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07/17/2018 09 Surplus Property at 415 N 6th Ave; Yakima Housing Authority AgreementITEM TITLE: SUBMITTED BY: BUSINESS OF THE CITY COUNCIL YAKIMA, WASHINGTON AGENDA STATEMENT 1 Item No. 9. For Meeting of: July 17, 2018 Resolution declaring the property located at 415 N 6th Ave surplus to the uses and needs of the City of Yakima; and authorizing disposition and approving a purchase and sales agreement with the Yakima Housing Authority in an amount not to exceed $20,000 Joan Davenport, Al CP, Community Development Director Archie Matthews, ONDS Manager (509) 576-6761 SUMMARY EXPLANATION: The City of Yakima, through the Office of Neighborhood & Development Services (ONDS), obtained title to the property at 415 North 6th Avenue through a Deed in Lieu of Foreclosure. The property is adjacent to a current Yakima Housing Authority (YHA) housing development, which the YHA would like to expand within the next 5-10 years to add low income housing to the development. Because one of the goals of the City is to increase affordable housing, which is also one of the goals of ONDS, it is requested that the City Council surplus the land and sell it to YHA to create additional affordable housing units within the City. The attached Resolution declares the property surplus to the uses and needs of the City of Yakima, authorizes disposition of the property, and approves the Purchase and Sale Agreement with the Yakima Housing Authority. ITEM BUDGETED: NA STRATEGIC PRIORITY: Neighborhood and Community Building APPROVED FOR SUBMITTAL: STAFF RECOMMENDATION: Acting City Manager Adopt resolution BOARD/COMMITTEE RECOMMENDATION: ATTACHMENTS: Description 0 Resdution415NEthA‘,e D Exhi - PSA Upload Date 7/9/2018 7/9/2018 Type Resolution act 2 A RESOLUTION 3 RESOLUTION 2018 - declaring the property located at 415 North 6th Avenue, Yakima, Washington, 98902 to be surplus to the uses and needs of the City of Yakima, and authorizing disposition of such parcel to the Yakima Housing Authority to be used for low-income housing upon mutually acceptable terms and conditions. WHEREAS, in 2016, the City of Yakima (City) acquired the property at 415 North 6th Avenue ("Subject Property") through a Deed in Lieu of Foreclosure when the property owner failed to make payments to a loan that was due and owing to the City; and WHEREAS, in June of 2018, the home on the property was destroyed by fire, requiring the City to remove the fire debris, asbestos, and demolish the house as it was no longer habitable; and WHEREAS, the property currently stands as an empty lot with a large depression where the house was formerly located, which will need to be filled and properly engineered for a new structure; and WHEREAS, the City Council finds and determines that the property at 415 North 6th Avenue is surplus to the uses and needs of the City of Yakima, and that a declaration that the property is surplus, and an authorization for the disposition of the property are in the best interests of the residents of the City of Yakima, and will promote the public health, safety, and welfare; and WHEREAS, the property is located adjacent to a low-income housing facility owned and operated by the Yakima Housing Authority; and WHEREAS, the City is in need of additional low-income and affordable housing units and the Yakima Housing Authority, a public housing authority formed under RCW 35.82, intends to expand the low-income housing complex currently located on adjacent properties to the property at 415 North 6th Avenue to serve more residents who are in need of low-income housing and are poor and/or infirm; and WHEREAS, the Yakima Housing Authority, a intends on expanding the complex within approximately five to ten years and wishes to secure this parcel so that it can do so when funding is available and the Yakima Housing Authority is ready to build additional units; and WHEREAS, the tax assessor's determination of value of the property prior to the transfer of the property to the City of Yakima August 8, 2017, was $22,600.00, and that value was of the land which was, at the time, flat with a house located thereon; and WHEREAS, per representations by the Yakima Housing Authority, this property will be used for low-income housing for the poor and/or infirm; and WHEREAS, the City Council has reviewed the Purchase and Sale Agreement and finds that the purchase price of $20,000.00 is the fair market value of the property taking into account the current condition of the property, that it is being sold "as is," the assessed value of the property, and the fact that the property will be used for low-income housing for the poor and/or infirm; and 4 WHEREAS, the City Council finds and determines that authorizing the City Manager to enter into the Purchase and Sale Agreement with the Yakima Housing Authority is in the best interests of the residents of