations ______________________________________ 6 Figure 2: Overview of EV Charging Types __________________________________________________________ 22 Figure 3: Proposed EVSE at City-owned Facilities ___________________________________________________ 30 Figure 4: Site plan of propose Public Works Corp Yard EVSE __________________________________________ 32 Figure 5: Site plans of proposed Miller Ave Garage EVSE – Main floor (above) and 4th Floor (below) _________ 38 Figure 6: Site plan of proposed City Hall Parking Lot EVSE ____________________________________________ 42 Figure 7: Existing EV Charging Locations in South San Francisco _______________________________________ 48 List of Tables Table 1:South San Francisco EVSE Masterplan Summary ______________________________________________ 4 Table 2: Questions to be Addressed by EVSE Masterplan _____________________________________________ 10 Table 3: EVSE Performance Metrics ______________________________________________________________ 14 Table 4: Project Needs by City Department ________________________________________________________ 15 Table 5: Electric Vehicle Candidates for South San Francisco Motor pool ________________________________ 17 Table 6: Currently (2018) Available Electric Vehicles _________________________________________________ 18 Table 7: Future Electric Vehicles by Year of Planned Year of Introduction: 2018 -2022 _____________________ 19 Table 8: Comparison of EVSE Charging Capacity by Miles per Minute ___________________________________ 22 Table 9: Summary of Available EVSE Funding Opportunities __________________________________________ 23 Table 10: Implementation Priorities ______________________________________________________________ 28 Table 11: Implementation Timeframes ____________________________________________________________ 28 Table 12: Summary of Planned EVSE Funding at City-Owned Facilities __________________________________ 29 Table 13: Anticipated Charging Needs for Employee Commute Vehicles by City Worksite __________________ 36 Table 14: South San Francisco EVSE Siting Guidelines ________________________________________________ 43 Table 15: Existing EV Chargers in South San Francisco _______________________________________________ 46 Table 16: EV Charging Requirements from California State and Municipal Codes _________________________ 51 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Shaping a Smarter Transportation Experience Acronymns AC Alternating Current BAAQMD Bay Area Air Quality Management District BEV Battery Electric Vehicle (See also EV & PEV) CCC Civic Center Campus DC Direct Current DCFC Direct Current Fast Charge (DC Fast Charge) EA Electrify America, LLC. EV Electric Vehicle EVSE Electric Vehicle Supply Equipment FAR Floor Area Ratio GHG Green House Gas (emissions) HPC High Power Charger ICE Internal Combustion Engine kW Kilowatt kWh Kilowatt hour MMBTU one million British Thermal Units (BTU) MSB Municipal Services Building NEMA National Electrical Manufacturers Association PEV Plug-in Electric Vehicle (See also EV & BEV) PG&E Pacific Gas and Electric Company PHEV Plug-in Hybrid Electric Vehicle SSFEV South San Francisco Employee Vehicle TBD To Be Determined TCO Total Cost of Ownership V Volt ZEV Zero-Emissions Vehicle Page 4 City of South San Francisco Electric Vehicle Charging Master Plan May 1, 2018 EXECUTIVE SUMMARY This plan is intended to guide deployment of Electric Vehicle Supply Equipment (EVSE) or electric battery charging infrastructure to facilitate conversion of the City’s vehicle fleet to electric power. This plan determines which City-owned facilities are most appropriate for EVSE installation by priority, implementation phase, EVSE type, primary and secondary user and primary funding source as summarized in Table 1. Table 1:South San Francisco EVSE Masterplan Summary Attribute Options EVSE User SSF Vehicles, SSF employees and general public Primary Funding Source PG&E’S EV Charge network, EVgo, SSF general funds Additional Funding Source BAAQMD, Electrify America Chargers Level 2 DC Fast Charger High Power Charger Existing 90 4 0 Planned (Phase 1 &2) 55 0 4 Planned (Phase 3) 40-48 2 50 Total 185-193 6 54 Implementation Phase Existing City Charging Sites City EV Chargers Public EV Chargers Priority Possible Funding 1 (late 2018) SSF City Hall Annex Public Works Corp Yard 1 1 - High High SSF SSF and PG&E 2 (early 2019) Public Works Corp Yard 23 8 High PG&E City Hall Parking lot 12 High PG&E Miller Ave Parking Garage - 10 4 HPC High High PG&E EVgo 3 (by 2021) Fire Station #61 Fire Station #62 Fire Station #64 Fire Station #65 Water Quality Control Plant Fernekes Recreation Bldg. Other City facilities Brentwood Parking Lot 4 2 2 2 2 - - - - - - - - 3 - 6 1 - 2 2 – 6 Medium Low Low Low Low Low Low Low SSR or EA SSF SSF SSF SSF BAAQMD or EA BAAQMD BAQMD Implementation Phase Planned Charging Sites for Future City Facilities City EV Chargers Public EV Chargers Priority Possible Funding 3 (by 2021) Future Community Civic Center Campus Future Police Station Future Fire Station #63 Future Garage #2 10 4 + 2 DCFC 2 - 4 10 - - 50 HPC Medium Medium Medium Medium PG&E, SSF or EA SSF SSF BAAQMD/EA/EVgo Page 5 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 The plan’s high priority sites are being implemented in two phases in 2018 and early 2019, totaling 55 level 2 chargers and 4 High Power Chargers. Implementation of Phase 1 of this plan consisted of installation of two Level 2 chargers available to charge City and employee vehicles at the City Hall Annex and the Public Works Corp Yard, facilitating initial fleet electrification. The second phase consists of 53 smart level 2 chargers to be installed in early 2019 by PG&E as part of the utility’s EV Charge network and four High Power DC Fast Chargers to be installed by EVgo. As summarized in Table 1, 23 of these will be used primarily to charge City-owned vehicles at the Public Works Corp Yard and City employee commute (personal) vehicles when not in use by the City. 18 level 2 chargers plus four High Power Chargers will be available for public charging at the Miller Ave Garage and in front of the Corp Yard and the remaining 12 chargers will be available for shared charging use by City fleet vehicles, as well as the general public at the City Hall parking lot. Depending on charging demand and EVSE funding opportunities, subsequent implementation phases could add chargers for each type of user at other City-owned facilities including fire stations, parks, and other sites as well as the City’s planned police, fire and community center campus at Antoinette Ln. and Chestnut Ave. as well as additional public chargers at the future downtown parking garage #2. Along with guiding EVSE at City facilities, this plan provides guidance and information on current and future electric vehicles, EVSE types and existing charging facilities, EVSE funding opportunities, suggested performance metrics, and policy and regulatory guidance for EVSE siting, shared use, and deployment. Page 6 City of South San Francisco Electric Vehicle Charging Master Plan May 1, 2018 Figure 1: South San Francisco Existing & Proposed EVSE Locations Page 7 City of South San Francisco Electric Vehicle Charging Master Plan May 1, 2018 1.0 INTRODUCTION 1.1 Background The benefits of electric traction power are many, including reduced emissions, lower operating costs, reduced maintenance, vehicle longevity and enhanced performance. Driving electric cuts greenhouse gas emissions in half—or more, depending on how electricity is generated where drivers live. The City of South San Francisco is part of Peninsula Clean Energy, San Mateo County’s official electricity provider to meet local climate action goals by providing 50% renewable energy. Charging a PEV usually costs half as much as getting gas (or even less), so an electric vehicle can save its owner about $13,000 over the life of the vehicle. Plus, PEVs don’t need oil changes, are less expensive to maintain than internal combustion engine (ICE) vehicles and may be eligible for tax credits, rebates and even access to HOV lanes. In California, emissions from transportation account for 50 percent of the state’s greenhouse gas (GHG) emissions and 80 percent of smog-forming pollutants which is why the state has been the national leader regulating air pollution and GHG emissions as well as on the market for Zero Emission Vehicles (ZEVs). On January 26, 2018, Governor Brown signed Executive Order B-48-18 targeting 5 million ZEVs in California, a third of the state’s vehicles by 2030 through significantly expand vehicle charging infrastructure. This $2.5 billion initiative will help install 250,000 additional vehicle charging stations throughout California by 2025. Funding is available through the California Energy Commission’s $100 million annual Alternative and Renewable Fuels and Vehicle Technology Program as well as through incentives approved by the California Public Utilities Commission. (See Section 2.5 for more information on available funding opportunities.) South San Francisco, located in the center of the San Francisco Peninsula in California’s Bay Area, serves as a critical transportation artery for those wishing to travel in and out of San Francisco and throughout the Peninsula. The city’s central location and proximity to high-quality transportation such as commuter rail, regional bus networks, and ferry system make it a growing hub for transit and commuters throughout the region. City and local government officials are currently planning and implementing strategies to accommodate this growing class of commuters while also looking to curb harmful greenhouse gas emissions Page 8 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 (GHGs) and other pollutants emitted from traditional internal-combustion-engine (ICE) vehicles. The City has adopted its own Climate Action Plan, approved the first commercial vehicle hydrogen fuel station in San Mateo County, and was an active participant in completion of the San Mateo County Alternative Fuel Readiness Plan, which includes developing best practices to increase procurement, usage, and availability of alternative fuels; supporting and promoting public private partnerships; and facilitating coordinated efforts in pursuing alternative fuel related funding opportunities. Through these efforts, the City hopes to reduce the environmental impact of daily commuting and transportation in the Bay Area through increased usage of zero emission vehicles in City fleets, by employees commuting to City work sites and by supporting access to EV charging stations to promote charging by the general public. 1.2 How to Use This Document This plan has been developed to assist the City strategically electrify its fleet and support electric vehicle use by its employees, citizens and visitors. This document is comprised of four chapters: • Chapter 1 provides the decision-making framework including the plan’s vision, goals and objectives and answers to the City’s most important questions as well as the measures by which success will be evaluated. • Chapter 2 clarifies the project needs including those specific to each City department and the overall fleet needs. This chapter also provides a summary of electric vehicle offerings and EVSE types and a survey of applicable EVSE funding opportunities, several of which support plan implementation. • Chapter 3 addresses the City’s needs for charging its future vehicle fleet at City facilities, use of this infrastructure by employees to charge commute vehicles as well as public vehicle charging on City- owned facilities. This chapter also includes guidance on planning and siting of EVSE. • Chapter 4 focuses on public charging on non-City facilities. It includes a detailed inventory of all existing EVSE and policy guidance to assist the Planning Department with planning, zoning and building codes. 1.3 Mission, Vision, Goals and Objectives Mission The City’s mission statement is: The City of South San Francisco’s mission is to provide a safe, attractive and well-maintained City through excellent customer service and superior programs. One of the City’s core values under the mission statement is for the City to commit to excellence and services. Vision The City of South San Francisco is preparing for a future increasingly dominated by highly efficient, cost- effective and emissions-free vehicles. Consistent with the City of South San Francisco’s Climate Action Plan and other policies, this EVSE master plan envisions reducing the City’s environmental footprint by expanding the use of alternative-fuel vehicles. The City seeks to set a visible public example by converting its fleet to electricity—a safe, abundant, clean and convenient energy source for vehicles of all types. The City is laying Page 9 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 the groundwork for electric traction power by strategically planning and expediting implementation of the City’s vehicle charging infrastructure to charge portions of a right-sized, electrically-powered municipal vehicle fleet in the near term. This infrastructure will be located at prominent City-owned facilities to conveniently charge City-operated electric vehicles as well as to encourage electric vehicle commuting by City employees. Additional charging infrastructure will be installed at the City’s downtown public parking and other public parking facilities to serve the charging needs of the general public. This master plan seeks to foster investments in electric vehicle charging infrastructure on private development through appropriate policies, guidance and resources. Goals and Objectives This plan will be guided by the following three goals, each of which is clarified by specific objectives. Goal 1: Provide direction for electrification of City fleets Objective1.1: Project and clarify future PEV fleet needs by range, type and cost Goal 2: Provide direction for EVSE infrastructure on City property for City fleet vehicles, employee-owned vehicles and public use Objective 2.1: Provide technical guidance for EVSE deployment at City facilities addressing EVSE types, charging locations, EVSE quantities, design and maintenance considerations, prioritization and deployment timeframes. Objective 2.2: Provide planning-level cost-estimates for EVSE deployment Objective 2.3: Provide documentation needed to support future grant and other program applications to fund and install EVSE Objective 2.4: Provide policy direction for EVSE sharing by City and employee-owned vehicles Objective 2.5: Provide guidance regarding liability and risk related to EVSE use Goal 3: Support use of electric vehicles through expanded EVSE installation by the private sector on private property within the City of South San Francisco Objective 3.1: Provide policy guidance for updates to land use, development and parking codes to ensure inclusion of appropriate EVSE in development projects Page 10 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 1.4 Key Questions This master plan seeks to provide guidance to the City’s questions asked by the project stakeholders during the project’s January 8, 2018 kickoff meeting. These questions, organized by topic, are answered below in Table 2. Table 2: Questions to be Addressed by EVSE Masterplan Question Answer by Topic Question Fleet Selection What vehicle range is needed? According to analysis by CST Fleet Services as part of the City’s 2016 Fleet Study, the average fleet vehicle only travels 20.5 miles per day and most vehicles travel far fewer miles. Only 5 police vehicles average more than 100 daily miles. New generation PEVs have an average range of 180 miles per full charge so range will not be an issue, assuming the City has sufficient charging infrastructure for its fleet. Other than range and cost, what should be EV fleet selection criteria? Clearly the needs of the user should drive fleet selection. The City’s 2016 Fleet Study recommended right sizing the City’s fleet and establishing a motor pool of shared vehicles. A shared fleet would need to be versatile but most of these would be light duty passenger vehicles. The other two applications include light pick -up trucks for parks and emergency response vehicles. Assuming the City has sufficient PEV charging capacity as proposed by this plan, the fleet selection criteria should not differ significantly from other fuel type vehicles. What should the City select for vehicle types? As discussed above, the City should select versatile vehicles for shared use including relatively small passenger cars and light pick-up trucks. Because of their round-the-clock usage, Police cruisers should have higher battery capacity. For example, the Chevy Bolt has 240-mile range. When charged at its maximum charge rate of 60kW, a Chevy Bolt would take approximately one hour to charge using a DC Fast Charger proposed for the future Police Station or even less time at the High Power Charger proposed for Miller Ave Garage. Tables 6 and 7 list current and future EVs. Question Vehicle Cost What are the vehicle purchase costs? The base price of electric vehicles currently on the market as of 2018 range from approximately $30K for a Ford Focus or Nissan Leaf to well over $100K for higher end Tesla models. The median base price excluding the higher end Tesla models is a little over $32,000 excluding $2,500 state and $7,500 federal EV purchase incentives. For more information, see: https://evrater.com/evs#ev-list What are the vehicle operations costs? The vehicle operation costs depend on the actual vehicle and its usage. More relevant to this plan however is a comparison of the cost of a comparable gasoline fueled automobile to a PEV. A 2018 study published in the Journal of Applied Energy (Palmer, Tate, Wahdud & Nellthorp) determined that the average relative cost of depreciation for EVs to be approximately 11% higher but maintenance to be 30% less and fuel cost to be almost 50% less than gasoline fueled vehicles. Page 11 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Question Fuel Type(s) Should the City only consider battery electric or plug-in hybrid or fuel cell vehicles? A 2015 study of different vehicle types found battery-electric vehicles to be slightly less than legacy gas or diesel vehicles on a Total Cost of Ownership (TCO) basis. Of the three types of electrified vehicle, the pure EV is most cost-effective. The TCO for hybrids was higher than that of traditional vehicles because they still use fuel and have more complex drivetrains, and receive less in the way of incentives. Plug-in hybrids were generally the most expensive type of vehicle. See https://cleantechnica.com/2018/02/05/new-study- finds-electric-vehicles-offer-lowest-total-cost-ownership/ Question Ownership Should the City lease or purchase its EV fleet? Leasing EVs is more popular than purchasing for the general public due to a number of reasons such as battery degradation over time, improving technology, lower monthly payments and tax credits. However, it is not clear that these benefits apply to City fleets. From a pure economic perspective, direct purchase is typically a lower cost option assuming the City has sufficient capital for fleet purchase. Alternatively, the City may want to consider car share options where the electric vehicle is owned by a third -party mobility service such as Envoy. Under this option, the City could host a small fleet of on- demand electric vehicles parked on City facilities for use by City employees and pay by use without having to own or lease the vehicle. For more information, see: https://www.envoythere.com/ Should the City lease or purchase EVSE? The majority of costs for EVSE is design and installation rather than the purchase cost of the charging equipment itself, therefore EVSE leasing would not offer the City much cost advantages. In the first two phases of this plan, 44 of 46 chargers proposed for City facilities will be owned and maintained by third parties including PG&E and EVgo as described in section 2.5. Question Charging Station Quantities How many charging stations per EV? The number of chargers per EV depends on the type of charger, vehicle use, and vehicle range. For the sake of planning, a reasonable assumption is one charger for every three EVs. A good rule of thumb is to plan on installing twice as many chargers as the City anticipates it will need, and double the capacity of the conduit and load capacity of the panel to accommodate future chargers. How many charging stations per building? The number of chargers per City-owned building depends on the type of charger, as well as the vehicle use and range of City and employee-owned vehicles charging at each facility. In addition, because the majority of chargers proposed by this plan are supported by PG&E’s EV Charge Network program that mandates at least 10 chargers per site, the Public Works Corp Yard, City Hall Parking Lot and Miller Ave Garage will each have 10 or more chargers though subsequent phases may add smaller numbers of chargers at additional facilities as summarized on Table 12. Because it is far more cost- effective to incorporate EVSE in new construction than retrofits, planned facilities such as the future Community Civic Center Campus, Police and Fire Station as well as Garage #2 should be designed for EV readiness as discussed in Chapter 4 to maximize capacity for future EV charging demands. Page 12 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Question Type(s) of chargers What type of EVSE should the City purchase for its fleet? This plan recommends a small number of low-cost Level 2 chargers for initial purchase and installation in Phase 1 at the Corp Yard and City Hall Annex. Additional Level 2 smart chargers will be installed by PG&E in Phase 2 at City Hall Parking Lot and the Corp Yard. EVSE selection for subsequent phases of implementation will be determined by fu ture fleet needs, available technology and funding opportunities. Are there applications requiring different EVSE? Yes. This plan includes both Level 2 chargers for City and employee veh icles parked at City facilities. These chargers require approximately 4-6 hours to recharge vehicles. DC Fast Chargers or High Power Chargers are recommended for convenient faster public charging at the Miller Avenue Garage. Question Financial Incentives What EVSE grants are available for the City to apply for? Numerous third-party funding opportunities may be available for implementation of this plan as discussed in section 2.5. Question Maintenance How should the City maintain its EV fleet? PEVs have fewer moving parts than ICEs and are far simpler to maintain. Most maintenance functions will continue to be performed by the City’s 3.5 mechanics. If necessary, the City’s mechanics may need additional training to handle any maintenance tasks unique to EVs as the EV fleet ages. How should the City maintain its EV EVSE? As proposed by this plan, the majority of the City’s EVSE will be owned and maintained by PG&E under the EV Charge Sponsor options selected by the City: PG&E is required to maintain the EVSE for the duration of this contract (10 years). PG&E will pay all Operations and Maintenance costs associated with the EVSE, maintains the common area improvements, and keeps the EVSE in good condition, excluding ordinary wear and tear. Can Someone on staff be trained? As noted above, the City’s mechanics may need additional training to handle any vehicle maintenance tasks unique to EVs as the EV fleet ages. City owned EVSE can be maintained by certified electricians. What are the staffing and administrative impacts of maintenance? Staffing and administrative impacts should be minimal. Under the selected EV Charge Sponsor option, the City is responsible for notifying PG&E or EVgo of any problems it is aware of related to the EVSE. The City maintains the immediately surrounding common areas such as pavement maintenance. - What are the costs of outsourcing maintenance? EVSE maintenance is included as part of the EV Charge Sponsor option selected by the City. Page 13 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 What are the GHG & emissions benefits of vehicle electrification? GHG reduction is one of the principal benefits of electric vehicles. For example, according to the Union of Concerned Scientists, a 2018 Ford Focus Electric in California emits less than one quarter of the GHG than a comparable gas-powered vehicle and achieves the equivalent of 118 mpg. (Source: https://www.ucsusa.org/clean-vehicles/electric- vehicles/ev-emissions-tool#z/94080/2018/Ford/Focus%20Electric) Switching from traditional combustion engines to electric vehicles in urban areas will also reduce criteria air pollutants including: volatile organic compounds (VOC) and carbon monoxide (CO) by 100 percent; sulfur oxide (SOx) by 75 percent; nitrous oxide (NOx) by 69 percent; particulate matter (PM10) by 31percent (Source: Argonne National Laboratory) Question Environmental Benefits How should charging stations be metered for electricity use? Electricity used by low cost chargers installed by the City as part of phase 1 can be tracked using data loggers but will not need to be metered. Level 2 chargers by EVBox installed by PG&E will be smart chargers. Smart Charging is an umbrella term that defines all intelligent functionalities in EVBox’s charging stations that optimize the charging infrastructure by creating and distributing the available power in an efficient and flexible manner. Question Electric Meters and Efficiency Optimization What is the best way to determine efficiency? Efficiency can be tracked using data loggers on low cost Level 2 chargers and using EVBox’s charging management software on Level 2 chargers owned by PG&E. Is there an economy of scale? Yes. PG&E requires a minimum of 10 chargers per site to optimize economy of scale, which is why 31 chargers are proposed at the Corp Yard, 12 at the City Hall parking lot and 10 at Miller Avenue Garage. Question Solar Feasibility Can on-site solar be used to supply electricity for charging? On-site photovoltaic panels located above parking facilities generate power for the grid but are not typically connected directly to EV chargers; charging demand times do not sync well with maximum solar energy and the size of the solar panels and energy storage would likely exceed the space requirements of the City’s charging facilities. Question Employee Charging How should the City guarantee charging for employees? Section 3.3 contains policies and guidelines for employee use of the City’s chargers which do not include charging guarantees because the City’s chargers may be in use to charge municipal vehicles. Page 14 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Question Resiliency In the event of a power outage, how would facilities staff power up vehicles that are charging over night or at the time? To minimize risk of running low on power, vehicle batteries should never be drained below a certain point. This should not be a problem for most City vehicles due to the relatively low millage driven by the majority of the City’s fleet coupled with increasing range of newer EVs. However, as an emergency precaution, the City could connect EVSE to generators or standby energy storage systems. The City will need to evaluate the EV charging capacity of existing generators to ensure resiliency. How many vehicles could the generator charge in addition to the building during an emergency? This will depend on the available surplus capacity of each facility’s emergency power supply. Question Auxiliary Power Supply Could EVs and/or EVSE be used as power sources for such tools and equipment? Use of the EV battery to power equipment on some EV models. For example, Via Motors offers vans with the capability of being equipped with two 240-volt outlets for work or emergencies. A power export module option provides 14.4 kW at 60 amps of onboard mobile power. A utility grade output module is planned for the future and will be designed to provide 50 kW of mobile emergency power to keep critical facilities online. (Source: https://www.viamotors.com/electric-vehicles.html) 1.5 Key Performance Indicators Success of this EVSE Masterplan will be monitored over time using the metrics listed in Table 3 below. Table 3: EVSE Performance Metrics Topic Metric 1. Energy Consumption • MMBTU 2. GHG Emissions • MTCO2e (Metric ton of CO2 equivalent) 3. City vehicle ownership cost • Total purchase and operational expenditures 4. EVSE usage by: - City Vehicles - City Employees - Public • Hours charged • KWH 5. Employee Satisfaction • Employee survey responses Page 15 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 2.0 NEEDS AND OPPORTUNITIES This chapter addresses the City’s electric vehicle fleet needs, summarizes current and expected electric vehicle offerings and charger types and EVSE funding opportunities. 