1200 King County King County Courthouse 516 Third Avenue Seattle, WA 98104 Meeting Agenda Committee of the Whole
Councilmembers: Joe McDermott, Chair; Reagan Dunn, Vice Chair; Claudia Balducci, Rod Dembowski, Jeanne Kohl-Welles, Kathy Lambert, Dave Upthegrove, Pete von Reichbauer, Girmay Zahilay
Lead Staff: Jake Tracy (206-263-0875) Committee Clerk: Marka Steadman (206-477-0887)
9:30 AM Wednesday, July 7, 2021 Virtual Meeting
PUBLIC NOTICE: The Committee of the Whole meetings will be held virtually until further notice. To help prevent the spread of the COVID 19 virus, the Chambers will be closed and all committee members and staff will be participating in the meeting remotely. The live feed of the video conference will be streaming on the King County Council's website and on KCTV Channel 22. Ways to provide public comment are noted below.
Pursuant to K.C.C. 1.24.035 A. and F., this meeting is also noticed as a meeting of the Metropolitan King County Council, whose agenda is limited to the committee business. In this meeting only the rules and procedures applicable to committees apply and not those applicable to full council meetings.
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There are two ways to provide public comment:
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King County Page 1 Printed on 6/28/2021 COW Meeting Materials Page 1 July 7, 2021 Committee of the Whole Meeting Agenda July 7, 2021
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HOW TO WATCH/LISTEN TO THE MEETING: There are two ways to watch or listen in to the meeting if you don't wish to provide public comment:
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To show a PDF of the written materials for an 1. Call to Order agenda item, click on the agenda item below.
2. Roll Call
3. Approval of Minutes
June 23, 2021, special meeting minutes pp. 4-6
4. Public Comment
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Briefing
5. Briefing No. 2021-B0091 (No materials)
Executive COVID-19 Briefing Dwight Dively, Director, Office of Performance, Strategy and Budget
Discussion and Possible Action
6. Proposed Ordinance No. 2021-0232 pp. 8-23
AN ORDINANCE proposing to amend the King County Charter to utilize ranked-choice voting for the election of county officers, including the King County executive, the King County assessor, the King County director of elections, the King County councilmembers and the King County prosecuting attorney, effective January 1 following the council's adoption of an ordinance approving protocols for ranked-choice voting; amending Section 610 of the King County Charter; and submitting the same to the voters of the county for their ratification or rejection at the November 2, 2021, general election.
Sponsors: Mr. Zahilay and Ms. Kohl-Welles Miranda Leskinen, Council staff
7. Proposed Ordinance No. 2021-0245 pp. 24-35
AN ORDINANCE proposing to amend the King County Charter to establish Reverend Doctor Martin Luther King, Jr., County council as the designated name for the legislative branch of county government in King County where applicable in the king county charter; amending Sections 210, 220, 220.10, 230.50.10, 270.10, 270.20, 270.30, 270.40 and 680.10 of the King County Charter; and submitting the same to the voters of the county for their ratification or rejection at a special election to be held in conjunction with the November 2, 2021, general election.
Sponsors: Mr. Zahilay Mike Reed, Council staff
8. Proposed Ordinance No. 2021-0237 pp. 36-188
AN ORDINANCE relating to the sale of the surplus property located at 13620 SE Eastgate Way, Bellevue, Washington, in council district six. Sponsors: Ms. Balducci
Terra Rose, Council staff
Other Business
Adjournment
King County Page 3 Printed on 6/28/2021
COW Meeting Materials Page 3 July 7, 2021 1200 King County King County Courthouse 516 Third Avenue Seattle, WA 98104 Meeting Minutes Committee of the Whole Councilmembers: Joe McDermott, Chair; Reagan Dunn, Vice Chair; Claudia Balducci, Rod Dembowski, Jeanne Kohl-Welles, Kathy Lambert, Dave Upthegrove, Pete von Reichbauer, Girmay Zahilay
Lead Staff: Jake Tracy (206-263-0875) Committee Clerk: Marka Steadman (206-477-0887)
1:00 PM Wednesday, June 23, 2021 Virtual Meeting
DRAFT MINUTES - SPECIAL MEETING
1. Call to Order
Chair McDermott called the meeting to order at 1:04 p.m.
2. Roll Call Present: 9 - Ms. Balducci, Mr. Dembowski, Mr. Dunn, Ms. Kohl-Welles, Ms. Lambert, Mr. McDermott, Mr. Upthegrove, Mr. von Reichbauer and Mr. Zahilay
3. Approval of Minutes
Councilmember Dunn moved approval of the June 16, 2021, meeting minutes. There being no objections, the minutes were approved.
