RESOLUTION 18-015 RE AGREEMENT BETWEEN HAMC AND THE CITY OF SURPRISE FOR HERITAGE AT SURPRISE .PDF

INTERGOVERNMENTAL AGREEMENT BETWEEN
HOUSING AUTHORITY OF MARICOPA COUNTY
AND
THE CITY OF SURPRISE
FOR AFFORDABLE HOUSING IN SURPRISE, ARIZONA
KNOWN AS "HERITAGE AT SURPRISE"
(C-XX-XX- )
This Intergovernmental Agreement ("Agreement") is entered into by and between the Housing
Authority of Maricopa County, a political subdivision of the State of Arizona ("HAMC"), and
the City of Surprise, an Arizona municipal corporation ("City"). HAMC and the City are
collectively referred to as the "Parties" or individually as a "Party."
STATUTORY AUTHORIZATION
1. Arizona Revised Statutes § 11-951 et seq. authorizes public agencies to enter into
Intergovernmental Agreements for the provision of services or for joint cooperative action.
BACKGROUND
2. City owns certain real property generally located within the City of Surprise bounded by
North Hollyhock Street to the east, West Rimrock Street to the north and North Nash Street to
the west, and is bounded by an unnamed alley to the south, being the western part of Maricopa
County Assessor's Parcel Number ("APN") 501-70-039A, as more particularly described on the
attached Exhibit "A", a portion of which will be leased to HAMC and is more particularly
described on the attached Exhibit "A-1" ("Property").
3. City recognizes the importance of housing that is affordable to people of all income
levels and that HAMC, in part, provides such affordable housing to people in Maricopa County,
including the City of Surprise.
4. Utilizing the Department of Housing and Urban Development ("HUD"), Rental
Assistance Demonstration ("RAD") program, HAMC and a project partner, Gorman &
Company, LLC, a Wisconsin limited liability company ("Project Partner"), desire to
cooperatively develop an affordable housing project ("Project") on the Property, such Project to
consist of 100 apartments, common rooms, common areas, and parking, as depicted on the site
plan attached as Exhibit "B" ("Site Plan").
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5. The Parties agree that the Property and the Project are to be dedicated to providing
affordable housing in perpetuity, including for the duration of the Lease. Accordingly, the
Parties also agree that City may record a deed restriction against the Property limiting use of the
Property to affordable housing in perpetuity or until such time as a super majority of the Surprise
City Council should agree to remove the restriction. The Parties further agree that the Lease will
include an express provision to this effect.
6. HAMC and GEC Heritage at Surprise, LLC, a Wisconsin limited liability company, an
affiliate of Project Partner, are the members of Heritage at Surprise MM, LLC, a Wisconsin
limited liability company, which is a member of Heritage at Surprise, LLC, a Wisconsin limited
liability company (the "Project Owner"), which will own the Project. One or more entities
affiliated with a low-income housing tax credit investor to be chosen by Project Partner (such
entities being the "Investor Members") will be admitted as members of Project Owner in
connection with the closing of financing for the Project. HAMC, as lessee, will enter into a
Ground Lease with City, as lessor, for the Property ("Lease"), to be executed prior to closing the
RAD transaction.
7. HAMC will enter into a Ground Sublease with the Project Owner for the Property
("Sublease") prior to closing the RAD transaction. HAMC and City acknowledge, that during
the term of the Sublease, Project Owner will be considered, for all purposes, the owner of all
improvements (including, but not limited to, buildings, fixtures and other real property
improvements to the Property) making up the Project.
PURPOSE OF THE AGREEMENT
8. City and HAMC desire to enter into this Agreement to set forth respective intentions for
the structure of ownership and management of the Property and the Project. City and HAMC
understand and agree that the Lease and the Sublease will provide the substantive detail with
regard to the relationship of City as "Landlord" and HAMC as "Tenant" under the Lease and the
relationship of HAMC as "Landlord" and Project Owner as "Tenant" under the Sublease.
TERMS OF THE AGREEMENT
9. Background and Purpose. Information set forth in the Background and Purpose of the
Agreement is incorporated herein by reference.