2.1 Project Needs The needs for EVSE vary by City department. According to input provided as part of a focus group conducted with City stakeholders on January 8, 2018, the specific needs of each department are summarized in Table 4 below: Table 4: Project Needs by City Department City Department Project Needs Planning Division The Planning Division develops long-range policies and guidelines and processes development applications. The Planning Division seeks policy and regulatory resources supporting vehicle electrification in private developments consistent with the City’s General Plan and Climate Action Plan. Current building codes require new development to be “EV Ready” and the Zoning Ordinance contains non-mandatory incentives in the form of a Floor Area Ratio / density bonus in some districts for green building measures, which could include EV charging and parking beyond baseline requirements. The Planning Division seeks guidance on how to update policies, codes, incentives and provide guidance for developers, in order to encourage EV infrastructure in private development. Fire Department The Fire Department’s immediate EV needs are to replace its current fleet of 2 -4 small pick-up trucks used by fire inspectors with light duty EVs that carry a certain amount of equipment needed for fire inspections and investigations. The start-stop usage and short trips make this fleet appropriate for electrification. These are currently based at Fire Station #61 which has appropriate locations to install EVSE. Fire prevention staff are currently assigned individual vehicles but due to low mileage and lack of specific vehicle needs, some vehicle consolidation may be possible. One concern unique to this department is disaster resiliency—supplying fuel to the backup generator in the event of long-term power outage, however this generator could be used to charge EVs. Facilities Division The Facilities Division cleans and maintains the City’s buildings, operating both a day and night shift. Because of the dual shift operations, EVs used by cleaning crews may need to charge on-site at multiple locations or have access to a Direct Current Fast Charger (DCFC). Another concern is redundancy – in the event of a power outage, how would facilities staff power up vehicles that are charging over night or at the time? How many vehicles could the generator charge in addition to the building during an emergency? Page 16 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 City Department Project Needs Parks Division Parks operates a large fleet of light duty pickup trucks and heavy -duty trucks for specialized work. In addition to the need for vehicles, park maintenance crews have particular needs for tools and equipment that could be electrified such as lawn mowers, utility vehicles, leaf blowers, and light power tools. Could EVs and/or EVSE be used as power sources for such tools and equipment? Police Department The Police Department was not represented at the kickoff meeting. However, according to the 2016 Fleet Study, the Police Department has a large vehicle fleet and police patrol vehicles that are among the most utilized vehicles in the City’s fleet, making them worth considering for electrification. According to Ron Hall of CST Fleet Services, travel range limitations of battery electric vehicles available in 2016 prevented consideration of EVs at that time but newer, extended range EVs and faster charging speeds are expected to support this use in the near future. Page 17 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 2.2 City Vehicle Needs The City of South San Francisco’s vehicle fleet management consultant CST Fleet Services analyzed the City’s vehicle needs and prepared a fleet report in 2016. The report identified five classes of vehicles for future electrification comprising a total of 81 vehicles as well as four additional classes of potential vehicles that could be electrified pending viable prototypes, totaling six vehicles as summarized in Table 5 below. Due to limitations in current electric vehicle availability, the City is focusing on acquiring electric light duty vehicles as its initial EV fleet, to which electric pick-up trucks and other trucks will be subsequently added once these become more widely available in the market. Table 5: Electric Vehicle Candidates for South San Francisco Motor pool Vehicle Type EVs Needed Vehicle Type Prototypes Needed Light Duty Pickup 63 Full Size Van/Wagon 2 Automobile 11 Mini Van 2 Small Cart Vehicle 3 Heavy Duty Truck 1 Motorcycle 4 Medium Duty Truck 1 Total 81 6 Source: South San Francisco Fleet Report, CST Fleet Services 2016 (minus 3 former electric carts) Among other suggestions, the 2016 analysis recommended that the City right-size its fleet through reassignment including increased reliance on shared vehicles since many vehicles are used infrequently and/or for short trips, and also recommends setting consistent annual budgets for vehicle replacement that could be reduced through vehicle sharing. The most relevant recommendation to this plan is to phase in electric vehicles as older vehicles are retired and new EV models are introduced to the market. The 2016 report identified the following steps to phase in EVs: 1) Determine locations of use 2) Set up charging stations (currently none) 3) Apply for grants for funding 4) Set plan for encouraging electric vehicle use 5) Purchase vehicles The analysis also recommended the conversion of an additional 74 specialty vehicles including ambulances, fire apparatus, and police patrol cars and SUVs to electric drive trains once appropriate specialty electric vehicle models become available. Consider Disposal , 6 Consider Replacement, 9 Consider Reassignment , 97 Keep , 101 Vehicle Recommendation Summary Page 18 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 2.3 Current and Future EVs In 2016 when CST was preparing the fleet analysis, very few EVs were available on the market and the few available models had limited range or high initial price as exemplified by the Nissan Leaf and the Tesla Model S. Since then, the automotive industry has introduced or announced numerous new and planned EV models. By 2018, 14 vehicle brands offer a total of 24 models with an average vehicle range of nearly 180 miles per charge, as summarized in Table 6. Table 6: Currently (2018) Available Electric Vehicles Brand Model Price Battery (kWh) Range (miles) BMW i3 $43,450 33 114 CHEVROLET Bolt EV $37,495 60 238 FIAT 500e $31,800 24 84 FORD Focus Electric $29,120 33.5 115 HONDA Clarity Electric $34,290 25.5 89 HYUNDAI loniq Electric $29,500 28 125 KIA Soul EV $32,250 30 111 MERCEDES-BENZ B250e* $39,900 36 87 MITSUBISHI i-MiEV* $22,995 16 62 NISSAN Leaf $29,990 40 150 NISSAN Leaf (1st Gen) $30,680 30 107 RENAULT Zoe $31,000 41 186 SMART Fortwo ED $23,800 17.6 100 TESLA Model 3 $35,000 55 220 TESLA Model 3 (Long Range) $49,000 75 310 TESLA Model S 100D $94,000 100 335 TESLA Model S 75* $69,500 75 249 TESLA Model S 75D $74,500 75 259 TESLA Model S P100D $135,000 100 315 TESLA Model X 100D $96,000 100 295 TESLA Model X 75D $79,500 75 237 TESLA Model X P100D $140,000 100 289 VOLKSWAGEN e-Golf $30,495 35.8 125 VOLKSWAGEN e-Up! $34,500 18.7 99 *Discontinued models Source: EV Rater (https://evrater.com/evs#ev-list) Accessed 1/25/18 Page 19 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 By 2020, virtually every automotive manufacturer will offer a variety of EVs at multiple price points, all with sufficient battery range to meet the City’s needs. Table 7 lists future EV offerings announced by industry as of early 2018 in order of offering. Table 7: Future Electric Vehicles by Year of Planned Year of Introduction: 2018-2022 Year Brand Model Range (miles) Status 2018 AUDI e-tron Quattro 265 Prototype, but production uncertain 2018 HYUNDAI Kona Electric 242 On target for production 2018 JAGUAR I-PACE 220 On target for production 2018 KIA Niro EV 238 On target for production 2018 KIA Stonic EV 186 Prototype, but production uncertain 2019 AUDI e-tron Sportback 250 Prototype, but production uncertain 2019 FARAY FUTURE FF91 378 Vague and Uncertain 2019 FORD Model E 200 Vague and Uncertain 2019 HONDA Urban EV Prototype, but production uncertain 2019 LUCID Air 240 On target for production 2019 MAZDA Unnamed EV Vague and Uncertain 2019 MERCEDES-BENZ EQC 255 On target for production 2019 MINI E Prototype, but production uncertain 2019 NISSAN Leaf (Long Range) 225 On target for production 2019 NISSAN Unnamed SUV 225 Vague and Uncertain 2019 PORSCHE Mission E 260 On target for production 2019 SEAT Mii Electric 99 Vague and Uncertain 2019 TESLA Model Y On target for production 2019 TOYOTA Unnamed EV Vague and Uncertain 2019 VOVLO XC40 220 Prototype, but production uncertain 2020 AUDI A9 e-tron 250 Vague and Uncertain 2020 BMW 3-Series Electric 210 Prototype, but production uncertain 2020 BMW 4-Series GT 311 Vague and Uncertain 2020 BMW X3e Prototype, but production uncertain 2020 MERCEDES-BENZ EQA 180 Vague and Uncertain 2020 MITSUBISHI e-Evolution Vague and Uncertain 2020 SKODA Vision E 260 Vague and Uncertain Page 20 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Year Brand Model Range (miles) Status 2020 TESLA Roadster 620 Prototype, but production uncertain 2020 VOLKSWAGEN I.D. Prototype, but production uncertain 2020 VOLKSWAGEN I.D. AEROe Vague and Uncertain 2020 VOLKSWAGEN I.D. Crozz 240 Prototype, but production uncertain 2020 VOLKSWAGEN I.D. Lounge Vague and Uncertain 2021 BMW Inext Vague and Uncertain 2021 HYUNDAI Unnamed EV 311 Vague and Uncertain 2021 SUBARU Unnamed EV Prototype, but production uncertain 2022 VOLKSWAGEN I.D. Buzz 270 Vague and Uncertain Source: EV Rater (https://evrater.com/evs#ev-list) Accessed 1/25/18 Specialty vehicles including fire apparatus, ambulances, trucks and motorcycles are all currently in development, expected to be rolled out in the relatively near future by manufactures such as Rosenbaur, Nissan, Chanje, and Zero Electric respectively. 2.4 EVSE Types EVSE is the equipment used to deliver electrical energy from an electricity source (such as the electricity running through City facility electrical outlets) to an EV. ESVE communicates with the EV to ensure that an appropriate and safe flow of electricity is supplied. EVSE for EV is classified into several categories by that rate at which the batteries are charged. Level 1 and Level 2 provide alternating current (AC) electricity to the vehicle, with the vehicles onboard equipment converting AC to the direct current (DC) needed to charge the batteries. The other type-DC fast charging- provides DC electricity directly to the vehicle. Charging times range from less than 30 minutes to 20 hours or more based on the type of EVSE as well as the type of battery, how depleted it is, and the vehicle’s energy capacity. Electric vehicles generally have more capacity than PHEV’s, so charging a fully depleted electric vehicle takes longer than charging a fully depleted PHEV. Many medium and heavy duty EV manufacturers are adopting light duty charging standards or commercially available standards developed for other uses. However, some manufacturers are introducing alternative charging configurations in the medium and heavy duty EVs, so EVSE options and performance may be different for these vehicles. Level 1 Level 1 EVSE provides charging through a 120-volt (V) AC plug and requires a dedicated branch circuit. Most, if not all, EVs come with a level 1 EVSE cord set so that no additional charging equipment is required. On one end of the cord is a standard 3 prong house plug (NEMA 5-15 Connector). The other end of the cord is a J1772 standard connector which plugs into the vehicle. Level 1 is typically used for charging when there is only a 120V outlet available. Depending on the battery type and vehicle, level 1 charging adds about 2-5 miles of range to a PEV per hour of charging time. Page 21 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Level 2 Level 2 EVSE offers charging through a 240V (typical in residential application) or a 208V (typical in commercial application) AC plug and requires installation of charging equipment and a dedicated electrical circuit. Because a level 2 EVSE can easily charge a typical EV battery overnight, it is a common installation for fleet facilities. Level 2 equipment uses the same connector on the vehicle on the vehicle as level 1 equipment. Based on the battery type, charger configuration, and circuit capacity, level 2 charging adds about 10-25 miles of range per hour of charge time. Most City vehicles travel fewer than 60 miles a day, so they don’t have high demand for charging. Level 2 is economical to deploy and easy to manage, making it a good fit for most City-owned facilities. DC Fast Charging DC fast charging EVSE (480V input to the EVSE) enables rapid charging at sites such as heavy traffic corridors and public fueling stations. A DC fast charger can add 60-80 miles of range to a light duty EV in 20 minutes. DC fast chargers are also appropriate charging technology for vehicles that are used continuously, such as police cruisers, to minimize down time. DC fast charging stations can minimize stops on long trips and meet driver needs by being conveniently located at regular intervals and near amenities such as restaurants, retail shops and places with WiFi hotspots, giving drivers something to do while their vehicles charge. Ultimately, drivers will be able to charge along the entire interstate highway system and the major roads that feed it from cities and metro areas across the country. High Powered Chargers High Powered (150-350 KW) chargers are high amperage DC fast chargers that are the fastest type of EVSE, able to fully charge an EV in about 15- 20 minutes. These typically require at least 6 parking stalls plus an equivalent area for support infrastructure including a dedicated transformer that can handle a 1-megawatt load at peak draw. These have proven difficult to locate due to the large site requirements, so EVgo (the only charging provider that currently installs High Power Chargers in the US) is looking for cities to provide sites. High Powered chargers are the best type of EVSE for the rapidly growing Mobility as a Service (MaaS) industry typified by Uber and Lyft. J-1772 CHAdeMO CCS/SAE J1772 combo Page 22 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Figure 2: Overview of EV Charging Types Source: https://www.afdc.energy.gov/fuels/electricity_infrastructure.html Table 8: Comparison of EVSE Charging Capacity by Miles per Minute Level 1: 110/120 Volt Charger Level 2: 220/240 Volt Charger 20 A Max Level 2: 220/240 Volt 30 A Max DC Fast Charge 50 kW High Powered Charger 150- 350kW Charging Time Miles 10 minutes 1 2-3 2-4 25-30 Up to 75 30 minutes 2-3 5-7 6-11 75-100 Up to 250 60 minutes 3-5 10-15 12-22 150-200 Up to 500 2 hours 6-10 20-30 24-44 300+ N/A 4 hours 12-20 40-60 48-88 N/A N/A 6 hours 18-30 60-90 72-132 N/A N/A Source: https://w3.usa.siemens.com/powerdistribution/us/en/product-portfolio/electricvehicle/versicharge/Pages/ev-charging- station.aspx and EVgo Page 23 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 2.5 Available Funding Opportunities The City of South San Francisco is eager to utilize third-party funding opportunities to leverage the City’s limited capital investments for EVSE infrastructure. Fortunately, there are multiple programs that support vehicle electrification, the most relevant of which are summarized in Table 9 and described below. Table 9: Summary of Available EVSE Funding Opportunities Program Funding focus appropriate to South San Francisco Potentially Eligible Sites PG&E (EV Charge Network) 60-80% % funding for Level 2 workplace and multi-unit dwellings, with a goal to install 15% of chargers in disadvantaged communities • City Hall Parking lot (12) • Public Works Corp Yard (31) • Miller Ave Parking Garage (10) • future Community Civic Center Campus EVgo 100% funding for DC Fast chargers serving the general public, ideally near high density residential development and retail. • Miller Ave Parking Garage (4 HPC) • future Community Civic Center Campus BAAQMD (Charge!) 75% funding for public Level 2 and DC Fast Chargers serving activity centers, such as libraries, parks, community centers and retail. • Fernekes Recreation Building at Orange Park • future Community Civic Center Campus • other parks, community centers and libraries • Future downtown parking garage • Brentwood Parking Lot Electrify America 100% funding for community-based charging station sites in workplaces, retail municipal lots and garages, as well as 150kW high-speed community charging depots. • future Community Civic Center Campus • Fire Station 61 • Fernekes Recreation Building at Orange Park • Future downtown parking garage Source: PG&E, EVgo, BAAQMD and Electrify America Page 24 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 PG&E Pacific Gas and Electric Company (PG&E), the electric utility serving South San Francisco, is eager to partner with communities to increase the use of electric vehicles. In early 2018, PG&E initiated a new $130m program called EV Charge Network to install 7,500 Level 2 charging ports (deploying single and dual port chargers) at 500-750 sites within its service territory. The focus of the program is workplace and multi-unit dwellings, with a goal to install 15% of chargers in disadvantaged communities such as South San Francisco’s proposed charging locations. The program covers the full cost of the design and installation of infrastructure supporting EVSE hardware as well as a subsidy for the charging equipment itself, representing approximately 60-80% of total project costs for a savings of up to $150,000 per site. PG&E provides all the design and installation except for charger installation, which is completed by the selected vendor. Site owners have the option of which chargers to install from a list of approved vendors, how to price use of chargers and whether to own the chargers. Based on the program’s siting criteria, proposed candidates for the program include: Site EV Chargers Estimated Participation Payment Corp Yard, 550 N. Canal St. 31 $35,650 City Hall, 400 Grand Ave. 12 $13,800 Miller Ave. Garage, 329 Miller Ave. 10 $11,500 Total 53 $60,950 Also, if the application is submitted prior to the program’s 2020 sunset and PG&E funding is still available, the future Community Civic Center Campus (scheduled for the completion in 2021) could also qualify. Because each application needs an account number (which this site doesn’t yet have), PG&E would create a temporary account number and this proposed project would be added to PG&E’s future waitlist, subject to future funding availability. The Public Works Corp Yard, City Hall Parking Lot, and Miller Ave Parking Garage are all located in disadvantaged communities. This means they are eligible for a higher cost offset for the chargers. The program includes two possible options EV Charge Owner and EV Charge Sponsor. In the case the site owns the chargers (EV Charge Owner), the City would receive a rebate of $1,150 per port. In the case that PG&E owns the chargers (EV Charge Sponsor), the City would pay a one-time participation payment equal to the cost of the chargers selected, minus $1,150 per port. After careful review of these choices, the City has selected the EV Charge Sponsor option and has applied for each of these sites. By selecting the EV Charge Sponsor option, PG&E will procure, install, own and maintain the EV Service Connection, EV Supply Infrastructure and EVSE Package. The City is responsible for a one-time participation payment and this will 2-port EVBox Charger For information, contact: Kimberly Voellmann 415.416.5634 k1v5@pge.com Page 25 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 be the City’s only cost for participation in this program. As a qualifying disadvantaged community, the participation payment will be $1,150 per port resulting in a total outlay of $60,950 for 53 chargers. PG&E is expanding its incentive program to include incentives for medium and heavy-duty fleet vehicles which may be appropriate for certain City vehicles such as public works trucks and fire engines. In addition, PG&E is developing an incentive program for DC Fast Chargers for public use. The City should monitor both programs for eligibility. Both are expected to be introduced in late 2018 or 2019. EVgo EVgo is a private EV charging company funded by the $120 million NRG/CPC settlement which mandates program completion by December 5, 2018. EVgo is also the nation’s largest network of public electric vehicle (EV) DC Fast charging stations. Like Tesla, and PG&E, EVgo is currently building a-self financed network for EV Charging infrastructure throughout the state of California. Like Tesla (but unlike PG&E), EVgo specializes in DC Fast chargers that it will own and operate to serve the general public, ideally near high density residential development and retail. DC Fast Chargers can be located in public parking lots and garages without pay gates or on public streets with angle or perpendicular (not parallel) parking. Along with installing and operating DC Fast Chargers, EVgo is the only company building 150-350 kW High Powered chargers that can charge an EV in about 15- 20 minutes. These newer facilities require at least 6 parking stalls plus an equivalent area for support infrastructure including a dedicated transformer that can handle a 1-megawatt load at peak draw. EVgo plans to build 10-12 High Power Charger projects in California but these have proven difficult to locate due to the large site requirements, so EVgo is looking for cities to provide the land. Based on analysis of City-owned locations within the City of South San Francisco, the Miller Ave Parking Garage appears to be the optimal location for both types of charger and the City plans to construct 4 High Power Chargers on the main floor of the garage. In addition, EVgo may be interested in installing additional chargers in the planned Civic Center Campus at Antoinette Ln at Chestnut Ave depending on utilization of the chargers installed at the Miller Avenue Garage. South San Francisco is expected to be a very desirable location for both charger types that target the needs of the general public and the rapidly expanding shared mobility industry given the City’s proximity to SFO, San Francisco, and Silicon Valley. EV charger utilization in the Bay Area doubled between 2017 and 2018 and will likely skyrocket due in large part to expansion of electrified ride hailing such as Uber and Lyft, with many vehicles owned by 3rd party fleet operators such as Maven and Drivago, ReachNow, and