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HomeMy WebLinkAboutagenda.council.regular.20170724 CITY COUNCIL AGENDA July 24, 2017 5:00 PM I. Call to Order II. Roll Call III. Scheduled Public Appearances IV. Citizens Comments & Petitions (Time for any citizen to address Council on issues NOT scheduled for a public hearing. Please limit your comments to 3 minutes) V. Special Orders of the Day a) Councilmembers' and Mayor's Comments b) Agenda Deletions and Additions c) City Manager's Comments d) Board Reports VI. Consent Calendar (These matters may be adopted together by a single motion) a) Resolution #100, Series of 2017 - Contract to purchase Backhoe/loader for the Water Department b) Resolution #104, Series of 2017 - Aspen Housing Partners Development Agreement c) ARC Board Appointment d) Minutes - July 10, 2017 VII. Notice of Call-Up a) Notification for 60-Day Call-Up of approval of APCHA Board Resolution No. 02 (Series of 2017), Adopting Amendments to Part II, Sections 5, 6 and 7, and Adding Appendix L to the Aspen/Pitkin Employee Housing Guidelines pertaining to Categories 1-7 Income Limits and Use of Area Median Income (AMI) b) Notice of HPC approval of Demolition, Minor Development, Commercial Design Review, and Setback Variations for 201 E. Main Street, HPC Resolution #13, Series of 2017 VIII. First Reading of Ordinances IX. Public Hearings a) Ordinance #20, Series of 2017 - Harassing Dog Code Amendment X. Action Items *Meeting will be continued until after Work Session for consideration of last agenda item.* XI. Executive Session a) C.R.S. Section 24-6-402(4)(b) and (e)(I): Conference with attorneys and determining positions relative to matters that may be subject to negotiations; developing strategy for negotiations and P1 instructing negotiators regarding pending litigation, Castle and Maroon Creek diligence cases and Ruedi Augmentation Plan/Queen Street Well. XII. Adjournment Next Regular Meeting August 14, 2017 COUNCIL’S ADOPTED GUIDELINES · Make Decisions Based on 30 Year Vision · Tone and Tenor Matter · Remember Where We’re Living and Why We’re Here COUNCIL SCHEDULES A 15 MINUTE DINNER BREAK APPROXIMATELY 7 P.M. P2 Page 1 of 2 MEMORANDUM TO: Mayor and City Council FROM: Jerry Nye, Superintendent of Streets THRU: Scott Miller, Public Works Director DATE: 7/24/2017 RE: Contract Approval Resolution #100 Series 2017 for the purchase of a Caterpillar 4x4 Backhoe/Loader for the Water Department REQUEST OF COUNCIL: Staff recommends the approval of Resolution # 100 Series 2017, contract for the fleet replacement purchase of a Caterpillar 4x4 Backhoe/Loader for the Water Department. PREVIOUS COUNCIL ACTION: The purchase was anticipated and included in the 2017 Asset Management Plan. City Council approved the Asset Management Plan as part of the 2017 Budget. BACKGROUND: Staff contracted with Wagner Equipment Company using the National Joint Powers Alliance (NJPA) cooperative purchase agreement to purchase the new equipment. The contract price reflects the trade in of our old backhoe/loader. DISCUSSION: The Water Department currently has a 1994 John Deere model 710 backhoe/loader for clearing out waterways, head gate work, ditch cleaning, loading and unloading equipment and supplies, plowing and removing snow from the water campus. The John Deere was not replaced on the usual ten-year replacement plan because it was still very dependable and did not require significant maintenance at that time. However, at its current age, staff anticipates high maintenance costs, frequent breakdown and significant loss of reliability. The new Caterpillar 430 backhoe/loader is smaller in size, more versatile and economical to operate. Staff expects it to have a minimum ten-year lifespan and will evaluate replacement at the end of the ten years. FINANCIAL/BUDGET IMPACTS: The Water Department has budgeted $155,000 in the 2017 AMP for this expenditure. Cost for the new Caterpillar is: Caterpillar 430 Backhoe/Loader $120,900.00 Less Trade-in of the John Deere -$17,220.00 Total contract price $103,680.00 P3 VI.a Page 2 of 2 ENVIRONMENTAL IMPACTS: The Caterpillar 430 is equipped with a turbo charged, direct injection diesel engine that is compliant with EPA Tier 4 emission standards. It is equipped with an Economy mode that allows the machine to run at lower engine speeds and has load sensing hydraulics to ensure the machine is running at proper engine speed for the work performed. Sustainability initiative? Yes Outcome area affected: Air Quality Key metrics affected: Reduction in particulate matter and ozone pollution from vehicle emissions. RECOMMENDED ACTION: Staff recommends the contract approval for the purchase of the Caterpillar 430F2 4x4 Backhoe Loader for the Water Department. ALTERNATIVES: PROPOSED MOTION: “I move to approve Resolution # 100 Series of 2017 on the consent calendar of Monday July 24, 2017 CITY MANAGER COMMENTS: ATTACHMENTS: P4 VI.a RESOLUTION # 100 (Series of 2017) A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO, APPROVING A CONTRACT BETWEEN THE CITY OF ASPEN AND WAGNER EQUIPMENT COMPANY INC. AUTHORIZING THE CITY MANAGER TO EXECUTE SAID CONTRACT ON BEHALF OF THE CITY OF ASPEN, COLORADO. WHEREAS, there has been submitted to the City Council a contract for a Caterpillar Backhoe Loader, between the City of Aspen and Wagner Equipment Company Inc., a true and accurate copy of which is attached hereto as Exhibit “A”; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO, That the City Council of the City of Aspen hereby approves that Contract for a Caterpillar Backhoe Loader, between the City of Aspen and Wagner Equipment Company Inc., a copy of which is annexed hereto and incorporated herein, and does hereby authorize the City Manager to execute said agreement on behalf of the City of Aspen. INTRODUCED, READ AND ADOPTED by the City Council of the City of Aspen on the 24th day of July, 2017. Steven Skadron, Mayor I, Linda Manning, duly appointed and acting City Clerk do certify that the foregoing is a true and accurate copy of that resolution adopted by the City Council of the City of Aspen, Colorado, at a meeting held July 24, 2017. Linda Manning, City Clerk P5 VI.a CITY OF ASPEN STANDARD FORM OF AGREEMENT SUPPLY PROCUREMENT City of Aspen Project No.: 2017-086. AGREEMENT made as of 24th day of July, in the year 2017. BETWEEN the City: Contract Amount: The City of Aspen c/o Fleet 130 South Galena Street Aspen, Colorado 81611 Phone: (970) 920-5055 And the Vendor: Wagner Equipment Company c/o ___________________________________ PO Box 14620 Denver, CO 80217 Phone: 303-561-0451 Summary Description of Items to be Purchased: Caterpillar Model 430F2 HRC Backhoe Loader ____________________________________________________________________________ Exhibits appended and made a part of this Agreement: If this Agreement requires the City to pay an amount of money in excess of $25,000.00 it shall not be deemed valid until it has been approved by the City Council of the City of Aspen. City Council Approval: Date: July 24, 2017 Resolution No.:___________________ Exhibit A: List of supplies, equipment, or materials to be purchased. Total: $103,680.00 P6 VI.a The City and Vendor agree as set forth below. 1. Purchase. Vendor agrees to sell and City agrees to purchase the items on Exhibit A appended hereto and by this reference incorporated herein as if fully set forth here for the sum set forth hereinabove. 2. Delivery. (FOB 1080 Power Plant Road, Aspen, CO 81611.) [Delivery Address] 3. Contract Documents. This Agreement shall include all Contract Documents as the same are listed in the Invitation to Bid and said Contract Document are hereby made a part of this Agreement as if fully set out at length herein. 4. Warranties. (12 Months Unlimited Hours, Parts and Labor (Travel Time included for the first 6 months). 5. Successors and Assigns. This Agreement and all of the covenants hereof shall inure to the benefit of and be binding upon the City and the Vendor respectively and their agents, representatives, employee, successors, assigns and legal representatives. Neither the City nor the Vendor shall have the right to assign, transfer or sublet its interest or obligations hereunder without the written consent of the other party. 6. Third Parties. This Agreement does not and shall not be deemed or construed to confer upon or grant to any third party or parties, except to parties to whom Vendor or City may assign this Agreement in accordance with the specific written permission, any right to claim damages or to bring any suit, action or other proceeding against either the City or Vendor because of any breach hereof or because of any of the terms, covenants, agreements or conditions herein contained. 7. Waivers. No waiver of default by either party of any of the terms, covenants or conditions hereof to be performed, kept and observed by the other party shall be construed, or operate as, a waiver of any subsequent default of any of the terms, covenants or conditions herein contained, to be performed, kept and observed by the other party. 8. Agreement Made in Colorado. The parties agree that this Agreement was made in accordance with the laws of the State of Colorado and shall be so construed. Venue is agreed to be exclusively in the courts of Pitkin County, Colorado. 9. Attorney’s Fees. In the event that legal action is necessary to enforce any of the provisions of this Agreement, the prevailing party shall be entitled to its costs and reasonable attorney’s fees. 10. Waiver of Presumption. This Agreement was negotiated and reviewed through the mutual efforts of the parties hereto and the parties agree that no construction shall be made or presumption shall arise for or against either party based on any alleged unequal status of the parties in the negotiation, review or drafting of the Agreement. P7 VI.a 11. Certification Regarding Debarment, Suspension, Ineligibility, and Voluntary Exclusion. Vendor certifies, by acceptance of this Agreement, that neither it nor its principals is presently debarred, suspended, proposed for debarment, declared ineligible or voluntarily excluded from participation in any transaction with a Federal or State department or agency. It further certifies that prior to submitting its Bid that it did include this clause without modification in all lower tier transactions, solicitations, proposals, contracts and subcontracts. In the event that Vendor or any lower tier participant was unable to certify to the statement, an explanation was attached to the Bid and was determined by the City to be satisfactory to the City. 12. Warranties Against Contingent Fees, Gratuities, Kickbacks and Conflicts of Interest. (A) Vendor warrants that no person or selling agency has been employed or retained to solicit or secure this Contract upon an agreement or understanding for a commission, percentage, brokerage, or contingent fee, excepting bona fide employees or bona fide established commercial or selling agencies maintained by the Vendor for the purpose of securing business. (B) Vendor agrees not to give any employee of the City a gratuity or any offer of employment in connection with any decision, approval, disapproval, recommendation, preparation of any part of a program requirement or a purchase request, influencing the content of any specification or procurement standard, rendering advice, investigation, auditing, or in any other advisory capacity in any proceeding or application, request for ruling, determination, claim or controversy, or other particular matter, pertaining to this Agreement, or to any solicitation or proposal therefore. (C) Vendor represents that no official, officer, employee or representative of the City during the term of this Agreement has or one (1) year thereafter shall have any interest, direct or indirect, in this Agreement or the proceeds thereof, except those that may have been disclosed at the time City Council approved the execution of this Agreement. (D) In addition to other remedies it may have for breach of the prohibitions against contingent fees, gratuities, kickbacks and conflict of interest, the City shall have the right to: 1. Cancel this Purchase Agreement without any liability by the City; 2. Debar or suspend the offending parties from being a vendor, contractor or subcontractor under City contracts; 3. Deduct from the contract price or consideration, or otherwise recover, the value of anything transferred or received by the Vendor; and 4. Recover such value from the offending parties. 13. Termination for Default or for Convenience of City. The sale contemplated by this Agreement may be canceled by the City prior to acceptance by the City whenever for any reason and in its sole discretion the City shall determine that such cancellation is in its best interests and convenience. P8 VI.a 14. Fund Availability. Financial obligations of the City payable after the current fiscal year are contingent upon funds for that purpose being appropriated, budgeted and otherwise made available. If this Agreement contemplates the City using state or federal funds to meet its obligations herein, this Agreement shall be contingent upon the availability of those funds for payment pursuant to the terms of this Agreement. 15. City Council Approval. If this Agreement requires the City to pay an amount of money in excess of $25,000.00 it shall not be deemed valid until it has been approved by the City Council of the City of Aspen. 16. Non-Discrimination. No discrimination because of race, color, creed, sex, marital status, affectional or sexual orientation, family responsibility, national origin, ancestry, handicap, or religion shall be made in the employment of persons to perform under this Agreement. Vendor agrees to meet all of the requirements of City’s municipal code, section 13-98, pertaining to nondiscrimination in employment. Vendor further agrees to comply with the letter and the spirit of the Colorado Antidiscrimination Act of 1957, as amended and other applicable state and federal laws respecting discrimination and unfair employment practices. 17. Integration and Modification. This written Agreement along with all Contract Documents shall constitute the contract between the parties and supersedes or incorporates any prior written and oral agreements of the parties. In addition, vendor understands that no City official or employee, other than the Mayor and City Council acting as a body at a council meeting, has authority to enter into an Agreement or to modify the terms of the Agreement on behalf of the City. Any such Agreement or modification to this Agreement must be in writing and be executed by the parties hereto. 18. Authorized Representative. The undersigned representative of Vendor, as an inducement to the City to execute this Agreement, represents that he/she is an authorized representative of Vendor for the purposes of executing this Agreement and that he/she has full and complete authority to enter into this Agreement for the terms and conditions specified herein. 19. Electronic Signatures and Electronic Records This Agreement and any amendments hereto may be executed in several counterparts, each of which shall be deemed an original, and all of which together shall constitute one agreement binding on the Parties, notwithstanding the possible event that all Parties may not have signed the same counterpart. Furthermore, each Party consents to the use of electronic signatures by either Party. The Scope of Work, and any other documents requiring a signature hereunder, may be signed electronically in the manner agreed to by the Parties. The Parties agree not to deny the legal effect or enforceability of the Agreement solely because it is in electronic form or because an electronic record was used in its formation. The Parties agree not to object to the admissibility of the Agreement in the form of an electronic record, or a paper copy of an electronic documents, or a paper copy of a document bearing an electronic signature, on the ground that it is an electronic record or electronic signature or that it is not in its original form or is not an original. P9 VI.a IN to ITNESS WHEREOF, The City and the Vendor, respectively have caused this Agreement duly executed the day and year first herein written in three i3) copies, all of which, to all and purposes, shall be considered as the original. THE CITY OF ASPEN: City Manager UIPMENT COMPANY By: P10 VI.a EXHIBIT A SUPPLY PROCUREMENT AGREEMENT 2017 CATERPILLAR Model: 430F2 HRC Backhoe Loader STANDARD EQUIPMENT BOOMS, STICKS AND LINKAGES - 15' Center pivot excavator style - backhoe - Pilot operated joystick hydraulic - controls with pattern changer valve - Pilot operated stabilizer controls - Boom transport lock - Swing transport lock - OTHER STANDARD EQUIPMENT - Backhoe Safety Manual - Operations and Maintenance Manual - Lockable hood - Tire Valve Stem Protection - Long Life Coolant -30C (-20F) - Padlocks (2 on ST, 3 on IT) BOOMS, STICKS AND LINKAGES - Street pads stabilizer shoes - Anti-drift hydraulics - (Boom, Stick and E-Stick) - Cat Cushion Swing(tm) system - Bucket level indicator - Lift cylinder brace - Return-to-dig (auto bucket positioner) - Self-leveling loader with single lever - control - Transmission neutralizer switch - Single Tilt Loader - POWERTRAIN - Cat C4.4, 86kW (Net 108 HP/81kW) - Direct Injection Turbo Charged Engine, - with ACERT technology. - US EPA Tier4 Final Emissions Compliant - with Selective Catalytic Reduction(SCR) - Water separator with service indicator - Thermal starting aid system - Eco mode - A dry-type axial seal air cleaner with - integral precleaner, automatic dust - ejection system & filter condition - indicator - Hydraulically boosted multi-plate wet - disk brake with dual pedals & interlock - Differential lock - Drive- line parking brake OPERATOR ENVIRONMENT - Interior rearview mirror - Rear fenders - ROPS canopy - 2-inch retractable seat belt - Tilt steering column - Steering knob - Hand and foot throttle - Automatic Engine Speed Control - One Touch Low Idle - Floor mat and Coat Strap - Lockable storage area - Air suspension seat OTHER STANDARD EQUIPMENT - Hydrostatic power steering - Standard Storage Box - Transport tie-downs - Ground line fill fuel tank with 44 - gallon capacity - Ground line fill diesel exhaust fluid - tank with 5 gallon capacity - Rubber impact strips on radiator guards - Bumper - CD-ROM Parts Manual POWERTRAIN - High Ambient Cooling Package - Torque converter - Transmission--four speed synchro mesh - with power shuttle & neutral safety - switch - Spin-on fuel, engine oil & transmission - oil filters - Outboard planetary rear axles - Open Circuit Breather - HYDRAULICS - Load sensing, variable flow system - with 43 gpm axial piston pump - 6 micron hydraulic filter - O-ring face seal hydraulic fittings - Caterpillar XT-3 hose - Hydraulic oil cooler - Pilot control shutoff switch - PPPC, Flow-sharing hydraulic valves - Hydraulic suction strainer - ELECTRICAL - 12 volt electrical start - 150 ampere alternator - Horn and Backup Alarm - Hazard flashers/turn signals - Halogen head lights (4) - Halogen rear flood lights (4) - Stop and tail lights - Audible system fault alarm - Key start/stop system - 880 CCA maintenance free battery - Battery disconnect switch - External/internal power receptacles(12v) - Diagnostic ports for engine and machine - Electronic Control Modules - Remote jump start connector - OPERATOR ENVIRONMENT - Lighted gauge group - MACHINE SPECIFICATIONS 430F2 BACKHOE LOADER FORK TINE, 2'' X 5'' X 54'' BELT, SEAT, 2'' SUSPENSION BUCKET-HD ROCK, 24'', 7.0 CFT P11 VI.a BUCKET-GP, 1.5 YD3, IT COUNTERWEIGHT, 1015 LBS GUARD, STABILIZER TIRES, 12.5 80/19.5L-24, FS RADIO & CD PLAYER, BLUETOOTH RIDE CONTROL COLD WEATHER PACKAGE, 120V HRC SEAT, DELUXE FABRIC COUPLER, PG, MANUAL, DUAL LOCK PRODUCT LINK, CELLULAR, PL641I HYDRAULICS, MP, 6FCN/8BNK, IT PT, 4WD, AUTOSHIFT CAB, DELUXE AIR CONDITIONER, T4 STICK, EXTENDABLE, 16FT ENGINE, 86KW, C4.4 ACERT, T4F WORKLIGHTS (8) HALOGEN LAMPS CARRIAGE, FORK CUTTING EDGE, TWO PIECE,WIDE STABILIZER PADS, FLIP-OVER Wheel Spacers SELL PRICE $120,900.00 LESS GROSS TRADE ALLOWANCE ($17,220.00) TOTAL $103,680.00 TRADE-INS Model Make Serial Number Year Trade Allowance 710D JOHN DEERE (JD) 802326 1994 $17,220.00 WARRANTY & COVERAGE 12 months Unlimited Hours, Parts and Labor (Travel Time included for the first 6 months) P12 VI.a Page 1 of 3 MEMORANDUM TO: Mayor and City Council FROM: Chris Everson, Affordable Housing Project Manager THRU: Barry Crook, Assistant City Manager DATE OF MEMO: July 17, 2017 MEETING DATE: July 24, 2017 RE: Resolution #104, Series of 2017, Aspen Housing Partners (AHP) Development Agreement Note: This memo has been revised since its initial submittal. REQUEST OF COUNCIL: Staff is requesting approval of Development Agreement with Aspen Housing Partners (AHP). BACKGROUND: During the summer of 2015, staff performed community outreach for potential development of affordable housing at City-owned properties located at 517 Park Circle, 802 West Main Street and 488 Castle Creek Road. Council subsequently directed staff to issue City of Aspen RFP # 2015-139 “Public Private Partnership Affordable Housing Development ”. At a work session on November 1, 2016, Council verified selection of Aspen Housing Partners (AHP) as the selected developer. PREVIOUS COUNCIL ACTION: On November 14, 2016, Council approved Resolution #165 of 2016 “Summary of Agreement Terms for Affordable Housing Development between the City of Aspen and Aspen Housing Partners”. DISCUSSION: Since November 2016, and in close partnership with staff, AHP has performed extensive community outreach and has participated in numerous City Council work sessions and has received approval from City Council to submit development applications for the properties mentioned above. During that time, AHP has performed significant due diligence and has invested approximately $375,000 in the planning and design process. During the same time, the City of Aspen has made no notable funding contributions to these projects. The City purchased the properties mentioned above in 2008 for $13.2 million. Thus far, AHP has submitted a development application for 517 Park Circle and is planning to submit development applications within the next few weeks for 802 West Main Street and 488 Castle Creek Road. The attached Development Agreement is an expansion of the previously adopted Summary of Agreement Terms and has been approved for submittal to Council by the City Attorney, although the City attorney wishes to reserve the right to make minor, insignificant revisions to the form of the agreement and exhibits as needed for finalization. SCHEDULE: As per the agreement, the project anticipates the use of low income housing tax credit (LIHTC) financing. Applications for tax credit funding can be submitted only after the re- zoning entitlements processes are complete for all three properties – which are anticipated to occur throughout the remaining months of 2017 and potentially into 2018. P13 VI.b Page 2 of 3 The attached agreement contains a schedule exhibit which suggests construction start in mid-2018 with potential tenants moving into the facilities in mid -2019. Given the unknowns in the entitlements process and the tax credit application process, this may be optimistic . FINANCIAL/BUDGET IMPACTS: Council has approved $600,000 from the 150 Housing Development Fund in budget authority for 2017. While AHP continues to fund the development, staff will maintain the approved public funding and will request additional budget authority for 2018 to be commensurate with the needs of the project going forward. The attached Development Agreement includes a budget exhibit which shows an updated development cost and the City of Aspen’s potential contribution to the development under the three different scenarios, including the use of 9% Federal tax credits, 4% Federal plus State Tax Credits and 4% Federal Tax Credits only. Only the 4% Federal scenario is non-competitive thus staff seeks to remain open to all three scenarios until such a time when we can submit and potentially be awarded such tax credits. A summary of the potential City funding is included below for each of the three tax credit scenarios and includes history since originally proposed. Estimated City of Aspen Funding Contribution $2017 (% of total) 9% Federal Tax Credits 4% Federal + State Tax Credits 4% Federal Tax Credits Only Development Cost Estimate (Land Not Included) June 2016 - AHP Proposal 48 Units with (39) Tax Credit Units + (4) Cat3 Units + (5) Cat4 Units $6.9 Million (29%) $8.6 Million (36%) $11.6 Million (48%) $24 Million * December 2016 - Community Outreach 48 Units with (23) Tax Credit Units + (14) Cat2 Units + (8) Cat3 Units + (3) Cat4 Units $8.3 Million (35%) $13.8 Million (58%) $15.7 Million (65%) $24 Million † July 2017 - Development Agreement 49 Units with (24) Tax Credit Units + (14) Cat2 Units + (9) Cat3 Units + (2) Cat4 Units $9.9 Million (39%) $14.9 Million (58%) $17.0 Million (66%) $25.7 Million Notes: * Increases from June 2016 to December 2016 are attributable to changes to the income levels to be served. The