the City of Yakima and will promote the general health, safety and welfare, now, therefore BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YAKIMA: Section 1. Fee title ownership of the property at 415 North 6th Avenue, Yakima, Washington 98902 (Yakima County Assessor's Tax Parcel Number 181324-132477) is hereby declared surplus to the uses and needs of the City of Yakima. Section 2. The City Manager is hereby authorized to dispose of the Subject Property through executing the Purchase and Sale Agreement with the Yakima Housing Authority, which is attached hereto and based on the following: (a) The property is sold "as is" to the Yakima Housing Authority; (b) The sale of the Subject Property will facilitate the Yakima Housing Authority to expand its low-income housing complex located adjacent to the Subject Property which will benefit the poor and infirm; and (c) The sale of the Subject Property is subject to the terms and conditions as detailed in the Purchase and Sale Agreement attached hereto. Section 3. The City Manager is authorized to sign and enter into a Purchase and Sale Agreement between the City of Yakima and the Yakima Housing Authority to sell the property commonly known as 415 North 61h Avenue, Yakima, Washington, 98902 pursuant to the terms and conditions listed in the Agreement, Exhibit "1," attached hereto and fully incorporated herein. ADOPTED BY THE CITY COUNCIL this day of , 2018. Kathy Coffey, Mayor ATTEST: Sonya Claar Tee, City Clerk 5 "EXHIBIT 1" PURCHASE AND SALE AGREEMENT This Purchase and Sale Agreement is made this day of July , 2018 (the "Effective Date"), by and between Housing Authority of the City of Yakima, a public body corporate and politic organized and existing under the laws of the state of Washington, and/or its assigns ("Buyer"), and City of Yakima, a Washington municipal corporation ("Seller"). 1. Purchase and Sale. Upon the terms and conditions set forth herein, Buyer agrees to buy from Seller, and Seller agrees to sell to Buyer, the unimproved real property in Yakima, Yakima County, Washington (the "Property"). The Property includes (a) the land legally described in Exhibit A attached hereto and all easements, development rights, water and mineral rights and other rights appurtenant thereto (the "Land"), and (b) all permits, approvals, studies, surveys, warranties and other documents associated with the Land. 2. Price. The purchase price for the Property shall be twenty thousand dollars ($20,000), payable in full in cash at Closing (the "Purchase Price"). 3. Title. 3.1 Review of Title. Within ten (10) business days of the Effective Date, Seller will provide Buyer with a preliminary commitment for title insurance for the Property issued by Title Company, together with complete and legible copies of all exceptions and encumbrances noted thereon (the "Preliminary Commitment"), together with a copy of any existing survey (the "Survey"). Buyer shall have fifteen (15) days after receipt of the Preliminary Commitment and Survey to advise Seller in writing of any encumbrances, restrictions, easements or other matters (the "Exceptions") to which Buyer objects. All Exceptions to which Buyer does not object in writing within the 15 -day period shall be deemed accepted by Buyer. If Buyer objects to any Exceptions within the 15 -day period, Seller shall advise Buyer in writing within five (5) days of receipt of Buyer's written objections (a) which Exceptions Buyer will remove at Closing, (b) which Exceptions the Title Company has agreed to insure around in the title policy to be issued at Closing (together with the proposed form of endorsement) and (c) which Exceptions will not be removed or insured around. Within ten (10) days of receipt of Seller's response to Buyer's written objections, and assuming Seller has not agreed to remove all exceptions to which Buyer objects, Buyer shall notify Seller in writing of Buyer's election to either (a) terminate this Agreement, in which event the Earnest Money shall be returned to Buyer, or (b) waive its objections to the Exceptions the Title Company has agreed to insure around and the Exceptions Seller will not remove or insure around, in which event such Exceptions shall be deemed accepted by Buyer. Notwithstanding the foregoing, Seller agrees to remove all financial encumbrances and liens at or prior to Closing, and if Seller fails to do so, Buyer may cause any remaining financial encumbrances and liens to be satisfied in full at Closing from the Purchase Price. In the event the Survey must be updated or recertified to meet Title Company requirements, Buyer shall be responsible for doing so at Buyer's sole cost and expense. -1- 6 3.2 Title Insurance. Seller shall cause Title Company to deliver to Buyer at Closing an Owner's Title policy of title insurance issued by Title Company in the face amount of the purchase price, dated the date of Closing, insuring Buyer's title subject to no exceptions other than the standard printed exceptions and the Exceptions deemed accepted by Buyer pursuant to Section 3.1 above. The policy of title insurance shall also include the endorsements Title Company agreed to provide in accordance with Section 3.1 above and such other endorsements as Buyer may reasonably request. Seller agrees to provide whatever indemnities or affidavits the Title Company may require to remove from the policy of title insurance the standard preprinted exception for parties in possession and the standard preprinted exception for mechanics liens. 