10. Obligations of the City.
A. The City will lease the Property to HAMC for the amount of ten dollars ($10.00) per
year for a period of eighty-five (85) years from the date of the RAD conversion;
which will also be the date of the closing, and the Lease and Sublease shall be eligible
for a minimum of three (3) ten (10) year extensions. The City authorizes HAMC to
sublease the Property to the Project Owner. The complete terms and conditions of the
Lease and Sublease will be subject to the mutual agreement of City, HAMC and
Project Owner.
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B. The City will comply with Lease covenants and conditions and all applicable Federal,
State, and local laws, rules, and regulations.
C. City will work in good faith with HAMC and Project Partner to meet the objective of
providing affordable housing on the Property.
D. City will not exercise control over HAMC, the Property, the Project, or the Project
Owner, but may apply and enforce Surprise Municipal Code provisions that normally
are applicable to development of real property within the City and other customary
police power ordinances and regulations, and agrees that HAMC, or a HAMC or a
Project Owner designated person or entity, will be the property manager for the
Project and that Project Owner will have sole authority and control over the
management and operation of the Project and the Property, subject to the terms of the
Lease and Sublease and the conditions of the RAD program and other funding and
agency requirements referenced in 10B above. Notwithstanding the foregoing HAMC
agrees that City will retain fee ownership of the Property.
E. City, in support of the long-term goal of establishing affordable housing in the
Surprise Heritage District, shall facilitate the use of Community Development Block
Grant ("CDBG") funds ($500,000 of HUD funding) to HAMC to improve the public
property adjacent to the Property.
11. Obligations of HAMC.
A. HAMC will, with Project Partner, develop the Property substantially in accordance
with the Site Plan and in accordance with applicable provisions of the Surprise
Municipal Code and design guidelines.
B. HAMC will comply with RAD and other lending guidelines in the operation of the
Project.
C. HAMC will work with the City to provide use by the City of certain areas of the
Project, as will be more specifically set forth in a separate agreement.
D. HAMC will comply with the terms of the Lease and Sublease.
GENERAL TERMS AND CONDITIONS
12. By entering into this Agreement, the Parties agree that to the extent permitted by law,
each Party will defend, indemnify and save the other Party harmless, including any of the
Parties' departments, agencies, officers, employees, elected official or agents, from and against
all loss, expense, damage or claim of any nature whatsoever which is caused by any activity,
condition or event arising out of the performance or nonperformance by the indemnifying Party
of any of the provisions of this Agreement. By entering into this Agreement, each Party
indemnifies the other against all liability (including but not limited to vicarious liability), losses
and damages of any nature that is occasioned by the performance or nonperformance of this
Agreement, except such injury or damage that is occasioned by the negligence of that other
Party. The damages which are the subject of the indemnity will include but not be limited to the
damages incurred by any Party, its departments, agencies, officers, employees, elected officials,
or agents. In the event of an action, the damages which are the subject of this indemnity will
include costs, expense of litigation and reasonable attorneys' fees.
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HAMC and the City of Surprise acknowledge and agree that the Parties to this Agreement are
each self-insured.
13. The Parties will comply with Executive Order 75-5, as amended by Executive Order
2009-09, which mandates that all persons, regardless of race, color, religion, sex, age, national
origin or political affiliation, will have equal access to employment opportunities, and all other
applicable State and Federal employment laws, rules and regulations, including the Americans
with Disabilities Act. The Parties will take affirmative action to ensure that applicants for
employment related to development of the Project and management and operation of the Project
and employees are not discriminated against due to race, creed, color, religion, sex, gender
identification, national origin or disability.
14. The Parties will comply with A.R.S. § 23-214, which requires verification of employment
eligibility through the e-verify program, provides economic development incentives for those
that comply, and requires a list to be provided quarterly to the United States SOS listing those
employers who have adhered to the requirements.
15. This document is the complete and exclusive statement of understanding between the
Parties, and it supersedes all proposals, oral or written, and all other documents or
communications between the parties relative to the subject matter herein covered, unless such
documents or communications are specifically included by reference.
16. The laws of the State of Arizona will govern the construction and interpretation of this
Agreement, and the venue for any arbitration or claim arising out of or in any way related to this
Agreement will be Maricopa County, Arizona. Upon the occurrence of a default under this
Agreement, the non-defaulting party may seek any right or remedy allowed at law or in equity or
by statute or otherwise (except as provided below) for such breach, including, but not limited to
seeking specific performance, all of which shall be construed and held to be cumulative and non-
exclusive; provided, however, the non-defaulting party shall not seek, and hereby waives any
right to, damages from the defaulting party for loss of profits, loss of sub-rents, loss of any other
revenue, loss of business opportunity, loss of good will, or loss due to business interference. The
parties further agree that their recourse for any damages shall be limited to collection from the
defaulting party's interest in the Property and not from any other assets of the defaulting party.
