sdc exemptions for regulated affordable housing guideline · sdc exemption for regulated affordable...

City of Tigard

SYSTEMS DEVELOPMENT CHARGE (SDC) EXEMPTIONS FOR REGULATED AFFORDABLE HOUSING GUIDELINE

City of Tigard 13125 SW Hall Blvd. Tigard, Oregon 97223 www.tigard-or.gov SDC Exemption Guideline of 3

OVERVIEW

Tigard Municipal Code 3.24.100.D. allows for exemption of city transportation and park Systems Development Charges (SDCs) for regulated affordable housing.

The Regulated Affordable Housing SDC Exemption Program is managed jointly by the Community Development Department and Finance and Information Services Department. The program allows for the exemption of only city transportation and park SDCs for regulated affordable housing units located within the City of Tigard. Other SDCs for water, sanitary sewer, and stormwater systems are NOT exempt under this program.

Regulated affordable housing is defined in Tigard Municipal Code 3.24.030 as housing that is made affordable through public subsidies or statutory regulations that restrict or limit resident income levels or rents and satisfy the conditions below.

To be considered regulated affordable housing, units must:

1. Have a local, state, or federal compliance agreement or contract;

2. Be affordable to households at or below 80% median family income as defined annually by Housing and Urban Development (HUD) for the Portland-Vancouver Metropolitan Statistical Area (MSA); and

3. Remain regulated affordable housing units for a minimum of 20 years from the date of occupancy.

ELIGIBILITY REQUIREMENTS

To be eligible for the Regulated Affordable Housing SDC Exemption Program, the proposed development must:

• Meet regulated affordable housing definition and considerations as stated in Tigard Municipal Code 3.24.030.

• Be located within the City of Tigard.

• Provide a copy of the compliance agreement or contract with the local, state or federal entity(ies) that, at minimum, specifies the number of units that will be affordable for at least 20 years and how the entity(ies) will monitor compliance.

• Submit an Application for Systems Development Charge (SDC) Exemption.

APPLICATION REQUIREMENTS

To apply for the exemption, applicants must do the following:

• Submit a completed application to the SDC Administrator. Applicants are responsible for requesting the most current application. Contact the SDC Administrator at 503-718-2460 or [email protected] to obtain a copy of the current application. Attachment 1 has sample exemption application.

http://www.tigard-or.gov/

mailto:[email protected]


• Application must be complete in order for it to be reviewed. A separate application should be submitted for each building permit. The application should be accompanied by the following documentation:

1. A copy of the compliance agreement or contract with the local, state or federal entity(ies).

2. A legal property description.

3. Proof of ownership of the property or agency to act for owner.

4. The estimated SDC costs from a City of Tigard Permit Coordinator (for multi-family housing).

5. Plat Map.

6. Additional pages to complete descriptions from the application, if necessary.

• It is the responsibility of the applicant to ensure that the application for the SDC exemption is submitted and approved before the payment of all SDCs are due to the City. SDCs are calculated and due and payable pursuant to Tigard Municipal Code 3.24.080. In accordance with TMC 3.24.080.B, the City may not issue a building permit or allow connection to the City’s systems until either all SDCs have been paid in full or an exemption has been granted. It is the applicant’s sole responsibility to ensure an exemption application is submitted to the City in a timely manner in order to meet the timelines in TMC 3.24.080.

• Submit completed application with required documentation to the SDC Administrator for review and approval.

CITY PROCESS

Compliance Agreement, Declaration of Restrictive Covenants and Equitable Servitude for Recording

Once application is approved, the City will provide property owner with a Compliance Agreement, Declaration of Restrictive Covenants and Equitable Servitude that will include the amount of the SDC exemption(s). This document must be executed by both parties. The applicant must record this document with Washington County prior to the City’s issuance of a Certificate of Occupancy. Attachment 2 has sample compliance agreement.

Denial Letter

If the application is not approved, the applicant will receive a denial letter with an explanation of why the application was denied. The denial letter will also list any remedies that the applicant can take to allow the application to be resubmitted for another review. Disqualifying Event

Should circumstances happen before the minimum 20 years occupancy that cause the units to no longer be defined as regulated affordable housing, the SDC Exemption will automatically be revoked, and the exempted SDCs will be immediately due and payable, plus interest. Interest will be charged from the date of occupancy to the payment date at the rate stated in the city’s master fees and charges. If no rate is set, then the interest on the exempted amount will default to prime rate as published by the Wall Street Journal at the date of occupancy plus four percent. The City of Tigard will not accept any new SDC



exemption applications from the applicant until all repayments for a revoked exemption have been made in full. Compliance

The City of Tigard reserves the right to request copies of compliance or monitoring reports done by funder(s) or auditor(s) that show the applicant continues to comply with the 20-year occupancy requirement for regulated affordable housing.