others. On April 12, 2018 EVgo announced an agreement with Maven, General Motors’ car sharing brand, to construct a dedicated DC fast charging network available to Maven Gig Chevrolet Bolt EV drivers. (Source: https://www.evgo.com/about/news/evgo-maven-gig-announce-nations-first-dedicated- fast-charging-network-demand-drivers/) and South San Francisco is a potential location for these chargers. For information, contact: Jonah Eidus 415.633.6554 Jonah.Eidus@evgo.com EVgo’s High Power Charger Page 26 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Charge! Charge! Is a grant program funded by California’s Transportation Fund for Clean Air and administered by the Bay Area Air Quality Management District (BAAQMD) that helps offset a portion (up to 75%) of the cost of purchasing and installing new publicly available charging stations (with the other 25% paid by the applicant) at qualifying facilities within the Air District’s jurisdiction. Funding is available on a first-come, first-served basis to public agencies and private businesses and is paid to grantees (“Project Sponsors”) on a reimbursement basis after the project has been completed. Awards are based on the anticipated electricity that a station can deliver to EVs, and hence its potential to reduce petroleum use (and air pollution) by allowing drivers to shift away from petroleum-fueled vehicles to EVs. Charge! projects must be eligible for at least $10,000 in funding, which typically can be achieved by deploying at least one DC Fast charging station or at least three level 2 (6.6KW or higher) dual port charging stations. As a public agency that owns the property where the proposed charging stations will be installed, the City of South San Francisco would be eligible for this grant program. However, EV charging stations funded by Charge! should ideally be available to the general public within close proximity to and directly serve one or more activity centers, such as libraries and parks, or community centers, operate for a minimum of 3 years, and achieve a minimum usage requirement, which correlates to the amount of funding awarded. Chargers must also be accessible 365 days per year, for at least 8 hours per day during normal business hours. EV charging stations must be well-lit, secure, and in compliance with all Local, State, and Federal regulations and/or requirements. Unfortunately, because funding for the Charge! program is awarded on a first -come, first-serve basis, no funding was available when this plan was developed, but the City should monitor the program in the future in case it is re-funded as is expected in late 2018. In addition to the City, Charge! also funds EVSE at sites owned by businesses, non-profits, and public agencies who either own the EV charging site or who provide evidence (e.g., lease agreement) from the property owner allowing the applicant to install and operate charging stations for the duration of the Project Term. Electrify America Electrify America LLC. is investing $2.7 billion in mitigation funding from Volkswagen Group of America’s diesel scandal settlement over the next 10 years in Zero Emission Vehicle (ZEV) infrastructure, education/outreach, and access/exposure and is building a nationwide network of workplace, community, and highway chargers. In early 2017, the City applied for funding for 27 chargers at seven City owned sites including the Miller Avenue Parking Garage City Hall Annex, Public Works Corp Yard, Fire Station #61, Fernekes Recreation Building at Orange Park and the Brentwood Parking Lot. Electrify America LLC considered these sites for both the DC fast charger and Level 2 workplace/multi-unit dwelling programs, but did not award funding as part of the first cycle of awards. One City-owned site that should meet Electrify America’s workplace program criteria including at least 100 parking spots and 50 employees is the planned Civic Center Campus which will have 120 employees and a large number of For information, contact: Sophie Shulman sophie.shulman@electrifyamerica.com For information, contact: Mark Tang 415.749.4994 x2 mtang@baaqmd.gov Page 27 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 parking stalls. The City should work with Electrify America to fund EVSE for this project as well as other sites such as Fernekes Recreation Building at Orange Park. Other sources of information on local ZEV investments can be found on the California Air Resources Board’s website: https://www.arb.ca.gov/msprog/vw_info/vsi/vw-zevinvest/electrifyamerica_reports.htm or purchased through Gladstein Neandross & Associates: https://www.gladstein.org/checkout/?rid=pgCn3N. Additional funding information is available through the California Electric Vehicle Infrastructure Project (CALeVIP) which works with community partners to develop regional incentive projects to install plug-in EV chargers and accelerate the expansion of charging infrastructure. The potential funding could be raised up to $200 million and would serve public locations in order to meet the growing demands for EV charging stations in the state. For more information, visit: https://calevip.org/ Page 28 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 3.0 CHARGING ELECTRIC VEHICLES ON CITY FACILITIES Consistent with Goal 2 of this plan to provide direction for EVSE infrastructure on City property for City fleet vehicles, City employee-owned vehicles and public use, this chapter addresses the City’s needs for charging its future vehicle fleet at City facilities, use of this infrastructure by employees to charge commute vehicles as well as public vehicle charging on City-owned facilities 3.1 Priority Setting and Implementation Phasing Converting the City’s vehicle fleet from internal combustion to electric propulsion will take place over multiple years as existing vehicles are retired and replaced with EVs on an as-needed basis, allowing time for the City to plan, design and install the EVSE infrastructure needed to support this transition. The purpose of the phasing and priority recommendations listed in Table 10 and Table 11 below is to guide decision making on which sites to install EVSE and in what sequence. Priorities gauge the importance of the investment to the City and phasing determines the order of implementation. Table 10: Implementation Priorities Priority Description High ✓ Urgency driven by immediate need to support City EV acquisition and operations where City vehicles are located. ✓ Current, limited-duration funding availability Medium ✓ Needed for planned City EV fleet acquisition and operations ✓ Cost-effective opportunity ✓ Strong current public/political support Low ✓ Potential future funding opportunity ✓ Potential expanded capacity for City EV fleet expansion ✓ Expanded employee charging Table 11: Implementation Timeframes Implementation Phase Timeline Description 1 Late 2018 No delays, City responsibility for implementation 2 Early 2019 Minor delays pending implementation by third parties including PG&E and EVgo 3 2021 Pending future funding by City or third party or driven by City capital project schedule for development of the Future Community Civic Center Campus and Police Station, and planned Fire Station #63. Page 29 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Proposed EVSE locations are listed in Table 12 and mapped in Figure 3. Table 12: Summary of Planned EVSE Funding at City-Owned Facilities SSF Facility # of chargers Potential Primary Funding Source Priority Phase SSF Vehicles & Employees General Public A. SSF City Hall Annex, 400 Grand Ave 1 SSF High 1 B. Public Works Corp Yard, 550 N Canal St. 1 SSF High 1 23 8 PG&E High 2 C. City Hall Parking lot, 400 Grand Ave 12 PG&E High 2 D. Miller Ave Parking Garage, 329 Miller Ave 10 4 HPC PG&E and EVgo High 2 E. Fire Station #61, 480 N Canal St. 4 SSF or EA Medium 3 F. Fire Station #62, 249 Harbor Way 2 SSF Low 3 G. Fire Station #64, 2350 Galway Dr. 2 SSF Low 3 H. Fire Station #65, 1151 South San Francisco Dr. 2 SSF Low 3 I. Water Quality Control Plant, 195 Belle Aire Rd 2 SSF Low 3 J. Fernekes Recreation Building at Orange Park, 781 Tennis Dr. 3-6 BAAQMD or EA Low 3 K. Other City facilities: libraries; parks; senior & community centers. 1-2 per BAAQMD Low 3 L. Brentwood Parking Lot on El Camino Real at Hazelwood Ave 2-6 BAAQMD Low 3 Planned Future SSF Facility (2022 implementation) M. Future Community Civic Center Campus at Antoinette Ln at Chestnut Ave 10 10 2-4 DCFC? PG&E, SSF and/or EA Medium 3 N. Future Police Station at Antoinette Ln at Chestnut Ave 4 + 2 DCFC? SSF Medium 3 O. Future Fire Station #63 at Arroyo and Camaritas 2-4? SSF Medium 3 P. Future Garage #2 (location to be determined) 50 50 DCFC BAAQMD or EA and EVgo Medium 3 Note: All numbers are Level 2 unless High Power Charger (HPC) or Direct Current Fast Charger (DCFC) Page 30 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Figure 3: Proposed EVSE at City-owned Facilities Page 31 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 3.2 Charging for City-Operated Vehicles on City Facilities The most appropriate locations for charging the City’s fleet is where the City’s vehicles are parked and maintained. Existing City-owned facilities in this category include the Public Works Corp Yard, the Municipal Services Building (MSB), and Fire Station 61. These sites include secure parking facilities as well as unsecured parking outside the security gates. The following information addresses charging for City-owned and operated vehicles that are based at these facilities and charging for City employees at these sites is addressed in section 3.3 below. Site Name: Public Works Corp Yard Address: 550 N Canal St. Priority: High Number of Chargers by type: 32 Level 2 User: City/City Employee and public Primary Funding Source: PG&E Implementation Phase: 1&2 The Corp Yard is the City’s main Public Works facility where most City-owned vehicles are parked and serviced. A variety of vehicles are based here including numerous trucks and specialized equipment and would be the likely location to park (and charge) the majority of the City’s electric vehicle fleet. The facility contains a vehicle maintenance building and a large parking lot secured by a gated fence. There is also a smaller public lot located on the street side of the building. Due to the large percentage of city-owned vehicles parked and serviced here, the Corp Yard is the City’s top priority for EVSE charging. A total of 32 Level 2 chargers are planned for this site. Phase 1 consisted of a single low-cost charger that was purchased and installed by City staff on an exterior wall of the building for a cost of approximately $2,000. Phase 2 will consist of 31 level 2 smart chargers owned and installed by PG&E’s EV Charge Network program. Eight of these will be located along the public parking lot between the building and Canal Street. The primary purpose of these will be to charge vehicles owned by the general public including Public Works customers. The majority of chargers will be located along the northern and southern edges of the main yard for charging City vehicles as illustrated in Figure 5. These chargers will also be available to charge employee owned vehicles when chargers are not being used by the City’s fleet. The large number of chargers to be located at this facility can support EVs assigned to nearby Fire Station #61 and other City facilities until EVSE can be installed in subsequent phases. The City’s share of the cost for these chargers is expected to total $35,600. Emergency backup power is provided by a 135 kW/169 kVA rated generator with a 300-gallon fuel tank estimated to have a remaining lifespan of 12 years that may have capacity to support EV charging during power outages. Page 32 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Figure 4: Site plan of propose Public Works Corp Yard EVSE Site Name: SSF City Hall Annex Address: 400 Grand Ave. Priority: High Number of Chargers by type: 1 Level 2 User: City and City Employee Primary Funding Source: SSF Implementation Phase: 1 The Annex located next to City Hall has a driveway with four angled parking stalls used by City vehicles. The City has installed a single Level 2 EV charging station primarily for use by City vehicles in phase 1 of plan implementation. By purchasing and installing this charger, the City’s cost for this site is approximately $2,000. Page 33 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Site Name: Fire Station #61 Address: 480 N Canal St. Priority: Medium Number of Chargers by type: 4 Level 2 User: City and City Employee Primary Funding Source: SSF or Electrify America Implementation Phase: 3 South San Francisco Fire Station #61 is the Fire Department headquarters where both fire and rescue equipment and the Fire Marshal are based. Fire safety inspectors who have dedicated vehicles assigned to them used for frequent but low-mileage trips are also based at Fire Station #61. The inspectors have traditionally used small pickup trucks that were used in the past to haul equipment, but Fire Department staff indicate that fire safety inspectors could use compact automobiles, allowing current vehicles to be replaced with short or medium-range battery electric vehicles. An estimated total of four Level 2 chargers are recommended for this facility, 3 of which will be used by non-fire truck vehicles that are owned by the City and 1 station which will be made available to the public to be installed in phase 3 of plan implementation. In the interim, any EVs assigned to this facility would charge at the Corp Yard. Emergency backup power is provided by a 240 kW/300 kVA rated generator with a 2,000-gallon fuel tank estimated to have a remaining lifespan of 13 years that may have capacity to support EV charging during power outages. Site Name: Fire Stations #62, 64 and 65 Address: 249 Harbor Way, 2350 Galway Dr. and 1151 South San Francisco Dr. respectively Priority: Medium Number of Chargers by type: 2 Level 2 plus exterior 110 volt outlets for Level 1 employee vehicle charging User: City and City Employee Primary Funding Source: SSF Implementation Phase: 3 South San Francisco Fire Station #62, #64 and #65 are typical fire stations where fire and rescue equipment is based. The Fire Department has opted for two Level 2 chargers at each facility to charge future City vehicles as well as employee vehicles when not in use. However, since the 4-5 Fire Department employees assigned to each of these stations are on duty for 48-hours, sufficient time should be available to charge their personal EVs using Level 1 chargers plugged into exterior electrical outlets. Each fire station is also equipped with an emergency generator to supply backup power during power outages. Fire Station #62 has a 60 kW/70 kVA rated generator with a 150-gallon fuel tank estimated to have a remaining lifespan of 6 Page 34 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 years. Fire Station #64 has a 55 kW/69 kVA rated generator with a 250-gallon fuel tank that has exceeded its remaining lifespan of 15 years. Fire Station #65 also has a 55 kW/69 kVA rated generator but only with a 50-gallon fuel tank estimated to have exceeded its remaining lifespan. EV Chargers at each station should be connected to the facility’s emergency generator for vehicle charging in the event of a power outage, depending on available surplus power capacity. Site Name: Water Quality Control Plant Address: 195 Belle Aire Rd. Priority: Low Number of Chargers by type: 2 Level 2 User: City and City Employee Primary Funding Source: SSF Implementation Phase: 3 The South San Francisco Water Quality Control Plant is one of the City’s largest facilities and the only significant facility on the east side of Highway 101. A small fleet of trucks and other city-owned vehicles are located here. Two Level 2 chargers are proposed for the 36-stall surface parking lot in phase 3. Emergency backup power is provided by 12 permanently installed standby generators ranging in size from 35 kW to 2,000 kW rated generator with 70 to 4,000-gallon fuel tanks. Remaining estimated lifespan ranges from 0 to 21 years. These generators may have capacity to support EV charging during power outages, though this will have to be evaluated. Site Name: Future Police Headquarters adjacent to Community Civic Center Campus Address: Antoinette Lane at Chestnut Ave Priority: Medium Number of Chargers by type: 2-4 High Power Charger or DC Fast Chargers User: City and City Employee Primary Funding Source: SSF Implementation Phase: 3 A new Police Headquarters is planned for construction adjacent to the new Community Civic Center Campus scheduled for completion in 2022. By 2022 many Police Departments will likely be using EV fleets since the operation costs, longevity, vehicle torque and lack of noise make EVs ideal cruisers. To service a fleet of police cruisers, a new facility such as this should include a bank of High Power chargers or DC Fast Chargers, since patrol cars are used around the clock and will need to minimize down time for charging. Page 35 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 3.3 Charging for City Employees' Vehicles at City Worksites Providing access to the City’s vehicle charging infrastructure to City employees would help reduce the community-wide emissions and provide a desirable employee benefit to aid staff recruitment and retention. This could be achieved through dedicated charging infrastructure or infrastructure shared between employee-owned and City owned vehicles. In the latter scenario, City employees could be allowed to use the City’s EVSE to charge personal vehicles during the day while the City’s electric fleet is in use. At night, this charging infrastructure would be reserved to charge municipal vehicles. The following policy is proposed to manage this shared resource and electricity usage could be tracked using software. In the future, additional EVSE may be needed as demand for EV charging expands, depending on battery range and charging technology. City of South San Francisco EV charger use policies and guidelines City EV Charger Use Policies 1) City of South San Francisco Employees may use City-owned EV chargers at City worksites only when these chargers are not being used to charge City-owned vehicles. 2) All employee vehicles that are parked on City-owned worksites must be registered in the City’s Vehicle Registration System and display a City-issued car tag before they can use the charging stations. Qualifying vehicles are issued special South San Francisco Employee Vehicle (SSFEV) car tags, which come with additional parking benefits. 3) Employees parking at City EV chargers must limit charging times to no more than 4 hours per day. Employees may also use these spaces for no more than 4 hours to wait for available charging stations. Combined waiting and charging times may exceed 4 hours. 4) By using the charging stations, the EV owner consents for his/her vehicle to be unplugged when the charging station indicates their vehicle is fully charged. This will better enable vehicles parked adjacent to existing charging stations the opportunity to charge. Authorized personnel may disconnect your vehicle at any time. Sample policy language for use of City-owned EVSE by City employees: Consistent with the goals and GHG reduction strategies of South San Francisco Climate Action Plan and to support employee recruitment and retention, the City encourages its employees to use environmentally responsible and cost-effective modes of transportation for commuting to and from City work sites. Employees may use City- owned EV chargers at City worksites at no cost when these chargers are not being used by City-owned vehicles at times when these City-owned vehicles are in use and not needing to charge. To use City-owned EV chargers, City employees must abide by the City’s Employee EV charger use policies and guidel ines. Page 36 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 City Employee EV Charging Guidelines 1) Employees should not count on workplace charging stations being available when making vehicle purchase decisions. The decision to purchase or lease an EV should be based on his/her ability to charge at home and convenience of publicly available charging stations as daily access to charging cannot be guaranteed since the City’s chargers may be in use to charge municipal vehicles. 2) Employees should not use charging stations if they can drive the entire 2-way commute on electricity with charging at home. We encourage EV owners who park in spaces adjacent to the charging stations to open charge-port covers to let other EV owners know they may plug in their vehicles when they are done. When a charge is complete, employees should move their vehicle so other employees can use the charging station. 3) Charging cords and charging station status indicators have matching identification numbers to show which cord goes with which charging station. Employees should neatly replace the charging cords when finished. Cords left on the ground are safety hazards. 4) A list of registered EV owners by City worksite is available on the City’s intranet. The workplace EV community can use this list to collaborate on ideas how to better share the City’s charging stations. Future EV charging needs for City employees As previously discussed, the City assumes that approximately 1/3 of all vehicles in California will be electric by 2030, including those used by City employees for commuting. The City further expects demand for charging at 20% of EVs used by City employees, a ratio consistent with typical employers. Therefore, this plan recommends a ratio of approximately 1 Level 2 charger for every 14 City employees per worksite. Table 13 summarizes theoretical charging demand for the City’s largest worksites. Since two of the City’s largest existing worksites are expected to sponsor 10 PG&E chargers and the planned Municipal Services Campus is also expected to include chargers, the majority of EVSE for use by City employees will already be provided as listed on Table 11 above. Table 13: Anticipated Charging Needs for Employee Commute Vehicles by City Worksite Worksite Employee Charger Demand Planned EVSE City Hall 38 2-3 12 City/Public worksite chargers planned City Hall Annex 26 1-2 1 installed for City Corporation Yard 68 4-5 32 City/Public worksite chargers planned Municipal Services Building 117 7-8 None due to planned facility replacement Fire Station #61 46 2-3 4 proposed for City vehicles Fire Stations #62, 64 and 65 5 (each) 1 2 proposed for City vehicles Fire Station #63 18 1-2 None due to planned facility replacement Water Quality Control Plant 36 2-3 2 proposed Future Civic Center Campus 120 8 Depends on future funding by PG&E, EVgo and Electrify America, LLC. Source: City of South San Francisco Employee Count by Department (and-or Division) Note: Excludes City worksites with fewer than 10 assigned employees (other than Fire Station 62, 64, and 65) including Grand Avenue Library, Learning Center Miller Ave Parking Garage. Page 37 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 EV Charger Pricing for City Employees It is up to the City to determine whether or not to charge its employees for the cost of EV charging. At the state level, Governor Brown and his administration have stated that charging an employee car at a state- owned charger is not a gift of public funds. However, each state agency can establish its own policy and rate for charging (source: DGS Electric Vehicle Supply Equipment Guidance Document, February 2014) and this would apply to local governments as well. Currently the City offers free parking to its employees. As this serves to incentivize driving to work, the City intends to include workplace charging at no cost to employees as an incentive to use an EV for personal commuting. Along with other employee benefits such as the Commuter Check and Bike Commute to Work Program, offering no-cost EV charging will further reduce the City’s carbon footprint, partially offsetting the impact of employee commuting. This perk should be conditioned on compliance with the City’s EV Charging policies and guidelines. Should the City opt to charge, there are multiple options for offering charging stations at the workplace. 