WASHINGTON SANTA ANA HOUSING PARTNERS, L.P

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Developer must be audited to the subcontractor level by an outside auditing firm approved by the City. The Developer shall pay for the audit to the subcontractor level by an outside auditing firm. Section 11. FEDERAL COVENANTS 11.1. The Developer shall carry out the design, construction and operation of the Project, and operate the Program, in conformity with all applicable laws, regulations, and rules of governmental agencies having jurisdiction, including without limitation and to the extent applicable, the NSP Requirements pursuant to the authority of Title XII of Division A of the American Recovery and Reinvestment Act of 2009 (Public Law 111-5 {February 17, 2009}) (Recovery Act) and sections 2301-2304 of the Housing and Economic Recovery Act of 2008 (Public Law 110-289 {July 30, 2008}) (HERA). 11.1.5 Reserved. 11.2. Qualification as Affordable Housing. As more particularly provided in the Affordability Restrictions on Transfer of Property, Developer shall use, manage and operate the Property in accordance with the requirements of 24 CFR 92.252, 24 CFR 570 so as to qualify the housing on the Property as Affordable Housing with affordable rents. 11.3. Tenant and Participant Protection. Developer shall comply with the requirements of 24 CFR 92.253. 11.4. Local Preference. Except with regard to persons experiencing homelessness referred off of the County of Orange coordinated entry system due to the layer of forty-three (43) PBVs provided by the Orange County Housing Authority, and subject to compliance with the NSP Regulations and applicable California and federal fair housing laws, and the requirements of Section 142(d) and Section 42 of the Internal Revenue Code local preference for Santa Ana residents and workers in tenant selection shall be a requirement of the Project. Subject to applicable laws and regulations governing nondiscrimination and preferences in housing occupancy required by Section 142(d) and Section 42 of the Internal Revenue Code, HUD or the State of California, as well as the City of Santa Ana Affordable Housing Funds Policies and Procedures, the Developer shall give preference in leasing units in the following order of priority: (a) First priority shall be given to persons who have been permanently displaced or face permanent displacement from housing in Santa Ana as a result of any of the following: (i) A redevelopment project undertaken pursuant to California's Community Redevelopment Law (Health & Safety Code Sections 33000, et seq.) -- applicable only to projects funded by the Low and Moderate Income Housing Asset Fund; (ii) Ellis Act, owner -occupancy, or removal permit eviction; (iii) Earthquake, fire, flood, or other natural disaster; 26 The Crossroads at Washington City NSP Loan Agroomont