4. Sale of Property is "As Is" 4.1 "As Is" Purchase. Buyer agrees to accept the Property "AS IS, WHERE IS, WITH ALL FAULTS," including but not limited to the environmental condition of the Property. Buyer further acknowledges that: (a) no representations or warranties, whether express or implied, have been made to Buyer by Seller as to the condition of the Property or its suitability for particular purposes or uses and Buyer is not relying on any such warranty or representation as a condition or inducement to purchase the Property. In particular, and without limitation, Seller does not expressly or impliedly warrant that the Property meets any current City, County, State or Federal building codes, ordinance, laws or regulations relative to use, tax exemption or status, or any other nature. Buyer assumes the complete responsibility to check with the appropriate governmental authority for its intended use of the Property. Seller shall not be responsible for the repair, replacement or modification of any deficiencies, malfunctions, or mechanical defects in the materials, workmanship and mechanical components of the Property prior to and/or subsequent to Closing. 4.2 Access. During the term of this Agreement, Buyer shall be entitled to access to the Property to conduct such investigations, tests, surveys and other analyses as Buyer determines is necessary, provided (a) Buyer restores the Property to its original condition following any such tests and investigations, and (b) Buyer indemnifies, defends and holds Seller harmless from and against all claims, costs, expenses and liabilities arising out of Buyer's entry upon the Property and/or the performance of the tests and investigations conducted by Buyer on the Property. 4.3 Survey. During the Review Period, Buyer may at Buyer's sole option obtain a survey of the Property or update any existing Survey provided by Seller. 5. Closing. 5.1 Time and Place of Closing. Closing shall occur in the office of the City of Yakima on or before 30 days from the date of this Agreement. Buyer and Seller shall work together to ensure all instruments and documents necessary to complete the transaction in accordance with this Agreement are drafted and filed. As used herein, "Closing" or "date of Closing" means the date on which all appropriate documents are recorded and the proceeds of sale are available for disbursement to Seller. 5.2 Closing Costs. At Closing, closing costs shall be paid as follows: (a) Seller's Closing Costs. Seller shall pay (i) the premium for a standard coverage policy of title insurance and the endorsements required to insure around the -2- 7 Exceptions the Title Company agreed to insure around in accordance with Section 3.1 above; and (ii) deed recording fees. (b) Buyer's Closing Costs. Buyer shall pay (i) the additional title premium for extended coverage and the costs of any title insurance endorsements required by Buyer (other than the costs of the title insurance endorsements to be provided by Seller pursuant to subparagraph (a) above); and (ii) any other fees associated with the transfer that are not paid by Seller. 6. Deliveries at Closing. 6.1 Seller's Delivery. At Closing, Seller shall deliver the following: (a) Statutory Warranty Deed, conveying title to the Land to Buyer, subject to no encumbrances, claims and defects other than the Exceptions deemed approved by Buyer pursuant to Section 3.1 above. (b) FIRPTA Affidavit. 6.2 Buyer's Delivery. At Closing, Buyer shall deliver the following: (a) Cash in the amount of the Purchase Price. 7. Risk of Loss. Seller shall deliver the Property to Buyer at Closing in substantially the same condition existing as of the date hereof. Buyer agrees to take the Property "as is." 8. Condemnation. If the Property or any part thereof is or becomes the subject of a condemnation proceeding prior to Closing, Buyer may, at its option, terminate this Agreement by giving notice of such termination to Seller, and upon such termination the Earnest Money shall be refunded to Buyer; provided, however, that Buyer may elect to purchase the Property (or such portions thereof as have not been taken in the condemnation proceeding), in which case the total purchase price shall be reduced by the total of any condemnation award received by Seller at or prior to Closing. On Closing, Seller shall assign to Buyer all Seller's rights in and to any future condemnation awards or other proceeds payable or to become payable by reason of any taking. Seller agrees to notify Buyer of eminent domain proceedings immediately after Seller learns thereof. 