proposal evaluation committee was aware that the income mix would need to be modified, and this was the case for all proposals which were received, not only for AHP. This did not increase the developer’s fee, and the AHP team was very flexible about the mix and knew that the City would need to decide on a final income mix. The income mix changes from June to December were a collaboration among City and Housing Authority staff and was arrived at by balancing tax credit proceeds while also providing some units as needed at higher income levels . Non-tax-credit units are not eligible for tax credit funding, therefore the City’s contribution increased to serve these income levels under the APCHA Guide lines. This income mix was vetted during the community outreach process and was included in materials provided for City Council work sessions. † Increases from December 2016 to July 2017 are attributable to project cost increases due to changes which occurred during the community outreach process and related City Council work P14 VI.b Page 3 of 3 sessions. Underground storage was added at 802 West Main Street. Larger storage closets were added at Park Circle and Castle Creek. Additional parking was added as prescribed by Counc il. One additional unit was added. A second bathroom was added to all 2-bedroom units. Some additional contingency was added for site work and utilities as a precautionary measure. Some variation among the scenarios is also due to fluctuating tax credit va lues which may continue over time. Estimates are subject to change in the future. RECOMMENDED ACTION: Staff recommends approval. CITY MANAGER COMMENTS: ATTACHMENTS: Exhibit A: Master Development Agreement between the City of Aspen and Aspen Housing Partners P15 VI.b RESOLUTION NO. 104 Series of 2017 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO, APPROVING A PROPOSED MASTER DEVELOPMENT AGREEMENT BY AND BETWEEN THE CITY OF ASPEN, COLORADO AND ASPEN HOUSING PARTNERS, LLC, AND AUTHORIZING THE CITY MANAGER TO EXECUTE A FINAL AGREEMENT ON BEHALF OF THE CITY OF ASPEN, COLORADO. WHEREAS, there has been submitted to the City Council a proposed Master Development Agreement by and between the City Of Aspen, Colorado and Aspen Housing Partners, LLC, a copy of which draft agreement is attached hereto. NOW, WHEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO: Section One That the City Council of the City of Aspen hereby approves the entry into a Master Development Agreement by and between the City Of Aspen, Colorado and Aspen Housing Partners, LLC, a copy of which draft agreement is attached hereto and does hereby authorize the City Manager of the City of Aspen to execute a final agreement on behalf of the City of Aspen in substantially the form attached hereto, subject to the approval of the City Manager and the City Attorney. Dated _________________, 2017. _____________________________ Steve Skadron, Mayor I, Linda Manning, duly appointed and acting City Clerk do certify that the foregoing is a true and accurate copy of that resolution adopted by the City Council of the City of Aspen, Colorado, at a meeting held July 24, 2017. ______________________________ Linda Manning, City Clerk P16 VI.b AHP Revised Draft 07.19.17 MASTER DEVELOPMENT AGREEMENT by and between CITY OF ASPEN, COLORADO and ASPEN HOUSING PARTNERS, LLC P17 VI.b AHP Revised Draft 07.18.17 i TABLE OF CONTENTS Page ARTICLE I. DEFINITIONS 1 ARTICLE II. ENGAGEMENT; DEVELOPMENT PLAN, SCHEDULE AND BUDGET 5 2.1 Basic Intent ................................................................................................................5 2.2 Designation and Engagement of Developer ................................................................6 2.3 Development Plan ......................................................................................................6 2.4 Project Schedule.........................................................................................................7 2.5 Project Budget ...........................................................................................................7 2.6 Status Reports and Information ..................................................................................7 ARTICLE III. DEVELOPER SERVICES AND DEVELOPER FEE 8 3.1 Developer Services ....................................................................................................8 3.2 Funding of Development Services ..............................................................................9 3.3 Developer Fee ............................................................................................................9 3.4 Contractors and Consultants .......................................................................................9 3.5 Cooperation and Approval Standards .........................................................................9 3.6 Communications ...................................................................................................... 10 ARTICLE IV. DUE DILIGENCE MATTERS 10 4.1 Title Insurance Commitments................................................................................... 10 4.2 Surveys .................................................................................................................... 10 4.3 Access to the Property and Other Investigations ....................................................... 11 4.4 Special Terms Regarding Environmental Conditions ................................................ 11 4.5 Removal of Site, Generally ...................................................................................... 12 ARTICLE V. ENTITLEMENT/FEASIBILITY PERIOD 13 5.1 Entitlement / Feasibility Period, Generally ............................................................... 13 5.2 Design...................................................................................................................... 13 5.3 Public Outreach Process ........................................................................................... 13 5.4 Entitlement Process .................................................................................................. 13 5.5 No Guaranty of City Approval ................................................................................. 14 5.6 Debt Financing ......................................................................................................... 14 5.7 Equity Financing ...................................................................................................... 14 5.8 Minimize City Funds................................................................................................ 14 ARTICLE VI. CLOSING DOCUMENTS 14 6.1 Closing Documents, Generally ................................................................................. 14 6.2 Project Entity Agreement ......................................................................................... 15 6.3 LURA ...................................................................................................................... 15 6.4 APCHA Covenant .................................................................................................... 15 6.5 Ground Leases ......................................................................................................... 15 6.6 Right of First Refusal and Purchase Option .............................................................. 16 P18 VI.b AHP Revised Draft 07.18.17 ii 6.7 Cure Rights .............................................................................................................. 17 6.8 City Loan Documents .............................................................................................. 17 6.9 Property Management .............................................................................................. 18 6.10 Admissions and Occupancy Policies; Role of APCHA ............................................. 19 6.11 Construction Contract .............................................................................................. 19 6.12 Guarantees at the Closing ......................................................................................... 19 6.13 Cash Flow Waterfall ................................................................................................ 19 ARTICLE VII. LIHTC PROGRAM SELECTION AND CLOSING 20 7.1 LIHTC Program Selection ........................................................................................ 20 7.2 Closing Contingencies.............................................................................................. 20 7.3 Closing .................................................................................................................... 21 ARTICLE VIII. TERMINATION 21 8.1 Termination by City for Event of Default ................................................................. 21 8.2 Termination by Developer for Event of Default ........................................................ 22 8.3 Events Beyond Control ............................................................................................ 22 8.4 Termination for Infeasibility .................................................................................... 22 8.5 Delivery of Work Product to City ............................................................................. 24 ARTICLE IX. MISCELLANEOUS 24 9.1 Term ........................................................................................................................ 24 9.2 Notices ..................................................................................................................... 24 9.3 Further Assurances ................................................................................................... 25 9.4 Assignment .............................................................................................................. 26 9.5 Counterparts ............................................................................................................. 26 9.6 Interpretation and Governing Law ............................................................................ 26 9.7 Attorneys’ Fees ........................................................................................................ 26 9.8 Severability .............................................................................................................. 26 9.9 Final Agreement ....................................................................................................... 26 9.10 Waivers .................................................................................................................... 26 9.11 Successors ................................................................................................................ 26 9.12 Headings .................................................................................................................. 26 9.13 Construction ............................................................................................................. 26 9.14 Certain Approvals .................................................................................................... 26 9.15 Binding Effect .......................................................................................................... 27 9.16 Cumulative Rights.................................................................................................... 27 9.17 References to this Agreement ................................................................................... 27 9.18 No Commissions ...................................................................................................... 27 P19 VI.b AHP Revised Draft 07.18.17 1 MASTER DEVELOPMENT AGREEMENT THIS MASTER DEVELOPMENT AGREEMENT is entered into as of ____________ ___, 2017 between THE CITY OF ASPEN, a home rule municipality within the State of Colorado (the “City”), and ASPEN HOUSING PARTNERS, LLC, a Colorado limited liability company (the “Developer”). RECITALS A. On December 18, 2015 the City issued a Request for Proposals (the “RFP”) to select a private master developer to assist the City with planning, entitling, financing, developing, managing, operating and maintaining for-rent affordable housing units on three separate sites owned by the City and located within the municipal boundaries of the City (collectively, the “Project”). The three development sites owned by the City (the “Sites” and each a “Site”) are described on Exhibit°A of this Agreement. B. Pursuant to the RFP, the City competitively selected the Developer as the developer for the Project . The City and the Developer thereafter entered into that certain Summary of Terms for Development Agreement for Affordable Housing as approved by City Council Resolution #165, Series of 2016, November 14, 2016. C. The City and the Developer now desire to enter into this Agreement in order to set forth specific rights and responsibilities in connection with carrying out the Project. D. Capitalized terms used in this Agreement are either defined under the heading “Definitions” below, or elsewhere within the text of this Agreement. AGREEMENT In consideration of the foregoing recitals and the mutual covenants and agreements set forth herein, which both parties agree to be good and valuable cons ideration, the parties agree as follows: ARTICLE I. DEFINITIONS The following capitalized terms will have the meanings given for them below. Other capitalized terms that are used in this Agreement but that are not defined below are defined in the other provisions of this Agreement. “Affiliate” means, with respect to any entity, any other person or entity that directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such entity. “AFR” is defined in Sect ion 6.8.2. “Agreement” means this Master Development Agreement (including all attached exhibits), as amended from time to time. P20 VI.b AHP Revised Draft 07.18.17 2 “APCHA” means the Aspen/Pitkin County Housing Authority formed by an intergovernmental agreement (as amended from time to time) between the City and the Board of County Commissioners of Pitkin County, Colorado . “APCHA Covenant” means a perpetual Occupancy Deed Restriction a nd Agreement to be recorded against each Site for the purpose of causing all Units developed on such Site pursuant to this Agreement (including both the LIHTC Units and the Non-LIHTC Units) to qualify as affordable housing rental Units in accordance with t he APCHA Guidelines and the final approved Development Plan. “APCHA Guidelines” means the annual guidelines published by APCHA to govern the operation of the APCHA affordable housing program, as amended from time to time. “Applicable Public Housing Requirements” means any HUD Laws, LIHTC Laws, APCHA Guidelines, and other federal, state and local regulatory requirements applicable to the Project and the Units as affordable housing units during the period required by law, together with the LURA and APCHA Covenant recorded on each Site. “Cash Flow Waterfall” is defined in Section 6.13. “CHFA” means the Colorado Housing and Finance Authority, a body corporate and political subdivision of the State of Colorado, which has been designated as the Colorado state allocating agency for Tax Credits pursuant to the LIHTC Laws. “City” is defined in the first paragraph of this Agreement. “City Funds” means the funds approved and made available by the City for paying a portion of the development costs for the Project. “City Loan” means a subordinate loan made by the City to the Project Entity as provided in a separate commitment letter in the form attached as Exhibit B in the amount of the City Funds. “Closing” means the date on which all of the principal commitments regarding development of the Project (including, without limitation, the City Loan, the Ground Leases, the Tax Credits and Investor financing, all other necessary construct ion and third-party financing, the Project Entity Agreement, the LURA, the APCHA Covenant, and the Construction Contract) are performed or converted to binding obligations of performance by the execution of the Closing Documents. “Closing Contingencies” is defined in Section 7.2. “Closing Documents” is defined in Section°6.1. “Code” means the Internal Revenue Code of 1986, as amended from time to time. “Construction Contract” is defined in Section 6.11. “Developer” is defined in the first paragraph of this Agreement. P21 VI.b AHP Revised Draft 07.18.17 3 “Developer Fee” is defined in Section 3.3. “Developer Pursuit Costs” means any and all actual out -of-pocket expenses incurred and paid by Developer or any Affiliate of Developer in performing the Developer Services pursuant to, and authorized in the manner set forth in, this Agreement, including without limitation (a) all professional fees and reimbursable expenses paid to third-party consultants in pursuit of the Project such as architects, landscape architects, engineers, planners, surveyors, lawyers, geotechnical consultants, environmental consultants, and traffic engineers; (b) all costs incurred to conduct the Public Outreach Process for the Project, such as facility rental charges, food and beverage charges, and materials production expenses; (c) travel expenses for travel outside of the Roaring Fork Valley; and (d) all application fees paid to any governmental entity in connection with the Project such as, without limitation, the City of Aspen Community Development Department, CHFA, APCHA, and/or HUD. Notwithstanding the foregoing, Developer Pursuit Costs will not include Developer’s general overhead expenses such as office rent and utilities, insurance premiums (except any Project -specific insurance policies obtained by the Developer at the request of the City or with the City’s approval), salaries or benefits paid to any principal of Developer or any Affiliate of Developer, and income taxes. “Developer Services” is defined in Section 3.1. “Development Plan” is defined in Section 2.3.1. “Entitlement/Feasibility Period” is defined in Section 5.1. “Environment” means surface or subsurface soil or strata, surface waters and sediments, navigable waters, wetlands, groundwater, sediments, drinking water supply, ambient air, species, plants, wildlife, animals and natural resources. The term also includes indoor air, surfaces and building materials, to the extent regulated under Environmental Laws. “Environmental Condition” means the presence of Hazardous Materials in the Environment at, on, in, under or about a Site. “Environmental Law” means any present or future federal, state or local law, ordinance, rule, regulation, permit, license or binding determination of any governmental authority relating to, imposing liability or standards concerning, or otherwise addressing Hazardous Materials, the environment, health or safety, including, but not limited to: the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601 et seq. (“CERCLA”); the Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq. (“RCRA”); the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801 et seq.; the Clean Air Act, 42 U.S.C. Section 7401 et seq.; the Clean Water Act, 33 U.S.C. Section 1251 et seq. and any so-called “Superfund” or “Superlien” law, and the Occupational Safety and Health Act, 29 U.S.C. Section 651 et seq., as each is from time to time amended and hereafter in effect. “Event of Default” is defined in Section 8.1 (as to the Developer) and Section°8.2 (as to the City). “Events Beyond Control” is defined in Section 8.3. P22 VI.b AHP Revised Draft 07.18.17 4 “Final Entitlement” means that all zoning, subdivision, variance (if applicable), and other approvals that are necessary under the Land Use Code for all of the Sites to be eligible for submittal of a building permit application for construction of the Project pursuant to the final Development Plan have been approved and/or issued and that all applicable appeal, initiative, and referendum periods have either run without any such appeal, initiative, or referendum being filed, or, if any such appeal, initiative, or referendum is filed for the purpose of challenging, reversing or invalidating any such approval, that such appeal, initiative, or referendum has been finally co ncluded or resolved with all such necessary approvals for the Project being preserved and/or upheld. “General Contractor” means the general contractor chosen by the Developer in accordance with the terms of this Agreement to construct the Project. “Ground Leases” is defined in Section 6.5. “Hazardous Materials” means any solid, liquid, or gaseous material, chemical, waste or substance that is regulated by a federal, state or local governmental authority and includes those substances listed or defined as “hazardous substance” under CERCLA, “hazardous waste” under RCRA or otherwise classified as hazardous, dangerous or toxic under any Environmental Law and will specifically include petroleum, oil and petroleum hydrocarbons, radon, radioactive materials, asbestos, lead-based paint, urea formaldehyde foam insulation and polychlorinated biphenyls. “HUD” means the U.S. Department of Housing and Urban Development. “HUD Laws” means the United States Housing Act of 1937 (42 U.S.C. § 1437, et seq.), as amended from time to time, and any regulations promulgated by HUD thereunder. “Investor” means the Tax Credits investor limited partner(s) or non-managing member(s) in the Project Entity as may be selected pursuant to Section 5.7. “Land Use Code” means the City of Aspen Land Use Code set forth in Title 26 of the City’s Municipal Code, as it may be amended from time to time. “LIHTC Laws” means all Colorado and federal laws and regulations governing the allocation, issuance, use of and implementation of Tax Credits in the State of Colorado, including without limitation Section 42 of the Code, and the Treasury Regulations promulgated pursuant thereto, and Article 22 of Title 39, Colorado Revised Statutes, as amended from time to time, and the regulations promulgated pursuant thereto. “LIHTC Units” means those Units developed on each Site pursuant to this Agreement that qualify as a low-income housing units pursuant to the LIHTC Laws. “LURA” means a Land Use Restriction Agreement to be recorded against each Site of the Project with respect to the LIHTC Units, as required by the LIHTC Laws. “Management Agent” is defined in Section 6.9. “Management Fee” is defined in Section 8.4.6. P23 VI.b AHP Revised Draft 07.18.17 5 “Non-LIHTC Units” means those Units developed on each Site pursuant to t his Agreement that are not LIHTC Units. “Project” is defined in Recital A of this Agreement. “Project Budget ” is defined in Section 2.5. “Project Entity” means a limited liability company or limited partnership to be formed by the Developer to develop, own, operate and maintain all three Sites in accordance with Section 2.4. “Project Entity Agreement” means the limited partnership agreement or limited liability company agreement governing the affairs and management of the Project Entity to be entered into in accordance with this Agreement. “Project Schedule” is defined in Section 6.2. “Public Outreach Process” is defined in Section 5.3. “RFP” is defined in Recital A of this Agreement . “Required Remediation Work” is defined in Section 4.4.2. “Site ESA” is defined in Section 4.4.2. “Site Investigation” is defined in Section 4.3. “Sites” or “Site” is defined in Recital A of this Agreement. “Submittal Date” is defined in Section°5.4. “Surveys” is defined in Section 4.2. “Tax Credits” means low income housing tax credits allocated by CHFA for the Project pursuant to the LIHTC Laws. “Title Company” means Stewart Title of Aspen as agent for Stewart Title Insurance Company. “Units” means all rental housing units to be constructed on the Sites pursuant to this Agreement. ARTICLE II. ENGAGEMENT; DEVELOPMENT PLAN, SCHEDULE AND BUDGET 2.1 Basic Intent. The intent of this Agreement is to create a mechanism for the City and the Developer to develop the Sites for rental affordable housing purposes in a manner consistent with the Development Plan and the Applicable Public Housing Requirements. The Sites are not currently entitled for such development and due diligence has not yet been performed to confirm the suitability of the Sites for such development. This Agreement establishes a process P24 VI.b AHP Revised Draft 07.18.17 6 by which (a) due diligence will be performed on the Sites to evaluate suitability for development of the Project; (b) the Public Outreach Process will be followed to solicit and develop feedback from neighbors of the Sites and the public at -large concerning the Project; (c) applications for all necessary zoning, subdivision and other entitlements will be processed for the Sites pursuant to the Aspen Land Use Code; (d) the costs for development of the Project will be determined and sources and amounts of funding for such costs (including Tax Credits, City Funds, Investor equity, and construction financing) will be identified and potentially agreed upon; and (e) if Final Entitlement occurs, the Closing Documents agreed upon, and all costs and funding sources agreed upon, the Project will be constructed on the Sites. 