17. This Agreement is subject to the provisions of A.R.S. § 38-511 relating to conflicts of
interest.
18. This Agreement is subject to the provisions of A.R.S. § 12-1518 relating to the use of
arbitration.
19. Any amendments to this Agreement will be in writing and signed by both Parties to the
Agreement.
20. This Agreement will become effective on the date that it has been approved and fully
executed by the Mayor and City Council for the City of Surprise and the HAMC Board of
Commissioners and will remain in full force and effect until all stipulations previously indicated
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have been satisfied except that it may be amended upon written agreement of the Parties. The
initial term of this Agreement will be eighty-five (85) years from the effective date and may be
extended for a minimum of three (3) ten (10) year extensions upon written agreement of the
Parties.
21. The Parties warrant that they are in compliance with A.R.S. Section 41-4401 and further
acknowledge that:
21.1 Any contractor or subcontractor who is contracted by a Party to perform work on
the subject of this Agreement will warrant their compliance with all federal immigration laws
and regulations that relate to their employees and their compliance with the E-Verify program
under A.R.S. Section 23-214(A), and will keep a record of the verification for the duration of the
employee's employment or at least three (3) years, whichever is longer.
21.2 Any breach of the warranty will be deemed a material breach of this Agreement,
and is subject to penalties up to and including termination of the contract.
21.3 The Parties retain the legal right to inspect the papers of any contractor or
subcontractor employee who works on the Project to ensure that the contractor or subcontractor
is complying with the warranty above and to require that the contractor make all papers and
employment records of any employee available during normal working hours in order to
facilitate such an inspection.
21.4 Nothing in this Agreement will make any contractor or subcontractor an agent or
employee of the Parties to this Agreement.
22. All notices required under this agreement to be given in writing will be sent to:
City of Surprise
16000 North Civic Center Plaza
Surprise, Arizona 85374
Facsimile:
Attn: City Manager
With copy to: Surprise City Attorney's Office
16000 North Civic Center Plaza
Surprise, Arizona 85374
Facsimile:
Housing Authority of Maricopa County
8910 North 78 th Avenue
Peoria, Arizona 85342
Attn: Executive Director
With copy to: Maricopa County Attorney's Office
301 East Jefferson Street
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Phoenix, Arizona 85003
23. This Agreement does not create a duty or responsibility unless the intention to do so is
clearly and unambiguously stated in the Agreement.
24. Sections and other headings contained in this Agreement are for reference purposes only
and will not affect in any way the meaning or interpretation of this Agreement.
25. This Agreement may be executed in two (2) or more counterparts, each of which will be
deemed an original but all of which together will constitute the same instrument. Faxed, copied
and scanned signatures are acceptable as original signatures.
26. The Parties agree that each Party retains ownership of its data. Neither Party may
release, store, save, disseminate or otherwise use data that has been shared by the other Party,
unless previously consented to in writing by the other Party. Notwithstanding any other
provision of this Agreement to the contrary, the Parties acknowledge that they are subject to
A.R.S. 39-121 through 39-128 regarding public records. Any provision regarding confidentiality
is limited to the extent necessary to comply with the provisions of Arizona law.
27. The Parties agree that each Party is responsible for safely maintaining the integrity and
confidentiality of the other Party's data received or under its control as a result of the Agreement.
Each Party will immediately notify the other Party upon discovery of a breach of the data, and
will work cooperatively with the other Party to terminate, minimize, and resolve the breach.
28. Notwithstanding any other provision of this Agreement to the contrary, the Parties
acknowledge that they are subject to A.R.S. 39-121 through 39-128 regarding public records.
Any provision regarding confidentiality is limited to the extent necessary to comply with the
provisions of Arizona law.
29. City acknowledges that this Agreement imposes no contractual obligation upon
Maricopa County; and that in the event of a default under this Agreement, of any kind
whatsoever, City will look solely to HAMC or HAMC related parties to the transactions
contemplated in this Agreement, the Lease and Sublease, for remedy or relief; and that
neither Maricopa County nor any Supervisor, elected official, officer, agent or employee of
Maricopa County will be liable to City, or any successor in interest to City in any way.