City of Tigard • 13125 SW Hall Blvd. • Tigard, Oregon 97223 • www.tigard-or.gov • SDC Exemption Application • Page 1 of 2

City of Tigard

Systems Development Charge (SDC) Exemption Application

REQUEST FOR REGULATED AFFORDABLE HOUSING SDC EXEMPTION

(New Construction – Rental and For Sale. Allowed under TMC 3.24.100.D) Note: Refer to the Systems Development Charge (SDC) Exemptions for Regulated Affordable Housing Guideline for eligibility requirements before completing application. City Transportation and Park SDCs exemption only.

PROPERTY INFORMATION REQUIRED SUBMITTAL

Name of Property Owner: ELEMENTS

☐ Compliance Agreement or Contract

☐ Legal Property Description

☐ Proof of Ownership /

Authorized Representative

☐ Plat Map

☐ Estimated SDC Costs Worksheet

☐ Application

Property address/location(s):

Tax map and tax lot #(s):

Name of project/Development:

Anticipated construction end date:

FOR STAFF USE ONLY

Unit Type Total Units Units to Receive Exemption Application accepted:

Single Family Detached By:

Single Family Attached Date:

Apartment/Condominium Application review completed:

By:

APPLICANT INFORMATION Date:

Entity Type (check all that apply):

☐ Limited Liability Company ☐ Corporation Comments:

☐ Limited Partnership ☐ Individual

☐ Other (specify): Rev. 11/15/2018

Name(s) (Entity or Individual) as appears on title of property:

Address:

Signatory(s) (authorized to sign on behalf of entity/individual):

Title with Entity (e.g., Member, President;

Individual, if not owned by entity):

Phone: Email:

Project Contact if other than Applicant:

Contact Phone: Contact Email:

ATTACHMENT 1

City of Tigard • 13125 SW Hall Blvd. • Tigard, Oregon 97223 • www.tigard-or.gov • SDC Exemption Application • Page 2 of 2

THE APPLICANT(S) ACKNOWLEDGE(S) AND AGREE(S) THAT:

1. I (We) understand that by accepting this application and documents for an SDC exemption, the City is in no way committing actual funding or exemptions for my project. Commitment of an exemption will only be made after all documentation is received and city staff have reviewed and approved my request.

2. In the event the property for which an exemption is granted ceases to be utilized for regulated affordable housing before the minimum 20-year occupancy requirement, the owner of the property will be required to pay to the city the amount of the exempted systems development charges, plus interest.

3. If the application is approved, the applicant must record the executed Compliance Agreement, Declaration of Restrictive Covenants and Equitable Servitude with Washington County prior to the City’s issuance of a Certificate of Occupancy.

4. All statements made in this application are true and accurate and are made for the purpose of obtaining the exemption indicated herein.

5. Verification of any information contained in this application may be made at any time by the City of Tigard and the original copy of this application will be retained by the City.

6. The City, its agents, successors and assigns will rely on the information contained in this application and the information I/We have represented herein; if any information should change prior to obtaining a certificate of occupancy, I (We) will notify the City.

THE APPLICANT(S) SHALL CERTIFY THAT:

I (We) certify that the information provided in this application is true and correct as of the date set forth opposite my (our) signature(s) on this application.

SIGNATURE of owners(s) or authorized representative(s) required

Applicant or Authorized Representative Signature Print Name Date



APPLICANTS

To consider an application complete, you will need to submit ALL of the REQUIRED SUBMITTAL ELEMENTS as described on the front of this application in the “Required Submittal Elements” box. It is the responsibility of the applicant to ensure that the application for the SDC exemption is submitted and approved before the payment of all SDCs are due to the City. SDCs are calculated and due and payable pursuant to Tigard Municipal Code 3.24.080. In accordance with TMC 3.24.080.B, the City may not issue a building permit or allow connection to the City’s systems until either all SDCs have been paid in full or an exemption has been granted. It is the applicant’s sole responsibility to ensure an exemption application is submitted to the City in a timely manner in order to meet the timelines in TMC 3.24.080. SUBMIT COMPLETED APPLICATION TO: SDC Administrator, Finance and Information Services, City of Tigard, 13125 SW Hall Blvd., Tigard, OR 97223. If dropping the application off in person, drop off at the Utility Billing (UB) front counter located within Tigard City Hall. Questions can be directed to the SDC Administrator at [email protected] or 503-718-2460.