2.2 Designation and Engagement of Developer. The City confirms the designation of the Developer as the developer for the entitlement of the Project and development of the Sites in accordance with the Development Plan (as defined below) and this Agreement. Notwithstanding the foregoing, nothing contained in this Agreement will be deemed or construed to create a relationship of partners, co -venturers, or principal and agent between the City and the Developer. The Developer will have no power or authority to create any obligation on the part of the City, as obligor, guarantor, or surety, with respect to any obligation to third parties incurred by the Developer. 2.3 Development Plan. 2.3.1 Current Development Plan. The current basic plan for development of the Sites fo r the Project is attached to this Agreement as Exhibit C (as it may be revised from time to time in accordance with the terms of this Agreement, the “Development Plan”). 2.3.2 Adjustment of Development Plan. As the City and Developer pursue the further planning and implementation of the Project pursuant to this Agreement , they may identify areas in which the Development Plan can be improved so as to make the Project more economically feasible, to address reasonable concerns of other stakeholders such as neighbors of the Sites, to better achieve the underlying objective of developing affordable housing within the City and/or to meet expectations or requirements of funding sources. The City and Developer recognize that both the Project as a whole and each Site are wholly dependent upon each of the projected funding sources being available in a timely manner, and other conditions which are, in part, beyond the parties’ control. The parties therefore recognize that the Development Plan (and its goal of achieving a certain number of affordable housing units) may prove to be predicated on assumptions which are no longer well-founded, causing the Development Plan or segments thereof to be no longer reasonably feasible, or requiring changes to the number or mix of Units at one or more of the Sites. Where future amendments to the Development Plan are required by the foregoing factors or more generally by infeasibility or other circumstances, the City and Developer will work together to develop changes that accomplish the original goals set forth in the Development Plan (including its goal of achieving a certain number of affordable housing units) to the maximum extent reasonably feasible given available resources. The City must approve any changes to the Development Plan, and the City’s approval of any update to the Development Plan will confirm the City’s approval of the proposed actions by the P25 VI.b AHP Revised Draft 07.18.17 7 Developer described in it. Any update to the Development Plan will be deemed incorporated into this Agreement as if attached in full. 2.4 Project Schedule. The projected schedule for starting and finishing all tasks contemplated by this Agreement and the Development Plan is attached as Exhibit D (as it may be supplemented and amended in accordance with the terms of this Agreement, the “Project Schedule”). The Developer will revise and update the Project Schedule, subject to approval by the City, to reflect evolving events and circumstances and pr ovide an updated Project Schedule to the City from time to time. If the City objects to any proposed change in the Project Schedule as submitted by the Developer, the City will promptly advise the Developer in writing of the City’s basis for such objectio n and any suggested means of avoiding or otherwise remedying such change. Each party agrees to advise the other promptly if it learns of any known or reasonably anticipated event or condition that might affect the Project Schedule. Any approved update to the Project Schedule will be deemed incorporated into this Agreement as if attached in full. 2.5 Project Budget. The current budget for the overall Project is attached as Exhibit E (as it may be supplemented and amended in accordance with the terms of this Agreement, the “Project Budget ”). The Project Budget may include for approval by the City a budget of proposed Developer Pursuit Costs, and any costs incurred pursuant to any suc h approved Project Budget shall be authorized under this Agreement. In addition, Developer may submit specific proposed Developer Pursuit Costs for authorization in addition to any other Developer Pursuit Costs included in the Project Budget. All material proposed revisions to a Project Budget, including without limitation any change of 10% or more to any line item (both sources and uses), and including any appropriate qualifications and/or exclusions (e.g., for any Environmental Condition), will be submitted by the Developer to the City for approval or when requested by the City, which upon approval by the City will be deemed to constitute a revised Project Budget. The Developer shall advise the City of any proposed updates to the Project Budget at least twice annually. If the City objects to any proposed change in the Project Budget as submitted by the Developer, the City will promptly advise the Developer in writing of the City’s basis for such objection and the parties will work in good faith to resolve any disagreement concerning the proposed change. Each party agrees to advise the other promptly if it learns of any known or reasonably anticipated event or condition that might affect the Project Budget. Any agreed modification to the Project Budget will be deemed incorporated into this Agreement as if attached in full. 2.6 Status Reports and Information. The Developer will provide the City with periodic progress reports as reasonably requested by the City on the status of all Project -related activities, and which will include proposed modifications to the Development Plan, Project Budget and Project Schedule, when necessary. Developer will attend progress meeting s with the City respecting such matters as the predevelopment phase of the Project progresses. Upon request from the City, Developer will provide projected timetables and delivery schedules relating to certain key activities such as the Submittal Date and the date of Closing. In addition, the Developer shall submit to the City a monthly summary of Developer Pursuit Costs, along with a reconciliation against any approved budget for such Developer Pursuit Costs. P26 VI.b AHP Revised Draft 07.18.17 8 ARTICLE III. DEVELOPER SERVICES AND DEVELOPER FEE 3.1 Developer Services. The Developer, directly or through the Project Entity, will initiate, coordinate, and carry out or contract for all design, Final Entitlement, permitting, financing, and construction activities in connection with the development, construction and completion of development of each Site pursuant to the Development Plan, as further provided in and subject to the terms of this Agreement. The services and activities to be performed by Developer subject to the terms of this Agreement (the “Developer Services”) include, without limitation, the following: 3.1.1 The Developer will oversee all due diligence activities to evaluate the suitability of the Sites for the develop ment of the Project , which process the parties acknowledge is substantially complete as of the execution of this Agreement. 3.1.2 The Developer will be responsible for, and has completed as of the execution of this Agreement, conducting the Public Outreach Process described in this Agreement in order to solicit feedback on the proposed Project from community members, neighbors and other identified stakeholders. 3.1.3 The Developer will be responsible for applying for and pursuing Final Entitlement of the Project. 3.1.4 Developer will be responsible for pursuing the award and commitment of all sources of construction, gap and permanent financing needed for development of the Project in accordance with the Project Budget, other than the City Funds, as further provided in this Agreement. 3.1.5 Developer will be responsible for applying for, obtaining and preserving through Closing an allocation of Tax Credits from CHFA in accordance with the Project Budget. 3.1.6 Developer will contract with and supervise the delivery of all work product required for the Project from professional consultants such as architects, landscape architects, engineers, planners, surveyors, lawyers, geotechnical consultants, environmental consultants, and traffic engineers, each of which will be under the control and direction of Developer. 3.1.7 The Developer will be responsible for soliciting and selecting third- party lenders and the Investor for the Project. The Developer will provide the City with an opportunity to review and comment on Developer’s proposal for soliciting an Investor and any lender s. The Developer will provide the City with copies of all Investor and lender proposals received together with a summary analysis a nd assessment of the proposals, and shall obtain the approval of the City before accepting or ent ering into any letter of intent with respect any such proposal. 3.1.8 The Developer shall lease all units in the Project in accordance with the Applicable Public Housing Requirements. P27 VI.b AHP Revised Draft 07.18.17 9 3.2 Funding of Development Services. The Developer will be responsible for funding all expenses incurred to provide the Developer Services and perform its obligations under this Agreement, subject to the right to be reimbursed and/or compensated for such services through payment of, as applicable, the Development Fee (if the Closing o ccurs) or the Management Fee and reimbursement of the Developer Pursuit Costs pursuant to the applicable provisions of Article VIII. The expenses incurred by Developer in providing the Developer Services will be accounted for in a standard development accounting format, and the City will have full access to all such Project accounting records at all times. 3.3 Developer Fee. As compensation for its undertaking and performance of Developer Services, the Developer (or an Affiliate of Developer designated by Developer) will be entitled to earn and receive a developer fee from the Project Entity of 12% of the “eligible basis” costs for the Project as calculated pursuant to the requirements of CHFA (the “Developer Fee”). The Developer and the Cit y intend that the Developer Fee will equal the maximum amount available pursuant to the LIHTC Laws and the CHFA program or 12%, whichever is less. Subject to terms required by the Investor and any senior lender, 20% of the Developer Fee will be earned by the Developer for the Developer Services it performs up to the Closing and will be paid to the Developer concurrently with the consummation of the Closing. The remainder of the Developer Fee will be paid to the Developer over the course of the construction and leasing process for the Project according to a payment schedule to be approved by the City and the Investor, subject to commercially reasonable terms for potential deferment of portions of the Development Fee arising from unanticipated cost overruns. No portion of the Developer Fee will be considered earned or payable unless and until the Closing occurs. If this Agreement is terminated prior t he Closing, then the reimbursement and compensation of the Developer for performing the Developer Services up to the time of termination will be governed by the applicable provisions of Article VIII. 3.4 Contractors and Consultants. The Developer or the Project Entity will be responsible for the selection and engagement of contractors, consultants and other participating parties necessary for carrying out the Developer Services. The Developer will notify the City in advance of all proposed selections by the Developer of contractors, consultants or other participating parties engaged or selected for participation in the Project, and all such selections shall be subject to the City’s approval, which shall not unreasonably be withheld. The City hereby approves all of the consultants and contractors previously engaged by the Developer identified in Exhibit F. The replacement of any consultant or contractor listed on Exhibit F shall be subject to the terms of this Section 3.4. 3.5 Cooperation and Approval Standards. The City and the Developer will cooperate with one another in a good faith effort to complete the Project. Such cooperation will include reasonable efforts to respond to one another as expeditiously as possible with regard to requests for information or approvals required hereby and prompt proactive sharing of information pertinent to the carrying out and orderly progression of the Project. With regard to materials or documents requiring the approval of one or more parties, if such materials or documents are n ot approved as initially submitted, then the parties will engage in such communication as is necessary under the circumstances to resolve the issues resulting in such disapproval. The City will promptly review any matter submitted and advise the Developer in writing of approval or of why approval is being withheld. The City’s approval of any matter required hereunder will be in writing and P28 VI.b AHP Revised Draft 07.18.17 10 will not be unreasonably withheld, conditioned or delayed, except as otherwise specifically provided in this Agreement. 3.6 Communications. To facilitate communication, the City and the Developer each will designate a representative with responsibility for the routine administration of such party’s obligations under this Agreement. Initially such representatives will be Chris Everson, Affordable Housing Project Manager, for the City and Jason Bradshaw, Manager, for the Developer. ARTICLE IV. DUE DILIGENCE MATTERS 4.1 Title Insurance Commitments. The Developer has obtained title insurance commitments for the three Sites from the Title Company (as updated from time to time, the “Title Commitments”). The Title Commitment s will be used, if the Closing occurs, as the basis for the issuance of leasehold title insurance policies to the Project Entity to insure its interests under the Ground Leases and also to provide a lender’s title insurance policy to the City with respect to the City Loan and any construction lender with respect to its construction loan (including any applicable HUD requirements). The Developer, with the assistance and ad vice of legal counsel and other consultants, has reviewed the Title Commitments and determined that there do not appear to be any matters of title affecting the Sites that would materially impair or prevent the Project from being developed on the Sites, such as, for example and without limitation, restrictive covenants that conflict with the Development Plan. The Developer will cause the Title Commitments to be updated from time to time prior to the Closing. As a condition to the Closing, the final form o f the Title Commitments and the insurance coverage to be provided pursuant to the title insurance policies to be issued pursuant to the Title Commitments will be subject to the approval of the Project Entity (with respect to its owner’s policy to be issued insuring its leasehold interests pursuant to the Ground Leases, the City (with respect to its mortgagee’s policy to be issued with respect to the City Loan), any construction lender for the Project (with respect to its mortgagee’s policy to be issued with respect to the City Loan), and, to the extent applicable under the Applicable Public Housing Requirements, any governmental entity participating in the issuance of the Tax Credits or facilitating any other financing for construction of the Project. 4.2 Surveys. The Developer has obtained preliminary surveys of the Sites prepared by Peak Surveying, Inc. in accordance with the 2016 Minimum Standard Detail Requirements of ALTA/NSPS Land Title Surveys, including Items 1 - 5, 7(a), 8, 11 – 14, 16 -19 of Table A (as updated and revised from time to time, the “Surveys”). The Developer, with the assistance and advice of legal counsel and other consultants, has reviewed the Surveys and determined that there do not appear to be any matters affecting the Sites as revealed by the Surveys that would materially impair or prevent the Project from being developed on the Sites, such as, for example and without limitation, any easements that conflict with the Development Plan that cannot be terminated or relocated by the City as the owner of the Sites. The Developer will cause the Surveys to be updated and supplemented from time to time in accordance with the requirements of CHFA, HUD, the City, the Title Company, any lender for the Project, and based on the Developer’s review of the Surveys. As a condition to the Closing, the final form of the Surveys will be subject to the approval of the Project Entity, the City, the Title Company, any construction lender for the Project, and, to the extent applicable under the Applic able Public Housing Requirements, any governmental entity P29 VI.b AHP Revised Draft 07.18.17 11 participating in the issuance of the Tax Credits or facilitating any other financing for construction of the Project. 4.3 Access to the Property and Other Investigations. For the duration of this Agreement, the City will permit representatives of the Developer and all consultants and professionals engaged by the Developer in the performance of the Developer Services to have access to the Sites at all reasonable times for the purpose of obtaining and up dating information and conducting studies, evaluations, assessments, tests and investigations of the Sites for the purpose of evaluating the suitability of the Sites for development of the Project and to assist with the design of the Project on the Sites (the “Site Investigations”). The Site Investigations may include, without limitation, surveying work, geotechnical sampling and testing, environmental site assessments, asbestos testing, mold testing, and traffic studies. The Developer will make available to the City copies of all work product generated by the Developer and its consultants and professionals pursuant to the Site Investigations. The Developer, with the assistance of its professional consultants, will review the results and work product of t he Site Investigations to determine if there are any matters affecting the Sites as revealed by the Site Investigations that would materially impair or prevent the Project from being developed on the Sites. The Developer will notify the City of any such matters that materially impair or prevent the Project from being developed on the Sites. The Developer will cause the Site Investigations to be updated and supplemented from time to time in accordance with the requirements of CHFA, HUD, the City, any lender for the Project, and based on the Developer’s review of the Site Investigations. As a condition to the Closing, the condition of the Sites as revealed by the Site Investigations will be subject to the approval o f the Project Entity, the City, any construction lender for the Project, and, to the extent applicable under the Applicable Public Housing Requirements, any governmental entity participating in the issuance of the Tax Credits or facilitating any other financing fo r construction of the Project. 4.4 Special Terms Regarding Environmental Conditions. 4.4.1 Environmental Assessment. As part of the Developer Services, Developer will cause Phase I environmental site assessments to be completed for the Sites, and will provide a copy to the City. If recommended by any Phase 1 environmental site assessment or otherwise deemed warranted by the Developer or the City with respect to an existing or suspected Environmental Condition identified in any Phase 1 environmental site assessments or addenda thereto, the Developer will cause to be performed a Phase II environmental site assessment with respect to any applicable Site along with any further testing or other evaluation reasonably necessary to determine the existence, scope and extent of any Environmental Cond ition, and will provide a copy of all such items to the City. If a Phase II environmental site assessment is determined to be necessary as provided above, then the Developer and its consultants will be afforded a reasonable period of time to determine the extent of any Required Remediation Work that will be required with respect to the applicable Site. 4.4.2 Required Remediation Determination. If a Phase I environmental site assessment , a Phase II environmental site assessment or any further testing or evaluation (collectively, a “Site ESA”) identifies the presence of an Environmental Condition, the Developer will determine, in consultation with the City and appropriate P30 VI.b AHP Revised Draft 07.18.17 12 environmental consultants engaged for the Project by the Developer, the scope of remediation, if any, required to be performed at the affected Site to comply with the remedy standards under the applicable Environmental Laws for the intended use of the Site pursuant to the Development Plan (the “Required Remediation Work”). 4.4.3 Performance of Required Remediation and Alternatives. The City and the Developer acknowledge that the third-party funding sources for the Project, as a condition to the Closing and their funding of the Project, will likely require evidence that any Required Remediation Work has been completed in accordance with applicable Environmental Laws, which may inc lude a requirement to obtain a certificate of completion or a “no further action” clearance letter with respect thereto from the Colorado Department of Public Health and Environment. If Required Remediation Work is determined to be needed, then the Developer will determine if the Required Remediation Work will need to be completed prior to the Closing to satisfy the requirements of all third - party funding sources. If the third-party funding sources will permit the Required Remediation Work to be completed after the Closing, then the Required Remediation Work will become part of the Project and incorporated into the Development Plan for undertaking as part of the construction work on the applicable Site after the Closing. If, however, the third-party funding sources will require that the Required Remediation Work be completed prior to and as a condition of the Closing, then the City will have the option to: (a) eliminate the affected Site from the Project; or (b) agree with the Developer on a schedule, plan, and funding arrangement for the purpose of completing the Required Remediation Work on the affected Site prior to the Closing with the costs thereof treated as Project costs to be subsequently reimbursed at the time of Closing (if feasible under the LIHTC Laws and all requirements of third-party funding sources); or (c) agree with the Developer on an alternative method for addressing the Required Remediation Work that is mutuall y satisfactory to the Developer, the City, and all third -party funding sources; or (d) terminate this Agreement pursuant to either Section 8.4.1 or Section 8.4.2, as applicable, and not proceed with the Project. If the City chooses to eliminate a Site from the Project pursuant to this Section 4.4.3, then all references in this Agreement to the “Sites” and the “Project” shall be deemed to omit the Site so eliminated. 4.5 Removal of Site, Generally. The Developer and the City may mutually determine at any time, based on the investigations of the Sites undertaken by the Developer pursuant to this Article IV or any other information concerning the feasibility of the Project that becomes available to the City and the Developer from time to time, that a Site should be eliminated from the Project. The decision to eliminate a Site from the Project pursuant to this Section 4.5 must be memorialized in an amendment to this Agreement or other written agreement between the parties. Neither party shall have any obligation to agre e to eliminate a Site from the Project pursuant to this Section 4.5. If the parties do agree to eliminate a Site from the Project pursuant to this Section 4.5, then all references in this Agreement to the “Sites” and the “Project” shall be deemed to omit the Site so eliminated. This Section 4.5 shall not limit the City’s right to eliminate a Site from the Project on account of Required Remediation Work pursuant to Section 4.4.3. P31 VI.b AHP Revised Draft 07.18.17 13 ARTICLE V. ENTITLEMENT/FEASIBILITY PERIOD 5.1 Entitlement / Feasibility Period, Generally. There will be a two-year period beginning upon the date of this Agreement for the Developer to obtain Final Entitlement for the Project and commitments for all third-party financing necessary to proceed with development of the Project (the “Entitlement/Feasibility Period”). The Entitlement/Feasibility Period will encompass and be subject to the following sections of this Article V. 5.2 Design. The Developer will, in consultation with the City and based on input of the planning consultants, Project Architect, landscape designers, and engineers engaged by the Developer for the Project, refine and advance the Development Plan for the Project, with it being intended that the Development Plan will include final construction drawings and specifications for construction of the Project on the Sites as of the Closing. The Development Plan, as refined and advanced, will take into consideration community-wide, neighborhood and stakeholder feedback based on a public outreach effort that will be led by the Developer as described below. The Developer will cause the Development Plan to be updated and revised from time to time prior to the Closing as necessary or appropriate to address or incorporate information obtained during investigation of the Sites, changes in the Project Budget or as needed to be consistent with the Project Budget, feedback from consultants engaged for the Project, and directives from the City regarding its preferences for the Project. Each iteration of the Development Plan will be subject to the approval of the City. All proposed revised versions of the Development Plan will be submitted to the City for approval, from time to time, as they are being develo ped. The City will communicate to the Developer its approval or disapproval of any proposed update to the Development Plan within ten (10) days of submission. If the City disapproves of a proposed update to the Development Plan, a written explanation will be provided to the Developer. 