30. HAMC acknowledges that, in the event of a default under this Agreement of any
kind whatsoever, HAMC will look solely to the City for remedy or relief, and that no
elected or appointed official, officer, agent, or employee of the City will be liable to
HAMC, or any successor in interest to HAMC in any way.
Remainder of page intentionally blank
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IN WITNESS WHEREOF, the Parties have executed this Agreement at their respective
Arizona offices.
APPROVED BY:
HOUSING AUTHORITY OF
MARICOPA COUNTY
Chairman, Board of Commissioners
Date:
Attested To:
Clerk of the Board
IN ACCORDANCE WITH A.R.S. §§ 11-952, 11-201, AND 11-251, THIS AGREEMENT
HAS BEEN REVIEWED BY THE UNDERSIGNED ATTORNEYS WHO HAVE
DETERMINED THAT THIS AGREEMENT IS PROPER IN FORM AND WITHIN THE
POWERS AND AUTHORITY GRANTED UNDER THE LAWS OF THE STATE OF
ARIZONA.
APPROVED AS TO FORM:
By:
Deputy County Attorney
Date:
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IN WITNESS WHEREOF, the Parties have executed this Agreement at their respective Arizona
offices.
APPROVED BY:
CITY OF SURPRISE
___________________________________
Mayor
Date: __________________________
APPROVED AS TO FORM:
By: ______________________________
City Attorney
Date: __________________________
Attested To:
____________________________
City Clerk
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EXHIBIT A
APN DESCRIPTION
SEE ATTACHED
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EXHIBIT A
INTERGOVERNMENTAL AGREEMENT BETWEEN
HOUSING AUTHORITY OF MARICOPA COUNTY AND
THE CITY OF SURPRISE
Legal Description of Maricopa County Assessor’s Parcel Number 501-70-039A
A PORTION OF THE SOUTHEAST QUARTER OF SECTION 2, TOWNSHIP 3 NORTH,
RANGE 1 WEST OF THE GILA AND SALT RIVER BASE AND MERIDIAN, MARICOPA
COUNTY, ARIZONA. BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS:
COMMENCING AT THE CENTER QUARTER CORNER OF SECTION 2, TOWNSHIP 3
NORTH, RANGE 1 WEST MARKED BY A 3 INCH BRASS CAP FLUSH, FROM WHICH
THE SOUTH QUARTER CORNER OF SAID SECTION 2 BEING MARKED BY A 2 INCH
BRASS CAP FLUSH, BEARS SOUTH 00 DEGREES 00 MINUTES 50 SECONDS EAST
2659.98 FEET; THENCE SOUTH 00 DEGREES 00 MINUTES 50 SECONDS EAST 695
FEET ALONG THE WEST LINE OF THE SOUTHEAST QUARTER OF SAID SECTION 2;
THENCE SOUTH 89 DEGREES 31 MINUTES 53 SECONDS EAST 30 FEET TO A POINT
ON THE EAST RIGHT OF WAY LINE OF NASH STREET, BEING MARKED BY A ONE-
HALF INCH CAPPED REBAR STAMPED 42137 AND THE POINT OF BEGINNING;
THENCE CONTINUING SOUTH 89 DEGREES 31 MINUTES 53 SECONDS EAST 474.23
FEET ALONG THE SOUTH RIGHT OF WAY LINE OF RIMROCK STREET; THENCE
SOUTH 00 DEGREES 05 MINUTES 53 SECONDS EAST 276.42 FEET; THENCE NORTH
89 DEGREES 32 MINUTES 23 SECONDS WEST 474.63 FEET TO THE EAST RIGHT OF
WAY LINE OF SAID NASH STREET; THENCE NORTH 00 DEGREES 00 MINUTES 50
SECONDS WEST 276.49 FEET ALONG SAID EAST RIGHT OF WAY LINE TO THE
POINT OF BEGINNING.
