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Loan Agreement and Ground Lease Agreement for FX Residences <br />December 7, 2021 <br />Page 9 <br />2 <br />2 <br />6 <br />4 <br />The intended goal of the collection of development impact fees at the time of building <br />permit issuance is to ensure that the payment of the fees is completed prior to the vesting <br />of development rights by a project developer. Development impact fees for development <br />projects include customary fees to defray costs for the City to provide development <br />services under the permit, outside agency fees as applicable, and established <br />development impact fees. While deferral of collection of development impact fees is not <br />a routine practice, HomeAid submitted their request under California Government Code <br />Section 66007 and the City is required to consider their request. <br />The collection of the development impact fees for a new residential development is to <br />generally fund planned acquisition and development of parks and open space within the <br />City to mitigate the impacts that new developments will have on the demand for parks <br />and open space within the City. While the request will defer the collection of the <br />development impact fees to a later time in the development process, it will not waive or <br />prevent the City from collecting the fee through protections and securities provided to the <br />City under the agreement. Furthermore, the fees will be paid prior to the actual impact, <br />as no residents will be allowed to occupy the Project until payment is received by the City. <br />The Development Impact Fee Deferral Agreement has been signed by HomeAid to <br />acknowledge their acceptance of the terms. <br />Subordination Agreement <br />As a public lender for an affordable housing project such as this, the private market senior <br />lender typically requests a subordination agreement for the Housing Authority’s loan <br />agreement in order to ensure the senior lender will be paid back before the Housing <br />Authority’s loan. In this case, staff are uncertain if a subordination agreement is going to <br />be requested by the private market senior lender or another lender. If necessary, the <br />subordination agreement will be drafted and finalized at the conversion from the <br />construction loan to the permanent loan. <br />Project Description <br />The Project includes the construction of a new affordable rental residential development <br />consisting of 17 units, 1,120 square feet of group space (e.g., lobby, lounge/loft, and laundry <br />areas), and a 389-square foot community room. The development will consist of a two-story <br />building with flats/apartment units, trash enclosure, ten covered parking stalls, and one van <br />accessible surface-parking stall. It will feature onsite amenities such as communal laundry <br />facilities on the first and second floor, onsite bicycle storage, 400 square feet of on-site <br />storage, and 608 square feet of office space. One unit will be set aside for the onsite <br />manager while 16 units are proposed as affordable to chronically homeless households <br />earning less than thirty percent (30%) and twenty-five (25%) of the area median income <br />(AMI). Each of the seventeen units will be one-bedroom and will contain a full kitchen, a <br />single bedroom, a full bathroom, and open/common (living) areas.