5.3 Public Outreach Process. Prior to the date of this Agreement, the Developer commenced a public outreach process to solicit feedback from the community regarding the Project (the “Public Outreach Process”). The Public Outr each Process included an at-large community meeting and neighborhood-specific meetings for neighbors of the three Sites. The Public Outreach Process was used to further develop the Development Plan and the Project Budget, including, without limitation, the LIHTC Unit/Non-LIHTC Unit mix at each Site and the APCHA rental categories for the Units. The work product developed from the Public Outreach Process included a detailed summary of the community input received at each of the public outreach events in a transparent format and included an executive summary of the same. Such work product was delivered by the Developer to the City for the City’s consideration and to enable the City to provide guidance on the current Development Plan attached to this Agreeme nt as Exhibit C. 5.4 Entitlement Process. Based on the current Developed Plan, the Developer will prepare and submit applications to the City’s Community Development Department for each Site for the purpose of applying for Final Entitlement. The parties ack nowledge that each of the Sites will require a rezoning (along with other approvals) to proceed with the Project. The parties agree that the Developer will apply to rezone each of the Sites as AH – Planned Development pursuant to the Land Use Code. The date as of which the Developer has submitted applications to the City’s Community Development Department for the purpose of applying for Final Entitlement with respect to all of the Sites will be the “Submittal Date” pursuant this Agreement. P32 VI.b AHP Revised Draft 07.18.17 14 5.5 No Guaranty of City Approval. The City hereby reserves all police power rights and discretionary approval rights pursuant to the Land Use Code. Nothing in this Agreement is intended to create, or shall be construed as creating, any obligation on the part of the City, the City Council, or any department of the City to grant Final Entitlement approval or any preliminary approval or recommendation that is required to obtain Final Entitlement approval pursuant to the Land Use Code. The Developer acknowledges that the applications submitted for the purpose of obtaining Final Entitlement will be subject to all applicable requirements of the Land Use Code. Without limiting any of the foregoing, it is agreed and acknowledged that the discretion of the City Council to approve, approve with conditions, or deny any land use application for the Project in accordance with the standards of the Land Use Code is hereby and will be preserved. 5.6 Debt Financing. As the Final Entitlement process progresses, the Developer will pursue appropriate debt financing for a construction loan and permanent loan following completion of construction of the Project. The debt financing may be pursued as a HUD -insured loan under the HUD § 221(d)(4) program by which the federal Department of Housing and Urban Development insures a combined construction/permanent loan facility that is provided by a private commercial lender. The Developer agrees to pursue financing such that the terms, conditions and net proceeds are competitive so as to require the lowest amount of City Funds reasonably achievable to complete construction of the Project. 5.7 Equity Financing. Subject to Section 3.1.7, the Developer will have the right to choose the Investor for the Project. However, the Developer will solicit three competitive bids for providing equity to the Project Entity from nationally recognized equity providers for Tax Credits projects to substantiate the proposed pricing being utilized by the Developer and the Project Entity. 5.8 Minimize City Funds. The Developer agrees to structure the debt and equity financing for development of the Project so as to require the lowest City Funds amount reasonably achievable by minimizing development and construction costs and maximizing all debt and equity sources. ARTICLE VI. CLOSING DOCUMENTS 6.1 Closing Documents, Generally. The City and the Developer acknowledge that development and operation of the Project and the Sites contemplates and encompasses certain long-term continuing relationships between the City, the Developer, the Project Entity and/or Affiliates of the Developer following completion of construction of the Project that are integral to the realization of the goals of the Proje ct. The terms and conditions of such continuing relationships with respect to the Project are to be more fully described and set forth in various documents and agreements that will be executed in connection with the Closing. The present understandings bet ween the City and the Developer with respect to such relationships as they relate to the Project, and as will be memorialized and further detailed in separate agreements at the Closing, are summarized in the following provisions of this Article VI. The Developer and/or the Project Entity, as appropriate, the City, the Investor, any third-party lenders, APCHA, CHFA, HUD (as applicable), and any other applicable parties will execute at Closing such documents as will be necessary and appropriate to the implementation of the Project in accordance with this Agreement and the LIHTC Laws, which will collectively be known as the “Closing Documents.” P33 VI.b AHP Revised Draft 07.18.17 15 The Closing Documents will conform to the particular commitments made in this Agreement and will be in form and content satisfactory to the Developer, the City, the Developer’s counsel, the City’s counsel, the Investor, the Investor’s counsel, other lenders’ counsel, bond counsel (as applicable), the purchasers and the underwriters of any bonds, HUD (as applicable), and/or any other requisite funding source. 6.2 Project Entity Agreement. Developer will cause the Project Entity to be formed as a limited partnership or limited liability company in which Developer or an Affiliate of Developer will be the sole general partner or manager with the authority to manage and make decisions on behalf of the Project Entity, subject to approval of certain major decisions by the limited partners or other members. The Developer or its Affiliate, in its capacity as the general partner or manager of the Project Entity, will make only a de minimus equity contribution to the Project Entity. At the request of the City, the Project Entity will be structured and the Project Entity Agreement will be drafted to permit APCHA to be a special limited partner or member for purposes of securing exemption from ad valorem real estate taxes for the Sites or to achieve other agreed Project goals, but without APCHA having any participation in the allocation of net losses or net income or distribution of net cash flow from the Project Entity. In recognition of the magnitude of the City’s financial investment in the Project in the form of the City Funds, the City or an Affiliate of the City will be a special limited partner or special member in the Project Entity for the purpose of giving the City the right to remove and replace the general partner or manager (as applicable) in the event of uncured material defaults by such general partner or manager under the Project Entity Agreement and/or to cure materials defaults by the Project Entity under any loan agreements or the Ground Leases. 6.3 LURA. A LURA will be recorded against each of the Sites at the Closing for the purpose of imposing income and rent restrictions against all of the LIHTC Units in the Project. The income and rent restrictions of each LURA will be in place for the initial 15 -year “compliance period” required by the LIHTC Laws and an additional “extended-use period” of at least 15 years or whatever period is required pursuant to the LIHTC Laws based on the Tax Credits program ultimately used for the Project. Each LURA will comply in form and substance with all requirements of the LIHTC Laws and will also be subject to the approval of the City, APCHA, the Developer, the Investor, and any Project lenders (including any required and mutually acceptable subordination provisions). 6.4 APCHA Covenant. An APCHA Covenant will be recorded against each of the Sites at the Closing for the purpose of imposing income and rent restrictions against all of the Units in the Project (both the LIHTC Units and the Non-LIHTC Units). The term of the APCHA Covenants will be perpetual (unless released in the future with the approval of the City and APCHA). The APCHA Covenants will be senior (i.e., non-subordinated) to all mortgages and deeds of trust encumbering the Sites for the purpose of securing any of the loans made to fin ance development of the Project. Each APCHA Covenant will comply in form and substance with all requirements of the APCHA Guidelines, but will include special provisions to avoid conflicts between the provisions of the LURA and the pro visions of the APCHA Covenant. 6.5 Ground Leases. The City will hold fee title to each Site but will convey control of each Site through a long-term ground lease to the Project Entity (the “Ground Leases”). The form of the Ground Leases will be subject to the approval of the City and the terms required P34 VI.b AHP Revised Draft 07.18.17 16 pursuant to the Applicable Public Housing Requirements and the reasonable requirement of the Investor and any lender to the Project; provided, however, that the final form of the Ground Leases must be acceptable to the City and t he Developer. The basic terms of each of the Ground Leases will be as follows: 6.5.1 The commencement date of the rental term under each Ground Lease will occur as of the consummation of the Closing. 6.5.2 The initial rental term of each Ground Lease will be 40 years with an option for the Project Entity to extend the term by an additional 10 years. 6.5.3 The base rent payable under each Ground Lease will be a nominal amount of $10.00 per year. 6.5.4 The Project Entity, as the tenant under each Ground Lease, will be the owner of all the improvements existing or constructed on the Sites and such improvements will be deeded or otherwise conveyed to the Project Entity in a manner that satisfies the requirements of the title insurer to insure the Project Entity’s ownership int erest in such improvements. 6.5.5 The Project Entity, as the tenant, will be responsible for all operating and ownership costs for the three Sites. 6.6 Right of First Refusal and Purchase Option. The City will have an option to purchase the Investor’s interests and the interests of the Developer or any affiliate in the Project Entity or the Project or the Project Entity’s rights to each Site under each Ground Lease and a right of first refusal to purchase the Project or the Project Entity’s rights to each Site under each Ground Lease in compliance with the LIHTC Laws, and specifically Section 42(i)(7) of the Code. The right of first refusal and purchase option will arise at the end of the initial 15 -year compliance period under the LIHTC Laws, and will be set forth in a separate agreement entered into at the Closing in connection with the tax credit investment. The purchase price under the right of first refusal will be equal to the sum of: (a) all outstanding indebtedness and accrued but unpaid interest owed to the senior lender for the Project; (b) any amount owed to the City as the junior lender pursuant to the City Loan and any other junior secured debt; plus (c) the amount of all so -called “exit tax” obligations that will be incurred by the Project Entity and its participants as a result of the City exercising the option. The purchase price under the purchase option shall be the fair market value of the interests or assets being purchased. The Developer or its designated Affiliate, as the general partner or ma nager of the Project Entity, will use commercially reasonable efforts (with no guaranty) to prevent the participants in the Project Entity from having negative capital account balances that would increase the exit tax obligations. The capital accounts of the Project Entity will be monitored in this regard. The Project Entity Agreement will include a provision under which losses that would otherwise create negative capital accounts can be allocated to the City as a special limited partner/member in the Pro ject Entity and thereby reduce any exit tax obligations, subject to compliance with all Treasury Regulations promulgated under the Internal Revenue Code. The Developer will produce downstream capital account projections to be included in subsequent iterat ions of the Project Budget delivered to the City pursuant to this Agreement. P35 VI.b AHP Revised Draft 07.18.17 17 6.7 Cure Rights. To the extent feasible given the requirements of the senior lender to the Project, the City will be given notice and cure rights with respect to any defaults by the Project Entity under its loan from the senior lender for the Project. The City will also have curative rights as the special limited partner/member in the Project Entity in order to prevent defaults from occurring under the senior loan. The terms of the senior loan will be subject to the City's approval in its discretion. The City and the Developer acknowledge that the senior lender (for the construction phase and permanent financing phase) and/or any loan insurer such as HUD (per §°221(d)(4) of the HUD Laws) will have its own requirements with respect to the Ground Leases to protect its interests in the event of a default by the Project Entity as the tenant, but the City will not be required to accept such requirements. 6.8 City Loan Documents. The City will enter into a loan agreement with the Project Entity at the Closing to the City Funds to the Project consistent with the final approved Project Budget . The City Funds will provide the financing necessary to fund the development costs for the Project in excess of the funds generated from the sale of the Tax Credits, senior loans, and other approved sources, in an amount approved by the City. The City will not be responsible for funding any cost overruns in excess of those detailed in the final approved Project Budget except to the extent caused by the City’s acts or omissions. The City Loan will include and/or address, as applicable, the following basic terms: 6.8.1 Term. The City Loan will have a term of 50 years or other commercially available term agreed to by the parties for the purpose of making the Project financially feasible. 6.8.2 Interest Rate. The annual interest rate will be set at the "applicable federal rate" (the “AFR”) published by the IRS (i.e., the lowest rate permitted by the IRS) or another rate agreed to by the parties as necessary to make the Project financially feasible. If the Project cash flows will not support an interest rate at the AFR, then the interest rate will be set at the highest rate that allows a “true debt”/”residual value” analysis to show reasonable repayment. 6.8.3 Note and Leasehold Deed of Trust. The City Loan will be evidenced by a promissory note and will be secured by a junior leasehold deed of trust on the Project Entity’s interest in the Sites under the Ground Leases. Such deed of trust will be junior to the leasehold deeds of trust granted by the Project Entity from time to time to secure the obligations under the construct ion and permanent financing for the Project, as any such senior loans may be amended, extended, and/or refinanced from time to time. As the holder of a junior deed of trust, the City will be required to enter into a commercially reasonable subordination agreement with the senior lender(s) detailing the relative rights of the lenders and confirming the City’s junior position, along with its notice and cure rights and other rights to take over the Project for the purpose of protecting the City’s investment. The final form of the leasehold deed of trust to be granted to the City and all related inter -creditor agreements will be subject to the final approval of all parties thereto. 6.8.4 Repayment. The City Loan will be non-recourse to the Project Entity and prior to maturity will be payable from, and only from, 75% of the annual excess cash flow, if any, generated by the Project, in accordance with the waterfall set forth in P36 VI.b AHP Revised Draft 07.18.17 18 Section 6.13. Payments on the City Loan will be applied first to accrued interest and then to principal. 6.8.5 Funding of City Funds. The method and procedure for funding of the City Funds into the Project will be subject to the approval of the City, the P roject Entity, the Investor and the construction lender. The parties acknowledge: (a) that the delivery of the City Funds for construction of the Project through the City Loan facility will be structured in a manner that will permit the construction lender and the Project Entity to verify the contribution of the City Funds in a manner that does not delay the Project; and (b) t he City Funds will need to be committed to the Project such that they are not subject to annual appropriation or the voter approval limitations imposed by Section 20, Article XX of the Colorado Constitution (i.e., the Colorado Taxpayer’s Bill of Rights). Subject to these considerations and the requirements of the construction lender, the Developer acknowledges that the City Loan will be funded on a monthly construction draws basis, after at least 50% of all other equity and debt sources have been funded. The City will be provided, for its review, a copy of all monthly construction progress reports and all monthly construction draws and applications for payment under the Construction Contract pursuant to standard construction industry practices. The parties acknowledge some flexibility may be needed in determining how and when the City Loan funds are contributed to the Project over the course of construction and the City may need to fund the City Loan pari passu with the construction loan or based on agreed completion milestones instead of after all other sources have been funded. 6.8.6 Excess Funds. Notwithstanding the total amount of City Funds committed to the City Loan as of the Closing, the City will be obligated to contribute only that portion of the City Funds that is actually needed for completing construction of the Project. All construction and related development expenses for the Project will be accounted for by the Developer in a standard construction accounting format, with the City having access during normal business hours upon reasonable prior notice to all accounting and expense records for the Project. Upon completion of construction, the Developer shall obtain a cost savings audit with respect to the Project. To the extent the actual costs incurred to complete development of the Project, as reflect in the cost savings audit, less the other sources of funds, are less than the amount of the City Funds approved as of the Closing, the City will be permitted to retain such portion of the City Funds and the principal amount of the Cit y Loan will be reduced by the amount so retained by the City, and any excess development funds upon conversion to permanent loan status will be applied to pay down the City loan. 6.9 Property Management. The property management agent for each developed Site of the Project (the “Management Agent”) will be a management company selected by the Developer, with the approval of CHFA and the City, with expertise in managing Tax Credits projects and ensuring compliance with all LIHTC Laws. The Management Agent will be responsible to the Project Entity for management of each developed Site in accordance with the terms of a management agreement to be approved by all applicable parties (the “Management Agreement”) and including a management plan that will provide for (a) obtaining applications from eligible households, (b) pre- screening applicants to determine their status as eligible residents, (c) selecting residents from among eligible applicants; (d) criteria for continued P37 VI.b AHP Revised Draft 07.18.17 19 occupancy, and (e)obtaining final approval of all applications from APCHA. The City will (along with the Investor and lenders) have a right to approve a successor Management Agent, if applicable, which approval will not unreasonably be withheld, conditioned or delayed. The Management Agent will receive an appropriate management fee under the Management Agreement in an amount not to exceed the fee allowable under the LIHTC Laws. 6.10 Admissions and Occupancy Policies; Role of APCHA. The City and the Developer acknowledge that the goal of achieving long-term sustainability of each Site as a mixed- income community will be enhanced by administrative procedures and terms and conditions of occupancy that reduce discernible distinctions in maintenance, operation and conditions of continued occupancy, between the LIHTC Units and the Non-LIHTC Units to the greatest extent feasible while assuring that the rental of the LIHTC Units complies with the LIHTC Laws. The selection of applicants for admission to and continued occupancy of all the Units at each Site will be the function of the Project Entity acting through the Management Agent; provided, that prior to accepting any tenant application, the Project Entity and Management Agent shall submit the tenant application file to APCHA for review and approval. APCHA approval of all tenants will be required in accordance with APCHA’s adopted guidelines. A combined form of application meeting the requirements of both the LIHTC Laws and APCHA’s adopted guidelines will be developed for the Project. 6.11 Construction Contract. The Developer will select the General Contractor for the Project through a selection process meeting the requirements of Section 3.4. Prior to selection of the General Contractor, the Developer will provide the City with the name of any proposed General Contractor or a list of proposed General Contractors, and the City may advise the Developer in writing of any objections it may have with respect to any prop osed General Contractor, which objections will be reasonably considered by the Developer. Developer will negotiate a fixed price or guaranteed maximum price contract (the “Construction Contract”) between the Project Entity and the General Contractor. No less than twenty-one (21) days prior to execution of the Construction Contract, the Developer will submit a final draft to the City for its review and approval based on its compliance with this Agreement and the Applicable Public Housing Requirements, and at the City’s election, based upon a reasonableness analysis conducted by the City. The Developer will require the General Contractor to (i) conduct the bidding process for subcontractors in a fashion that ensures that all information pertinent to the eva luation of each bid is provided to the General Contractor, and (ii) provide the City with full access to all books and records and other information relating to the procurement process for General Contractor sub- bids under the Construction Contract during normal business hours on reasonable advance notice. 6.12 Guarantees at the Closing. Developer or an Affiliate of Developer will execute such guarantees as may reasonably be required by the Investor and third -party lenders including, as applicable, construction completion, development deficit guarantees, operating deficit guarantees, tax credit recapture guaranties and environmental indemnities. Developer reserves the right to negotiate the terms of such guarantees with the Investor and such third -party lenders on a commercially reasonable basis. The City will not be required to provide guarantees to the Investor or to third-party lenders or to any other party. 