AND
A PORTION OF THE SOUTHEAST QUARTER OF SECTION 2, TOWNSHIP 3 NORTH,
RANGE 1 WEST OF THE GILA AND SALT RIVER BASE AND MERIDIAN, MARICOPA
COUNTY, ARIZONA. BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS:
COMMENCING AT THE CENTER QUARTER CORNER OF SECTION 2, TOWNSHIP 3
NORTH, RANGE 1 WEST MARKED BY A 3 INCH BRASS CAP FLUSH, FROM WHICH
THE SOUTH QUARTER CORNER OF SAID SECTION 2 BEING MARKED BY A 2 INCH
BRASS CAP FLUSH, BEARS SOUTH 00 DEGREES 00 MINUTES 50 SECONDS EAST
2659.98 FEET; THENCE SOUTH 00 DEGREES 00 MINUTES 50 SECONDS EAST ALONG

THE WEST LINE OF THE SOUTHEAST QUARTER OF SAID SECTION 2, 695.00 FEET;
THENCE SOUTH 89 DEGREES 31 MINUTES 53 SECONDS EAST 30 FEET TO A POINT
ON THE EAST RIGHT OF WAY LINE OF NASH STREET, BEING MARKED BY A ONE-
HALF INCH CAPPED REBAR STAMPED 42137; THENCE CONTINUING SOUTH 89
DEGREES 31 MINUTES 53 SECONDS EAST 474.23 FEET ALONG THE SOUTH RIGHT
OF WAY LINE OF RIMROCK STREET TO THE POINT OF BEGINNING; THENCE
CONTINUING SOUTH 89 DEGREES 31 MINUTES 53 SECONDS EAST 154.19 FEET
ALONG SAID RIGHT OF WAY LINE TO A ONE-HALF INCH CAPPED REBAR
STAMPED 42137 AND THE WEST RIGHT OF WAY LINE OF HOLLYHOCK STREET;
THENCE SOUTH 00 DEGREES 00 MINUTES 08 SECONDS WEST 302.40 FEET ALONG
SAID WEST RIGHT OF WAY LINE TO A ONE-HALF INCH CAPPED REBAR STAMPED
42137; THENCE NORTH 89 DEGREES 32 MINUTES 23 SECONDS WEST 329.07 FEET TO
A ONE-HALF INCH CAPPED REBAR STAMPED 31020; THENCE CONTINUING NORTH
89 DEGREES 32 MINUTES 23 SECONDS WEST 299.25 FEET TO A POINT ON THE EAST
RIGHT OF WAY LINE OF SAID NASH STREET BEING MARKED BY A ONE-HALF
INCH CAPPED REBAR STAMPED CMX RLS 19344; THENCE NORTH 00 DEGREES 00
MINUTES 50 SECONDS WEST 26.00 FEET; THENCE SOUTH 89 DEGREES 32 MINUTES
23 SECONDS EAST 474.63 FEET; THENCE NORTH 00 DEGREES 05 MINUTES 53
SECONDS WEST 276.42 FEET TO THE POINT OF BEGINNING.

EXHIBIT A-1
PROPERTY DESCRIPTION
SEE ATTACHED
11

EXHIBIT A
LEGAL DESCRIPTION
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE COUNTY OF MARICOPA, STATE OF
ARIZONA, AND IS DESCRIBED AS FOLLOWS:
A portion of the Southeast quarter of Section 2, Township 3 North, Range 1 West of the Gila and Salt River Base and
Meridian, Maricopa County, Arizona, being more particularly described as follows;
Commencing at the Center quarter corner of Section 2, Township 3 North, Range I East marked by a 3 inch brass
cap flush, from which the South quarter corner of said Section 2 being marked by a 2 inch brass cap flush, bears
South 00 degrees 00 minutes 50 seconds East 2659.98 feet;
THENCE South 00 degrees 00 minutes 50 seconds East 695 feet along the West line of the Southeast quarter
of said Section 2;
THENCE South 89 degrees 31 minutes 53 seconds East 30 feet to a point on the East right of way line of Nash Street,
being marked by a one-half inch capped rebar stamped 42137 and the POINT OF BEGINNING;
THENCE continuing South 89 degrees 31 minutes 53 seconds East 474.23 feet along the South right of way line of
Rimrock Street;
THENCE South 00 degrees 05 minutes 53 seconds East 276.42 feet;
THENCE North 89 degrees 32 minutes 23 seconds West 474.63 feet to the East right of way line of said Nash Street;
THENCE North 00 degrees 00 minutes 50 seconds West 276.49 feet along said East right of way line to the POINT OF
BEGINNING.

EXHIBIT B
SITE PLAN
SEE ATTACHED
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