3.4 Charging for Public-Owned Vehicles at City Facilities South San Francisco owns a variety of facilities where the City itself has no direct need for its own EV charging but that are accessible to the public and appropriate for EV charging. These include the following public parking facilities, parks, libraries, community centers and education facilities. Site Name: Miller Ave Parking Garage, Address: 329 Miller Ave Priority: High Number of Chargers by type: 4 HPC on Main floor, 10 Level 2 on top floor User: Public Primary Funding Source: EVgo, PG&E Implementation Phase: 2 The Miller Avenue Parking Garage in downtown South San Francisco is heavily used by employees of both downtown businesses and construction contractors working in the area. A total of four older ChargePoint Level 2 EV charging stations are currently located on the main floor just inside the garage entrance. These chargers are consistently occupied by EVs owned by members of the general public, (though not always for active charging). EVgo will replace these with four new 150kW High-Power Chargers along with transformer and conduit capacity to increase charging speeds in the future as vehicles with higher charging speeds become available. Ten additional Level 2 chargers sponsored by PG&E are planned for the top floor of the garage, directly above the existing charger bank. These chargers to be acquired though PG&E’s EV Charge Network program will cost the City $11,500. Charger locations planned for the Miller Ave Garage are illustrated on Figure 6. The High Power chargers can recharge an EV in 15-20 minutes similar to how drivers of gasoline-powered vehicles are fueled. These chargers would be funded and installed by EVgo in this garage to accommodate an acute need for this infrastructure in one of the most heavily trafficked areas of the City. All 14 of the Page 38 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 chargers at the Miller Ave Garage are intended for public use. These chargers, especially the High Power units will not only benefit those who currently visit or work in the City’s downtown, but also those passing through the City on their way to San Francisco or San Jose. City-owned vehicles could also use these High- Power Chargers as a back-up to Level 2 chargers at the Corp Yard and City Hall if City vehicles ever need a quick charge. EVgo is responsible for all costs associated with these chargers at no capital cost to the City. Figure 5: Site plans of proposed Miller Ave Garage EVSE – Main floor (above) and 4th Floor (below) Page 39 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Site Name: Future Downtown Parking Garage #2 Address: TBD Priority: Medium Number of Chargers by type: 50 Level 2 and 50 DCFC/HPC User: Public and MaaS fleet Primary Funding Source: EVgo Implementation Phase: 3 The City is planning to construct a second City-owned garage for public parking at a yet to be selected City- owned site in or near downtown. This facility which is expected to contain 200-250 parking stalls is planned for completion in 2022 or 2023. Designing a new garage creates an ideal opportunity to incorporate EV charging. Consistent with the updated CALGreen Code, at least 20% of the parking stalls should include Level 2 chargers and adequately sized conduit should be provided to all remaining stalls to assure EV- readiness. This garage may also be appropriate for charging electric fleet vehicles for the rapidly growing Mobility as a Service industry that is expected to replace a significant portion of vehicle miles currently being driven by private automobiles in the relatively near future, especially once automated vehicle fleets become commercially viable. This change is expected to significantly dampen demand for paid parking thus providing an economically-viable long-term use for this capital investment as demand for charging and layover of automated EV fleets will likely expand. In addition to conduit, the garage design would need to include space for a 5MW PG&E substation and transformers to supply 40-50 high power chargers. The City could partner with a commercial charging operator willing to lease garage space and install, own and operate the EVSE such as EVgo. Site Name: Fernekes Recreation Building, Orange Park Address: 781 Tennis Drive, Priority: Low Number of Chargers by type: 3-6 Level 2 User: Public Primary Funding Source: Electrify America or Charge! Implementation Phase: 3 The Fernekes Recreation Building at Orange Park has a large surface parking lot with an accessible electrical transformer that would be an appropriate site for three to six Level 2 EV charging stations dedicated to public use. This facility has high amounts of regional traffic and would serve the community while they engaged in everyday activities. It is through these interactions that residents can begin to see EVs as a viable option. No current funding source has been identified for EVSE at this site but it would likely qualify for a program supporting community charging infrastructure such as BAAQMD’s Charge! program or Electrify America, LLC. Page 40 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Site Name: libraries, parks, senior & community centers Address: Multiple, Priority: Low Number of Chargers by type: 1-2 Level 2 per site User: Public Primary Funding Source: TBD Implementation Phase: 3 The City owns several other public facilities including libraries, parks, senior & community centers, and schools that may be appropriate for future EVSE for public charging if funding becomes available such as through BAAQMD’s Charge! program. Site Name: Brentwood Parking Lot Address: El Camino Real at Hazelwood Ave, Priority: Low Number of Chargers by type: 2-6 Level 2 and/or 2 DC Fast Charger User: Public Primary Funding Source: TBD Implementation Phase: 3 The City owned parking lot on El Camino Real at Hazelwood Ave known as the Brentwood Parking Lot would be an appropriate site for 2-6 Level 2 or a smaller number of DC Fast Chargers for public use. Highway 82, also known as El Camino Real is a 52-mile highway that runs the length of the San Francisco Peninsula from San Jose north to San Francisco. This station would serve as a prime location along the highway for those looking to travel further than either of those destinations, or for those looking to charge before a long commute home or while running errands in the Brentwood shopping center. Site Name: Municipal Services Building (MSB) Address: Arroyo Drive & Camaritas Ave Priority: N/A Number of Chargers by type: N/A User: N/A Primary Funding Source: N/A Implementation Phase: N/A Page 41 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 The MSB facility at Arroyo Drive & Camaritas Ave is slated for replacement in 2021 by a future Community Civic Center Campus at Antoinette Lane and Chestnut Ave. is expected to have similar uses, parking and charging needs for municipal vehicles as the facility its replacing. Since the City’s vehicle electrification is expected to be implemented within the service life of the existing facility, it is included as one of the sites considered for EVSE installation however no EVSE is recommended by this plan due to the limited duration of future use. Instead, EVSE needs to be incorporated into the design of the future Community Civic Center Campus, Police Station and Fire Station #63 as explained in section 3.5 below. 3.5 Charging for City and Public-Owned Vehicles at Current and Planned City Facilities Two additional locations, the City Hall parking and the adjacent City Hall Annex 315 Maple Avenue, are publicly visible locations in downtown that are also used for parking limited numbers of municipal vehicles, and are therefore appropriate locations for charging. Reductions to total numbers of City vehicles as recommended by the 2016 Fleet Study will be factored into EVSE planning along with anticipated future expanded EV choices. Site Name: City Hall Parking lot Address: 400 Grand Ave Priority: High Number of Chargers by type: 10 Level 2 User: City vehicles, City employees, and general public Primary Funding Source: PG&E Implementation Phase: 2 The parking lot west of South San Francisco City Hall at 400 Grand Avenue has approximately 78 parking stalls accessed off Miller Ave. The majority of these are used by City employees and City Hall visitors as well as a small number of vehicles assigned to City Council and several departments. Twelve Level 2 workplace chargers funded by PG&E are planned for this well-used, high visibility lot. These chargers will be sited along the west edge of the lot parallel with Miller Ave and are expected to be used by a combination of City- owned vehicles, commute vehicles owned by City employee and by the general public. These chargers which are as illustrated in Figure 7 will be available to all users with the caveat that the City Hall parking lot will be for employees only during business hours 8am-5pm and the available to all users at other times. Along with the City’s future Community Civic Center Campus and possibly in front of the Corp Yard, it is one of the few City facilities included in this plan expected to be used for charging by all three classes of EV owners. These chargers to be acquired though PG&E’s EV Charge Network program will cost the City $13,800. Page 42 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Figure 6: Site plan of proposed City Hall Parking Lot EVSE Page 43 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Site Name: Future Community Civic Center Campus Address: Antoinette Lane at Chestnut Ave Priority: Medium Number of Chargers by type: 4-10 Level 2, 2-4 DC Fast Charge User: City vehicles, City employees, and general public Possible Primary Funding Sources: PG&E or Electrify America, LLC. Implementation Phase: 3 The City’s future Community Civic Center Campus is planned for Antoinette Lane and Chestnut Ave. in 2021. This replacement facility will have similar uses, parking and charging needs for municipal vehicles as the existing MSB facility it will replace. Since this will be a new public facility and place of employment for about 120 City employees including the Police Headquarters, programming should include EVSE for public use, City vehicles, and City employees. This should include a bank of 4-10 Level 2 chargers (depending on funding by PG&E and/or Electrify America) that could be used by the public plus another to be used to charge City vehicles at night and employee-owned commute vehicles during the day. The planned civic center campus also offers excellent potential to include both DC Fast Chargers and High Power Chargers (depending on funding by Electrify America and/or EVgo). It is far more cost-effective to include EVSE in planned new construction as opposed to retrofitting existing facilities, construction of the new Civic Center should plan for and include a robust EVSE system. Charging Infrastructure Planning The City needs to plan the fleet’s electricity and charging time needs by plotting electricity use and time requirements for all future electric vehicles. This will enable the City to assess the appropriate number and types of chargers. Guidelines for siting EVSE are listed in Table 14. Table 14: South San Francisco EVSE Siting Guidelines EVSE Siting Guidelines Location Convenience: Locate EVSE parking as close as possible to the electric service while making sure not to interfere with other city business. (Note: vehicles may need to be parked for several hours at a time) Avoid Hazards: Cords and wires should not interfere with pedestrian traffic or present any tripping hazards. Also, EVSE should not be close to any areas deemed hazardous. Ventilation: Provide adequate ventilation for charging electric vehicles in indoor locations Irrigation and Pooled Water Areas: Design EVSE is to operate safely in wet areas/weather. Avoiding areas with where water pools or irrigation systems spray is recommended, as a best practice. Preventing Impact: Use curbs, wheel stops, concrete/steel pillars to prevent vehicles from damaging EVSE. Signage: Provide visible and clearly-marked signage to designate EV only parking spaces. Efficiency As shown in the graphic below, Strategic siting of charging stations can maximize use of chargers by allowing drivers to move cords rather than vehicles. Source: www.electricvehicles.energy.gov Page 44 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Installation Costs EVSE installation costs vary considerably. Factors affecting the cost (and installation time) include the number of circuits and EVSE units installed, the required electrical upgrades, and the use of DC fast charging EVSE. If required, trenching and adding electrical service panels incur the most costs. According to the Rocky Mountain Institute/Project Get Ready, the cost of a level 2 EVSE unit, not including the installation costs, is approximately $1,000 to $7,000 (before incentives) depending on the level of sophistication. DC fast charging EVSE units are projected to cost $20,000 to $50,000, but manufacturers are working to decrease costs substantially. AFDC’s Federal and State Incentives and Laws database (www.afdc.energy.gov/afdc/laws). EVSE Maintenance Typically, there are very few EVSE maintenance requirements. In general, charging cords should be securely stored so they are not damaged. Be sure to check the accessible EVSE parts periodically for wear and tear to ensure they are clean. Periodic inspection, testing, and preventative maintenance by a qualified electrician may be recommended. Source: California PEV Collaborative Page 45 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 4.0 PUBLICLY ACCESSIBLE ELECTRIC VEHICLE CHARGING ON NON-CITY FACILITIES The third goal of this masterplan is to “Support use of electric vehicles through expanded EVSE installatio n by the private sector and other agencies on non-City owned property within the City of South San Francisco.” The majority of demand for EV charging in South San Francisco will likely continue to be generated by non- City operated vehicles and most EV charging is expected to occur on sites other than the previously listed City facilities. Current South San Francisco building codes require new development to be “EV Ready” and the Zoning Ordinance contains non-mandatory incentives in the form of a Floor Area Ratio / density bonus in some districts for green building measures, which could include EV charging and parking beyond baseline requirements. In addition to an inventory of existing publicly accessible EVSE in South San Francisco, this chapter consists of policy, regulatory and incentive guidance targeting developers, employers and homeowners in terms of encouraging future EVSE. 4.1 Publicly Accessible ESVE Locations Of the 19 EV charging sites currently within South San Francisco’s city limits listed by Plugshare (mapped on Figure 7 and summarized in Table 15), all but those in the Miller Avenue Garage are located on privately owned property. Charging in Public Other than at residential locations, most public charging will use Level 2 EVSE to enable charging at locations where vehicles are highly concentrated, such as shopping centers, city parking lots and garages, airports, hotels, government offices, and other businesses. Many charging stations offer free charging to encourage early adopters of EVs. However, most public stations will evolve toward a pay-for-use system as EVs become more mainstream. A number of payment models are being considered, all designed to make paying for charging simple and convenient. Drivers might subscribe to a charging service, swipe a credit card, enter a charging account number, or even insert coins or bills to charge their EVs. In many cases, drivers may only be charged a single fee for parking and charging. Page 46 City of South San Francisco Electric Vehicle Charging Master Plan May 1, 2018 Table 15: Existing EV Chargers in South San Francisco # Location Address # of Stations # of Chargers Network/ Brand Charge Pricing Parking Pricing Rating Plug Types 1 Actelion Pharmaceuticals 5000 Shoreline Ct, South San Francisco, CA 94080 2 4 ChargePoint $0.24/kWh $1.00/hr None EV Plug 2 Fluidigm 5000 Shoreline Ct, South San Francisco, CA, 94080 4 4 ChargePoint $0.59/kWh Free 6.9 EV Plug 3 The Cove at Oyster Point 121 Oyster Point Blvd, South San Francisco, CA 94080 4 8 ChargePoint $0.25/kWh Free None Wall 4 Britannia Oyster Point 1110 Veterans Blvd, South San Francisco, CA 94080 2 4 ChargePoint Unknown Free 6.6 EV Plug 6 6 Blink $0.59 /kWh Free EV Plug 1 2 Blink Unknown Free CHAdeMO 5 Oyster Point Marina Plaza 400 Oyster Point, B1, #117, South San Francisco, CA 94080 10 10 SemaCharge $ 2.00/Hr Free 8.8 EV Plug 6 395 Oyster Point Boulevard 395 Oyster Point Boulevard, South San Francisco, CA 94080 1 1 Non- networked Unknown unknown None EV Plug 7 Miller Avenue Parking Garage 329 Miller Ave., South San Francisco, CA 94080 4 4 ChargePoint Unknown Free 1.2 EV Plug 4 4 ChargePoint Unknown Free Wall 8 Boston Properties/Genentech 631 Gateway Blvd, South San Francisco, CA 94080, 1 2 SemaCharge $2.00/hr for 4 hours, then $6.00/hr after that Free 5.5 9 Gateway Blvd 601 Gateway Boulevard, Suite 930, South San Francisco, CA 94080 2 2 SemaCharge $2.00/hr for 4 hours, then $6.00/hr after Free None 10 701 Gateway 701 Gateway Blvd, South San Francisco CA 94080 2 4 Non- networked $1.75/hr Free None Page 47 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 # Location Address # of Stations # of Chargers Network/ Brand Charge Pricing Parking Pricing Rating Plug Types 11 Genentech 1 DNA Way, South San Francisco, CA, 94080 4 4 Blink $0.59/kWh Free 11 12 Walgreens 399 El Camino Real South San Francisco, CA 94080 1 1 CarCharging $2.00/hour, min $2.00, max $20.00 Free 1 EV Plug 1 1 Blink Unknown Free CHAdeMO 13 Hotel Focus SFO 111 Mitchell Avenue, South San Francisco, CA 94080 2 2 SemaCharge $3.00/ Hr Unknown 13 14 Britannia Point Grand 280 E. Grand Ave., South San Francisco, CA 94080 9 9 Blink $0.59/kWh Free 5.9 EV Plug 1 2 Blink $0.69/kWh Free CHAdeMO 15 Blue Ribbon Supply Company 451 East Jamie Court, South San Francisco, CA, 94080 1 1 ChargePoint $7.40/session Free 5.2 EV Plug 1 1 ChargePoint $7.40/session Free Wall 16 South San Francisco Scavenger 500 E Jamie Ct, South San Francisco CA 94080, United States 1 1 ChargePoint $1.00/Hr Free None EV Plug 1 1 ChargePoint $1.00/Hr Free Wall 17 Park SFO 195 N Access Rd, South San Francisco, California, 94080 3 6 ChargePoint Unknown $19/day to park via valet.16/day self pk. 17 18 Skypark 1000 San Mateo Ave, South San Francisco, California, 94080 8 8 ChargePoint Unknown Unknown 18 Source: PlugShare (https://www.plugshare.com/location/14914) In addition to these public EV chargers, Tesla is planning to open one or more DC fast-charging Supercharger stations in South San Francisco. Typical Supercharger locations have access to convenient amenities while Tesla owners charge, such as restaurants, grocery stores, or shopping. Tesla’s Superchar gers allow owners to charge while they seamlessly go about their normal routine for the duration of the charging session. Page 48 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Figure 7: Existing EV Charging Locations in South San Francisco Page 49 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 4.2 Policy Guidance for Inclusion of Appropriate EVSE in Development Projects The following information is adapted from California’s Zero-Emission Vehicles in California: COMMUNITY READINESS GUIDEBOOK, Governor’s Office of Planning and Research, fall 2013. Planning South San Francisco’s General Plan does not specifically address the needs of EVs in either the land use or the transportation chapter. This plan should include language about EV readiness as a high-level policy.. Zoning Zoning is addressed in Title 20 of the South San Francisco Municipal Code. The goal of zoning for EVs should be to support inclusion of EV charging though reducing administrative obstacles and ensure that vehicle charging is a permitted land use in as many zoning classifications as possible. The Zoning Code currently permits Floor Area Ratio (FAR) and density bonuses in districts throughout the city in exchange for incentives, including green building measures beyond what is required by code. Installation of EV charging units should be encouraged at a project level, as a green building measure that benefits employees and residents, while also helping to encourage the usage of low or zero-emission vehicles. Generally, EV charging does not fundamentally alter the purpose or interfere with the primary use of land. EV charging complements existing land uses in that it facilitates transportation modes that were not accommodated previously by those land uses. Ideally, EV charging as an accessory use should be allowed outright as a because it is generally compatible and complementary to many land uses, and can be used to provide required project parking. EV parking as a primary use would be classified as a “parking services” land use, which is currently principally or conditionally permitted throughout employment, commercial, and mixed-use districts throughout the City. As the City is embarking on a General Plan Update and associated Zoning Code update within the next year, these are appropriate opportunities to include General Plan policies that support EV charging/parking, as well as amendments to the Zoning Code to ensure that EV charging/parking is permitted and encouraged as a primary and accessory use throughout the City. Building Codes California’s state building codes provide uniform requirements for buildings throughout the state. These requirements are contained in Title 24 of the California Code of Regulations (CCR). Title 24 applies to all building occupancies and related features and equipment throughout the state. Cities and counties in California are required by state law to enforce Title 24 building standards. However, cities and counties may adopt local ordinances to modify these state building standards under limited circumstances because of local climatic, geological or topographical conditions. In addition to following current building codes to ensure safety, local governments could create ordinances to create EV-ready building codes. Local governments can advance EV adoption in a way that ensures safe, cost-effective installation of charging equipment. For example, by adopting more stringent building codes that require EV-ready wiring in new construction, South San Francisco could help meet future demand for charging and reduce or eliminate the costs associated with future retrofitting. In addition to these benefits, EV-readiness building codes advance equity by ensuring access to charging for multifamily building residents and the disabled. Requiring developers to run conduit and to plan for and provide space for future electrical panels and/or transformers is a relatively low cost means to ensure low-cost upgrades as the number of EVs grows. Page 50 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Requiring a dedicated 40-amp circuit in the garage for new homes or significant remodels is another low- cost strategy. When modifying building codes, it is important to expand or upgrade electrical service in tandem with any new prewiring requirements to ensure that load capacity can be met, thus helping to avoid potential future costs of service interruptions and necessary panel upgrades. Building codes related to EVs also can provide guidance on the following issues: • The number of circuits needed and service panel requirements • Placement of electric meters • Sourcing of electricity for on-street and lot parking • The impact of charging infrastructure on building electrical loads and local electrical distribution • Allocation and sizing of parking spaces to accommodate charging infrastructure • Compliance with the Americans with Disabilities Act (ADA) Building codes provide construction standards according to building uses including residential and nonresidential. Residential buildings are often classified into two categories: one- and two-family homes and townhouses, and multifamily dwellings (also called multi-unit dwellings or MUDs). Nonresidential buildings can include business, industrial, institutional and mercantile (retail) uses. The types of building codes the City will need to prepare for EV charging infrastructure will depend in part on the kinds of land uses and occupancies that are most commonly found in South San Francisco. California’s state building codes provide uniform requirements for buildings throughout the state, such as the California Electrical Code (Title 24, Part 3). Refer to the Zero-Emission Vehicle Codes and Standards section of the Guidebook for more information about the State Building Code. The following are voluntary measures contained in the CALGreen Code that can currently be implemented by local ordinance. Page 51 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 Table 16: EV Charging Requirements from California State and Municipal Codes Source: Table 28. EV Charging Requirements from California State and Municipal Codes, Bay Area Plug-in Electric Vehicle Readiness Plan, Background and Analysis 2013 Page 52 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 The following recommendations are intended to facilitate EV charging through building codes for commercial, high-rise, industrial and/or multifamily developments. • Allow charging capability to satisfy EV readiness requirements in building codes. • Consider present EV charging demand in determining whether to require a percentage of spaces with ready-to-use charging equipment in addition to EV-ready wiring for new single and multi- unit dwellings. • Require a certain minimum percentage of parking spaces in new construction be wired to be EV- ready • Consider future EV charging demand and require the layering of conduit capable of carrying future wires or cables from the electrical room to the charging units in new construction, where applicable. Require insets for additional or future panels and pads for additional or future transformers. • Require a minimum percentage of parking spaces in new construction be wired to be EV ready in commercial or industrial buildings, if these opportunities represent significant opportunities locally for EV charging. • Address Accessibility Requirements. For information, on state accessibility requirements, See Summary of 2016 California Building Code Changes for Electric Vehicle Charging Station (EVCS) Accessibility available on the state’s website: http://www.dgs.ca.gov/dsa/Programs/progAccess/evcs.aspx • Consider updating electrical codes to allow the sizing of electrical service for charging systems to reflect the load permitted by an automated energy management system. The National Fire Protection Association (NFPA) has issued two Temporary Interim Amendments (TIAs) to the 2011 National Electrical Code, which was adopted into the 2013 California Electrical Code. TIA 11-2 and TIA 11-3 provide specific model code language that can be adopted by local jurisdictions. For more information, refer to the Building Standards Commission Information Bulletin 13-02. 