9. Contingencies. In addition to the other provisions set forth elsewhere in this Agreement, the obligation of Buyer hereunder are conditioned upon the following: 9.1 Seller's representations and warranties as set forth in Section 10 hereof shall be true, complete and current as of the date of Closing. 9.2 All requirements set forth in the Preliminary Commitment (including any update) shall have been satisfied or waived by the Title Company, and the Title Company shall be prepared to issue the title policy as described in Section 3. 9.3 As of the Closing, there shall have been no material adverse change in the physical condition of the Property other than ordinary wear and tear, and there shall have -3- 8 occurred no reassessment, reclassification (reclassification could include revised regulatory agreement requirements), rezoning or other change in judicial or administrative decision or proceedings (including amendments and modifications of any of the foregoing), pending or proposed to be imposed by any governmental or quasi -governmental authority or any public or private utility having jurisdiction over the Property, excepting any changes to tax status that may occur as a result of the transfer. A "Material Change" is change that will have a material negative effect on the economic results of owning and operating the Property by Buyer. 9.4 Buyer shall have received the formal approval for this transaction by the Buyer's Board of Directors. 10. Representations and Warranties of Seller. Seller represents and warrants to Buyer only as follows: 10.1 Title. As of the date of Closing, Seller shall have good, marketable, indefeasible title to the Property (including, without limitation, the Land and Personal Property) free and clear of all liens, claims and encumbrances except for Exceptions deemed accepted by Buyer pursuant to Section 3.1 above. Seller has no knowledge of any condemnation or eminent domain proceedings now pending or anticipated with respect to the Land. There are no parties in possession of any portion of the Property as lessees, tenants -at -sufferance, invitees or purported purchasers that have not been specifically disclosed in writing to Buyer. 10.2 Litigation. There is no claim, litigation, proceeding or governmental investigation pending, or, so far as known to Seller, threatened against or relating to Seller, Seller's properties or business, the Property, or the transactions contemplated by this Agreement, or any dispute arising out of any contract or commitment entered into regarding the Property, nor is there any basis known to Seller for any such action or claim. 10.3 No Defaults. Neither the execution or delivery of this Agreement, the consummation of the transactions contemplated hereby, nor the fulfillment of the terms hereof, will conflict with or result in a breach of any of the terms, conditions or provisions of, or constitute a default under, any agreement or instrument which affects the Property or to which the Property is subject or any applicable laws or regulations of any governmental body having jurisdiction over the Property. 10.4 Hazardous Substances. Seller makes no representations or warranties concerning hazardous substances. Buyer purchases the property "as is." 10.5 Buyer Expressly Waives Receipt of Seller's Disclosure Statement pursuant to RCW 64.06.005(7). Buyer, pursuant to RCW 64.06.005 hereby expressly waives receipt of the Seller's Disclosures required under RCW 64.06.015, purchases and takes the property "as is, where is." Except for the representations and warranties set forth above and in the conveyance documents to be delivered at Closing, the Property is being sold to Buyer "as is, where is," without representation and warranty. Buyer acknowledges that Buyer will have the opportunity to inspect the Property and determine the physical condition thereof, and that Seller has made no representations and warranties with respect thereto. -4- 9 11. Liabilities and Assumption of Obligations. Except as expressly provided herein, Buyer shall not assume or take subject to any liabilities or obligations of the Property or Seller existing or accrued as of the date of Closing, and Seller shall pay the same as they mature and shall hold Buyer harmless with respect to all such liabilities and obligations. Liabilities and obligations of the Property accruing after the date of Closing shall be the responsibility of Buyer. Each party agrees to indemnify, defend and hold the other party harmless with respect to the liability and responsibility of such party in accordance with this Section. 