6.13 Cash Flow Waterfall. The net cash flow generated from rental of the Units in the completed Project after the payment of operating expenses (including deposits required to fund P38 VI.b AHP Revised Draft 07.18.17 20 or restore any reserve accounts to specified amounts based upon the terms of the senior loan and the requirements of the Investor) and debt service to the senior lender will, subject to modifications based upon the terms agreed with the Investor, be distributed in the following order, which will be incorporated into the applicable Closing Documents (the “Cash Flow Waterfall”): 6.13.1 To the payment of an asset management fee to the Investor, and to pay other amounts owing to the Investor according to the terms of the approved equity investment; 6.13.2 To the payment of any unpaid balance of any deferred Development Fee (which in all events must be paid within 12 years regardless of amount); 6.13.3 75% of the remaining cash flow shall be applied to the payment of the City Loan; and 6.13.4 All remaining cash flow after required payments on the City Loan shall be paid 90% to the general partner/manager of the Project Entity in payment of a Project Entity management fee and 10% to the Investor. ARTICLE VII. LIHTC PROGRAM SELECTION AND CLOSING 7.1 LIHTC Program Selection. After Final Entitlement has occurred or earlier upon mutual agreement of the Developer and the City, the Developer, with the cooperation of the City, will pursue an application for Tax Credits from CHFA. Such application will be for one of the following: (i) a competitive application for 9% federal Tax Credits, or (ii) a competitive application for 4% federal Tax Credits plus state Tax Credits; or (ii) a non-competitive application for 4% federal Tax Credits without state Tax Credits, with the actual Tax Credits being applied for being determined by the City, in consultation with the Developer, based on the option that requires the City Funds contribution to be as low as possible while having a reasonable probability of being approved by CHFA. If a competitive application for 9% federal Tax Credits or 4% federal Tax Credits plus state Tax Credits is denied by CHFA, the City and the Developer may agree to pursue a non-competitive application for 4% federal Tax Credits. The City may choose to forego a competitive application altogether and instead initially pursue a non-competitive application for only 4% federal Tax Credits. The Developer will not submit an application for Tax Credits to CHFA until it has been authorized to do so by the City. Once the City has authorized the Developer to submit an application for Tax Credits to CHFA, the Developer will submit such application as soon as reaso nably practicable and will also begin work on satisfying the other Closing Contingencies such that, assuming the Tax Credits application is approved by CHFA and all Closing Contingencies are actually satisfied, the Closing can occur within a commercially reasonable time following approval of the Tax Credits application by CHFA. 7.2 Closing Contingencies. The consummation of the Closing will be conditioned on the satisfaction of all contingencies necessary to commence and pay for construction of the Project in accordance with the final approved Development Plan, Project Budget, and Project Schedule in accordance with all applicable LIHTC Laws and Applicable Public Housing Requirements (“Closing Contingencies”). Such Closing Contingencies include, but may not be limited to the following items, which reflect certain expectations of the parties: P39 VI.b AHP Revised Draft 07.18.17 21 7.2.1 Final Entitlement for the Project has been obtained and building permits have been issued for the commencement of construction of the Project on each Site; 7.2.2 CHFA has allocat ed Tax Credits for the Project in accordance with the LIHTC Laws and the Tax Credits application submitted by the Developer ; 7.2.3 The Project Entity has entered into the Construction Contract with the General Contractor meeting all requirements of the LIHTC Laws; 7.2.4 All construction loan terms have been agreed to and the construction lender for the Project is prepared to begin (subject to the satisfaction of typical draw conditions) advancing construction loan proceeds for development of the Sites pursuant to the terms of the construction loan; 7.2.5 The Investor has approved the transaction and is committed to fund its investment in the Project Entity; 7.2.6 The loan documents for the City Loan have been agreed to and approved by the City and the Project Entity and the City Funds are adequately appropriated and committed to the Project; 7.2.7 The Title Company has issued pro forma title insurance policies acceptable to the Project Entity, the construction lender, and the City and is irrevocably committed to issue title insurance policies to the Project Entity (as the tenant), the construction lender with respect to its first position deed of trust on the Ground Leases, and the City with respect to its junior deed of trust on the Ground Leases to secure the City Loan; 7.2.8 The successful completion of any Required Remediation Work if required as a condition precedent to Closing by the Investor or any lender ; 7.2.9 The receipt of all necessary government approvals required for commencement of construction of the Project in addition to Final Entitlement; and 7.2.10 The form of all other Closing Documents have been approved and/or agreed to by all applicable parties. 7.3 Closing. Unless this Agreement is earlier terminated pursuant to the applicable provisions of Article VIII, the Closing will be consummated as soon as practicable following satisfaction of the all the Closing Contingencies and the City and the Developer will execute all Closing Documents, subject to approval by the City and the Developer, and take all actions necessary to consummate the Closing. ARTICLE VIII. TERMINATION 8.1 Termination by City for Event of Default. Upon written notice from the City and the expiration of any cure rights set forth in this Section 8.1, any of the following will constitute an “Event of Default” by the Developer under this Agreement entitling the City to P40 VI.b AHP Revised Draft 07.18.17 22 terminate this Agreement (subject, in any event, to (1) Events Beyond Control in Section 8.3 or (2) the determination that performance is infeasible due to the occurrence of events contemplated in Section 8.4): 8.1.1 Developer becoming insolvent, making an arrangement with or for the benefit o f its creditors, acquiescing in the appointment of a receiver, trustee or liquidator, instituting or becoming the subject of any proceeding commenced under any law for the relief of debtors, or otherwise objectively demonstrating financial incapacity to ca rry out its obligations hereunder; or 8.1.2 Failure of Developer or an Affiliate of Developer to make payment when due to a third party contractor or consultant engaged by Developer, resulting in a lien statement being recorded against any of the Sites unless Developer causes such lien statement to be released within 45 days after the City delivers a copy of such recorded lien statement to Developer ; or 8.1.3 Material breach of any representation, warranties, covenants, or certifications made in this Agreement if such material breach is not cured by Developer within 30 days after receiving written notice of such breach from the City. 8.2 Termination by Developer for Event of Default. Upon written notice from the Developer, it will constitute an “Event of Default” by the City under this Agreement entitling the Developer to terminate this Agreement (subject, in any event, to (1) Events Beyond Control in Section 8.3 or (2) the determination that performance is infeasible due to the occurrence of events contemplated in Section 8.4) if the City materially breaches any representation, warranty, co venant, or certification made by it in this Agreement if such material breach is not cured by the City within 30 days after receiving written notice of such breach from the Developer. 8.3 Events Beyond Control. Notwithstanding Section 8.1 and Section 8.2, this Agreement will not be terminated for an Event of Default if the delay in completing the work or other cause of the subject Event of Default arises from unforeseeable causes beyond the reasonable control of the Developer or the City, as applicable (“Events Beyond Control”). Examples of Events Beyond Control include without limitation (a) acts of God or public enemy, (b) acts or failure to act, or delays in action, of CHFA, APCHA, HUD or other governmental entities in either their sovereign or contractual capacity, (c) fires, (d) floods, (e) strikes or labor disputes, (f) unavailability of materials, (g) unusually severe weather, (h) delays of subcontractors or suppliers at any tier arising from unforeseeable causes beyond the control and without fault or negligence of the Developer, (i) delay caused by litigation tha t is not between the City and the Developer; or (j) acts or failure to act by the party that has alleged the party is in default . 8.4 Termination for Infeasibility. In the absence of an Event of Default the parties will nevertheless still have the right to t erminate this Agreement and/or this Agreement may terminate automatically in certain circumstances as provided below in this Section 8.4. 8.4.1 Termination Prior to Submittal Date. The City and the Developer will each have the right to terminate this Agreement upon written notice to the other party at any time prior to the Submittal Date if such party determines in good faith that the Project P41 VI.b AHP Revised Draft 07.18.17 23 is infeasible or unachievable or excessively costly based on any of the information received or developed in the course of advancing the Project . Any termination by the City under this Section 8.4.1 shall be in its sole discretion. If either party terminates this Agreement prior to the Submittal Date pursuant to this Section 8.4.1, then the City will be responsible for reimbursing the Developer for all Developer Pursuit Costs incurred by the Developer through the date of such termination (even if actual payment by the Developer to an applicable vendor is made after the date of such termination). Such reimbursement by the City to the Developer will be paid within 30 days after the Developer submits to the City a written invoice for all such Developer Pursuit Costs together with reasonable back -up for the total amount owed (e.g., invoices of vendors or other appropriate support for any amount claimed) together with proof that the Developer has actually paid all such Developer Pursuit Costs. For the avoidance of doubt, upon any termination prior to the Submittal Date, no Management Fee (as described belo w) shall be payable to the Developer. 8.4.2 Termination After Submittal Date and Prior to Closing. After the occurrence of the Submittal Date, this Agreement will terminate even in the absence of an Event of Default under the following circumstances: (a) by t he City upon seven (7) days’ written notice delivered to Developer at any time prior to the Closing if the City determines in good faith, but in its sole and absolute discretion, that the Project is infeasible or unachievable or excessively costly, on terms acceptable to the City; or (b) automatically as of the last day of the Entitlement/Feasibility Period if Final Entitlement for the Project does not occur by the end of the Entitlement/Feasibility Period unless the City and the Developer agree in writing to extend the Entitlement/Feasibility Period. If this Agreement terminates pursuant to this Section 8.4.2, then, subject to Section 8.4.3, the City will (i) reimburse the Developer for all Developer Pursuit Costs incurred by the Developer through the date of such termination (even if actual payment by the Developer to an applicable vendor is made after the date of such termination); and (ii) pay the Developer the accrued “Management Fee” (as defined in Section 8.4.5 below) for providing the Developer Services until the effective date of such termination. Such reimbursement of the Developer Pursuit Costs and payment of the Management Fee by the City to the Developer will be paid within 30 days after the Developer submits to the City a written invoice for the Management Fee and all such Developer Pursuit Costs together with reasonable back -up for the total amount owed (e.g., invoices of vendors or other appropriate support for any amount claimed) together with proof that the Developer has actually paid all such Developer Pursuit Costs. 8.4.3 Termination for Failure of Financing. If the Developer is not able to secure a loan commitment (in a commercially reasonable form, including standard qualifications and conditions that must be satisfied as a condition to actual closing of the loan) from one or more qualified lenders to provide financing for construction of the Project in accordance with the Project Budget by the end of the Entitlement/Feasibility Period, then this Agreement will automatica lly terminate unless the Developer and the City agree to extend the Entitlement/Feasibility Period. If this Agreement terminates pursuant to this Section 8.4.3, then the Developer will not be entitled receive reimbursement from the City for any of the Developer Pursuit Costs and will not be entitled to receive any payment of Management Fee or other consideration from the City in compensation for the Developer Services. P42 VI.b AHP Revised Draft 07.18.17 24 8.4.4 Effect of Termination for Infeasibility. If this Agreement terminates or is terminated pursuant to this Section 8.4, then the parties will be released from a ll obligations to each other under this Agreement except for the reimbursement and payment terms contained in Section 8.4.1 and Section 8.4.2 and those terms of this Agreement that expressly survive termination. 8.4.5 Management Fee. The sole compensation to Developer for its services through the Entitlement/Feasibility Period (ot her than reimbursement of Developer Pursuit Costs as provided above and the Developer Fee pursuant to Section 3.3) shall be a management fee (the “Management Fee”) calculated as provided in this Section 8.4.5, and payable as provided in this Section 8.4. The “Management Fee” means a management fee equal to the lesser of: (x) $20,000 per calendar month (prorated for any partial month based on the actual number of days in such month) for the period of time beginning on the Submittal Date and ending on the day on which this Agreement terminates pursuant to this Section 8.4, (y) 20% of the Developer Fee that would be earned by the Developer based on the most recent approved Project Budget if the Closing occurred and the Project were consummated in accordance with the most recent approved Development Plan and Project Budget, or (z) $500,000. The Management Fee shall accrue and shall be payable only as provided in Section 8.4.2; provided, that if the Closing occurs, the accrued Management Fee shall be waived in lieu of Developer receiving payments of the Developer Fee as provided in Section 3.3. 8.5 Delivery of Work Product to City. If this Agreement is terminated or terminates pursuant to Section 8.1 or Section 8.4, the Developer will discontinue all services affected in pursuit of the Project and deliver to the City, without recourse to the Developer, copies all written information, reports, papers, and other materials concerning the Sites and the Project accumulated or generated in performing the Developer Services under this Agreement, but excluding any internal proprietary financial information concerning the Investor, the Developer or any Affiliate of the Developer. If this Agreement is terminated pursuant to Section 8.4.1 or Section 8.4.2, then Developer will not be obligated to deliver such materials to the City until the City has paid the Developer the amounts to which it is entitled pursuant to Section 8.4.1 or Section 8.4.2, as applicable. The terms of this Section 8.5 will survive the termination of this Agreement. ARTICLE IX. MISCELLANEOUS 9.1 Term. This Agreement will continue in effect until it is terminated pursuant to its terms or consummation of the Closing. Upon consummation of the Closing, the terms of this Agreement will merge with and be superseded by the terms of the Closing Documents. 9.2 Notices. Any notice or other communication given or made pursuant to this Agreement will be in writing and will be (i) delivered personally or by courier, (ii) emailed, (iii) sent by overnight express delivery, or (iv) mailed by first class mail, to a party at its respective address set forth below (or at such other address as will be specified by the party by like notice given to the other party): P43 VI.b AHP Revised Draft 07.18.17 25 If to City: City of Aspen Attn: Chris Everson, AH Project Manager 130 S. Galena St. Aspen, CO 81611 Email: chris.everson@cityofaspen.com With a copy to: City of Aspen Attn: James R. True, Esq., City Attorney 130 S. Galena St. Aspen, CO 81611 Email: jim.true@cityofaspen.com If to Developer: Aspen Housing Partners, LLC Attn: Jason Bradshaw 228 Eastwood Road Aspen, CO 81611 Email: jebradshaw@mac.com With a copy to: Waas Campbell Rivera Johnson & Velasquez LLP Attn: Bart Johnson, Esq. 420 E. Main St., Ste. 210 Aspen, CO 81611 And: SCG Development Attn: Stephen Wilson 8245 Boone Blvd., Suite 640 Vienna, VA 22182 Email: spw@stratfordcapitalgroup.com All such notices and other communications will be deemed given on the date of personal or local courier delivery, email transmission confirmed by a delivery receipt , delivery to overnight courier or express delivery service, or deposit in the United States Mail, and will be deemed to have been received (i) in the case of personal or local courier delivery, on the date of su ch delivery, (ii) in the case of telecopy, upon actual receipt, (iii) in the case of delivery by overnight courier or express delivery service, on the date following dispatch, and (iv) in the case of mailing, on the date specified in the return receipt therefor. 9.3 Further Assurances. Each party will execute such other and further documents as may be reasonably necessary or proper for the consummation of the transaction contemplated by this Agreement. P44 VI.b AHP Revised Draft 07.18.17 26 9.4 Assignment. Neither this Agreement nor any part or subpart of this Agreement will be assignable by Developer, except upon written consent of the City. 9.5 Counterparts. This Agreement may be executed in counterparts, each of which will be deemed original, but all of which, together, will constitute one instrument. 9.6 Interpretation and Governing Law. This Agreement will not be construed against the party who prepared it but will be construed as though prepared by both parties. This Agreement will be construed, interpreted, and governed by the laws of the State of Colorado. 9.7 Attorneys’ Fees. If the Developer or the City files a suit to enforce this Agreement or any provisions contained herein or any legal dispute arises from this Agreement between the parties, the substantially prevailing party in such suit will be ent itled to recover, in addition to all other remedies or damages, reasonable attorneys’ fees and court costs incurred in such suit. 9.8 Severability. If any portion of this Agreement is declared by a court of competent jurisdiction to be invalid or unenforceable such portion will be deemed severed from this Agreement and the remaining parts will continue in full force as though such invalid or unenforceable provision had not been part of this Agreement. 9.9 Final Agreement. Unless otherwise expressly provided herein, this Agreement constitutes the final understanding and agreement between the parties with respect to the subject matter hereof and supersedes all prior negotiations, understandings and agreements between the parties, whether written or oral. This Agreement may be amended, supplemented or changed only by a writing signed or authorized by or on behalf of the party to be bound thereby. 9.10 Waivers. The failure of either party to insist in any one or more cases upon the strict performance of any of the other party’s obligations under this Agreement or to exercise any right or remedy herein contained will not be construed as a waiver or a relinquishment for the future of such obligation, right or remedy. No waiver by either party of any provision of this Agreement will be deemed to have been made unless set forth in writing and signed by that party. 9.11 Successors. The terms, covenants, agreements, provisions, and conditions contained herein will bind and inure to the benefit of the parties hereto, their successors and permitted assigns. 9.12 Headings. The headings in this Agreement are inserted for convenience only and will not be used to define, limit or describe the scope of this Agreement or any of the obligations herein. 9.13 Construction. Whenever in this Agreement a pronoun is used, it will be construed to represent either the singular or the plural, either the mascu line or the feminine, as the case will demand. 9.14 Certain Approvals. Unless otherwise expressly stated, all approvals or consents required of either party hereunder will not be unreasonably withheld, conditioned or delayed, and will be in writing. P45 VI.b AHP Revised Draft 07.18.17 27 9.15 Binding Effect. This Agreement will inure to the benefit of, and will be binding upon, the City’s successors and assigns except as otherwise provided in this Agreement. This Agreement will inure to the benefit of, and will be binding upon, Developer’s successors an d assigns so long as the succession or assignment is permitted pursuant to the terms of this Agreement. 9.16 Cumulative Rights. Except as expressly limited by the terms of this Agreement, all rights, powers and privileges conferred hereunder will be cumulative and not restrictive of those provided at law or in equity. 9.17 References to this Agreement. All references to this Agreement will include all documents and exhibits incorporated by reference. 