4.3 Incentives to Encourage EV Usage and Sales For local, state and federal financial incentives for charging equipment, vehicles, utility rate discounts, HOV lane exemptions, parking and insurance, visit: https://www.driveclean.ca.gov/pev/Incentives.php Page 53 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 5.0 BIBLIOGRAPHY “Appendix C: WSDOT Requirements for Highway EVSE.” Bay Area Air Quality Management District. “Bay Area and Monterey Bay Regions PEV Planning Concepts Document.” ICF International, August 2012. California Department of General Services. “Electric Vehicle Supply Equipment Guidance Report.” DGS General Services, February 2014. California Plug-In Electric Vehicle Collaborative. “Plugging in at Work: How to Effectively Install, Share and Manage Electric Vehicle Charging Stations.” November 2015. Chargepoint. “All Roads Lead to e-Mobility.” Bloomberg New Energy Finance, Electric Vehicle Outlook, 2017. Chargepoint. “Buyers Checklist: How to Choose an Electric Vehicle Charging Station.” City of Houston. “Electrical Vehicle Charging Long Range Plan for the Greater Houston Area.” City of Portland, Oregon. “Electric Vehicles: The Portland Way.” City of Sacramento. “2017 Electric Vehicle Strategy.” October 2017. City of South San Francisco. “Climate Action Plan.” PMC, February 2014. City of South San Francisco. “Electrify America: Additional Information on Miller Avenue Parking Garage.” May 2017. City of South San Francisco. “Electrify America: Community Charging Infrastructure Proposal.” January 2017. “Community Civic Campus Parking Options.” Cooper, Adam. “Plug-In Electric Vehicle Sales Forecast Through 2025 and the Charging Infrastructure Required.” Other Contributor: Kellen Schefter, The Edison Foundation Institute for Electric Innovation, June 2017. CST Fleet Services. “Fleet Study.” December 2016. “Detailed South San Francisco Vehicle List R27.” CST Fleet Services. “Employee Count by Department and/or Division.” Goetz, Matthew. "Electrical Vehicle Charging Considerations for Shared, Automated Fleets." 3 Revolutions, ITS UC Davis, Contributors: Noel Crisostomo, California Energy Commission; Chris Nelder and Jonathan Walker (Formerly) Rocky Mountain Institute; Ron Kilcoyne, North County Transit District; Mollie D’Agostino, Institute of Transportation Studies, UC Davis, ITS UC Davis 3 Revolutions, July 2017. Hoang, John. “Alternative Fuel Readiness for San Mateo County.” City/County Association of Governments of San Mateo County, September 2017. ICF International. “Bay Area and Monterey Bay Regions PEV Local Best Practices Document.” August 2012. ICF International. “Bay Area Plug-In Electric Vehicle Readiness Plan: Background and Analysis.” ICF International. “Bay Area Plug-In Electric Vehicle Readiness Plan: Summary 2013.” December 2013. Johnson, Dan. “City of Shoreline Notes.” February 2018. Page 54 City of South San Francisco Electric Vehicle Charging Master Plan November 2018 “Key Questions from EV Owners to Property Management and Developers.” Mahama, David. “City of South San Francisco Traffic Signal System Master Plan.” Other Contributor: Kevin Fehon, DKS Associates, October 2015. McLaren, Joyce. “Emissions Associated with Electric Vehicle Charging: Impact of Electricity Generation Mix, Charging Infrastructure Availability, and Vehicle Type.” Other Contributors: John Miller, Eric O’Shaughnessy, Eric Wood, and Evan Shapiro, National Renewable Energy Laboratory, April 2016. Nealer, Rachael. “Cleaner Cars from Cradle to Grave: How Electric Cars Beat Gasoline Cars on Lifetime Global Warming Emissions.” Union of Concerned Scientists, Contributors: David Reichmuth, Don Anair, November 2015. Nigro, Nick. “Strategic Planning to Implement Publicly Available EV Charging Stations: A Guide for Businesses and Policymakers.” Other Contributors: Dan Welch, Janet Peace, Center for Climate and Energy Solutions, July 2015. Palmer, Kate. “Total Cost of Ownership and Market Share for Hybrid and Electric Vehicles in the UK, US and Japan.” Other Contributors: James E. Tate, Zia Wadud, John Nellthorp, Elsevier Ltd., October 2017. “Plugging Away: How to Boost Electric Vehicle Charging Infrastructure.” June 2017. Pratt, Andrea. “A Clean and Green Fleet.” City of Seattle Department of Finance & Administrative Services, Fleet Management Division, August 2014. Pratt, Andrea. “Fleet Electrification.” City of Seattle Finance and Administrative Services, Fleet Management Division. San Diego Gas & Electric Company. “Plug-In Electric Vehicles (PEV) in San Diego Clean Transportation Program” 2011. Seattle Department of Construction and Inspections. “Installation of Electric Vehicle (EV) Charger for Commercial Properties.” May 2017. Seattle Department of Construction and Inspections. “Installation of Electric Vehicle (EV) Charger for Single Family and Multifamily Homes.” Seattle Department of Transportation. “Electric Vehicle Charging in the Public Right-of-Way (EVCROW) Program: SDOT Pilot Permit Program Requirements.” July 2017. Smith, Margaret. “Level 1 Electric Vehicle Charging Stations at the Workplace.” Energetics Incorporated, July 2016. Sustainable Transportation Strategies. “Site Design for Electric Vehicle Charging Stations.” US Department of Energy Clean Cities, July 2012. US Department of Energy Vehicle Technologies Office. “Costs Associated with Non-Residential Electric Vehicle Supply Equipment: Factors to consider in the implementation of electric vehicle charging stations.” New West Technologies, LLC, November 2015. US Department of Energy. “Plug-In Electric Vehicle Handbook for Workplace Charging Hosts.” West Coast Green Highway. “Host Site Specifications for West Coast Green Highway Electric Vehicle Charging Stations.” Workplace Charging Challenge. “Sample Workplace Charging Policy.” US Department of Energy, March 2015. City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-80 Agenda Date:3/11/2020 Version:1 Item #:8. Study Session regarding conceptual program guidelines for an Employee Down Payment Assistance Program. (Nell Selander, Deputy Director, Economic & Community Development Department) RECOMMENDATION Staff recommends that the City Council receive a presentation on conceptual program guidelines for an Employee Down Payment Assistance Program and provide direction. BACKGROUND In February 2017,staff brought forward an information item to City Council regarding the possibility of creating an Employee Down Payment Assistance Program (Program).The staff report,included as Attachment 1 to this report,described the program as offering full-time employees a loan of up to $100,000 at the Local Agency Investment Fund (LAIF)rate,plus shared appreciation.Under the proposed 2017 program, the loan would have to be used on the purchase of a home in South San Francisco and the $100,000 would be limited to providing 15% of the purchase price. After receiving Council’s direction (see Attachment 2 for minutes from the February 2017 Council meeting),staff released a Request for Proposals (RFP)on June 2,2017 to solicit a loan servicer.At the time,staff believed engaging a loan servicer would allow the City to rapidly deploy the Employee Down Payment Assistance Program.On June 28,2017,Council approved a $1 million appropriation from the Capital Infrastructure Fund for the Employee Down Payment Assistance Program as part of the 2017-2019 Biennial Budget.Ultimately,the City received only one response to the June 2017 RFP, which was not competitive. To learn down payment assistance program best practices,staff met with colleagues at HEART of San Mateo County in late 2017 to discuss their Down Payment Assistance Program.HEART staff shared best practices,including:(a)encouraging buyers to quickly repay their loans,to allow resources to be redeployed more quickly;(b)allowing home purchases in a wide geographic area, due to low housing inventory;and (c)partnering with a local bank to implement the program,in order to provide efficiencies and lend expertise to a local program. Understanding that restructuring the City’s Program and soliciting a more experienced partner to administer it would best use the funds Council had set aside,staff issued an RFP in August 2018 to engage an experienced community home mortgage lender to design,manage,and operate the Employee Down Payment Assistance Program.Despite reaching out to local,community banks directly and having a promising meeting with a well-respected local credit union,the City did not receive any responses to the August 2018 RFP. In July 2019,staff had the opportunity to meet with Hello Housing -an affiliate of MidPen Housing that manages affordable home ownership programs,as well as designs down payment assistance programs for public agencies.Hello Housing recently designed AC Boost,Alameda County’s Measure A1-funded down payment assistance program.Hello Housing is now administering that program.Given the City’s inability to secure a partner to administer the Program in the past,staff City of South San Francisco Printed on 3/5/2020Page 1 of 4 powered by Legistar™ File #:20-80 Agenda Date:3/11/2020 Version:1 Item #:8. program.Given the City’s inability to secure a partner to administer the Program in the past,staff engaged Hello Housing in September 2019 to assist in developing guidelines for a Program that would provide the biggest benefit to the most eligible employees,while being easy and inexpensive to administer. DISCUSSION Together,staff and Hello Housing considered amortizing payment loans,partial deferral loans,and shared appreciation loans.The team considered the maximum loan amount,the amount an employee will be responsible for putting down,the term of the loan,first time homebuyer status,purchase geography,and triggers for repayment.The Program described in detail below could be fully designed and documented in the coming months,with outreach,online application,and lottery occurring in June and July,reservation of funds beginning in August,and loan closings happening as early as September 2020.Substantial changes to the program described below could delay the design and documenting process,but it is staff’s intention to roll out this new Program in summer 2020. Below,is a summary of the Program developed for Council’s consideration and feedback.These program elements are also described in Hello Housing’s presentation, included as Attachment 3 to this report. ·Shared Appreciation Loan.Staff and Hello Housing recommend a shared appreciation loan for two primary reasons:1)it will allow the borrower to buy a more expensive home and 2)it is an inexpensive and easy loan product to administer.Buyers can borrow more on their first mortgage with a shared appreciation loan because there is no monthly expense associated with loan repayment.Administering a shared appreciation loan is easy and inexpensive because no payments are collected,the shared appreciation is calculated at the repayment event,and only annual monitoring is required rather than tracking payments and late payments. ·Maximum Purchase Price,Loan Amount,and Required Down Payment.Staff and Hello Housing do not recommend limiting the maximum purchase price of the home that the City’s Employee Down Payment Assistance Loan can be used to help finance.This is largely due to the unprecedentedly high housing prices in the Bay Area.By limiting the sale price,the City would be limiting the inventory to which our employees would have access.The loan amount would be limited to a maximum of $100,0000.Additionally,the employee borrower would be required to put down at least 3%of the purchase price.This is consistent with market lending practices and therefore presents the lowest barrier of entry to employees seeking to become homeowners. ·Loan Term.Staff and Hello Housing recommend 30-year term,with incentives to repay at Year 5 and/or at Year 10.Because the City’s initial investment in this program is just $1 million and can only support nine loans,staff and Hello Housing recommend designing a program that encourages repayment sooner rather than later.This will allow Council to redirect these funds to other,important programs,or to reinvest them in the Employee Down Payment Assistance Program.Either way,earlier repayment will ensure these funds do not get tied up indefinitely.An incentive can be structured in one of two ways:1)a discount on the shared appreciation taken by the City if the loan is repaid at Year 5 or Year 10;or 2)a penalty on the shared appreciation taken by the City if the loan is held past Year 5 or Year 10. Staff is seeking Council’s direction on whether or not repayment incentives should be included and whether or not they should be in the form of a discount or a penalty. ·First Time Homebuyer.Staff and Hello Housing recommend that the Program be available to full-time employees who have passed their probationary period that are either 1)first time homebuyers (meaning City of South San Francisco Printed on 3/5/2020Page 2 of 4 powered by Legistar™ File #:20-80 Agenda Date:3/11/2020 Version:1 Item #:8. employees who have passed their probationary period that are either 1)first time homebuyers (meaning they have not owned a home in three years); or 2) are selling an existing home to move closer to work. ·Purchase Geography.Staff and Hello Housing are recommending a two-tiered approach to purchase geography.Employees seeking to purchase a home in South San Francisco would be considered in Tier 1,through either a preference program or a set-aside for loans deployed in South San Francisco. Employees seeking to buy a home outside of South San Francisco,but within the Counties of San Francisco and San Mateo,would be considered in Tier 2.Staff is looking for Council’s direction regarding how to prioritize purchase geography.Limiting the purchase geography to only South San Francisco may result in the loans being underutilized because there is very little housing inventory in South San Francisco.Although single-family homes may be relatively affordable to other communities in San Mateo County,the City has far fewer condominiums that would be affordable to a single-person household. Staff is seeking Council’s direction on the following questions: o Is it Council’s preference to limit the geography to South San Francisco exclusively,or is it acceptable to set aside half the loans for South San Francisco and the other half for San Francisco and San Mateo Counties? o Alternatively,would Council prefer a preference,so that those preferring to buy a home in South San Francisco are ranked through the lottery ahead of those looking to buy in San Francisco or San Mateo Counties? ·Triggers for Repayment.Staff and Hello Housing are recommending that the following events trigger repayment of the loan, and the corresponding shared appreciation: o Transfer of title, o Home is no longer owner-occupied, o Upon a cash-out refinance, and/or o When the employee no longer works for the City (the employee would have 12 months to refinance and repay the loan, with a one-time extension for a documented hardship). FISCAL IMPACT The City Council approve Resolution 73-2017 on June 28,2017 appropriating $1 million for the Employee Down Payment Assistance Program.Should Council direct staff to proceed with the Program presented in this report,staff intends to implement the Program.The initial program setup (design and documentation,Program Guidelines preparation,creating an online application and website,identifying preferred lenders,and creating marketing materials)is a one-time expense that is estimated to cost $50,000.Deploying each loan is estimated to cost roughly $6,000 and includes fielding calls from interested employees,maintaining the Program website, providing reports to the City,holding a workshop for employees,facilitating Program applications,waitlist creation and management,full application review,loan document preparation,and handling appeals.If the City places nine loans at $100,000 each, the $1 million appropriation will be exhausted. CONCLUSION The Employee Down Payment Assistance Program remains an important tool in attracting and retaining high- quality staff,while also encouraging employees to move closer to work,reducing commute times and greenhouse gas emissions.Attachment 4 is a map of where full-time City staff live,who would be eligible for the Program as proposed.Although nearly a third of full-time City employees live in South San Francisco,and many more live in San Francisco and San Mateo Counties,there are still many mega-commuters among Team SSF.Implementing the Program will allow,at a minimum,nine City employees to buy a home in this expensive City of South San Francisco Printed on 3/5/2020Page 3 of 4 powered by Legistar™ File #:20-80 Agenda Date:3/11/2020 Version:1 Item #:8. and highly competitive housing market that is closer to work. Staff is seeking Council’s feedback on the Program guidelines discussed above and,in particular,on the following items: ·Early Repayment Incentives.A repayment incentive can be structured in one of two ways:1)a discount on the shared appreciation taken by the City if the loan is repaid at Year 5 or Year 10;or 2)a penalty on the shared appreciation taken by the City if the loan is held past Year 5 or Year 10.Staff is seeking Council’s direction on whether or not repayment incentives should be included and whether or not they should be in the form of a discount or a penalty. ·Purchase Geography.Is it Council’s preference to limit the purchase of homes using this down payment loan to South San Francisco exclusively,or is it acceptable to set aside half the loans for South San Francisco and the other half for San Francisco and San Mateo Counties?Alternatively,would Council prefer a preference,so that those preferring to buy a home in South San Francisco are ranked through the lottery ahead of those looking to buy in San Francisco or San Mateo Counties? Unless otherwise requested by Council,staff will use the feedback obtained from Council at its March 11,2020 study session to finalize program guidelines and proceed with implementing the program with the goal of opening the program for applications in June or July 2020. Attachments: 1.February 22, 2017 Staff Report 2.February 22, 2017 Minutes 3.Hello Housing Presentation 4.Map of Where City Employees Live City of South San Francisco Printed on 3/5/2020Page 4 of 4 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA Study session regarding Down Payment Assistance Program for City Employees.(Richard Lee,Director of Finance) RECOMMENDATION It is recommended that the City Council review the information in this staff report and provide staff with direction regarding the proposed Down Payment Assistance Program outlined below.There are no actions for consideration at this time. BACKGROUND/DISCUSSION Staff requests that the City Council consider implementation of a Down Payment Assistance Program (Program)for City employees.The Program would be in furtherance of the City’s primary strategic goals to:1) Attract,train,support and retain a high performance team;and 2)Build and maintain a sustainable city by providing a full range of employment and housing options. The City has successfully implemented similar housing assistance programs in the past,most recently with the First Time Homebuyer Program,which was approved by the City Council via Resolution in 2002 (Resolution # 71-2002).The First Time Homebuyer Program was funded by the former South San Francisco Redevelopment Agency (RDA)as well as Community Development Block Grant funds.The First Time Homebuyer Program ended in 2012 due to dissolution of the RDA.However during the tenure of the First Time Homebuyer Program,it provided assistance to 95 residents and employees of businesses located in South San Francisco (including South San Francisco Unified School District and City of South San Francisco)to purchase a home within South San Francisco. In the current home loan market,as part of the underwriting process,prospective borrowers must provide documented evidence that they will have sufficient liquid assets after purchase of the property to cover 12 months of principal,interest,property tax,homeowner’s insurance (PITI),and when applicable,mortgage insurance premium and homeowner’s association dues.In 2016,the average sales price for a single family home in South San Francisco was $901,000.Assuming the borrower provides a 20 percent down payment,they would need to provide evidence of $51,800 in liquid assets to meet the PITI requirements,a requirement that may dissuade or prevent prospective home buyers from securing a home loan.This is in addition to any required down-payment, typically 20% of the purchase price. Given the prohibitive level of assets required for the loan qualification process,staff recommends that the City Council consider implementing a Down Payment Assistance Program with the following parameters: ·Eligibility:Open to full-time regular employees of the City of South San Francisco.Verification of employment status would be conducted by the Human Resources Department. ·Loan Amount:Maximum of 15 percent of property purchase price,up to $100,000.Interest rate would be linked to the interest rate with the Local Agency Investment Fund,currently earning 0.75 percent. Loans will be amortized over a 30-year term.Payments during the first five years would be interest only payments,with principal payments and interest payments beginning in the sixth year.The loan would be File #:17-207,Version:1 City of South San Francisco Printed on 3/2/2020Page 1 of 2 powered by Legistar™ File #:17-207,Version:1 payments,with principal payments and interest payments beginning in the sixth year.The loan would be secured by a second deed on the property,otherwise known as a “silent second”loan.Similar to the First Time Homebuyer Program,the loan would be serviced by a third party administrator.Program participants must be approved by a first lender prior to obtaining a loan reservation from the City’s Down Payment Assistance Program. ·Geographic Restrictions:Property must be located within the boundaries of the City of South San Francisco. ·Funding Source: Infrastructure Reserves. ·Shared appreciation:If the employee sells or refinances the property,the City receives a pro rata share of the original loan to value ratio.For example,if the City loans an employee $100,000 to purchase a property for $900,000,the original loan to value ratio is 11.11 percent.If the employee sells the property for $1.2 million, the City’s shared appreciation, to be repaid, would be $133,333. Based on a recent survey of City employees,42 expressed interest in the Down Payment Assistance Program. Of those expressing interest,21 would apply for funding in 2017-2018,ten would apply for funding in 2018- 2019, six would apply for funding in 2019-2020, and five would apply in a future fiscal year beyond 2020. FUNDING Assuming all loans are paid back,the Program would have a net zero financial effect on the City long term, given the interest rate link to LAIF,while providing a low interest rate incentive for employees.Assuming Council concurrence,staff will include in the proposed FY 2017-2018 budget seed money for this program sufficient to meet any immediate demand.As more funds are needed,if any,staff will return to Council for appropriations. CONCLUSION The proposed Down Payment Assistance Program aligns with the City’s strategic plan,and serves to retain a high performance team in South San Francisco. City of South San Francisco Printed on 3/2/2020Page 2 of 2 powered by Legistar™ MINUTES 0„a SAA,„0 SPECIAL CITY COUNCIL CITY OF SOUTH SAN FRANCISCO o MUNICIPAL SERVICES BUILDING COUNCIL CHAMBERS e4irxota0* 33 ARROYO DRIVE SOUTH SAN FRANCISCO, CA WEDNESDAY,FEBRUARY 22, 2017 6:31 P.M. CALL TO ORDER Time: 6:31 p.m. ROLL CALL Present: Councilmembers Addiego, Garbarino, and Matsumoto,Vice Mayor Normandy and Mayor Gupta. Absent: None AGENDA REVIEW None. STUDY SESSION 1.Study session regarding Down Payment Assistance Program for City Employees. (Richard Lee,Director of Finance) Director of Finance Lee presented the staff report. Vice Mayor Normandy asked about the survey results. Director Lee stated the survey wasconductedtounderstandthemagnitudeofhowmanypotentialemployeeswouldbe interested and what level of funding would be needed for each of the fiscal years. Vice Mayor Normandy asked if the program would be further explained to staff. City Manager Futrell stated details were provide at the semi-annual town hall meetings. Councilmember Matsumoto stated it was a good effort but expressed concern that it applied to management level and above. She discussed the need to provide housing to lower level staff. She indicated support for the proposed program but suggested workforce or employee housing. She discussed affordable housing units at 150 Airport and suggested they commit to employee housing. Mayor Gupta asked if the program was only for properties $900,000 or above. Director Lee stated $900,000 was used for demonstration purposes. Councilmember Addiego stated condominiums would qualify. He expressed concern about available inventory. Councilmember Matsumoto asked what happened if the employee left City employment. Director Lee stated the employee would continue to make payments through a third party administrator. Councilmember Matsumoto stated she was not comfortable with that. City Manager Futrell stated the matter was considered and staff suggested not requiring home forfeiture. Councilmember Matsumoto suggested requiring they remain employed for five years. City Manager Futrell stated the Council would have to determine the penalty if the employee left the City. He stated the program was open to all employees and explained the down payment process. He discussed efforts to locate rental units for employees. Councilmember Matsumoto asked how much was in the Infrastructure Reserves. Director Lee stated the balance was $6.5 million. Councilmember Matsumoto stated she wanted to see the CIP. Councilmember Garbarino asked if units in the Airport Boulevard project could be set aside for employees. City Attorney Rosenberg stated there was a potential issue if a certain group was favored over another group. Councilmember Addiego discussed housing inventory and possible purchase of property. Vice Mayor Normandy asked when the OMNI 87-unit project was anticipated to be completed. Councilmember Matsumoto stated it included units at 20% below market rate. City Manager Futrell stated it was anticipated to open to the public in approximately 24 months. Mayor Gupta expressed concern about the City "double dipping" by being paid interest on the loan and getting a share of escalation. Director Lee stated shared appreciation was partofthefirsttimehomebuyerprogramandwaspresentedforCouncildiscussion. Mayor Gupta stated it was important to be fair to employee. Futrell He tated it had been included based,interest free equity sharing program. City Manager on inclusion in an earlier program but staff was agnostic. Councilmember Addiego suggested setting the interest rate at the same level as earned. City Manager Futrell explained that the intent was to break even with the same interest that would have been earned in the alternative investment. Councilmember Addiego asked how market shift would impact the City. City Manager Futrell suggested taking the feedback and turning it into a proposal for fine- tuning by the Budget Subcommittee. ADJOURNMENT Being no further business, Mayor Gupta adjourned the meeting at 6:57 p.m. Submitted by: Approved by: 9, ,4,- A Gabriel Rodng • ,Deputy City Clerk Pradeep Gupta, Mayor City of South San Francisco City of South San Francisco SPECIAL CITY COUNCIL MEETING FEBRUARY 22,2017 PAGE 2 MINUTES South San Francisco Employee Down Payment Assistance Program AgendaAgenda Introduction to Hello Housing Buying a home in San Mateo County Overview of DPA Products and Programs South San Francisco DPA -Recommendations Agenda 2 We design and manage Below Market Rate (BMR) portfolios, down payment assistance loan programs and inclusionary sales on behalf of cities and counties. ~1,750 Units under Management ~Originate over 70 down payment assistance loans per year ~Loan portfolio size: $10.5M $8MM anticipated growth by 2021 We design and implement innovative “Missing Middle” housing programs which rely on fostering public/private partnerships to bring new housing solutions into our communities We manage direct-to- consumer home repair programs, including Bright in Your Own Backyard, a new pilot program partnering with homeowners in San Mateo County add ADU’s to their properties. We develop affordable housing within the fabric of existing neighborhoods, primarily through acquisition/rehab of 1-4 unit residential properties. DevelopmentHello RehabHello Stewardship R&D 3 Buying a home in San Mateo County 4 $2,300,000 $1,500,000 $1,350,000 SMC Median $1,000,000 Median Home Values $950,000 4th quarter 2019 Neighborhood Quest 5 Single Family Homes Under $700,000 2-bedroom, 1 bathroom 640 –750 sq ft 6 Single Family Homes Under $900,000 3-bedroom, 1 bathroom 750-950 sq ft 7 Single Family Homes Under $1,000,000 3-bedroom, 2 bathroom 950-1,300 sq ft 8 Single Family Homes Under $1,350,000 3-bedroom, 4-bedroom, 2 bath homes 1,200 -1,600 sq ft 9 Down Payment Assistance Goals and Programs 10 1. 