Agenda Packet_2024-07-16 (Revised)

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EXHIBIT 2 CONDITIONAL GRANT AGREEMENT INCLUSIONARY HOUSING PROGRAM THIS CONDITIONAL GRANT AGREEMENT("Agreement")dated,for identification purposes only, as of , 2024, is made and entered into by and between the City of Santa Ana, a charter city and municipal corporation ("City"), and Habitat for Humanity of Orange County, a nonprofit religious organization ("Developer")with reference to the following: RECITALS: A. The City's Affordable Housing Opportunity and Creation Ordinance ("Ordinance") was originally adopted by the City Council on November 28, 2011 (Ordinance No. NS-2825), and is codified in Article XVIII.I of the Santa Ana Municipal Code ("SAMC"), as amended from time to time. The Ordinance established standards and procedures to encourage the development of housing that is affordable to a range of households with varying income levels. Pursuant to SAMC section 41-1904(c), developers may pay an in-lieu fee in certain instances to satisfy the inclusionary requirements. These funds are deposited into the Inclusionary Housing Fund, as defined by SAMC section 41-1901, and are to be used to increase and improve the supply of affordable housing per SAMC section 41-1909. B. Developer is the owner of that certain real property located at 1921 W. Washington Avenue, Santa Ana, California 92701, with Assessor Parcel Number 405-101-37, which is more particularly described in the legal description attached hereto as Exhibit A (the "Property"). C. The Property previously contained abandoned structures that were uninhabitable. Developer has demolished the structures and now desires to improve the Property with three duplex buildings that will provide six new affordable homeownership opportunities for low-income families who earn no more than eighty percent of the Orange County Area Median Income (the "Proj ect"). D. Developer responded to a request for proposals from the City regarding the Inclusionary Housing Fund, and the Project was selected for an award of funds. Consistent with the Pre-Commitment Letter from the City dated November 16, 2022, City desires to provide financial assistance to Developer for the development and construction of the Project by providing a grant to Developer in an amount not to exceed Two Million Two Hundred Thousand Dollars ($2,200,000) on terms and conditions set forth in this Agreement("Inclusionary Grant"). The Inclusionary Grant is funded through the City's Inclusionary Housing Fund for the purpose of providing affordable housing. E. The amount of the Inclusionary Grant was determined based upon the City's review of the Developer's proposal, the development Proforma and projected cash flows for the Project submitted by the Developer to the City ("Proforma"). The City Project Manager has authority to approve revisions to the Proforma and projected cash flows for the Project, provided that the Inclusionary Grant is not materially increased or extended. 1 55394.00101\42414134.1 City Council 12 — 15 7/16/2024