9.18 No Commissions. The parties covenant and agree that no brokerage commission, finder’s fee, or similar compensation is due to any third party in connection with this Agreement or will be owed upon the Closing. To the extent allowed by applicable law, the City agrees to indemnify and hold the Developer and the Project Entity harmless from and against any loss, liability, damage, cost or expense (including, without limitation, court costs and reasonable attorneys’ fees) paid or incurred by the Developer or the Project Entity by reason of any claim to any broker’s, finder’s or other fee in connection with this transaction by any party claiming by, through or under the City. The Developer agrees to indemnify and hold the City harmless from and against any loss, liability, damage or expense (including, without limitation, c ourt costs and reasonable attorneys’ fees) paid or incurred by the City by reason of any claim to any broker’s, finder’s or other fee in connection with this transaction by any party claiming by, through or under the Developer or the Project Entity. The parties’ obligations under this Section will survive Closing or any termination of this Agreement and remain fully enforceable thereafter. [remainder of page intentionally blank] P46 VI.b AHP Revised Draft 07.18.17 28 IN WITNESS WHEREOF, the parties have duly executed this Agreement by their duly authorized signatories on or as of the date first written above. CITY: City of Aspen, Colorado, a Colorado home rule municipal corporation By: ________________________________ Steven Skadron, Mayor Attest: Linda Manning, City Clerk APPROVED AS TO FORM: James R. True, Esq., City Attorney DEVELOPER: Aspen Housing Partners, LLC, a Colorado limited liability company By: ________________________________ Jason Bradshaw, Manager P47 VI.b AHP Revised Draft 07.18.17 A-1 Exhibit A Description of Sites 517 Park Circle, Aspen, Colorado: Lot 1, Re-Subdivision of Lots 1 and 2 of the WAGAR/DETWEILER SUBDIVIS ION, according to the Plat thereof recorded February 8, 2006 in Plat Book 77 at Page 41 as Reception No. 520689. COUNTY OF PITKIN, STATE OF COLORADO 802 W. Main Street, Aspen, Colorado: Lots Q, R, and S, Block 12, CITY AND TOWNSITE OF ASPEN COUNTY OF PITKIN, STATE OF COLORADO 488 Castle Creek Road, Aspen, Colorado: Lots 1 and 2, 488 CASTLE CREEK ROAD FINAL P.U.D. AND LOT SPLI T SUBDIVISION EXEMPTION according to the Plat thereof recorded September 27, 2006 in Plat Book 81 at Page 48 as Reception No. 529046. COUNTY OF PITKIN, STATE OF COLORADO P48 VI.b {A0099572 / 2 } C-1 Exhibit B Current Development Plan AHP will submit, in a phased approach, three separate land use applications for the development of 802 West Main St, 517 Park Circle and 488 Castle Creek Rd. Similarly, construction of the projects will be executed in a phased plan under three separate construction contracts. It is anticipated that the buildings will commence on 30-45 day intervals. The proposed unit mix include one and two bedroom units (71% one bedrooms / 29% two bedroom) with one parking space per bedroom at each location with the exception of Castle Creek which will have .84 parking spaces per bedroom. See table below : P49 VI.b {A0099572 / 2 } C-1 AHP, with input from City staff and APCHA, has assumed the category mix outlined in the table below. This mix was used in presentations during the public outreach process as well as the financial budgeting attached as Exhibit ___. The City of Aspen loan in each of the financing options is based on these assumptions. P50 VI.b {A0099572 / 2 } C-1 802 West Main Street Southeast perspective from corner of Main & 7th Streets Northeast perspective from approach on 7th Street P51 VI.b {A0099572 / 2 } C-1 488 Castle Creek Road View from Castle Creek Road View from Northern Approach UP P52 VI.b {A0099572 / 2 } C-1 517 Park Circle View from Park Circle View from the West P53 VI.b {A0099572 / 2 } C-1 Exhibit C Current Project Schedule P54 VI.b Today's Date 07/18/17 Timeline Start Dec-15 90 Day Periods Category Process Start Date End Date Days Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 May-19 Aug-19 Nov-19 Feb-20 Total Development Timeline 12/17/15 12/29/19 1,473 2 2 4 4 2 2 6 6 8 14 12 61 83 20 2 2 4 4 I. Pre-Development 12/17/15 08/31/18 988 1 1 2 2 1 1 3 3 2 3 2 1 0 0 0 0 0 0 RFP Response Preperation 12/17/15 03/18/16 92 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Aspen RFP Review and Approval 03/19/16 08/02/16 136 0 0 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Public Outreach Process 08/02/16 05/30/17 301 0 0 0 1 1 1 1 0 0 0 0 0 0 0 0 0 0 0 Land Use Application Preparation 05/30/17 08/14/17 76 0 0 0 0 0 0 1 1 0 0 0 0 0 0 0 0 0 0 Architectural Design/GC Review/Pricing 05/30/17 08/08/17 70 0 0 0 0 0 0 1 1 0 0 0 0 0 0 0 0 0 0 Land Use Review and Approval 07/05/17 01/02/18 181 0 0 0 0 0 0 0 1 1 1 0 0 0 0 0 0 0 0 Building Permit Preparation 10/02/17 03/31/18 180 0 0 0 0 0 0 0 0 1 1 1 0 0 0 0 0 0 0 Building Permit Review 01/03/18 08/31/18 240 0 0 0 0 0 0 0 0 0 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 II. Financing 10/01/17 08/31/18 334 0 0 0 0 0 0 0 0 2 4 4 2 0 0 0 0 0 0 Prepare/Submit App for CHFA for Bonds, 4%TCs/State LIHTC 10/01/17 01/01/18 92 0 0 0 0 0 0 0 0 1 1 0 0 0 0 0 0 0 0 CHFA 9% LIHTC or CO State LIHTC review/award 01/02/18 04/02/18 90 0 0 0 0 0 0 0 0 0 1 1 0 0 0 0 0 0 0 Prepare/Submit FHA 221(d)4 Construction to Perm Loan App 10/01/17 01/01/18 92 0 0 0 0 0 0 0 0 1 1 0 0 0 0 0 0 0 0 FHA Review 221(d)4 Application and issue Firm Commitment 01/01/18 05/01/18 120 0 0 0 0 0 0 0 0 0 1 1 0 0 0 0 0 0 0 Finalize Financing Documents and Close on Mortgage Loans 05/01/18 08/31/18 91 0 0 0 0 0 0 0 0 0 0 1 1 0 0 0 0 0 0 Underwriting - Federal and State LIHTC Equity 04/02/18 08/31/18 120 0 0 0 0 0 0 0 0 0 0 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 III. Construction/Lease-up 08/31/18 12/29/19 485 0 0 0 0 0 0 0 0 0 0 0 1 1 1 1 1 2 2 Construction- 3 Properties (PHASED)08/31/18 11/29/19 455 0 0 0 0 0 0 0 0 0 0 0 1 1 1 1 1 1 1 Lease-up of Apartment Units 08/31/19 12/29/19 120 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1P55VI.b {A0099572 / 2 } E-1 Exhibit D Current Project Budget P56 VI.b {A0099572 / 2 } E-1 Developer Pursuit Costs To Date P57 VI.b {A0099572 / 2 } E-1 9% AHTC Option P58 VI.b {A0099572 / 2 } E-1 4% + State AHTC Option P59 VI.b {A0099572 / 2 } E-1 4% AHTC Option P60 VI.b {A0099572 / 2 } E-1 Exhibit E Preliminary List of Approved Consultants Project Architect: David Johnston Architects Planning Consultant: Method Planning + Development General Contractor: Shaw Construction Landscape Architect: Connect One Design Civil Engineer: Roaring Fork Engineering Geotechnical Engineer: HP Kumar Traffic Engineer: McDowell Engineering, LLC Environmental Consultant: HP Kumar Surveyor: Peak Surveying, Inc. P61 VI.b MEMORANDUM TO: Mayor and City Council FROM: Linda Manning, City Clerk DATE of MEMO: July 18, 2017 MEETING DATE: July 24, 2017 RE: ARC Advisory Committee Appointments REQUEST OF COUNCIL: The ARC Advisory Committee would like Council approval of a new general member, Kelly Boggs and a new alternate general member, Sam Louras. BACKGROUND: The Aspen Recreation Center Advisory Committee was established by Resolution #53, Series of 2003 to assist the Council and its staff in the use, operation and maintenance of the physical plant, and the efficient operation of the programs and services offered within the ARC and the coordination with the Ice Garden. The Committee is comprised of four members from SPARC, one member appointed by the Youth Center and two members appointed by City Council. All members must be residents of Pitkin County for at least one year prior to appointment. Two members appointed by the SPARC board must be City of Aspen residents at the time of their appointment as well as during their term as a member of the Advisory Committee. The City Council appointees get further refined with one member representing the interests of the users of the swimming facilities at the ARC. The other member represents the general public interests and concerns relative to the entire ARC facilities including the ice rink, swimming facilities, youth center operations, climbing wall and other recreational amenities. ARC staff advertised the opening for several weeks at the facility as well as on the website. The only applications that were received were from Boggs and Louras. Both applicants were interviewed by the Committee. RECOMMENDED ACTION: By adopting the Consent Calendar, Council will make the following board appointments. Kelly Boggs - General Member. Sam Louras – General Member Alternate. P62 VI.c P63 VI.c Regular Meeting Aspen City Council July 10, 2017 1 SCHEDULED PUBLIC APPEARANCES –Proclamation Don Sheeley Sailing School ............................ 2 CITIZEN COMMENTS ............................................................................................................................... 2 COUNCILMEMBERS COMMENTS .......................................................................................................... 2 CONSENT CALENDAR ............................................................................................................................. 3  Resolution #102, Series of 2017 – Amendment to contract to analyze the potential use on In-Situ Reservoirs as a component of Aspen’s Integrated Water System ................................................................. 4  Resolution #99 – IGA with Pitkin County for Management of Buttermilk parking lots ...................... 4  Board Appointments ............................................................................................................................. 4  Minutes – June 26, 2017 ....................................................................................................................... 4 ORDINANCE #19, SERIES OF 2017 .......................................................................................................... 4 RESOLUTION #101, SERIES OF 2017 – Mandated Sign Code Policy Resolution ................................... 5 P64 VI.d Regular Meeting Aspen City Council July 10, 2017 2 At 5:00 p.m. Mayor Skadron called the regular meeting to order with Councilmembers Mullins, Frisch, Hauenstein and Myrin present. SCHEDULED PUBLIC APPEARANCES – Proclamation Don Sheeley Sailing School Mayor Skadron read the proclamation. Don moved here in 1970. He started the sailing classes 47 years ago at Ruedi reservoir. Don served 25 years on the Sister Cities committee, CCLC and on ACRA. He proclaimed in Don’s honor that the sailing program be known as the Don Sheeley Sailing School. Jill and Courtney accepted the Proclamation. Mayor Skadron said Don was a community asset and he is missed. CITIZEN COMMENTS 1. Ruth Harrison asked what happened to the BMC building. Steve Barwick, city manager, said it is owned by the affordable housing fund so it will be housing at some point. It will be quite a while yet. We have several other housing projects that will probably come first. She said she does not understand how a fine for a vicious dog is $50 and one for a dog off leash is $100. Jim True, city attorney, said we have a code for viscous dogs up to destroying the dog. The minimum penalty, I don’t know off hand. There are progressive penalties for vicious dogs. Ms. Harrison said the Maker and Place in the old hub, it would be fabulous if the City buys that property and makes it in to affordable space for the community to open businesses. 2. Peter Greeney said that he is supporting Mitch on the Buttermilk parking plan and opening the parking lot to RVs. 3. Toni Kronberg said she had a float in the parade asking to vote on the city hall building. She also asked about charging to park at Buttermilk. COUNCILMEMBERS COMMENTS Councilman Hauenstein said it was a very busy 4th. He has received some complaints over the chaos in one of the bars on the malls. We need to keep in mind the balance of vitality and peaceful over chaos. Councilman Myrin said the top ten list for Council is the 27th and 28th. Get your idea to us. August 2nd is a settlement conference for the dams. What is the process to select two elected officials to go to that. I want to be a part of that. Mayor Skadron said you are in opposition and there are already 10 opposers going, it makes no point sending you. I will be going and Ann will be going. Councilwoman Mullins said for consistency I think I should go again. There are already 10 people against the city position, I agree with the Mayor. Mr. True said my position has been clear that it will be difficult to have three or more members attending unless we go into executive session then it gets complicated. I don’t recall a lot of controversy around this last time. Councilman Myrin made a motion for Steve and Ann going and I will probably vote against this. I think it should be a formal process. Councilman Frisch said it is not legally required to take formal action to send two people to this. The Mayor has unwritten powers on behalf of the city council. Mr. True said you are exactly right. Mayor Skadron said Bert has made a motion to support Steve and Ann. Councilman Frisch seconded the motion. Councilman Hauenstein said regardless of what happens with the referee, if we are depending on two people reporting back on what went on, I feel comfortable with those chosen. Ann, Jim and Margaret and three to four other staff members are there. There are a lot of people bringing back the information. All in favor except Councilman Myrin. Motion carried. Councilman Frisch said he had a great trip to Morocco. It is good to be back. Mayor Skadron gave thanks to everyone who pitched in on the 4th. He gave condolences to the family of Richie Cohen. There was no more of a staunch defender of the Wheeler than Richie. P65 VI.d Regular Meeting Aspen City Council July 10, 2017 3 CONSENT CALENDAR Reso #102 – contract amendment for In-Situ reservoirs Margaret Medellin, utilities, said this is amending the existing contract with Deere and Ault for in-situ reservoirs to do some geo-technical work. Torre asked about the cost and applicability. It sounds like a great idea. He also asked about capacity. The target does not seem clear enough. Dave Hornbacher, utilities, said on capacity Headwaters will be back tomorrow to speak on that. We are working concurrently on different types of storage and the timing of the court case is driving it. Councilman Hauenstein said he is concerned that a contract of this size did not go through a bid process. He realized there are a few extenuating circumstances as to why it is not a sole source. There is a familiarity and comfort level with Deer and Ault and the charges are in line. We are in the process of determining what our storage needs are and looking at options. In the future, he would like to have a definition of the problems, needs and demands before we spend a lot on the solutions to know what the problems are. Given we are actively pursuing other sites he would like to have a competitive bid process. Councilman Frisch said for 50 some years, city hall has turned in a piece of paper to request an extension of water rights. This is the first time we have asked how much do we need. We also asked where are we going to keep it. We have nine hours of water storage if no one else moves to town. That is not prudent water management. I don’t think it is fair to say things are backwards. We are trying to tackle two really big things. That brings up carrying capacity, evaporation issues and other things. We are on the right track to say how much do we need and where are we going to store it. There are a lot of moving parts. This is not a new contract but an amendment to an existing one. The scope that is coming from the community is growing. I think it would be shortsighted not to work with the same people. The community is asking for more. I think it is really important to do this. Councilwoman Mullins stated this is a complicated problem. The need, the storage, and the supply and the risk factors we are willing to accept and the compromises we are willing to make. We need to track all three factors at the same time. This is an add to an existing contract. It is cost effective to use the same consultant. She supports what is presented. We are moving along in the correct direction. Councilman Myrin asked if we are pumping to a treatment facility. Ms. Medellin said the details are yet to be determined. This phase is just to see if the geology is appropriate. Councilman Myrin asked about the exchange concept, could we purchase water rights on the Roaring Fork. Mr. Hornbacher said we are looking at alternative transfer mechanisms with Wilderness Workshop. It is one of several options we are looking at. Councilman Myrin said he would like to know more about that. He is not convinced we have such a low number of storage hours. Maybe we don’t need the where are you going to put it. Reso #99 – Buttermilk Parking lot IGA Mitch Osur, parking, said the lot is owned by Pitkin County. Area A mass transit is free at all times as is lot D. C would be for construction staging at 40 dollars per day for four spaces. Councilman Hauenstein said the argument is that for construction vehicles that there will always be them coming in to town for the need for tools coming in to town. He would encourage seeing the pickup trucks not coming in to town. Jessica Garrow, community development, replied the CMPs address this. They do tend to carpool. There is an idea if we could do some staging at construction sites. Councilwoman Mullins said we have talked for quite a while for better utilizing the lot. How did you come up with how to use the lot and what outcome. Mr. Osur said we want to see less vehicles coming in to town. We will keep the lot flexible. The number one request we get is where can I park my RV. Now we can tell them at Buttermilk. Councilwoman Mullins asked what happens when Buttermilk opens in December. Mr. Osur replied it goes back to being managed by Buttermilk and the ski company. Councilman Hauenstein said could C get moved to the Intercept lot in December. Mr. Osur replied it would go against the agreement with CDOT. P66 VI.d Regular Meeting Aspen City Council July 10, 2017 4 Councilman Frisch said we have the Intercept lot, Buttermilk and the airport. It is great the lot has been sitting there empty and it is a good match. He said he hopes Snowmass can do something with their empty lots. Six dollars is the cheapest RV parking anywhere. He is glad we are trying things. Councilman Myrin asked if lot D can be next to A to make it easier if trail users are after work. Mr. Osur said our thought was people would want to park near the trail head if they were using the trail. Councilman Myrin asked where will the towed cars be towed. Mr. Osur replied the landfill or Shawn’s towing. Councilman Myrin said the rates are plus or minus 25 percent, do we have the ability to change it. Mr. Osur said we can do anything we want, we just need to ask the county. Councilman Myrin asked for the airport lot, who owns it. Mr. True replied he assume the county still owns it. Councilman Myrin said he would rather see it as construction staging then rental car. He also said he would support the configuration now with D against the mountain. Board Appointments – Mayor Skadron thanked Andrew Sandler and Collin Frank for joining the Board of Adjustment and Scott Kendrick and Roger Moyer for being appointed to the Historic Preservation Commission. · Resolution #102, Series of 2017 – Amendment to contract to analyze the potential use on In-Situ Reservoirs as a component of Aspen’s Integrated Water System · Resolution #99 – IGA with Pitkin County for Management of Buttermilk parking lots · Board Appointments · Minutes – June 26, 2017 Councilwoman Mullins moved to adopt the Consent Calendar; seconded by Councilman Frisch. All in favor, motion carried. ORDINANCE #19, SERIES OF 2017 – 211 W Hopkins Avenue, Amendment to Ordinance #29, Series of 2009 Councilwoman Mullins recused herself as she is a neighbor. Amy Simon, community development, stated the last 20 years the City has had conversation of post war era properties and how to preserve them. We have the Aspenmodern program now. In 2009 we were less certain. The owners of this property decided to enter into discussion and applied for a demolition permit. Ordinance 29, Series of 2009 was adopted. It granted a demolition permit and gave them 10 years to act on it. In exchange, they were required to talk to the city to try to come up with a different solution prior to demolition. That agreement is going to expire. It has been the same owners since 1956. Staff has an interest in seeing the home preserved. The owners do not want pressure. They are concerned about the deadline. They would like to allow another 10 years on the demo permit. It will still have a 90 day cooling off period to talk to the owners. If a negotiation takes place it will be under today’s code. There is a clause in the 2009 ordinance to allow Council to involuntary designate the property. That is putting pressure on the applicant. That has been struck in tonight’s version of the ordinance. Staff recommends Council adopt the amended ordinance. Mitch Haas, representing the applicant stated several children of the original owners own the property and are unsure of what they want to do with the property. In 2009 there was an application for demolition to try to preserve their rights. Now they are closer to the 10 year date and are starting to feel pressure as to what to do with the property. They are still unsure what to do and would rather leave it be and continue to use the property as is. The thought was to keep the ordinance in place. It is also in the city’s interest to keep the ordinance and permit alive. They are concerned with the possibility of the city still using the involuntary designation. The city still has the guarantee of the 90 day cooling off. It is a pretty elegant solution where the family may not be on the same page. P67 VI.d Regular Meeting Aspen City Council July 10, 2017 5 Councilman Myrin asked why are we rewriting the ordinance on the fly. Mr. Haas stated he didn’t see the packet until Friday afternoon. Mr. True replied I do see his dilemma. Councilman Myrin said the only thing this changes on the city side is this is the only house in the city excluded. I don’t see any downside. He would support this as written or as Mitch and Jim come up with. Councilman Frisch said he did watch the first reading. I appreciate the owners are trying to figure what to do. The value of the property is getting more valuable every day. The upside for the city is we might keep a pan abode. I thought we are just kicking the can down the road. We don’t give people 10 year vesting rights. Ms. Simon said we certainly could pick a different length of time. Councilman Frisch said he is just wondering if 10 years is really needed and not five. Ms. Simon said she thinks we have good incentives where multiple family members are involved. Councilman Myrin said the circumstances are so remote of Council restricting a pan abode in town versus vesting rights. Mayor Skadron said Bert, this is exactly opposite every development argument you have ever made. Councilman Myrin said if this went on the market tomorrow it would say it cannot be demolished without talking to the city for 90 days. Mayor Skadron said why not say make it five years. Councilman Myrin said he would support five but I support 10 because the possibility of us doing something like mandatory designating all of these is not going to happen. Councilman Frisch said he is having a hard time seeing why people need more than half a decade. Ms. Simon said the family has owned the property for 60 years. They are not in a rush to do something. Councilman Frisch said for the first 30 it wasn’t worth anything. Councilman Myrin said he thinks that is fair. Mr. Haas said we did not propose a number of years. We would be fine with five. Councilman Hauenstein said he does not see how this going away impacts the family. The only thing I see is the 90 day discussion with the family. I don’t like one off ordinances. I don’t see if this goes away it changes in any way. They still have the right to control their property. At this point I don’t see the need for it. Councilman Frisch said if there is nothing done I would recommend they start thinking of getting rid of the house. They are trying to argue they need some time to figure it out. If we don’t extend this the chances of the home staying are lessened. Councilman Hauenstein asked why. Councilman Frisch replied as soon as tomorrow what Bert talked about could happen. Ms. Simon said the ordinance says if they don’t demolish by 2019 the city can involuntarily designate. Mayor Skadron said the real concern is the inconsistency of the 10 year vesting with every other vesting we have granted. He would be more comfortable with five. Mr. True stated he can fix the wording changes Mitch brought up. Section 1 – amended as follows, 10 year to five years. Section 1 paragraph 2 unchanged. Section 1 paragraph 5 deleted. Section 1 paragraph 6 deleted. Mayor Skadron opened the public comment. There was none. Mayor Skadron closed the public comment. Councilman Myrin moved to adopt Ordinance #19, Series of 2017 with amendments. Seconded by Councilman Frisch. Roll call vote. Councilmembers Hauenstein, yes; Frisch, yes; Myrin, yes; Mayor Skadron, yes. Motion carried. RESOLUTION #101, SERIES OF 2017 – Mandated Sign Code Policy Resolution Councilwoman Mullins returned to the meeting. Phillip Supino, community development, stated this is to amend the sign code in response to Reed vs Town of Gilbert supreme court finding. It is only to targeted areas of the sign code. The policy resolution is step two in the three step code amendment process. Public outreach included 48 survey respondents, 132 aspen community voice visits, direct outreach to CC, C1 and SCI zones, direct outreach to stakeholder groups like CCLC, board of realtors, HPC and P&Z. P68 VI.d Regular Meeting Aspen City Council July 10, 2017 6 Content neutrality means sign regulations cannot make distinctions between uses. Distinction between a gas station sign and a restaurant sign now must be distinguished as a pole sign. If you must read the sign to determine its content it is not content neutral. What can be regulated includes size, materials, lighting, moving parts, portability, location, public property, fixed versus changeable copy, time restrictions and government copy. Previous direction from Council includes: Comply with the requirements of Reed Maintain the status quo to the extent possible Allow for non commercial speech on public property Limit the proliferation of yard signs Limit the proliferation of sandwich board signs Ensure no sign type becomes a nuisance The objectives are to achieve all the Council direction and ensure Reed compliance while maintaining the status quo. Councilman Hauenstein said he is confused on marijuana business wraps and business wraps in general. Mr. Supino said full coverage window wraps in part to comply with state marijuana separation requirements are different from window decal allowances that are presently in the code. A business can cover up to 50 percent of a window with up to 25 percent of commercial content. These amendments are an attempt to move away from blacked out coverage with some type of vinyl. Councilman Hauenstein said on banners and licensing would it need to be content neutral. Mr. True said it would be our property and the City’s statements. They would have to provide us with the banners and it becomes City speech. Councilman Hauenstein said for menu boxes, can they be limited to restaurants. Ms. Garrow said that is part of the problem. We can’t call out on uses. Councilwoman Mullins said one of the concerns last time was the proliferation of sandwich boards. Mr. Supino mentioned the ability to display with the second tier space. We can connect the regulation to that. You would see a change in the overall number of signs. It is difficult to predict the overall number in signs. Councilman Myrin said he would like to keep the historic signs. He asked about construction site signs and if they could be included in government signs as to what the building is going to look like when it is done. M.s Garrow said we are trying to work through that with the consultant. There is quite a bit required. Councilman Frisch said he would support some type of government required construction site signage in small