1. 1. 1. •Increase buying power to support access to homeownership for a larger portion of Bay Area residents •Avoid Private Mortgage Insurance payments through a 20% Down Payment •Support First-time homebuyers enter the market •Create a path towards homeownership for low-to-moderate income households •Reduce commutes by supporting local workforce to buy homes where they work –often accomplished with Live/Work preferences •Attract and retain quality employees Down Payment Assistance Goals 11 EXISTING DPA LOAN PROGRAMS Loan Type Amortizing Payment Partial Deferral Shared Appreciation Monthly Payments Yes No –1st five years No Max Loan $136,223 $100,000 $150,000 Max Purchase Price $908,156 $1,500,000 N/A Required Down Payment 5%3%3% Income Limit of Buyer $170,000 N/A Low-to-Moderate Loan Term 15-year term, 30-year amortizing payment 5-year deferral, 30- year amortizing payment 30-year term First-time home buyer Yes No Yes Other requirements/preferences Live/Work SMC County Employees (Employed for 18 months) Live/Work/ Educator/First Responder 12 Loan Comparison Shared Appreciation Loan Amortizing Payment Loan Purchase Price $1,000,000 $1,000,000 Buyer Down Payment 3%$30,000 $30,000 South City DPA Loan 10%$100,000 $100,000 1st Mortgage Payment 4%$4,154 $4,154 2nd Mortgage Payment 3.5%$0 $454 Private Mortgage Insurance .65%$471 $471 Total Housing Cost $4,808 $5,262 Sample Share of Appreciation Calculation at Repayment Purchase Price $1,000,000 DPA Investment by City 10%$100,000 Market Value at Resale $1,300,000 Appreciation in Value ($)30%$300,000 Principal returned to the City $100,000 Share of appreciation to City 10%$30,000 Share of appreciation earned by owner 90%$270,000 13 DPA Recommendation 14 Hello Housing’s Recommendation Loan Type Shared Appreciation Loan Max Loan $100,000 Max Purchase Price N/A Required Buyer Down Payment 3% Loan Term 30-year term –to include repayment provisions at year 5 and at year 10 1st Mortgage Loan Requirements 30-year fixed loan Eligibility Full-time employee of South City Length of Employment After 1-year of employment or completion of probationary period, which ever is longer. First-time homebuyer Preference to FTHB or if selling existing home to buy a home closer to work Purchase geography TIER 1 TIER 2 South San Francisco SM County ,SF County Triggers for Repayment •Transfer of Title •Home is no longer owner-occupied •Upon a cash-out refinance •No longer working for SSF must REFI within 12-months, 0ne (1) time extension if there is a documented hardship 15 Next Steps: Program Design and Documentation Marketing and employee outreach Online application and lottery Reservation of funds 90-120 days Loan closings –45-days March through May June/July June/July Starting in August Starting in September 16 Amortizing Payment Loans (Handout) The borrower repays the loan by making monthly payments of both principal and interest throughout the term of the loan. The borrower is paying down a portion of the loan principal each month which is building equity. Depending on how the loan is set up, at the end of the term, the loan and interest is paid in full. It reduces the overall buying power of the borrower by limiting how much of a loan a borrower can qualify for since they are making two loan payments a month. If the borrower is not able to achieve a 20% down payment, the borrower is also paying for Private Mortgage Insurance each month, making this loan expensive to the borrower. Deferred Interest, Silent Second Loan The borrower is not required to make monthly payments. Instead, monthly interest is calculated on the original loan amount and added to the full balance due when the loan term ends. The borrower can qualify for a more affordable loan or a larger loan since there are no monthly payment obligations. The loan results in a balloon payment at the end of the term which includes all outstanding principal and the accrued interest. It is not common for a borrower to pay down the loan principal during the term, therefore the interest is accruing on the full balance of the loan. Shared Appreciation Loan Loans are interest free and have no monthly payment during the term of the loan. When the loan term ends, the borrower repays the amount that they borrowed plus a proportional share of the increase in the value of their home. For example, a homeowner who obtained a DPA loan for 10% of the home purchase price would repay the amount of the loan principal, plus 10% of any increase in the home’s value. The borrower can qualify for a more affordable loan or a larger loan since there are no monthly payment obligations. The homeowner is incentivized to repay the loan early in order to lower the proportional share of appreciation due. + + ++ -- - Loan Types 17 ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !!! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! Napa Tracy Colma Pinole Oakley Novato Folsom Dublin Loomis Madera Antioch Belmont Hayward Turlock Rocklin Pioneer Oakland Montara Modesto Lincoln Jackson Fremont Fairfax Escalon Concord Alameda Richmond Woodside Danville Campbell Berkeley Brisbane Petaluma Pacifica Millbrae Hercules Riverbank Cupertino Sunnyvale Livermore Fairfield Brentwood Vacaville San Ramon San Bruno Daly City Union City Moss Beach San Mateo Santa Cruz San Rafael Sacramento Pine Grove Burlingame San Carlos San Lorenzo Granite Bay Foster City San Leandro Mill Valley Walnut Creek Grass Valley Redwood CityHalf Moon Bay Scotts Valley Pollock Pines Castro Valley Pleasant Hill San Francisco Rancho Murieta Mountain House West Sacramento El Dorado Hills South San Francisco City of South San Francisco Employee Home Locations Employees !1 !2 - 4 !5 - 11 !12 - 23 !24 - 40. ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! Novato Colma Pinole Novato Dublin Antioch Belmont Hayward Oakland Montara Fremont Concord Alameda Richmond Woodside Danville Campbell Berkeley Brisbane Pacifica Millbrae Hercules Cupertino Sunnyvale Livermore Brentwood San Ramon San Bruno Daly City Union City Moss Beach San Mateo San Rafael Burlingame San Carlos San Lorenzo Foster City San Leandro Mill Valley Walnut Creek Redwood City Half Moon Bay Scotts Valley Castro Valley Pleasant Hill San Francisco South San Francisco City of South San Francisco Employee Home Locations . Number of Employees !1 !2 - 4 !5 - 11 !12 - 23 !24 - 40 Department !City Clerk !City Manager !ECD !Finance !Fire !HR !IT !Library !Parks and Rec !Police !Public Works City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-84 Agenda Date:3/11/2020 Version:1 Item #:9. Report regarding an ordinance adding Chapter 8.72 to the South San Francisco Municipal Code Title 8 regulating the use of disposable food service ware by food facilities.(Christina Fernandez,Assistant to the City Manager) RECOMMENDATION It is recommended City Council waive reading and introduce an ordinance adding Chapter 8.72 to the South San Francisco Municipal Code Title 8 regulating the use of disposable food service ware by food facilities. BACKGROUND/DISCUSSION The City of South San Francisco is committed to sustainability,environmental preservation,and reducing greenhouse gas emissions. Among the initiatives to keep South San Francisco, “green” include: ·The City’s Green Food Packaging ordinance adopted in 2008 prohibits food vendors from dispensing prepared food to customers in disposable food service ware made from polystyrene.(SSFMC Chapter 8.60) ·Effective April 22,2013,the City adopted a reusable bag ordinance that prohibits the use of single use carryout bags at retail stores.It requires retailers to charge customers for recycled paper bags and reusable bags at point of sale. (SSFMC Chapter 8.64) ·Adopted in 2014,the City’s Climate Action Plan provided guidance in meeting the City’s goals to reduce energy usage and greenhouse gas emissions communitywide. ·In 2016,the City joined Peninsula Clean Energy,which gives residents and businesses the option to purchase energy from renewable sources. ·South San Francisco encourages residents and businesses to participate in various transit options including the Free South City Shuttle service and SCOOP, the commute app. In March 2019,the City of South San Francisco began to explore the prohibition of plastic food service ware, specifically plastic straws provided by restaurants and fast food establishments.At a Special City Council on April 9,2019,the City Council provided staff direction to continue to explore banning plastic straws and other food service ware from restaurants and fast food restaurants.Council directed staff to reach out to the business community regarding the potential ban of plastic straws. The City Manager’s office in coordination with the Economic and Community Development Department hosted a series of four Business Town Hall meetings on June 17,2019,June 24,2019,June 27,2019,and June 28, 2019. Two meetings were held in the morning and two in the evening. The City advertised the town hall meetings through mailers sent to every business license holder citywide.City of South San Francisco Printed on 3/6/2020Page 1 of 5 powered by Legistar™ File #:20-84 Agenda Date:3/11/2020 Version:1 Item #:9. The City advertised the town hall meetings through mailers sent to every business license holder citywide. Approximately 6,000 mailers were sent via U.S.Postal Mail to every business license address.The non-profit organization,Gatepath personally handed out mailers to every business along Grand Avenue and Linden Avenue. Further,the City advertised the business town hall meetings on social medial platforms including the City’s Facebook page,the Economic and Community Development Facebook page,NextDoor,and the City’s Website Calendar of Events.The Economic and Community Development department and the City Manager’s office also provided e-blasts to their distribution lists.The City also called businesses along Grand Avenue to inform them of the business town hall meeting dates. The Town Hall meetings discussed three different policy initiatives:the ban of plastic food service ware, increasing the minimum wage to $15 per hour,and banning flavored tobacco and e-cigarettes.Of the three initiatives,plastic food service ware received the least amount of resistance from restaurants and the California Restaurant Association.The California Restaurant Association expressed concerns that plastic straws should be made readily available for customers (e.g. at dispensers on counters). Current Municipal Code The City’s Green Food Packaging ordinance defines the term “disposable food service ware”as “single or non -durable use disposable products used by food vendors in the restaurant or food serving industry for serving or transportation prepared,ready to consume food or beverages,”which “includes,but is not limited to,plates, cups,bowls,utensils,cartons,trays,and hinged or lidded containers for takeout foods and/or leftover from partially consumed meals prepared at food vendors.”(SSFMC §8.60.010)The City’s current definition of “disposable food service ware”does not specifically include plastic straws or stirrers.Therefore,plastic straws or stirrers are permitted in the City. Furthermore,the City’s Green Food Packaging ordinance prohibits food vendors from dispensing prepared food to customers in disposable food service ware made from polystyrene.(SSFMC §8.60.020)The City’s definition of “food vendor”includes full service restaurants and fast food restaurants,as well as “any sales outlet,store,shop,restaurant,grocery store,supermarket,vehicle or other places of business operating primarily to sell or convey foods or beverages directly to the ultimate consumer,which foods or beverages are predominantly contained, wrapped or held in or on packaging.” Similarly,all city facilities,city sponsored events,and city permitted events are prohibited from using disposable food service ware made from polystyrene.Instead,all food vendors must use disposable food service ware that is biodegradable,compostable,reusable,or recyclable.(SSFMC §8.60.030)Additionally,all city facilities must use biodegradable,reusable,or recyclable food service ware unless it can be shown that there is not an alternative for a specific use. However,there are several exemptions in the City’s Green Food Packaging ordinance.(SSFMC §8.60.040) Prepared foods packaged outside of the City are exempt from the provisions.There may be situations unique to a food vendor where a suitable alternative does not exist for a specific application.Food vendors may also apply for an exemption due to significant economic hardship,but they must provide documentation that factually supports their claim.All exemptions are subject to City Manager or designee approval.A food vendor granted an exemption by the City must re-apply prior to the expiration of the one-year exemption period and demonstrate continued undue hardship,the continued absence of a suitable biodegradable, City of South San Francisco Printed on 3/6/2020Page 2 of 5 powered by Legistar™ File #:20-84 Agenda Date:3/11/2020 Version:1 Item #:9. compostable, reusable, or recyclable alternative, if they wish to have the exemption extended. County of San Mateo Disposable Food Service Ware Ordinance Concurrent with the City’s efforts to explore the prohibition of plastic food service ware,the City began discussions with the County of San Mateo’s Office of Sustainability who were in the process of exploring and creating a plastic food service ware ordinance. The County of San Mateo’s Plastic Food Service Ware ban eliminates the unnecessary distribution and use of disposable food service ware that is not reusable or compostable while improving the health and safety of residents of San Mateo County.The ban also helps the County meet its regional stormwater permit requirement by reducing litter in stormwater discharges. The County ordinance targets any vendor,business,organization,entity,group or individual,including licensed retail food establishments that provide prepared food for public consumption.The items prohibited include disposable food service ware used to serve/distribute prepared food.Some examples include bowls,plates, clamshells, cups, straws and utensils designed to be discarded after a single or limited number of uses. The County’s ordinance allows accessories such as straws,stirrers,cup spill plugs,condiment packets,utensils, and napkins shall be only provided (1)when requested by the consumer,(2)upon acceptance by the consumer after being offered by the food facilities,or (3)at a self-serve area and/or a dispenser.Accessories will be distributed unbundled as separate individual units.Take-out food delivery services that utilize digital ordering platforms shall provide clear options for customers to affirmatively request accessories.Per the Polystyrene Ban Ordinance, Polystyrene (#6 plastics, Styrofoam) disposable food service ware remains prohibited. Food facilities shall use disposable straws,stirrers,utensils,and cocktail/toothpicks (and the packaging that these individual items are wrapped in,if any)made from non-plastic,compostable materials.Non-plastic, compostable material is defined as,but not limited to,natural fiber based materials such as paper,sugarcane, wheat stalk/stem,bamboo,and wood.Traditional plastics (petroleum based)and compostable plastics (bioplastics or polylactic acid (PLA)) shall not be allowed for the items listed above. Food facilities shall use non-plastic,compostable plates,bowls,cups,food trays,clamshells,boxes,deli containers,and other containers.These items may be lined with,but not made entirely of compostable plastic. Additionally,these items shall be certified by the Biodegradable Products Institute (BPI)or by another third party approved by the County’s Office of Sustainability to ensure that the items break down in an industrial composting facility and are free of/have minimal traces of harmful fluorinated chemicals. There will be some notable exemptions, including: ·Disposable food service ware made from aluminum ·Disposable plastic straws may be provided only upon request to consumers with medical needs ·Healthcare facilities may distribute straws and cup sleeves without a request from the consumer ·Drive-thru areas of food facilities may distribute straws without a request from the consumer City of South San Francisco Printed on 3/6/2020Page 3 of 5 powered by Legistar™ File #:20-84 Agenda Date:3/11/2020 Version:1 Item #:9. ·If no reasonably feasible disposable food service ware alternative exists. The County will maintain and have available a list of approved disposable food service ware sources and/or references to organizations that maintain regularly updated lists of products that meet the ordinance requirements. The County ordinance will not become operative and will not be enforced for one year.This is to provide food facilities time to use up their existing non-conforming inventory of disposable food service ware and for education and enforcement efforts. Benefits to Adopting the County’s Ordinance as proposed Chapter 8.72 Upon review and discussion of the County’s proposed plastic food service ware ban,the City determined that it may more effective to delay implementation of the City’s plastic food service ware ban in anticipation of adopting an ordinance modeled after the County of San Mateo’s Plastic Food Service Ware Ordinance.The proposed Chapter 8.72 is modeled entirely on the County’s ordinance and contains identical requirements with respect to plastic food service ware ban, regulations and exemptions. The benefits to adopting an ordinance modeled after the County’s ordinance include: ·Outreach and Education The County of San Mateo will be responsible for the education and outreach efforts to the businesses when the ban is implemented.The County’s purpose during its initial implementation is to have all businesses become compliant and a large part of that is education. ·Enforcement In addition to education,the County of San Mateo will provide enforcement for all cities that choose to adopt their ordinance by reference.Infractions are punishable by civil or administrative remedies under law.The City reserves the ability to enforce the proposed Chapter 8.72 in addition to enforcement by County personnel. ·Regional Streamlining Currently,16 San Mateo County cities have pledged to adopt the County’s ban on plastic food service ware.Not only has this process provided the ability for the County to convene a collaborative process where all cities’viewpoints and concerns are taken into consideration,but it also allows for a regional, streamlined approach to the implementation of policies as they relate to plastic food service ware. The City’s ordinance will incorporate all applicable provisions of the County’s ordinance and will likewise delay operation and enforcement for one year.The City’s ordinance further provides the ability for both the City and County personnel to enforce the requirements provided therein. FISCAL IMPACT There is no known fiscal impact by adopting this ordinance.If adopted,the County will provide all outreach, education and enforcement.Funding for the County’s ordinance comes from the County’s AB 939 fee,which is levied on all waste disposed of within the county, and is designated specifically for waste reduction program. City of South San Francisco Printed on 3/6/2020Page 4 of 5 powered by Legistar™ File #:20-84 Agenda Date:3/11/2020 Version:1 Item #:9. RELATIONSHIP TO STRATEGIC PLAN Adoption of an ordinance regulating the use and distribution of disposable food service ware meets the City’s strategic initiatives of building and maintaining a sustainable city. CONCLUSION Adoption of an ordinance modeled after the San Mateo County ordinance regulating the use of disposable food service ware by food facilities creates a collaborative,regional streamlined approach to curbing the use and distribution of plastics countywide.Cities that adopt the county ordinance benefit from funded uniform enforcement and education mechanisms. It is recommended City Council waive reading and introduce an ordinance adding Chapter 8.72 to the South San Francisco Municipal Code Title 8 regulating the use and distribution of disposable food service ware by food facilities. Attachments: 1.County of San Mateo’s Disposable Food Service Ware Ordinance 2.Presentation City of South San Francisco Printed on 3/6/2020Page 5 of 5 powered by Legistar™ ORDINANCE NO. . BOARD OF SUPERVISORS, COUNTY OF SAN MATEO, STATE OF CALIFORNIA * * * * * * ORDINANCE REPEALING CHAPTERS 4.106 AND 4.107 OF THE SAN MATEO COUNTY ORDINANCE CODE AND ADOPTING A NEW CHAPTER 4.107 REGULATING THE USE OF DISPOSABLE FOOD SERVICE WARE BY FOOD FACILITIES The Board of Supervisors of the County of San Mateo, State of California, ORDAINS as follows: SECTION 1. Findings. The Board of Supervisors finds and determines that: (a) The production, management, and consumption associated with disposable food service ware, typically used for only a few minutes before being discarded, have significant environmental impacts, including environmental contamination; consumption of precious resources such as energy and water; emissions of greenhouse gases; air and water pollution; litter on streets; and plastic pollution in waterways and oceans. (b) Disposable food service ware constitutes a substantial portion of the litter found within San Mateo County and the rest of the Bay Area. These types of food service ware are commonly littered or blown out of trash receptacles and migrate through the storm drain system where they eventually end up in the ocean and the county’s beaches and creeks. (c) Polystyrene is a petroleum-based, lightweight plastic material commonly used as food service ware by retail food vendors. Polystyrene, often referred to by the trademark, Styrofoam, has also become a problematic environmental pollutant given its non-compostable and nearly non-reusable nature. (d) The most effective ways to reduce the negative environmental impacts of disposable food service ware include, in order of priority, using reusable food service ware; using natural-fiber based compostable materials, many made from renewable resources such as bamboo, wheat stalk/stem, and sugarcane that do not contain toxic chemicals; and recycling food service ware. When products are reused and recycled, natural resources are spared, less energy is used for the production of new products, and premium landfill space is preserved. When compostable products are turned into compost, they can reduce water use and lessen the need for fertilizer at the site where the compost is applied (e.g., gardens, yards, farm land, etc.), which can also lead to cost savings since less/no fertilizers need to be purchased. (e) Compostable food service ware such as cups, plates, clamshell containers, and utensils are now made from paper, sugarcane stalk, bamboo, wheat stalk/straw, and other blends of natural plant fibers. As these products degrade, they pose less of a danger to the environment. (f) Even with the emergence of compostable plastics, which are derived from renewable biomass sources such as plants and microorganisms, there are limited certified types of compostable plastic that biodegrade in a marine environment. (g) Certain disposable food service ware, including compostable paperboard containers, may contain fluorinated chemicals, also known as per- and polyfluorinated alkyl substances (PFAS), which are synthetic chemicals commonly used in disposable food service ware to repel water and gre ase. Fluorinated chemicals pose a public health risk as they have been linked to serious health effects including kidney and testicular cancer, thyroid disruption, delayed puberty, and obesity. (h) Plastics in waterways and oceans break down into smaller pieces, called microplastics, that do not biodegrade and are present in most of the world’s oceans. Microplastics consumed by marine organisms make their way into animals’ tissues and are beginning to show up in the fish that humans consume. Plastic debris also attracts and concentrates ambient pollutants in seawater and freshwater, which can transfer to fish and other seafood that is eventually sold for human consumption. (i) Reduction of disposable food service ware in the environment will advance compliance with federal, state, and county clean water mandates, including the County’s Municipal Regional Stormwater Permit requirement, by helping to reduce trash and litter in stormwater discharges. (j) Understanding the importance of and need for reducing plastic litter, the County adopted a plastic bag ban ordinance in 2012. Adopting this Ordinance will help further reduce the amount of litter entering the county’s storm drains, creeks, the bay, and the ocean. (k) This Board does, accordingly, find and declare that it should restrict the use by food facilities of polystyrene-based disposable food service ware and require the replacement of non-compostable or non-recyclable disposable food service ware with compostable alternatives that are non-plastic, natural fiber-based, and free of all intentionally added fluorinated chemicals, when and where possible. SECTION 2. Chapters 4.016 and 4.107 of the San Mateo County Ordinance Code are hereby repealed and replaced in their entirety by a new Chapter 4.107 to be numbered and entitled and to read as follows: CHAPTER 4.107 REGULATING THE USE OF DISPOSABLE FOOD SERVICE WARE 4.107.010 – Application of Chapter. (a) The provisions of this chapter shall apply only within the unincorporated areas of San Mateo County. (b) Food Facilities at the San Francisco International Airport and the San Francisco County Jail located in the unincorporated San Mateo County area of San Bruno are exempt from the provisions of this Chapter. 