SDC EXEMPTION FOR REGULATED AFFORDABLE HOUSING AGREEMENT

[PROJECT NAME]

Page 1 of 7

RETURN TO: City of Tigard Finance and Information Services 13125 SW Hall Blvd. Tigard, OR 97223 Attn: SDC Administrator

SPACE ABOVE FOR RECORDER’S USE

CITY OF TIGARD

COMPLIANCE AGREEMENT, DECLARATION OF RESTRICTIVE COVENANTS

AND EQUITABLE SERVITUDE

SDC EXEMPTION FOR REGULATED AFFORDABLE HOUSING THIS COMPLIANCE AGREEMENT, DECLARATION OF RESTRICTIVE COVENANTS AND EQUITABLE SERVITUDE (the “Agreement”) is made and entered into this ______ day of ________________, __________, by and between [NAME OF GRANTOR] (the “Grantor”) and the City of Tigard (the “City”).

PURPOSE The City desires to exempt the regulated affordable housing project known as [NAME], or a portion thereof, (the “Project”), located at [STREET ADDRESS(ES)] Tigard, Oregon, from payment of City of Tigard parks and transportation system development charges (“SDCs”) pursuant to Tigard Municipal Code. The legal property description of said Project is set forth in Exhibit A, which also is attached hereto and incorporated herein by reference. The SDCs exempted for eligible Project units are shown on Exhibit B.

Grantor desires to receive the exemption, to satisfy the conditions thereof, and to execute and record this Agreement for the purpose, in part, of creating restrictive covenants and an equitable servitude that shall run with the Project land and bind any and all subsequent owners of the Project for the term of this Agreement.

AGREEMENT

SECTION 1. REPRESENTATIONS, COVENANTS AND WARRANTIES OF THE GRANTOR

CONCERNING USE OF THE PROJECT AS REGULATED AFFORDABLE HOUSING. Grantor hereby represents, covenants, warrants and agrees that: a. Grantor will maintain the Project or a portion thereof as regulated affordable housing, as defined in Tigard

Municipal Code 3.24 (adopted March 6, 2018), for a period of 20 years (the “Exemption Period”) from the date of issuance of occupancy permits or final inspection approval is granted by City (“Exemption Date”).

b. Grantor will comply, and will cause its agents, employees, contractors, subgrantees and assigns, if any, to comply

with the terms and conditions of this Agreement and all otherwise applicable laws (including, without limitation, all applicable federal, state and local statutes, rules, regulations, ordinances and orders affecting the Project or activities related thereto).

ATTACHMENT 2


[PROJECT NAME]

Page 2 of 7

SECTION 2. COVENANTS TO RUN WITH THE LAND; EQUITABLE SERVITUDE. The

Grantor represents, covenants, warrants and agrees that:

a. The City is granting the exemption to the Grantor as an inducement to the Grantor to develop and operate the Project in accordance with the terms of this Agreement. In consideration of the receipt of the exemption, the Grantor has entered into this Agreement with the City and has agreed to restrict the use of the Project during the Exemption Period as set forth in this Agreement.

b. The representations, covenants, restrictions, granted by Grantor therein with respect to the Project shall be

deemed restrictive covenants running with the Project land and also shall be deemed an equitable servitude running with the Project land in favor of and enforceable by City. These restrictive covenants and equitable servitude shall pass to and be binding upon the Grantor’s successors in title including any purchaser, grantee or lessee of any portion of the Project, shall pass to and be binding upon the respective heirs, executors, administrators, devisees, successors and assigns of the Grantor or any purchaser, grantee or lessee of any portion of the Project and shall pass to and be binding upon any other person or entity having any right, title or interest in the Project. Each and every contract, deed or other instrument hereafter executed covering or conveying the Project or any portion thereof or interest therein shall contain an express provision making such conveyance subject to the covenants, restrictions, and charges contained herein; provided, however, that any such contract, deed or instrument shall conclusively be held to have been executed, delivered and accepted subject to such covenants, restrictions and charges regardless of whether or not such covenants, restrictions and charges are set forth or incorporated by reference in such contract, deed or instrument.