font. We are on the right track with sandwich boards. The argument with television displays is they are not signs. We are on the right track. Councilman Myrin said he had an email about wrapping the sound barriers at construction sites. Ms. Garrow said they are an issue. She said we may be able to distinguish between ones wrapped in aspen trees calling it art versus ones wrapped in PCL which would be advertising for the company. Mayor Skadron said will the real estate signs be a consistent size. Can they be smaller. Mr. Supino said you have that power. Ms. Garrow said if you change them for real estate signs you change them for all yard signs. Mr. Supino said we may change the code for election season to allow for additional yard signs. Mayor Skadron said sandwich boards will remain the status quo, we did that because the second floor issue. Councilwoman Mullins said if we can tie them to the second tier and maintain control of them that’s good. Ms. Garrow said we can provide some options on what the sandwich boards look like. Mayor Skadron said vehicle signs for right now are the status quo. Mr. Supino said our consultant feels P69 VI.d Regular Meeting Aspen City Council July 10, 2017 7 communities don’t have the ability to distinguish between the wienermobile and John Smith construction. They can say the wienermobile can’t park down town overnight and stay for two days. Mayor Skadron opened the public comment. There was none. Mayor Skadron closed the public comment. Councilman Myrin moved to adopt Resolution #101, Series of 2017; seconded by Councilman Frisch. All in favor, motion carried. Councilman Frisch moved to adjourn at 7:30p.m.; seconded by Councilwoman Mullins. All in favor, motion carried. Linda Manning City Clerk P70 VI.d Strengthening Community Through Workforce Housing 1 POLICY MEMORANDUM TO: Mayor and City Council FROM: Mike Kosdrosky, Executive Director DATE: July 5, 2017 MEETING DATE: July 24, 2017 RE: Notice of Call-Up by APCHA Board of Directors to City Council Adopting Amendments to the Aspen/Pitkin County Guidelines On June 21, 2017, the APCHA Board of Directors approved at the Public Hearing APCHA Resolution No. 2 (Series of 2017), Adopting Amendments to Part II, Sections 5, 6 and 7, and Adding Appendix L to the Aspen/Pitkin Employee Housing Guidelines pertaining to Categories 1-7 Income Limits and Use of Area Median Income (AMI). This amendment does the following: 1. Establishes single qualification system for determining Maximum Gross Incomes for Categories 1-5 for rental and ownership inventory; 2. Establishes a methodology for determining Maximum Gross Incomes and redefining Target Household Income Levels based on Area Median Income (AMI); 3. Eliminates Categories 6 and 7 and incorporates them into Category 5; and 4. Expands rental household income categories from four (4) to five (5) categories. The Fifth Amended Intergovernmental Agreement allows the Pitkin County Board of County Commissioners (BOCC) and the City of Aspen City Council (Council) a 60-day period to call-up any policy changes approved by the APCHA Board. This memo provides notification to Council for their Regular Meeting on July 24, 2017. ISSUES · Eight categories (including RO) are more than any peer community, adding to the administrative complexity of the program. So many categories are not needed to maintain economic diversity throughout the program. · The number of categories varies depending on the program (4 for rentals, 7 for ownership, plus RO for both), which complicates converting to alternative methods for establishing income categories. · Income maximums for each Category of housing differ depending upon whether a household is applying for a rental or ownership unit. This is unique among affordable housing programs, including peer communities, which use a single standard based on household size. APCHA’s dual qualification system creates “discriminatory effect” concerns that likely violate the Fair Housing Act. P71 VII.a Strengthening Community Through Workforce Housing 2 · The current income categories were derived from a combination of five sources used in a difficult-to-replicate methodology last calculated over 15 years ago. A new system is needed, which can be easily updated for simplification, transparency, and compatibility with potential State/Federal standards, to set prices and rents that will remain affordable over time. · Current Maximum Gross Incomes are no longer representative of actual area incomes. · Prices are not determined consistently based on an adopted standard for affordability. In some Categories, rents and prices are too high, about right, or too low relative to income, yet affordability is a clear objective of the Housing Program. · APCHA’s current income-calculation method results in a program that does not consistently serve the same target income market each year (i.e. the relationship between prices and income over time is inconsistent). In some years, defined incomes target a higher income market and in some years, target a lower income market. · According to the 2016 Policy Study of APCHA’s Affordable Housing Guidelines, affordability (i.e. cost-burden) is an issue for households earning near the minimum incomes in lower income (Category 1) and lower moderate income (Category 2) categories. · Affordability for moderate and higher income categories is not an issue (Category 3 and above). The housing program may be over-subsidizing households in these categories, creating serious equity questions. BACKGROUND The March 13, 2017, APCHA Policy Memorandum to the Board addressed and explored the issues of APCHA’s current dual qualification system. Preliminary staff recommendations from that memorandum were: 1. Change the number of Categories for both the rental and ownership programs to 5 Categories plus RO; 2. Convert Category Maximum Gross Incomes to AMI target incomes for each Category; and 3. Define and adopt an Affordability Standard in the Housing Guidelines. On April 19, 2017, APCHA staff provided the Board with four detailed scenarios to consider: · Scenario 1: Keep Current Methodology (Do Nothing Option); · Scenario 2: Translate Incomes to AMI, but keep Dual Qualification System (4 Rental, 7 Ownership Categories plus RO); · Scenario 3: Port Incomes to AMI, switch to a Single Qualification System for both Rental and Ownership, and adopt five (5) Income Categories using Consultant Proposed AMI Ranges); and · Scenario 4: Port Incomes to AMI, switch to a Single Qualification System for both Rental and Ownership, and adopt five (5) Income Categories (using Staff Proposed AMI Ranges). Staff recommended adopting Scenario 4 because it most closely met the following criteria used for evaluating program changes: P72 VII.a Strengthening Community Through Workforce Housing 3 · Simplicity · Transparency · Consistency · Ease of transition · Portability · Overall Housing Goals The Board directed staff on May 3rd to move forward with First Reading and public hearings to consider Scenario 4. The Board approved Resolution No. 02 (Series of 2017), Adopting Amendments to the Aspen/Pitkin County Employee Housing Guidelines Pertaining to Categories 1-7 Income Limits and Use of Area Median Income (AMI), at a Public Hearing held June 21, 2017. DISCUSSION Because the current system cannot be directly translated into HUD AMI ranges, any transition would affect existing conditions, current and future households served, and income limits, rent, and sales prices within Categories. These tradeoffs need to be considered relative to the numerous advantages that a simpler program based on AMI would serve over the long term. As outlined in the March 13 and April 19 Policy Memorandums to the APCHA Board of Directors, APCHA’s current dual qualification system unintentionally creates a “discriminatory effect” because it sets different income limits for renters and owners and classifies household size differently (i.e. based on number of adults for renters and number of dependents for owners). To address these issues, the dual qualification system should be converted to a single qualification system based on Area Median Income (AMI) percentages per total number of persons in a household. In addition, staff also recommended that the total number of categories be standardized to five income categories, plus RO, for both renters and owners (currently, renters have four (4) income categories and owners have seven (7) income categories, plus RO for each). Because the current dual income limits cannot be converted to a single qualification system, new income limits using AMI percentages had to be calculated. In calculating the new income limits, staff’s goal was to set the Category income ranges so that the distribution of households within that category would most closely match the distribution of units in that category, relative to overall inventory. For example, given that Category 3 units make up the largest portion of total inventory, the Category 3 minimum and maximum incomes were set so that the highest portion of households with a full-time employee working within Pitkin County fall within that Category income range. To meet this goal, staff established a methodology to quantify how well the distribution of units matched the distribution of households within the different income ranges (methodology explained in full in the April 19th Policy Memorandum Appendix B: Distribution Matching Error Analysis Methodology). P73 VII.a Strengthening Community Through Workforce Housing The proposed Category Income Limits are shown in the table below. Justification for basing Income Limits on AMI Inability to update current methodology While income categories were directly tied to area incomes when established in 2003 using 1999 Median Income, that is no longer the case. APCHA’s income categories are unique, they utilize an approach that adjusts the income limits each year only by change in area incomes or housing affordability. CPI is an index that measures changes in consumer prices of goods and services. Additionally, it is a regional index that is not directly linked to changes in the local Pitkin County economy. Recreating the methodology used for the 1999 Median Income, from which all the income levels are currently derived, would be costly and time intensive. This would need to be done periodically to ensure that these incomes are reflective of changes in area incomes over time. Given the resources required to establish a Median Income using this methodology, this is not a feasible option. What is AMI? Most affordable housing programs tie income categories to the Area Median Income (AMI). AMI published annually by the Department of Housing and Urban Development (HUD) for each county and represents the median family income of an area. In contrast to APCHA’s current qualification system, HUD calculates income limits based on the number of pers calculates income limits based on number of dependents HUD uses a combination of US Census, America Community Survey (ACS), and CPI information to update incomes and adjust for family size and for areas that have unusually high or low income relationships. Annual updating is a simple process using the change in AMI, which is calculated by HUD. HUD uses the same methodology to establish AMI for all states, cou country. The following methodology was used to calculate the 2017 AMI, also referred to as Family Income (MFI) (see Using MFI Instead of MHI 1. The U.S. Census Bureau's 2010 calculating HUD's FY2017 MFIs. In areas where the margin of error is more than half of the 2014 5 ACS itself, the state non-metro estimate of median family income is used. Strengthening Community Through Workforce Housing 4 The proposed Category Income Limits are shown in the table below. Limits on AMI Inability to update current methodology to establish new income limits While income categories were directly tied to area incomes when established in 2003 using 1999 Median Income, that is no longer the case. APCHA’s income categories are unique, they utilize an approach that adjusts the income limits each year only by changes in CPI, which is not linked to changes in area incomes or housing affordability. CPI is an index that measures changes in consumer prices of goods and services. Additionally, it is a regional index that is not directly linked to changes in the local Recreating the methodology used for the 1999 Median Income, from which all the income levels are currently derived, would be costly and time intensive. This would need to be done periodically to ensure of changes in area incomes over time. Given the resources required to establish a Median Income using this methodology, this is not a feasible option. Most affordable housing programs tie income categories to the Area Median Income (AMI). AMI published annually by the Department of Housing and Urban Development (HUD) for each county and represents the median family income of an area. In contrast to APCHA’s current qualification system, HUD calculates income limits based on the number of persons per household whereas the APCHA number of dependents for ownership and number of adults HUD uses a combination of US Census, America Community Survey (ACS), and CPI information to update for family size and for areas that have unusually high or low income relationships. Annual updating is a simple process using the change in AMI, which is calculated by HUD. HUD uses the same methodology to establish AMI for all states, counties, and metropolitan areas in the country. The following methodology was used to calculate the 2017 AMI, also referred to as Using MFI Instead of MHI below): 1. The U.S. Census Bureau's 2010-2014 ACS median family income estimates are used as a basis for calculating HUD's FY2017 MFIs. In areas where the margin of error is more than half of the 2014 5 metro estimate of median family income is used. While income categories were directly tied to area incomes when established in 2003 using 1999 Median Income, that is no longer the case. APCHA’s income categories are unique, they utilize an s in CPI, which is not linked to changes in area incomes or housing affordability. CPI is an index that measures changes in consumer prices of goods and services. Additionally, it is a regional index that is not directly linked to changes in the local Recreating the methodology used for the 1999 Median Income, from which all the income levels are currently derived, would be costly and time intensive. This would need to be done periodically to ensure of changes in area incomes over time. Given the resources required to Most affordable housing programs tie income categories to the Area Median Income (AMI). AMI is published annually by the Department of Housing and Urban Development (HUD) for each county and represents the median family income of an area. In contrast to APCHA’s current qualification system, ons per household whereas the APCHA number of adults for rental. HUD uses a combination of US Census, America Community Survey (ACS), and CPI information to update for family size and for areas that have unusually high or low income-to-housing-cost relationships. Annual updating is a simple process using the change in AMI, which is calculated by HUD. nties, and metropolitan areas in the country. The following methodology was used to calculate the 2017 AMI, also referred to as Median e estimates are used as a basis for calculating HUD's FY2017 MFIs. In areas where the margin of error is more than half of the 2014 5-year P74 VII.a Strengthening Community Through Workforce Housing 2. If there is a valid 2017 1-year ACS esti year data with the 1-year data. A valid 1 of the estimate is less than one-half of the estimate. 3. Once the appropriate 2014 ACS data Budget Office forecast of the national CPI is calculated to inflate the estimate from mid 2017 (or mid FY2017). HUD publishes one AMI per county yearly, mid represents 100% AMI for a 4-person household. HUD and state agencies (e.g. Colorado Housing and Finance Authority) use a standardized methodology to create 100% AMI figures for all household sizes from the published AMI. The 2017 AMI for Pitkin County, used for the proposed income limits is $98,000. Using median incomes instead of average incomes A measure of central tendency is a as an index. Measures of central tendency are either the mean, median, or mode of a dataset, and are selected depending on the distribution of the dataset. To equitably provide services to all Pitkin County residents, income limits must be set so that they reflect the distributi Mean (average) is the best measure of central tendency for assessing the income distribution chart below, one can see that Pitkin County’s income data is skewed (i.e. not normal). Median is the best measure of central tendency for positively skewed data. The mean is not an accurate measure of central tendencies for family income distributions in Pitkin County because 76%* of family incomes are below the measure, and 24%* are median evenly split the dataset, with 50% of family incomes below and 50% of above the median. Using the mean, or the average, in this case is misleading because a few extremely wealthy households in the County (e.g. billionaire households) will substantially raise the mean income making it look like Strengthening Community Through Workforce Housing 5 year ACS estimate of median family income available, HUD replaces the 5 year data. A valid 1-year 2014 5-year ACS estimate is one where the margin of error half of the estimate. 3. Once the appropriate 2014 ACS data has been selected, an inflation factor based on the Congressional Budget Office forecast of the national CPI is calculated to inflate the estimate from mid HUD publishes one AMI per county yearly, mid-spring for the preceding year. The AMI published person household. HUD and state agencies (e.g. Colorado Housing and Finance Authority) use a standardized methodology to create 100% AMI figures for all household sizes 2017 AMI for Pitkin County, used for the proposed income limits is Using median incomes instead of average incomes central or typical value for a probability distribution, and can be used f central tendency are either the mean, median, or mode of a dataset, and are selected depending on the distribution of the dataset. To equitably provide services to all Pitkin County residents, income limits must be set so that they reflect the distribution of incomes within the county. Mean (average) is the best measure of central tendency for normally distributed data; however, assessing the income distribution chart below, one can see that Pitkin County’s income data is l). Median is the best measure of central tendency for positively skewed data. The mean is not an accurate measure of central tendencies for family income distributions in Pitkin County because 76%* of family incomes are below the measure, and 24%* are above it. Whereas, the median evenly split the dataset, with 50% of family incomes below and 50% of above the median. Using the mean, or the average, in this case is misleading because a few extremely wealthy households in the eholds) will substantially raise the mean income making it look like mate of median family income available, HUD replaces the 5- year ACS estimate is one where the margin of error has been selected, an inflation factor based on the Congressional Budget Office forecast of the national CPI is calculated to inflate the estimate from mid-2014 to April, eceding year. The AMI published person household. HUD and state agencies (e.g. Colorado Housing and Finance Authority) use a standardized methodology to create 100% AMI figures for all household sizes 2017 AMI for Pitkin County, used for the proposed income limits is or typical value for a probability distribution, and can be used f central tendency are either the mean, median, or mode of a dataset, and are selected depending on the distribution of the dataset. To equitably provide services to all Pitkin County on of incomes within the county. distributed data; however, assessing the income distribution chart below, one can see that Pitkin County’s income data is positively l). Median is the best measure of central tendency for positively skewed data. The mean is not an accurate measure of central tendencies for family income distributions in Pitkin above it. Whereas, the median evenly split the dataset, with 50% of family incomes below and 50% of above the median. Using the mean, or the average, in this case is misleading because a few extremely wealthy households in the eholds) will substantially raise the mean income making it look like P75 VII.a Strengthening Community Through Workforce Housing 6 households have higher incomes on average than they actually do. HUD’s calculations for AMI are accurate measures of central tendencies for income distributions because they are based on the median income instead of the average, or mean, income of the ACS dataset. Using the median removes the effect of outliers, both on the high and low side of the distribution, on the central measure of the distribution. Benefits of using AMI APCHA’s current income-calculation methodology results in a program that does not consistently serve the same target household income group each year. Because APCHA’s current income limits are not tied to target household incomes, the program serves a different income group depending on the year given the change in CPI. An advantage of linking income limits to HUD AMI is that the target household income group would remain consistent over time. Additional advantages of basing APCHA Category incomes on AMI include: · It is a highly reliable, trusted, and readily available data source; · It is objective and updated annually by HUD; · Reduces complexity and increases simplicity of system over time; · Increases fairness because it more consistently maintains the relative affordability of Categories over time; · Creates consistency with State (CHFA) and Federal housing programs (e.g. LIHTC Program) and multiple funding sources; · Is used by peer communities and would allow Aspen to evaluate itself against similar programs; and · Increases methodology consistency, uniformity, and transparency. It is not possible to directly translate APCHA’s current Category system into HUD AMI ranges because of the different underlying tier structure of the rental and ownership programs. However, AMI percentages can be estimated for each Category using some basic assumptions and information from the 2015 Employee Survey1. The AMI’s for households with an employee working in Pitkin County are now well documented, making it possible to convert the current incomes into AMI percentages. Using MFI instead of MHI Along with the Median Family Income (MFI), the ACS also annually publishes a Median Household Income (MHI). The 2014 and 2015 5-year ACS median household income estimates for Pitkin County are $71,060 and $71,196, respectively. Family income is the sum of the income of all family members 15 years and older living in the household. Families are groups of two or more people related by birth, marriage, or adoption and residing together; all such people are considered members of one family. Household income is the sum of the income of all people 15 years and older living in the household. A household includes related family members and all the unrelated people, if any, such as lodgers, foster children, wards, or employees who share the housing unit. A person living alone in a housing unit, or a group of unrelated people sharing a housing unit, is also counted as a household. 