4.107.020 – Definitions. For purposes of this Chapter, the following terms have the following meanings: (a) “Aluminum Foil-based” means any Disposable Food Service W are composed entirely of aluminum, including but not limited to aluminum tray liners, aluminum foil, and aluminum foil baskets. (b) “Biodegradable Products Institute (BPI)” refers to a certification program that ensures that products and packaging displaying the BPI logo have been independently tested and verified accordingly to scientifically based standards to successfully break down in professionally managed industrial composting facilities. BPI-certified products meet the standards of the American Society for Testing Materials (ASTM) D6400 or D6868 for compostability. Starting on January 1, 2020, all BPI-certified products will also be required to have (1) a limit of 100 parts per million (ppm) total Fluorinated Chemicals as the upper threshold for acceptance and (2) no intentionally added Fluorinated Chemicals. (c) “Compostable” means that an item or material (1) will break down, or otherwise become part of usable compost in a safe and timely manner and (2) is Natural Fiber-based or made from other materials approved by the County Manager or designee. Compostable items may include those that are made entirely of Natural Fiber or Natural Fiber-based items that are coated or lined with biologically based polymer, such as corn or other plant sources (e.g., compostable plastics), if certified by BPI or by another independent third party approved by the County Manager or designee. (d) “Disposable” means designed to be discarded after a single or limited number of uses and not designed or manufactured for long-term multiple reuse. (e) “Food Service W are” means food contact products used for serving, distributing, holding, packaging, and/or transporting Prepared Food including, but not limited to plates, cups, bowls, trays, clamshell containers, boxes, utensils, straws, lids, and food contact paper (e.g., wraps, bags, tray liners, etc.). The term "Food Service Ware" includes Food Service Ware Accessories. (f) “Food Service Ware Accessories” include Food Service Ware such as straws, stirrers, cup spill plugs, cup sleeves, condiment packets, utensils (including chopsticks), cocktail sticks/picks, toothpicks, napkins, and other similar accessory or accompanying Food Service Ware used as part of food or beverage service or packaging. Detachable lids for beverage cups and food containers are not considered a Food Service Ware Accessory. (g) “Fluorinated Chemicals” means perfluoroalkyl and polyfluoroalkyl substances (PFAS chemicals) or fluorinated chemicals, which are a class of fluorinated organic chemicals containing at least one fully fluorinated carbon atom. (h) “Food Facility” means an operation that stores, prepares, packages, serves, vends, or otherwise provides food to the public for human consumption, as defined by the California Health and Safety Code Section 113789 or successor. It includes both permanent and temporary food facilities. Public schools are exempt from the provisions of this Chapter. (i) “Food Scrap Composting Method” means (1) self-hauling of food scraps to a permitted composting facility or a transfer station that accepts food scraps that will be transferred to a permitted composting facility for on-site compost processing, (2) food scrap compost collection service provided by a curbside hauler, or (3) on-site food scrap composting. (j) “Healthcare Facilities” mean places that provide healthcare to the public. Healthcare Facilities includes, but is not limited to hospitals, clinics, outpatient care centers, nursing homes, psychiatric care centers, medical offices, hospice homes, mental health and addiction treatment centers, orthopedic and other rehabilitation centers, urgent care, birth centers, etc. (k) “Natural Fiber/Natural Fiber-based” means a plant or animal-based, non- synthetic fiber, including but not limited to products made from paper, sugarcane, bamboo, wheat stems/stalk, hay, wood, etc. (l) “Non-Compostable” means not meeting the definition of Compostable set forth in this Chapter. (m) “Polystyrene-based” means and includes expanded polystyrene, which is a thermoplastic petrochemical material utilizing a styrene monomer and processed by any number of techniques including, but not limited to fusion of polymer spheres (expandable bead polystyrene), injection molding, form molding, and extrusion-blow molding (extruded foam polystyrene). The term "polystyrene" also includes polystyrene that has been expanded or blown using a gaseous blowing agent into a solid foam (expanded polystyrene [EPS]) and clear or solid polystyrene known as oriented polystyrene. (n) “Prepackaged Food” means any properly labeled processed food, prepackaged to prevent any direct human contact with the food product upon distribution from the manufacturer and prepared at an approved source. (o) “Prepared Food” means food or beverages that undergo a cooking or food preparation technique on the Food Facility’s premises for consumption by the public. Cooking or food preparation technique includes, but is not limited to the following: 1. Cooking methods, utilizing the application of heat, such as steaming, microwaving, simmering, boiling, broiling, grilling, frying, or roasting. 2. Beverage preparation, such as blending, brewing, steeping, juicing, diluting, or pouring. 3. Food preparation techniques, such as defrosting, rinsing, washing, diluting, cutting, portioning, mixing, blending, assembling, coating, dipping, garnishing, decorating, or icing. Prepared Food does not include raw eggs or raw, butchered meats, fish, and/or poultry sold from a butcher case, a refrigerator case, or similar retail appliance. (p) “Takeout Food” means Prepared Food requiring no further preparation, which is purchased to be consumed off a Prepared Food Facility’s premises. Takeout Food includes Prepared Food delivered by a Food Facility or by a third-party Takeout Food Delivery Service. (q) “Takeout Food Delivery Service” is a service that delivers Takeout Food from a Food Facility to a customer for consumption off the premises. This service can be provided directly by the Food Facility or by a third-party. 4.107.030 – Distribution of Disposable Food Service Ware Accessories. (a) No Food Facility shall provide any Disposable Food Service Ware Accessories except (1) upon request by the consumer, (2) upon acceptance by the consumer after being offered by the Food Facility, or (3) at a self-serve area and/or a dispenser. (b) Food Facilities shall only distribute Disposable Food Service Ware Accessories unbundled, as separate individual units. (c) Takeout Food Delivery Services that utilize digital ordering/point of sale platforms, including but not limited to the internet and smart-phone, shall only offer Disposable Food Service Ware Accessories by providing clear options for customers to affirmatively request these items separate from orders for food and beverages. The default option on the digital ordering/point of sale platforms shall be that no Disposable Food Service Ware Accessories are requested. Each individual Disposable Food Service Ware Accessory (e.g., each fork, knife, condiment packet, napkin, etc.) provided with Prepared Food must be specifically requested by the customer in order for a Food Facility to provide it. 4.107.040 – Standards and Required Use of Disposable Food Service Ware. (a) No Food Facility shall use Polystyrene-based Disposable Food Service Ware when providing Prepared Food. (b) Food Facilities shall only provide Disposable straws, stirrers, utensils, and cocktail/toothpicks (and the packaging that these individual items are wrapped in, if any) that are Compostable. (c) Nothing in this Chapter shall conflict or be construed to conflict with the Americans with Disabilities Act or any other applicable law concerning the rights of individuals with disabilities. In particular, nothing in this Chapter shall restrict, or be construed to restrict, the provision by Food Facilities of Disposable Non- Compostable straws to individuals who may request the use of Disposable Non- Compostable straws to accommodate medical needs or disabilities. Healthcare Facilities may distribute Disposable Non-Compostable straws with or without request by a patient at the discretion of the Healthcare Facility staff based on the physical or medical needs of the patient. (d) Food Facilities shall use Compostable items for the below Disposable Food Service Ware: 1. Plates 2. Bowls (of all sizes including, but not limited to soup and salad bowls and accessory bowls for condiments) 3. Cups (of all sizes including, but not limited to beverage cups) 4. Food trays 5. Clamshells, boxes, deli containers, and other containers used for the sale and/or distribution of Prepared Food (e.g., Takeout Food, leftover “doggie containers”, etc.) (e) Compostable items for the Disposable Food Service Ware listed in Subsection (d) used by Food Facilities must have been tested to breakdown into compost in an industrial composting facility in a timely manner and shall be free of all intentionally added Fluorinated Chemicals. To verify, these items shall be certified by Biodegradable Products Institute (BPI) or another independent third party approved by the County Manager or designee, in collaboration with local waste processors and haulers. (f) For all other Disposable Food Service Ware not listed in Subsections (b) and (d), Food Facilities shall use only Disposable Food Service Ware that can be composted by the Food Scrap Composting method utilized by the Food Facility and/or accepted for recycling by the Food Facility’s recycling collection service. (g) The County shall maintain a list of approved Disposable Food Service Ware sources and/or references to organizations that maintain regularly updated lists of products that meet the requirements detailed in Subsections (a), (b), (d), and (e) of this Section. This information shall be made available on the Office of Sustainability website and in the Office. If a product is not included on the approved lists, the Food Facility wishing to use a product as Disposable Food Service W are shall establish to the County Manager or designee’s satisfaction that the product complies with the requirements detailed in Subsections (a), (b), (d), and (e). 4.107.050 – Recordkeeping and Inspection. (a) Food Facilities shall keep complete and accurate record or documents of the below items. 1. Commencing on the effective date of this Ordinance and ending 365 days from the Ordinance effective date, the purchase of all Disposable Food Service Ware, including Non-Compostable and Compostable items. 2. The purchase of the acceptable Disposable Food Service Ware evidencing compliance with this Chapter for a minimum period of three years from the date of purchase. (b) The record shall be made available for inspection at no cost to the County during regular business hours by County employee or County-designated staff authorized to enforce this Chapter. Unless an alternative location or method of review is mutually agreed upon, the records or documents shall be made available at the Food Facility address. (c) The provision of false or incomplete information, records, or documents to the County shall be a violation of this Chapter. 4.107.060 – Automatic Exemptions. (a) Prepackaged Food is exempt from the provisions of this Chapter. (b) Polystyrene coolers and ice chests intended for reuse are exempt from the provisions of this Chapter. (c) Disposable Food Service Ware that is entirely Aluminum Foil-based is exempt from the provisions of this Chapter. (d) If the County determines that a reasonably feasible Disposable Food Service Ware that complies with Section 4.107.040 (a), (b), (d), and (e) of this Chapter does not exist, these items will be exempt from the abovementioned provisions of this Chapter until the County determines that a reasonably feasible alternative is available on the market for purchase. The County will have a current list of these exempted Disposable Food Service Ware posted on the Office of Sustainability website with hard copies available in the Office. (e) Certain Disposable Food Service Ware Accessories for beverage orders, specifically, straws and cup sleeves, shall be exempt from Section 4.107.030 (a) and may be distributed for safety reasons without the need for a request by the consumer or an offer by the Food Facility, specifically at drive-through areas of Food Facilities. Detachable lids are not considered a Disposable Food Service Ware Accessory, so Section 4.107.030 (a) does not apply to detachable lids. (f) Temporary exemptions due to an emergency are automatic without the submission of a request for an exemption. An emergency is defined as a sudden, unexpected occurrence posing a clear and imminent danger that requires immediate action to prevent or mitigate the loss or impairment of life, health, property, or essential public services. Examples of an emergency include, but are not limited to natural disasters, emergencies due to the release of hazardous materials, emergencies associated with loss of power and/or water, or emergency medical response. 4.107.070 – Case-by-Case Consideration of Requests for Hardship Exemption. (a) Grounds for an exemption. An exemption from any of the provisions of this Chapter may be granted by the County Manager or designee upon demonstration by a Food Facility to the satisfaction of the County that strict application of the requirements would cause undue hardship. An “undue hardship” includes, but is not limited to the following: 1. A situation unique to the Food Facility where a suitable alternative that conforms with the requirements detailed in Section 4.107.040 (a), (b), (d), and (e) does not exist for a specific application. 2. Imposing the provisions of this Chapter would cause significant economic hardship. “Significant economic hardship” may be based on, but not limited to, demonstrating that suitable Disposable Food Service W are is not available at a commercially reasonable price and the additional cost associated with providing the Disposable Food Service W are is particularly burdensome to the Food Facility based on the type of operation(s) affected, the overall size of the business/operation, the number, type and location of its facilities, the impact on the overall financial resources of the Food Facility, and other factors. Reasonable added cost for a suitable item as compared to a similar item that the Food Facility can no longer use shall not by itself constitute adequate grounds to support an exemption for such item. In determining whether a significant economic hardship has been established, the County Manager or designee shall consider the following information: ability of the Food Facility to recover the additional expense by increasing its prices; the availability of tax credits and deductions; outside funding; and other options. (b) Request for an exemption. A request for an exemption from the requirements of this Chapter shall include all information deemed necessary by the County to render a decision, including but not limited to documentation showing the factual support for the requested exemption. A request for an exemption may be approved by the County Manager or designee, in whole or in part, with or without conditions. The duration of the exemption, if granted, shall also be determined by the County Manager or designee. Information about the application process for requesting an exemption will be available on the Office of Sustainability ’s website and in the Office. 4.107.080 – Enforcement. (a) The County Manager or designee may enforce this Chapter. (b) A violation of this Chapter is an infraction and is also punishable by administrative fines as set forth in Chapter 1.40. (c) Violation of this Chapter is a public nuisance subject to all applicable civil, administrative, and criminal remedies and penalties according to the provisions and procedures contained in this ordinance code and state law including, but not limited to, an action for abatement or injunctive relief. (d) This Section shall not be interpreted to limit any otherwise available civil or administrative remedies under law. 4.107.090 – Enforcement within Incorporated Areas of County of San Mateo. (a) The County Manager or designee is hereby authorized to and may enforce Chapter 4.107 within an incorporated city within the County of San Mateo, if the governing body of that city does each of the following: 1. Adopts and makes part of its municipal code: i. Chapter 4.107 in its entirety by reference; or ii. An ordinance that contains each of the provisions of Chapter 4.107. 2. Authorizes, by ordinance, the County Manager or designee to enforce the municipal code adopted pursuant to Subsection (a)(1), such authorization to include, without limitation, the authority to hold hearings, issue citations, or assess administrative fines on behalf of the city. 3. Enters into a Memorandum of Understanding with the County for enforcement within the city. (b) The County Manager or designee shall only provide enforcement within an incorporated city if it has determined that it has adequate resources to do so. SECTION 3. California Environmental Quality Act (CEQA) Finding. This Ordinance is exempt from the environmental review requirements of CEQA pursuant to Section 15061 (b)(3) of Title 14 of the California Code of Regulations because it can be seen with certainty that there is no possibility that the provisions contained herein may have a significant effect on the environment. Further, the Ordinance is also exempt from the requirements of CEQA pursuant to CEQA Guidelines Sections 15307 and 15308 of Title 14 of the California Code of Regulations as actions taken by regulatory agencies to assure the maintenance, restoration, enhancement of natural resources, or protection of the environment. SECTION 4. Severability. If any provision, section, subsection, sentence, clause, phrase, or word of this Chapter 4.107, or any application thereof to any person or circumstance, is held to be invalid or unconstitutional by a court of competent jurisdiction, such decision shall not affect the validity of the remaining portions or applications of the Chapter. The Board of Supervisors hereby declares that it would have passed this Chapter, and each provision, section, subsection, sentence, clause, phrase, and word not declared invalid or unconstitutional without regard to whether any portion of this Chapter or application thereof would be subsequently declared invalid or unconstitutional. SECTION 5. Effective Date. This Ordinance shall be effective thirty (30) days after adoption. However, the mandatory provisions of this Ordinance, except for Section 4.107.050 (a)(1), shall only become operative and subject to enforcement one year (365 days) after the effective date. ******** Disposable Food Service Ware Ordinance City of South San Francisco City Council March 11, 2020 •1.3 million pounds of trash enters SF Bay every year•Single-use food & beverage packaging makes up 80% of ocean plastic pollution that comes from land Impact of our Throw-away Culture Plastics are in:•Our streets, storm drains, waterways and oceans•Marine and wildlife•Our food•Our air•Us Plastic is Ending Up Everywhere South San Francisco Green Initiatives •2008 –Polystyrene Ban •2013 –Reusable Bag Ordinance •2014 –Climate Action Plan •2016 –Peninsula Clean Energy •2019 –Disposable Food Service Ware Disposable Food Service Ware Ordinance •April 2019 –Special City Council •June 2019 –Series of Business Town Halls •County of San Mateo’s Office of Sustainability Disposable Food Service Ware Ordinance Provisions WHO will this impact?