SECTION 3. BURDEN AND BENEFIT. The parties hereby declare their understanding and intent

that the burdens of the covenants, restrictions, and charges set forth herein touch and concern the Project land and that the Grantor’s legal interest in the Project may be rendered less valuable thereby. The parties further declare their understanding and intent that the benefits of such covenants, restrictions, and charges touch and concern the Project land by enhancing and increasing the enjoyment and use of the owners and tenants of the development, the intended beneficiaries of such covenants, restrictions, and charges and by furthering the public purposes for which the exemption is granted.

SECTION 4. COMPLIANCE REPORTING. The Parties hereby agree that Grantor, if requested by

the City, will provide certification, in a format approved by the City in its sole discretion, that the Grantor is fulfilling its obligations under this Agreement. The City may inspect the Project, and any part thereof, and may inspect and copy all records of the Project, upon reasonable notice to the Grantor. The Grantor, its agents, employees, and subcontractors will cooperate fully with the City in any requested inspection or compliance monitoring. SECTION 5. TERM OF AGREEMENT. The parties agree that this Agreement and the restrictive covenants and equitable servitude created hereunder shall become effective upon execution of this Agreement and shall remain in full force and effect for a 20-year Exemption Period. Notwithstanding any other provision of this Agreement, this Agreement shall terminate and be of no further force and effect in the event of a completed foreclosure by the primary financing lender or by a lender to whom the City has subordinated this Agreement, or their successors or assigns, or in the event of a delivery by the Grantor of a deed for the Project to the primary financing lender in lieu of foreclosure, or to a lender to whom the City has subordinated this Agreement, or their successors or assigns. SECTION 6. TERMINATION. The City may terminate this Agreement, without further liability, upon 30 days’ notice and opportunity to cure. Notwithstanding termination, City may pursue any remedy provided for in Section 7. If the Grantor fails to perform or breaches any of the terms of this Agreement; or immediately and without notice and opportunity to cure if the City loses the authority to grant the exemption, is determined by its counsel or otherwise as lacking the authority to administer the exemption, or fails to receive or loses necessary funding,


[PROJECT NAME]

Page 3 of 7

appropriations, limitations or other expenditure or position authority sufficient to carry out the terms of this Agreement. SECTION 7. REMEDIES. If the Grantor defaults in the performance or observance of any covenant, agreement, or obligation set forth in this Agreement and if such default remains uncured for a period of 30 days after the notice thereof shall have been given by the City to the Grantor, then the City, at its option, may take any one or more of the following steps: a. Have access to and inspect, examine and make copies of all of the books and records of the Grantor pertaining

to the Project; b. Terminate the exemption of the Project or a portion thereof, in which case the SDC’s exempted herein shall

be immediately due and payable to City in the amounts shown on Exhibit B, along with interest accruing from the Exemption Date. City may, in addition to an action to collect SDC’s due, withhold issuance of building or development permits until paid in full;

c. Take such other action under this Agreement, at law or in equity as may appear necessary or desirable to the

City to enforce the covenants, agreements, warranties, and obligations of the Grantor hereunder.

No waiver or delay in enforcing the provisions hereof as to any breach or violation shall impair, damage or waive the right of any person entitled to enforce the same to obtain relief against or recover for the continuation or repetition of such breach or violation or any similar breach or violation thereof at any later time or times.

SECTION 8. RECORDING AND FILING. The Grantor shall cause this Agreement and all

amendments and supplements hereto to be recorded and filed in the real property records of Washington County and in such other places as the City may reasonably request. The Grantor shall pay all fees and charges incurred in connection with any recording. The Grantor shall provide either the original recorded document or a certified copy of the recorded document within ten days of the date of this Agreement.

SECTION 9. GOVERNING LAW; VENUE. This Agreement shall be governed by the laws of the State of Oregon. The courts of the State of Oregon, or to the degree necessary, the U.S. District Court for the District of Oregon shall have exclusive jurisdiction over any action brought by or against the City under this Agreement. The Grantor hereby consents to such exclusive jurisdiction and waives any and all objections it might have thereto.