1 Carried out as part of the 2016 Policy Study. P76 VII.a Strengthening Community Through Workforce Housing 7 Some argue Median Household Income (MHI) might be a better index to establish the new income limits than AMI, which is based on Median Family Income (MFI), simply because it “looks” better (i.e. lower). However, AMI is the best possible index option to set the new income limits based on the following (explained further below): · HUD income tables, based on MFI, are the best-defined income limits by area available; · ACS data lags and does not account for high housing costs in an area; · Using MHI to establish income limits would add to the complexity of the program and could deter private development of affordable housing; · There is no established methodology for adjusting annually published MHI, a single data point, to households of different sizes; and · Current income limits cannot be translated into MHI percentages based on household sizes. According to a HUD specialist, as to the question of why HUD bases income limits on family income, this is not a specific requirement; however, it is rooted in Federal statute: 42 USC 1437(b). The term “family” is used throughout this section of statute; therefore, it follows that HUD would use the family income statistics to meet the definitions of “low income families,” “very low income families,” and “extremely low income families”2. The very low-income limits (usually based on 50 percent of MFI) are the basis of all other income limits, as they are the best-defined income limits and have been the subject of specific, limited legislative adjustments subsequent to reviews of the HUD calculation methodology. In addition, a number of other income limit calculations are tied by legislation or regulation to HUD’s AMI calculation. This is to create a uniform national standard for the relationship between the rent and income distributions in defining the high- and low-housing cost adjustments, and to prevent fluctuations in Low-Income Housing Tax Credit Difficult Development Area (DDA) determinations that result solely from high housing cost income limit fluctuations as areas go in and out of the 50th percentile FMR (Fair Market Rents) program.3 ACS annually publishes 5-year estimates, summarizing data from five years of annual surveys. Due to the time required to do the survey and then compile the results, ACS 5-year estimates lag by more than a year (as of July 6, 2017, the most recent ACS 5-year available was from 2015). To address the time lag in available ACS data, HUD adjusts MFI using an established methodology to account for inflation and changes in the market. Additionally, when calculating the AMI from the ACS MFI data, HUD also includes adjustments for high and low housing costs specific to a geographic region if applicable. Because HUD does not use the MHI to establish AMI or any other income limits, there are no such adjustments established for MHI. Using MHI as an index to establish income limits means the data would be dated and would not account for area specific housing costs, inhibiting APCHA’s ability to serve the same target markets year-by-year. One of the main rationales for porting to AMI based income limits is to reduce program/administrative complexity and increase transparency and fairness in how the program operates. The methodology 2 Source: US Department of Housing and Urban Development, personal communication June 19, 2017 3 Source: HUD Income Limits Briefing Material – FY17 P77 VII.a Strengthening Community Through Workforce Housing 8 proposed for the new AMI based income limits is one outlined in detail by HUD, and readily available to the public. Although not currently used for the general income limits, APCHA is required to use AMI income limits for its Low-Income Housing Tax Credit (LIHTC) properties. AMI income limits also affect private developer’s decisions to participate in development partnerships with APCHA, dictating the amount of tax credits they can receive. Continuing to base APCHA’s general income limits on a non-AMI index unnecessarily perpetuates program and administrative complexity of having to oversee properties with different income limits, and keeps a barrier to entry in place for developers who seek tax credits to build more affordable workforce housing inventory. AMI and MHI are both singular data points published annually. However, AMI can be calculated for all household sizes, whereas MHI cannot be. The AMI published represents 100% AMI for a 4-person household in a region; the published AMI is used to calculate income limits for all household sizes, using a methodology established and published by HUD. On the other hand, MHI simply represents the calculated median income for all households surveyed, with no specific reference to what household size it represents. The usefulness of MHI as a basis for income limits is further reduced by the fact that there is no established methodology for converting the singular data point to apply to households of different sizes. As part of the 2016 Consultant Policy Study of the APCHA Guidelines and Program, households containing at least one person employed in Pitkin County, APCHA’s customer base, were surveyed to draw data about their household sizes and household incomes. The survey data was then compiled and used to establish the estimated AMI percentages served by each of the APCHA Income Categories. The proposed AMI-based income limits take into account those calculations to reduce the effect of changing income limits on APCHA’s target market, especially household currently living in APCHA’s inventory. Choosing to base income limits on MHI instead of MFI (i.e. AMI) could not use the survey data because there is no available data on how APCHA’s current categories translate to MHI. Results of Establishing Income Limits Using MHI Using MHI data as an alternative to MFI (AMI) data to establish income limits would create arbitrary assumptions for both income limits and household sizes. Such a decision would be counterproductive to meeting the organizational goals of APCHA policy initiatives4, as well as fall short of the benefits of using AMI outlined above. Attachments: APCHA Resolution No. 2 (Series of 2017) 4 APCHA policy goals are aimed to decrease program and administrative complexity, increase effectiveness and efficiency, increase program transparency and predictability, increase the availability of useful, reliable data, and increase the fairness of program implementation. P78 VII.a P79VII.a P80VII.a P81VII.a P82VII.a P83VII.a P84VII.a P85VII.a P86VII.a P87VII.a 201 E. Main Street - Notice of HPC approval Staff Memo 7/24/17 Page 1 of 3 MEMORANDUM TO: Mayor and Aspen City Council FROM: Justin Barker, Senior Planner THRU: Jessica Garrow, Community Development Director RE: Notice of HPC approval of Demolition, Minor Development, Commercial Design Review, and Setback Variations for 201 E. Main Street, HPC Resolution #13, Series of 2017 MEETING DATE: July 24, 2017 BACKGROUND: On June 28, 2017, the Historic Preservation Commission approved Demolition, Minor Development, Commercial Design Review, and Setback Variations for a project at 201 E. Main Street. The existing development on the 9,000 square foot property is a vacant one-story commercial building. There are two historic masonry structures that were built in 1889 and covered in stucco around the 1940s/50s. There is also a wood structure connecting the two masonry structure. This element was added in the 1980s and does not contain historic significance. The project includes demolition of the existing wood addition between the historic masonry buildings, construction of a new infill addition, and construction of a service enclosure on the alley wall. The project also includes relocation of a historic window, reconstruction of the alley wall, new exterior lighting, a new trash enclosure and code-compliant parking area, and general landscape improvements. Drawings representing the approved project are attached as Exhibit A, with conditions of approval noted. HPC approved the project with conditions by a unanimous 6-0 vote. The approved Resolution is attached as Exhibit B. Draft minutes from the June 28 HPC meeting will be provided to Council prior to the July 24th meeting date. The main topics of discussion for this project were the roof and windows of the new construction. The application included a pitched roof mechanical enclosure on top of the new addition. HPC was Figure 1 – Existing building P88 VII.b 201 E. Main Street - Notice of HPC approval Staff Memo 7/24/17 Page 2 of 3 somewhat divided on this design, but determined that a sloped roof form was not compatible with the more rectangular forms of the historic masonry structures, and included a condition that the final mechanical screen design and height would be approved by the HPC monitor and staff. The application design also included a series of double-hung windows ganged together on both sides of the new addition. Although the double-hung windows relate to the historic windows, HPC discussed that the proposed window design was too busy and should be simplified to clearly distinguish from the historic window pattern and design. This was also added as a condition for the final configuration to be approved by the HPC monitor and staff. Aspen Street elevation – new construction in blue The historic masonry structures are in severe disrepair due to trapped moisture from the stucco. The alley wall is most affected by this and needs to be rebuilt. HPC discussed whether the new material should be brick or wood, and decided wood is better to match the other new construction for this project. The approval includes relocation of a historic window on the east wall of the north building, facing the courtyard. The original wall contained three windows, the center one has since been replaced by a door. The proposal includes relocating the south window to where the center one was originally located, and adding a new door in its place. The remaining conditions of approval included a restoration plan detailing all restoration work on the historic structure and removal of certain items identified on the drawings in Exhibit A. HPC also granted setback variations to memorialize the historic development and to accommodate the new construction in a manner that is historically appropriate. The approved setback variation locations are on the following page. Proposed window relocation P89 VII.b 201 E. Main Street - Notice of HPC approval Staff Memo 7/24/17 Page 3 of 3 Approved setback variations – historic (blue), new (orange) PROCEDURE: Pursuant to Section 26.412.040(B), City Council has the option of exercising the Call Up provisions outlined in Section 26.412.040(B) within 15 days of notification on the regular agenda. For this application, City Council may vote to Call Up the project at their July 24th meeting. If City Council does not exercise the Call Up provision, the HPC Resolution shall stand. ATTACHMENTS: Exhibit A: Approved Conceptual Design Exhibit B: HPC Resolution #13, Series of 2017 Exhibit C: Draft HPC Minutes – June 28, 2017 (to be sent prior to meeting) P90 VII.b P91VII.b P92VII.b P93VII.b P94VII.b P95VII.b Historic Preservation Commission Resolution No. 13, Series 2017 Page 1 of 3 RESOLUTION NO. 13 (SERIES OF 2017) A RESOLUTION OF THE ASPEN HISTORIC PRESERVATION COMMISSION GRANTING DEMOLITION, MINOR DEVELOPMENT, COMMERCIAL DESIGN REVIEW, AND SETBACK VARIATION APPROVALS FOR 201 E. MAIN STREET, LOTS A, B, & C, BLOCK 74, CITY AND TOWNSITE OF ASPEN, PITKIN COUNTY, COLORADO. Parcel ID: 273707328001 WHEREAS, the Community Development Department received an application from 201 E. Main Holdings, LLC (Applicant), represented by Rybak Architecture & Development, P.C. and Backen, Gillam & Kroeger Architects, for the following land use review approvals: • Demolition pursuant to Land Use Code Section 26.415, • Minor Development pursuant to Land Use Code Section 26.415, • Setback Variations pursuant to Land Use Code Section 26.415, • Commercial Design Review pursuant to Land Use Code Section 26.412; and, WHEREAS, all code citation references are to the City of Aspen Land Use Code in effect on the day of initial application, April 26, 2017, as applicable to this Project; and, WHEREAS, pursuant to Chapter 26.304.060 of the Land Use Code, the Community Development Director may combine reviews where more than one (1) development approval is being sought simultaneously; and, WHEREAS, the Aspen Community Development Department reviewed the proposed Application and recommended continuation; and, WHEREAS, the Historic Preservation Commission reviewed the Application at a duly noticed public hearing on June 28, 2017, continued from June 14, 2017, during which time the recommendations of the Community Development Director and comments from the public were requested and heard by the Historic Preservation Commission; and, WHEREAS, during a duly noticed public hearing the Historic Preservation Commission approved Resolution No. 13, Series of 2017, by a six to zero (6 - 0) vote, granting approval with the conditions listed hereinafter. NOW, THEREFORE BE IT RESOLVED BY THE HISTORIC PRESERVATION COMMISSION OF THE CITY OF ASPEN, COLORADO THAT: Section 1: Approvals Pursuant to the procedures and standards set forth in Title 26 of the Aspen Municipal Code, the Historic Preservation Commission hereby grants Demolition, Minor Development, Commercial Design Review, and Setback Variation approvals for the project as presented to HPC on June 28, 2017, with the following conditions: P96 VII.b Historic Preservation Commission Resolution No. 13, Series 2017 Page 2 of 3 1. HPC grants the following setback variations: a. West side yard setback reduced to zero (0) feet to recognize the historic development conditions and to accommodate the proposed infill development. b. South rear yard setback reduced to zero (0) feet to accommodate a new service enclosure. c. North front yard setback reduced to zero (0) feet to recognize the historic development conditions. 2. The project must include repair of all existing historic exterior materials and features, including masonry, doors, windows, and porch. A preservation plan detailing all repair and restoration work shall be submitted to staff for approval prior to building permit submittal. 3. The Applicant shall restudy the window configuration on the infill addition to simplify the design, to be approved by staff and monitor. 4. Examine the exposed masonry on the interior of the front structure to identify the exact location to re-install the historic east facing window. 5. Remove all proposed wall sconces on the historic east walls that are not above an entry. 6. All mechanical equipment shall also be set back from any street-facing façade a minimum of 15 feet. Final mechanical equipment selection shall be submitted to staff for approval prior to building permit submittal. 7. Slate, which is proposed as a roofing material on the rear lean-to, was not used historically in Aspen and is not an approved roofing material. Final selection of a wood shingle or metal roof material shall be approved by staff and monitor. 8. The proposed evergreen plants are not approved along the base of the west and north sides of the historic structures because they are uncharacteristic of the historic landscape and may introduce too much moisture along the foundation of the buildings. Any sprinklers shall be located a minimum of three (3) feet away from the walls of the historic structures. 9. The mechanical screen shall be wood siding to match the infill addition. Final height and design shall be approved by staff and monitor. 10. The reconstructed wall on the alley side of the south structure shall be wood siding to match the infill addition. Section 2: All material representations and commitments made by the Applicant pursuant to the development proposal approvals as herein awarded, whether in public hearing or documentation presented before the Community Development Department and the Historic Preservation Commission are P97 VII.b Historic Preservation Commission Resolution No. 13, Series 2017 Page 3 of 3 hereby incorporated in such plan development approvals and the same shall be complied with as if fully set forth herein, unless amended by other specific conditions or an authorized authority. Section 3: This Resolution shall not affect any existing litigation and shall not operate as an abatement of any action or proceeding now pending under or by virtue of the ordinances repealed or amended as herein provided, and the same shall be conducted and concluded under such prior ordinances. Section 4: If any section, subsection, sentence, clause, phrase, or portion of this Resolution is for any reason held invalid or unconstitutional in a court of competent jurisdiction, such portion shall be deemed a separate, distinct and independent provision and shall not affect the validity of the remaining portions thereof. FINALLY, adopted, passed and approved this 28th day of June, 2017. Approved as to form: Approved as to content: __________________________ ______________________________ Andrea Bryan, Assistant City Attorney Jeffrey Halferty, Chair Attest: _______________________________ Nicole Henning, Deputy City Clerk P98 VII.b Page 1 of 3 MEMORANDUM TO: Mayor and City Council FROM: Aspen Police Department Community Response Officers Ginna Gordon and Audrey Radlinski THRU: Assistant Chief Bill Linn DATE OF MEMO: May 9, 2017 MEETING DATE: July 24, 2017 RE: Ordinance #20, Series of 2017 - Modifications to the Dogs Section 6.08 of the City of Aspen Municipal Code to include a section prohibiting Harassing Dog behavior REQUEST OF COUNCIL: Community Response Officers request the approval of Ordinance 20, which would add a new Subsection to 6.08 of the City of Aspen Municipal Code to include a Harassing Dog violation. A citation for a harassing dog violation would have an escalating fine structure of a $50 fine for a first offense and a $100 fine for a second offense. A third offense will require a mandatory court appearance in municipal court. PREVIOUS COUNCIL ACTION: N/A BACKGROUND: Aspen Municipal Code Section 6.08.120 currently prohibits the keeping of a “vicious dog,” defined as a “dog that unprovokedly bites or attacks human beings or other animals either on public or private property or in a vicious or terrorizing manner approaches any person in apparent attitude of attack upon the streets, sidewalks or any public ground or place.” Last year, the Aspen Police Department received 24 animal bite calls for service, but only 5 of those calls warranted a citation for “Keeping of a Vicious Dog” in the responding officer’s opinion. Under the current code, officers are limited to two options when dealing with a potentially dangerous/harassing dog. The first option available is for the responding officer to issue a citation for “Keeping of a Vicious Dog;” a mandatory court summons which is appropriate for our more severe offenses. Currently the other option is to issue a “Keeping of a Vicious Dog” warning. This has its applications, but often fails to hold the dog owner accountable for the animal’s troublesome behavior. For many situations that we encounter, these options are not viable solutions or P99 IX.a Page 2 of 3 applicable to the situation at hand. The police department is requesting a more moderate citation that would apply to most calls we receive and reserve the “Keeping of a Vicious Dog” for our more severe cases. DISCUSSION: The majority of dog bites reported to our department are not vicious in nature. For example, two dogs in a scuffle over a toy, a playful pup jumping onto a stranger and causing injury, a tethered dog lunging at a passerby, or a Blue Heeler nipping at the heels of a runner. Many of these require some level of accountability. A simple warning may not do justice for the victim, but a “Keeping of a Vicious Dog” citation would be too harsh of a penalty for the circumstances. Public Safety needs a more moderate option. Pitkin County Code currently has an ordinance termed “Harassing Dogs, ” in addition to a vicious dog ordinance, Staff believes it would greatly benefit our community if we adopt an ordinance similar to Pitkin County’s. Section 6.08.120 - Keeping of a Vicious Dog would remain untouched, and a new section for Harassing Dog would be implemented to Chapter 6.08 of Municipal Code. A huge encouragement for this direction is that a similar Pitkin County ordinance has been successfully implemented throughout Pitkin County and would be easily accepted by the public. This resource is necessary for public safety officers to appropriately enforce and correct problematic behavior. For example, a harassing dog ordinance, would have applied to 75% of the Aspen Police Department’s Animal Bite calls in 2016. In that same year, only 20% of the total animal bites calls met the criteria to be cited for “Keeping of a Vicious Dog.” That means that we are lacking the legal tool to address 75% of difficult dog behavior that is encountered. The proposed ordinance is attached. FINANCIAL/BUDGET IMPACTS: This citation would have an escalating fine structure · First Offense $50 fine · Second Offense $100 fine · Third Offense is a mandatory court appearance with a negotiable fine. If the Aspen Police Department had cited half of the calls for service last year that would have fit this violation, the resulting fines would have totaled $500. Projected over 10 years, this easily could result in $5,000 in revenue. ENVIRONMENTAL IMPACTS: This ordinance will protect wildlife preventing harassment from menacing dogs. RECOMMENDED ACTION: P100 IX.a Page 3 of 3 A new section for Harassing Dog would be implemented to Chapter 6.08 of the City of Aspen Municipal Code. PROPOSED MOTION: I move to approve a new Ordinance to Section 6.08 of the City Municipal Code for Harassing Dog. CITY MANAGER COMMENTS: ATTACHMENTS: Exhibit A: Ordinance #20, Series 2017 P101 IX.a ORDINANCE NO. 20 (Series 2017) AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF ASPEN, COLORADO, AMENDING TITLE 6 OF THE MUNICIPAL CODE OF THE CITY OF ASPEN – ANIMALS AND FOWL - TO ADD A NEW SECTION 6.08.190 ENTITLED: KEEPING A HARASSING DOG PROHIBITED. WHEREAS, Aspen Municipal Code Section 6.08.120 currently prohibits the keeping of a “vicious dog,” which is defined as a “dog that unprovokedly bites or attacks human beings or other animals either on public or private property or in a vicious or terrorizing manner approaches any person in apparent attitude of attack upon the streets, sidewalks or any public ground or place,” and WHEREAS, the Aspen Police Department received numerous animal bite call for service every year, but only a small number of those cases meeting the definition of “vicious dog.” The majority of cases still involve a dog that is potentially dangerous and warrants some law enforcement action or penalty for the dog owner; and, WHEREAS, under the current code, the only options available to officers when dealing with a dangerous or harassing dog is to issue the dog owner summons to municipal court or issue the dog owner a warning. There are cases, however, that warrant an “intermediate” sanction; and, WHEREAS, the adoption of a section to the Municipal Code prohibiting harassing dogs that would allow for a penalty assessment for the first two offenses as opposed to a mandatory court appearance is necessary for Law Enforcement to appropriately enforce and correct problematic dog behavior within the City; and, WHEREAS, the City Council finds that this ordinance furthers and is necessary for the promotion of the public health, safety, and welfare. NOW THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF ASPEN, COLORADO: Section 1. That Title 6 – Animals and Fowl - of the Municipal Code of the City of Aspen, Colorado, is hereby amended by the addition of a new section 6.08.190 – Keeping a Harassing Dog Prohibited, which section shall read as follows: 6.08.190 Keeping a Harassing Dog Prohibited. No person shall own, keep, possess, or harbor a harassing dog within the City. For the purposes of this section, a harassing dog is hereby defined and declared to be any dog that exhibits an apparent attitude of attack, approaches in a menacing fashion, chases a person or another animal, or has demonstrated tendencies that would cause a reasonable person to believe that the dog may inflict injury upon any person or animal. No owner or keeper of a dog shall permit the dog to harass any other animal or person. A dog shall be deemed harassing, whether P102 IX.a 2 or not the offending dog inflicts injury. A person charged with a first or second violation of this section shall have the option of paying a handling, processing and administrative assessment therefor to a designated City agent, the City of Aspen animal safety officer or his or her authorized agents, in lieu of further proceedings in court to defend such charge as described in Section 1.04.080. If such person elects to appear in court, he shall be proceeded against as otherwise provided by law for the violations charged and shall be subject to the penalties provided for in Section 1.04.080, if found guilty of such charges. The penalty assessments for a violator of this section shall be as follows: First Offense: $50 fine Second Offense: $100 fine Third Offense: mandatory court appearance with potential penalties pursuant to Section 1.04.080. Section 2: Litigation This ordinance shall not affect any existing litigation and shall not operate as an abatement of any action or proceeding now pending under or by virtue of the ordinances repealed or amended as herein provided, and the same shall be conducted and concluded under such prior ordinances. Section 3: Severability If any section, subsection, sentence, clause, phrase, or portion of this ordinance is for any reason held invalid or unconstitutional in a court of competent jurisdiction, such portion shall be deemed a separate, distinct and independent provision and shall not affect the validity of the remaining portions thereof. The City Clerk is directed, upon the adoption of this ordinance, to record a copy of this ordinance in the office of the Pitkin County Clerk and Recorder. INTRODUCED, READ AND ORDERED PUBLISHED as provided by law, by the City Council of the City of Aspen on the 26 day of June, 2016. _______________________ Steven Skadron, Mayor ATTEST: _____________________________ Linda Manning, City Clerk P103 IX.a 3 FINALLY, adopted, passed and approved this 24 day of July, 2017. _______________________ Steven Skadron, Mayor ATTEST: _______________________ Linda Manning, City Clerk APPROVED AS TO FORM: __________________________ James R. True, City Attorney P104 IX.a