–Food facilities: •Any entity that provides prepared food for public consumption Disposable Food Service Ware Ordinance Provisions Accessories (e.g., straws, stirrers, cup spill plugs, condiment packets, utensils, napkins, etc.) provided to consumers only upon request or at self-serve stations/dispensers. Disposable Food Service Ware Ordinance Provisions Straws, stirrers, utensils, and cocktail/toothpicks –Plastics not allowed•Traditional plastics•Compostable plastics (aka bioplastics, PLA)Not Allowed Disposable Food Service Ware Ordinance Provisions Straws, stirrers, utensils, and cocktail/toothpicks –Plastics not allowed•Traditional plastics•Compostable plastics (aka bioplastics, PLA) –Acceptable materials•Natural fiber-based (e.g., paper, wood, bamboo, sugarcane, wheat stalk, hay, etc.) Acceptable Items Disposable Food Service Ware Ordinance Provisions Plates, bowls, cups, food trays, clamshells, and other take-out containers –Plastics not allowed Not Allowed Disposable Food Service Ware Ordinance Provisions Plates, bowls, cups, food trays, clamshells, and other take-out containers –Plastics not allowed–Natural fiber-based materials acceptable–Fluorinated-chemical free Disposable Food Service Ware Ordinance Provisions Exemptions–Aluminum –Plastic straws for medicalaccommodations –upon request–If no reasonably feasible alternative exists County’s role in education & outreach and enforcement Disposable Food Service Ware Ordinance Provisions WHEN will this impact food facilities? Goes into effect 30 days after adoption, if adopted•Operation & enforcement –one year after adoption Staff Recommendation Waive reading and introduce an ordinance adding Chapter 8.72 to the South San Francisco Municipal Code Title 8 regulating the use of disposable food service ware by food facilities. Thank You Christina FernandezAssistant to the City ManagerChristina.Fernandez@ssf.net City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-85 Agenda Date:3/11/2020 Version:1 Item #:9a. An ordinance adding Chapter 8.72 to Title 8 of the South San Francisco Municipal Code regulating the use of Disposable Food Service Ware by Food Facilities. WHEREAS, the City of South San Francisco (“City”) is committed to sustainability, environmental preservation, and reducing greenhouse gas emissions; and WHEREAS, the City adopted a Green Food Packaging Ordinance in 2008, which prohibits food vendors from dispensing prepared food to customers in disposable food service ware made from polystyrene; and WHEREAS, in 2013, the City adopted a reusable bag ordinance prohibiting the use of single-use carryout bags at retail stores and requiring retailers to charge customers for recycled paper bags and reusable bags at the point of sale; and WHEREAS, neither ordinance specifically prohibits the use of disposable food service ware by food facilities; WHEREAS, the production, management, and consumption associated with disposable food service ware, typically used for only a few minutes before being discarded, have significant environmental impacts, including environmental contamination; consumption of precious resources such as energy and water; emissions of greenhouse gases; air and water pollution; litter on streets; and plastic pollution in waterways and oceans; and WHEREAS, disposable food service ware constitutes a substantial portion of the litter found within the City and the rest of the Bay Area; these types of food service ware are commonly littered or blown out of trash receptacles and migrate through the storm drain system where they eventually end up in the ocean, beaches, creeks and other natural scenic locations; and WHEREAS, polystyrene is a petroleum-based, lightweight plastic material commonly used as food service ware by retail food vendors. Polystyrene, often referred to by the trademark, Styrofoam, has also become a problematic environmental pollutant given its non-compostable and nearly non-reusable nature; and WHEREAS, the most effective ways to reduce the negative environmental impacts of disposable food service ware include, in order of priority, using reusable food service ware; using natural-fiber based compostable materials, many made from renewable resources such as bamboo, wheat stalk/stem, and sugarcane that do not contain toxic chemicals; and recycling food service ware. When products are reused and recycled, natural resources are spared, less energy is used for the production of new products, and premium landfill space is preserved; when compostable products are turned into compost, they can reduce water use and lessen the need for fertilizer at the site where the compost is applied (e.g., gardens, yards, farm land, etc.), which can also lead to cost savings since less/no fertilizers need to be purchased; and WHEREAS, compostable food service ware such as cups, plates, clamshell containers, and utensils are now made from paper, sugarcane stalk, bamboo, wheat stalk/straw, and other blends of natural plant fibers. As these products degrade, they pose less of a danger to the environment; and City of South San Francisco Printed on 3/17/2020Page 1 of 9 powered by Legistar™ File #:20-85 Agenda Date:3/11/2020 Version:1 Item #:9a. WHEREAS, even with the emergence of compostable plastics, which are derived from renewable biomass sources such as plants and microorganisms, there are limited certified types of compostable plastic that biodegrade in a marine environment; and WHEREAS, certain disposable food service ware, including compostable paperboard containers, may contain fluorinated chemicals, also known as per- and polyfluorinated alkyl substances (PFAS), which are synthetic chemicals commonly used in disposable food service ware to repel water and grease; fluorinated chemicals pose a public health risk as they have been linked to serious health effects including kidney and testicular cancer, thyroid disruption, delayed puberty, and obesity; and WHEREAS, plastics in waterways and oceans break down into smaller pieces, called microplastics, that do not biodegrade and are present in most of the world’s oceans. Microplastics consumed by marine organisms make their way into animals’ tissues and are beginning to show up in the fish that humans consume; plastic debris also attracts and concentrates ambient pollutants in seawater and freshwater, which can transfer to fish and other seafood that is eventually sold for human consumption; and WHEREAS, reduction of disposable food service ware in the environment will advance compliance with federal, state, and local clean water mandates, including the City’s Municipal Regional Stormwater Permit requirement, by helping to reduce trash and litter in stormwater discharges; and WHEREAS, the City Council considered this issue at a special meeting on April 9, 2019, and directed staff to continue exploring the prohibition of plastic food service ware in restaurants and fast food establishments within the City; and WHEREAS, the City concurrently began discussions with the County of San Mateo (“County’) Office of Sustainability to explore the creation of a plastic food service ware ordinance; and WHEREAS, the County has since prepared and adopted a Plastic Food Service Ware ordinance prohibiting the use of such plastic food service ware which would eliminate the unnecessary distribution and use of those wares while improving public health and safety for San Mateo residents; and WHEREAS, to effectuate its intents and achieve the goals described herein, the City is proposing to amend the South San Francisco Municipal Code by incorporating the County’s plastic food service ware ordinance and to provide for enforcement of such ordinance by the City and the County; and WHEREAS, this Ordinance is exempt from the environmental review requirements of the California Environmental Quality Act (CEQA) pursuant to Section 15061 (b)(3) of Title 14 of the California Code of Regulations because it can be seen with certainty that there is no possibility that the provisions contained herein may have a significant effect on the environment. Further, the Ordinance is also exempt from the requirements of CEQA pursuant to CEQA Guidelines Sections 15307 and 15308 of Title 14 of the California Code of Regulations as actions taken by regulatory agencies to assure the maintenance, restoration, enhancement of natural resources, or protection of the environment. NOW, THEREFORE, based on the entirety of the record before it, as described below, the City Council of the City of South San Francisco does hereby ordain as follows: City of South San Francisco Printed on 3/17/2020Page 2 of 9 powered by Legistar™ File #:20-85 Agenda Date:3/11/2020 Version:1 Item #:9a. SECTION 1. Findings.The City Council of South San Francisco finds that all Recitals are true and correct and are incorporated herein by this reference. SECTION 2.Amendment.Title 8, “Health and Welfare” of the South San Francisco Municipal Code is hereby amended by adding Chapter 8.72, “Use of Disposable Food Service Ware,” to read as follows: CHAPTER 8.72 USE OF DISPOSABLE FOOD SERVICE WARE 8.72.010 Definitions. 8.72.020 Distribution of Disposable Food Service Ware Accessories. 8.72.030 Standards and Required Use of Disposable Food Service Ware. 8.72.040 Recordkeeping and Inspection. 8.72.050 Automatic Exemptions. 8.72.060 Case-by-Case Consideration of Requests for Hardship Exemption. 8.72.070 Enforcement. 8.72.010 Definitions. For purposes of this Chapter, the following terms have the following meanings: a)“Aluminum Foil-based” means any Disposable Food Service Ware composed entirely of aluminum, including but not limited to aluminum tray liners, aluminum foil, and aluminum foil baskets. b)“Biodegradable Products Institute (BPI)” refers to a certification program that ensures that products and packaging displaying the BPI logo have been independently tested and verified accordingly to scientifically based standards to successfully break down in professionally managed industrial composting facilities. BPI-certified products meet the standards of the American Society for Testing Materials (ASTM) D6400 or D6868 for compostability. Starting on January 1, 2020, all BPI-certified products will also be required to have (1) a limit of 100 parts per million (ppm) total Fluorinated Chemicals as the upper threshold for acceptance and (2) no intentionally added Fluorinated Chemicals. c)“Compostable” means that an item or material (1) will break down, or otherwise become part of usable compost in a safe and timely manner and (2) is Natural Fiber-based or made from other materials approved by the city manager or designee. Compostable items may include those that are made entirely of Natural Fiber or Natural Fiber-based items that are coated or lined with biologically based polymer, such as corn or other plant sources (e.g., compostable plastics), if certified by BPI or by another independent third party approved by the city manager or designee. d)“Disposable” means designed to be discarded after a single or limited number of uses and not designed or manufactured for long-term multiple reuse. e)“Food Service Ware” means food contact products used for serving, distributing, holding, packaging, and/or transporting Prepared Food including, but not limited to plates, cups, bowls, trays, clamshell containers, boxes, utensils, straws, lids, and food contact paper (e.g., wraps, bags, tray liners, etc.). The term "Food Service Ware" includes Food Service Ware Accessories. City of South San Francisco Printed on 3/17/2020Page 3 of 9 powered by Legistar™ File #:20-85 Agenda Date:3/11/2020 Version:1 Item #:9a. f)“Food Service Ware Accessories” include Food Service Ware such as straws, stirrers, cup spill plugs, cup sleeves, condiment packets, utensils (including chopsticks), cocktail sticks/picks, toothpicks, napkins, and other similar accessory or accompanying Food Service Ware used as part of food or beverage service or packaging. Detachable lids for beverage cups and food containers are not considered a Food Service Ware Accessory. g)“Fluorinated Chemicals” means perfluoroalkyl and polyfluoroalkyl substances (PFAS chemicals) or fluorinated chemicals, which are a class of fluorinated organic chemicals containing at least one fully fluorinated carbon atom. h)“Food Facility” means an operation that stores, prepares, packages, serves, vends, or otherwise provides food to the public for human consumption, as defined by the California Health and Safety Code Section 113789 or successor. It includes both permanent and temporary food facilities. Public schools are exempt from the provisions of this Chapter. i)“Food Scrap Composting Method” means (1) self-hauling of food scraps to a permitted composting facility or a transfer station that accepts food scraps that will be transferred to a permitted composting facility for on-site compost processing, (2) food scrap compost collection service provided by a curbside hauler, or (3) on-site food scrap composting. j)“Healthcare Facilities” mean places that provide healthcare to the public. Healthcare Facilities includes, but is not limited to hospitals, clinics, outpatient care centers, nursing homes, psychiatric care centers, medical offices, hospice homes, mental health and addiction treatment centers, orthopedic and other rehabilitation centers, urgent care, birth centers, etc. k)“Natural Fiber/Natural Fiber-based” means a plant or animal-based, non- synthetic fiber, including but not limited to products made from paper, sugarcane, bamboo, wheat stems/stalk, hay, wood, etc. l)“Non-Compostable” means not meeting the definition of Compostable set forth in this Chapter. m)“Polystyrene-based” means and includes expanded polystyrene, which is a thermoplastic petrochemical material utilizing a styrene monomer and processed by any number of techniques including, but not limited to fusion of polymer spheres (expandable bead polystyrene), injection molding, form molding, and extrusion-blow molding (extruded foam polystyrene). The term "polystyrene" also includes polystyrene that has been expanded or blown using a gaseous blowing agent into a solid foam (expanded polystyrene [EPS]) and clear or solid polystyrene known as oriented polystyrene. n)“Prepackaged Food” means any properly labeled processed food, prepackaged to prevent any direct human contact with the food product upon distribution from the manufacturer and prepared at an approved source. o)“Prepared Food” means food or beverages that undergo a cooking or food preparation technique on the Food Facility’s premises for consumption by the public. Cooking or food preparation technique includes, but is not limited to the following: 1.Cooking methods, utilizing the application of heat, such as steaming, microwaving, simmering, boiling, broiling, grilling, frying, or roasting. City of South San Francisco Printed on 3/17/2020Page 4 of 9 powered by Legistar™ File #:20-85 Agenda Date:3/11/2020 Version:1 Item #:9a. 2.Beverage preparation, such as blending, brewing, steeping, juicing, diluting, or pouring. 3.Food preparation techniques, such as defrosting, rinsing, washing, diluting, cutting, portioning, mixing, blending, assembling, coating, dipping, garnishing, decorating, or icing. 4.Prepared Food does not include raw eggs or raw, butchered meats, fish, and/or poultry sold from a butcher case, a refrigerator case, or similar retail appliance. p)“Takeout Food” means Prepared Food requiring no further preparation, which is purchased to be consumed off a Prepared Food Facility’s premises. Takeout Food includes Prepared Food delivered by a Food Facility or by a third-party Takeout Food Delivery Service. q)“Takeout Food Delivery Service” is a service that delivers Takeout Food from a Food Facility to a customer for consumption off the premises. This service can be provided directly by the Food Facility or by a third-party. 8.72.020 Distribution of Disposable Food Service Ware Accessories. a)No Food Facility shall provide any Disposable Food Service Ware Accessories except (1) upon request by the consumer, (2) upon acceptance by the consumer after being offered by the Food Facility, or (3) at a self-serve area and/or a dispenser. b)Food Facilities shall only distribute Disposable Food Service Ware Accessories unbundled, as separate individual units. c)Takeout Food Delivery Services that utilize digital ordering/point of sale platforms, including but not limited to the internet and smart-phone, shall only offer Disposable Food Service Ware Accessories by providing clear options for customers to affirmatively request these items separate from orders for food and beverages. The default option on the digital ordering/point of sale platforms shall be that no Disposable Food Service Ware Accessories are requested. Each individual Disposable Food Service Ware Accessory (e.g., each fork, knife, condiment packet, napkin, etc.) provided with Prepared Food must be specifically requested by the customer in order for a Food Facility to provide it. 8.72.030 Standards and Required Use of Disposable Food Service Ware. a)No Food Facility shall use Polystyrene-based Disposable Food Service Ware when providing Prepared Food. b)Food Facilities shall only provide Disposable straws, stirrers, utensils, and cocktail/toothpicks (and the packaging that these individual items are wrapped in, if any) that are Compostable. c)Nothing in this Chapter shall conflict or be construed to conflict with the Americans with Disabilities Act or any other applicable law concerning the rights of individuals with disabilities. In particular, nothing in this Chapter shall restrict, or be construed to restrict, the provision by Food Facilities of Disposable Non- Compostable straws to individuals who may request the use of Disposable Non- Compostable straws to accommodate medical needs or disabilities. Healthcare Facilities may distribute City of South San Francisco Printed on 3/17/2020Page 5 of 9 powered by Legistar™ File #:20-85 Agenda Date:3/11/2020 Version:1 Item #:9a. Disposable Non-Compostable straws with or without request by a patient at the discretion of the Healthcare Facility staff based on the physical or medical needs of the patient. d)Food Facilities shall use Compostable items for the below Disposable Food Service Ware: 1.Plates 2.Bowls (of all sizes including, but not limited to soup and salad bowls and accessory bowls for condiments) 3.Cups (of all sizes including, but not limited to beverage cups) 4.Food trays 5.Clamshells, boxes, deli containers, and other containers used for the sale and/or distribution of Prepared Food (e.g., Takeout Food, leftover “doggie containers”, etc.) e)Compostable items for the Disposable Food Service Ware listed in Subsection (d) used by Food Facilities must have been tested to breakdown into compost in an industrial composting facility in a timely manner and shall be free of all intentionally added Fluorinated Chemicals. To verify, these items shall be certified by Biodegradable Products Institute (BPI) or another independent third party approved by the city manager or designee, in collaboration with local waste processors and haulers. f)For all other Disposable Food Service Ware not listed in Subsections (b) and (d), Food Facilities shall use only Disposable Food Service Ware that can be composted by the Food Scrap Composting method utilized by the Food Facility and/or accepted for recycling by the Food Facility’s recycling collection service. g)The city shall maintain a list of approved Disposable Food Service Ware sources and/or references to organizations that maintain regularly updated lists of products that meet the requirements detailed in Subsections (a), (b), (d), and (e) of this Section. This information shall be made available on the city’s website with hard copies available at the city manager’s office or another designated location. If a product is not included on the approved lists, the Food Facility wishing to use a product as Disposable Food Service Ware shall establish to the city manager or designee’s satisfaction that the product complies with the requirements detailed in Subsections (a), (b), (d), and (e). 8.72.040 Recordkeeping and Inspection. a)Food Facilities shall keep complete and accurate record or documents of the below items. 1.Commencing on the effective date of this Ordinance and ending 365 days from the Ordinance effective date, the purchase of all Disposable Food Service Ware, including Non-Compostable and Compostable items. 2.The purchase of the acceptable Disposable Food Service Ware evidencing compliance with this Chapter for a minimum period of three years from the date of purchase. City of South San Francisco Printed on 3/17/2020Page 6 of 9 powered by Legistar™ File #:20-85 Agenda Date:3/11/2020 Version:1 Item #:9a. b)The record shall be made available for inspection at no cost to the city during regular business hours by city employee or city-designated staff authorized to enforce this Chapter. Unless an alternative location or method of review is mutually agreed upon, the records or documents shall be made available at the Food Facility address. c)The provision of false or incomplete information, records, or documents to the city shall be a violation of this Chapter. 8.72.050 Automatic Exemptions. a)Prepackaged Food is exempt from the provisions of this Chapter. b)Polystyrene coolers and ice chests intended for reuse are exempt from the provisions of this Chapter. c)Disposable Food Service Ware that is entirely Aluminum Foil-based is exempt from the provisions of this Chapter. d)If the city determines that a reasonably feasible Disposable Food Service Ware that complies with Section 8.72.030 (a), (b), (d), and (e) of this Chapter does not exist, these items will be exempt from the abovementioned provisions of this Chapter until the city determines that a reasonably feasible alternative is available on the market for purchase. The city will have a current list of these exempted Disposable Food Service Ware posted on its website with hard copies available in the city manager’s office or another designated location. e)Certain Disposable Food Service Ware Accessories for beverage orders, specifically, straws and cup sleeves, shall be exempt from Section 8.72.020 (a) and may be distributed for safety reasons without the need for a request by the consumer or an offer by the Food Facility, specifically at drive-through areas of Food Facilities. Detachable lids are not considered a Disposable Food Service Ware Accessory, so Section 8.72.020 (a) does not apply to detachable lids. f)Temporary exemptions due to an emergency are automatic without the submission of a request for an exemption. An emergency is defined as a sudden, unexpected occurrence posing a clear and imminent danger that requires immediate action to prevent or mitigate the loss or impairment of life, health, property, or essential public services. Examples of an emergency include, but are not limited to natural disasters, emergencies due to the release of hazardous materials, emergencies associated with loss of power and/or water, or emergency medical response. 8.72.060 Case-by-Case Consideration of Requests for Hardship Exemption. a)Grounds for an exemption. An exemption from any of the provisions of this Chapter may be granted by the City Manager or designee upon demonstration by a Food Facility to the satisfaction of the City that strict application of the requirements would cause undue hardship. An “undue hardship” includes, but is not limited to the following: 1.A situation unique to the Food Facility where a suitable alternative that conforms with the requirements City of South San Francisco Printed on 3/17/2020Page 7 of 9 powered by Legistar™ File #:20-85 Agenda Date:3/11/2020 Version:1 Item #:9a. detailed in Section 8.72.030 (a), (b), (d), and (e) does not exist for a specific application. 2.Imposing the provisions of this Chapter would cause significant economic hardship. “Significant economic hardship” may be based on, but not limited to, demonstrating that suitable Disposable Food Service Ware is not available at a commercially reasonable price and the additional cost associated with providing the Disposable Food Service Ware is particularly burdensome to the Food Facility based on the type of operation(s) affected, the overall size of the business/operation, the number, type and location of its facilities, the impact on the overall financial resources of the Food Facility, and other factors. Reasonable added cost for a suitable item as compared to a similar item that the Food Facility can no longer use shall not by itself constitute adequate grounds to support an exemption for such item. In determining whether a significant economic hardship has been established, the city manager or designee shall consider the following information: ability of the Food Facility to recover the additional expense by increasing its prices; the availability of tax credits and deductions; outside funding; and other options. b)Request for an exemption. A request for an exemption from the requirements of this Chapter shall include all information deemed necessary by the city to render a decision, including but not limited to documentation showing the factual support for the requested exemption. A request for an exemption may be approved by the city manager or designee, in whole or in part, with or without conditions. The duration of the exemption, if granted, shall also be determined by the city manager or designee. Information about the application process for requesting an exemption shall be made available to the public on the city’s website and at the city manager’s office or another designated location. 8.72.070 Enforcement. a) The city manager, or his or her designee may enforce the provisions of this chapter. Additionally, the San Mateo County health system chief, or his or her designee, may enforce the provisions of this chapter. b) Notwithstanding authorization of enforcement by San Mateo County personnel in this chapter, the violation of, or noncompliance with, any of the requirements of this chapter or applicable provisions of this code, shall be subject to any administrative, civil, or criminal enforcement remedies available under the law and/or the city’s municipal code. In addition, the city may enforce the violation of this chapter by means of civil enforcement through a restraining order, a preliminary or permanent injunction or by any other means authorized by the law. SECTION 3.Severability. If any provision, section, subsection, sentence, clause, phrase, or word of this chapter, or any application thereof to any person or circumstance, is held to be invalid or unconstitutional by a court of competent jurisdiction, such decision shall not affect the validity of the remaining portions or applications of the chapter. The city council hereby declares that it would have passed this chapter, and each provision, section, subsection, sentence, clause, phrase, and word not declared invalid or unconstitutional without regard to whether any other portion of this chapter or application thereof would be subsequently declared invalid or unconstitutional. SECTION 4.Effective Date. City of South San Francisco Printed on 3/17/2020Page 8 of 9 powered by Legistar™ File #:20-85 Agenda Date:3/11/2020 Version:1 Item #:9a. This Ordinance shall be effective thirty (30) days after adoption. However, the mandatory provisions of this Ordinance, except for Section 8.72.040 (a)(1), shall only become operative and subject to enforcement one year (365 days) after the effective date. City of South San Francisco Printed on 3/17/2020Page 9 of 9 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-210 Agenda Date:3/11/2020 Version:1 Item #:10. Follow-up discussion of proposed relocation of South San Francisco Farmers’ Market from Orange Memorial Park to the downtown area. (Sheri Boles, Community Programs Manager, and Jorge Vega, Regional Manager, Pacific Coast Farmers’ Market Association) City of South San Francisco Printed on 3/6/2020Page 1 of 1 powered by Legistar™ City of South San Francisco Legislation Text P.O. Box 711 (City Hall, 400 Grand Avenue) South San Francisco, CA File #:20-211 Agenda Date:3/11/2020 Version:1 Item #:11. Conference with Legal Counsel - Existing Litigation (Government Code Section 54956.9(d)(1)) Name of Case: Kashiwa Fudosan America, Inc. v. City of South San Francisco San Mateo County Superior Court Case Number: 18-CIV-01728 City of South San Francisco Printed on 3/6/2020Page 1 of 1 powered by Legistar™