SECTION 10. AUTHORITY. Grantor hereby represents, warrants and certifies that:

a. It possesses legal authority to apply for and accept the terms and conditions of the exemption and to carry out the proposed Project;

b. Its governing body, if any, has duly authorized the filing of the application, including all understandings and assurances contained therein;

c. The person identified as the official representative of the Grantor in the application is duly authorized to act in connection therewith and to provide such additional information as may be required. The Grantor’s official representative has sufficient authority to make all certifications on its behalf;

d. This Agreement does not and will not violate any provision of any applicable law, rule, regulation or order of any court, regulatory commission, board or administrative agency applicable to the Grantor or any provision of the Grantor’s organic laws or documents;

e. This Agreement has been duly executed by an official representative of Grantor, delivered by Grantor, and will constitute the legal, valid and binding obligations of the Grantor, enforceable in accordance with their terms.


[PROJECT NAME]

Page 4 of 7

SECTION 11. INDEPENDENT CONTRACTOR. Grantor acknowledges and agrees that it is acting

in its own independent capacity under this Agreement and not as an agent or subcontractor for the City. Grantor assumes full responsibility for its own actions and shall provide for its own insurance and other compliance responsibilities, including providing for its own workers’ compensation and other insurance coverage, as needed.

SECTION 12. AMENDMENTS. This Agreement may be amended only by a written instrument

executed by the parties hereto or by their successors and duly recorded in the real property records of Washington County.

SECTION 13. SEVERABILITY. If any provision of this Agreement shall be invalid, illegal or

unenforceable, the validity, legality and enforceability of the remaining portions hereof shall not in any way be affected or impaired thereby.

SECTION 14. CONSTRUCTION. The parties to this Agreement acknowledge that each party and its counsel have participated in the drafting and revision of this Agreement. Accordingly, the parties agree that any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not apply in the interpretation of this Agreement or any amendment, modification, supplement or restatement of the foregoing or of any exhibit to this Agreement.

SECTION 15. NO LIMITATIONS ON ACTIONS OF CITY IN EXERCISE OF ITS GOVERNMENTAL POWERS. Nothing in this Agreement is intended, nor shall it be construed, to in any way limit the actions of the City in the exercise of its governmental powers. It is the express intention of the parties hereto that the City shall retain the full right and ability to exercise its governmental powers with respect to the Grantor, the Project, the land, and the transactions contemplated by this Agreement to the same extent as if it were not a party to this Agreement or the transactions contemplated thereby, and in no event shall the City have any liability in contract arising under this Agreement by virtue of any exercise of its governmental powers.

SECTION 16. TIME IS OF THE ESSENCE. Time is of the essence in the performance of the obligations of this Agreement.

SECTION 17. NOTICES. Any notice required to be given hereunder shall be made in writing and shall be given by personal delivery or first class mail, postage prepaid, at the addresses specified below, or at such other addresses as may be specified in writing by the City or the Grantor:

To the City: City of Tigard

Finance and Information Services 13125 SW Hall Blvd. Tigard, OR 97223 Attn: SDC Administrator

To the Grantor: _____________________ _____________________ _____________________ _____________________

[Signature Page to Follow]


[PROJECT NAME]

Page 5 of 7

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly

authorized representatives as of the day and year first above written. GRANTOR: CITY: [FULL NAME~] CITY OF TIGARD, an Oregon municipal corporation By: By: Marty Wine, City Manager Title: STATE OF _______________________ )

) ss: County of )

The foregoing instrument was acknowledged before me this day of ______________, _______, by _________________________________________, who is a of ______________________________________________________________________, on behalf of the Grantor.

__________________________________

Notary Public for the State of __________

My commission expires:_______________


[PROJECT NAME]

Page 6 of 7

EXHIBIT A

LEGAL DESCRIPTION OF THE PROJECT


[PROJECT NAME]

Page 7 of 7

EXHIBIT B

SCHEDULE OF SDCs EXEMPTED

System Exemption Amount

City Transportation $ xxx,xxxx

Parks $ xxx,xxxx

Water NOT ELIGIBLE

Sanitary Sewer NOT ELIGIBLE

Stormwater NOT ELIGIBLE

County Transportation Development Tax NOT ELIGIBLE

Total Exemption $ xxx,xxx

This SDC exemption is granted to the units located at the property address(es) listed below:

Project Name: [PROJECT NAME] in Tigard, Oregon [ZIP]

Street Address No. of Units Building Permit #

Address 1:

Address 2:

Address 3:

Address 4:

Address 5:

Address 6:

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