12. Negotiation and Construction. This Agreement and each of the terms and provisions hereof are deemed to have been explicitly negotiated between the parties, and the language in all parts of this Agreement shall, in all cases, be construed according to its fair meaning and not strictly for or against either party. 13. Brokers and Finders. Buyer and Seller shall indemnify and hold harmless the other from any claims asserted for commissions or fees alleged to be payable to any third party because of any act, omission or statement of the indemnifying party. 14. Possession. Buyer shall be entitled to possession of the Property on the date of Closing. 15. Governing Law, Attorneys' Fees. This Agreement shall be construed according to the laws of the state of Washington. If either Buyer or Seller should find it necessary to employ an attorney to enforce a provision of the Agreement or to recover damages for the breach hereof (including proceedings in bankruptcy), the prevailing party shall be entitled to be reimbursed for its court costs and attorneys' fees, in addition to all damages, through all levels of appeal. 16. Notices. All notices, demands, requests, consents and approvals which may, or are required to, be given by any party to any other party hereunder shall be in writing and shall be deemed to have been duly given if (a) delivered personally, (b) sent by a nationally recognized overnight delivery service, (c) electronically transmitted with confirmation sent by another method specified in this Section 16 or (d) if mailed or deposited in the United States mail and sent by registered or certified mail, return receipt requested, postage prepaid to: SELLER: BUYER: Cliff Moore, City Manager City of Yakima 129 N 2nd Street Yakima, WA 98901 Email: cliff.moore@yakimawa.gov Lowel Krueger, Executive Director Housing Authority of the City of Yakima 810 N 61h Ave. Yakima, WA 98902 Email: lowel.krueger@yakimahousing.org Either party hereto may by proper notice made by the other party designate such other address for giving of notices. All notices shall be deemed given on the day such notice is delivered (or if refused, the date of such refusal) or transmitted by electronic mail transmission or on the third business day following the date such notice is mailed in accordance with this Section 16; provided, -5- 10 however, that the time period in which a response to any such notice, demand, or request must be given shall commence on the date of receipt thereof. Notices on behalf of the respective parties may be given by their attorneys and such notices shall have the same effect as if in fact subscribed by the party on whose behalf it is given. 17. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors, heirs, administrators and assigns. 18. Time is of the Essence. Time is of the essence of this Agreement and of all terms and provisions hereof. 19. Entire Agreement. This Agreement contains the entire understanding between the parties and supersedes any prior agreements between them respecting the subject matter hereof. 20. Further Assurances. As and to the extent otherwise contemplated by this Agreement, each party to this Agreement agrees that it will at any time and from time to time after the date hereof, at its sole cost and expense, immediately following the reasonable request of the other party, promptly execute, acknowledge (if necessary) and deliver or cause to be properly executed, acknowledged (if necessary) and delivered, such agreements, certificates, statements, instruments and documents and promptly take, or promptly cause to be taken, such other and further steps and actions, as may be required by law or as reasonably shall be deemed necessary by the other party in order to more fully effect, evidence or carry out the intent and purposes of this Agreement. 21. Counterparts. This Agreement may be executed in several counterparts, which shall be treated as originals for all purposes, and all counterparts so executed shall constitute one agreement, binding on all the parties hereto, notwithstanding that all the parties are not signatory to the original or to the same counterpart. Any such counterpart shall be admissible into evidence as an original hereof against the person who executed it. DATED the day and year first above written. BUYER: Housing Authority of the City of Yakima, a public body corporate and politic organized and existing under the laws of the state of Washington By Its: Executive Director SELLER: City of Yakima, a Washington Municipal Corporation Exhibits: Exhibit A Legal Description of Property By Its: City Manager -6- 11 EXHIBIT A TO PURCHASE AND SALE AGREEMENT Legal Description Yakima County Parcel No. 181324-14277 Lot 9, BLOCK 286, OF CHARLTON ADDITION TO NORTH YAKIMA, NOW YAKIMA, WASHINGTON, ACCORDING TO THE OFFICIAL PLAT THEREOF, RECORDED IN VOLUME "B" OF PLATS, PAGE 102, RECORDS OF YAKIMA, COUNTY, WASHINGTON.