4. Public Comment
The following individuals provided public comment:
Amy Kangas Arianna Laureano Ashley Allen Blythe Serrano Bruce Becker Casey Bishop Nathan Cathersal Cecelia Black Chris Graves Cory Brewer Dan McCraw Dave Nagel Doug Trumm Emily McArthur Karen Taylor Hannah Swoboda
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Hillary Rose James Satterberg Jake Phillips Jason Austin Jazmine Smith Jim Henderson Jessi Murray JJ Bartlett Joe Wanagel John Adams John Stovall Joshua Johnson Kaitlin Heinen Katie Wilson Kraig Peck Laura Michelle Kirk Lisa Johnson Madeline Olson Malik Baz Margot Stewart Mark Epstein Mary Cogan Paterson Matt Smith Matt Wilder Matthew Lang Michelle Jones Owen Vanderkolk Peter Houck Renee Ballou Sarah Champernowne Jenifer Janes Sean Case Sebastian Stockpyle Shane Woerner
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Discussion and Possible Action
5. Proposed Ordinance No. 2021-0131
AN ORDINANCE relating to tenant protections; amending Ordinance 383, Section 5, as amended, and K.C.C. 2.60.050, adding a new chapter to K.C.C. Title 12 and repealing Ordinance 16223, Section 3, and K.C.C. 12.47.010, Ordinance 16223, Section 4, and K.C.C. 12.47.020, Ordinance 16223, Section 5, and K.C.C. 12.47.030 and Ordinance 16223, Section 6, and K.C.C. 12.47.040.
April Sanders, Council staff, briefed the committee and answered questions from the members.
Councilmember Kohl-Welles moved approval of striking amendment S2. The amendment was adopted with Councilmembers Dembowski, Dunn, Lambert and von Reichbauer voting no.
The Chair recessed the meeting into executive session for 10 minutes under RCW 42.30.110 at 3:41 p.m. to discuss with legal counsel legal risks of a proposed action when public knowledge regarding the discussion is likely to result in an adverse legal or financial consequence to the county. The executive session was extended an additional 5 minutes. The meeting returned to regular session at 3:53 p.m.
This item was expedited to the June 29, 2021, Council agenda.
A motion was made by Councilmember Kohl-Welles that this substitute Ordinance be Passed Out of Committee Without a Recommendation. The motion carried by the following vote:
Yes: 6 - Ms. Balducci, Mr. Dembowski, Ms. Kohl-Welles, Mr. McDermott, Mr. Upthegrove and Mr. Zahilay
No: 3 - Mr. Dunn, Ms. Lambert and Mr. von Reichbauer
Adjournment
The meeting was adjourned at 3:59 p.m.
Approved this ______day of ______
Clerk's Signature
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July 7, 2021
Agenda Item No. 5 Briefing No. 2021-B0091
Executive COVID-19 Response
There are no materials for this item.
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Metropolitan King County Council Committee of the Whole
STAFF REPORT
Agenda Item: 6 Name: Miranda Leskinen Proposed No.: 2021-0232 Date: July 7, 2021
SUBJECT
An ordinance to submit a charter amendment proposition to the voters to utilize ranked- choice voting for the election of county officers.
SUMMARY
Proposed Ordinance 2021-0232 would place on the November election ballot a charter amendment proposal to utilize ranked-choice voting for the election of county officers, including the King County Executive, the King County Assessor, the King County Director of Elections, the King County Councilmembers and the King County Prosecuting Attorney. If approved by voters, and subject to Council’s adoption of an ordinance approving protocols for ranked-choice voting, the amendment would take effect January 1 following Council’s adoption of the ranked-choice voting protocols ordinance.
To place this potential charter amendment on the November 2, 2021 ballot, the last regular Council meeting date for adoption as a non-emergency is July 20, 2021. The deadline for Elections to receive the effective ordinance is August 3, 2021.
Staff have prepared a technical corrections line amendment, and an accompanying title amendment, which are included as attachments to this staff report (Attachments 2-3).
BACKGROUND
Election of county officers in King County. Section 610 of the King County charter currently directs that “the nominating primaries and elections for the offices of King County Executive, King County Assessor, King County Council and King County Prosecuting Attorney shall be conducted in accordance with general law governing the election of non-partisan county officers”. Of note, Washington State law requires that primaries be held prior to a general election for partisan offices.1 Primaries can also be
1 For primary elections, Washington uses a top-two primary system in which all candidates are listed on the same primary ballot and voters may choose any candidate. The name of the candidate who receives the greatest number of votes in the primary appears first on the general election ballot, and the name of the candidate who receives the next greatest number of votes appears second. For offices in which there is more than one position with the same name, district number, or title, the positions are dealt with as separate offices to which candidates are elected in single-winner contests.
COW Meeting Materials Page 8 July 7, 2021 held for non-partisan offices except where two or fewer candidates have filed for the position. In the primary, the names of all candidates that file for office generally will appear on the primary ballot, with the top two candidates advancing to the general election ballot.
Under current practice, the winners of single-member offices in jurisdictions throughout Washington are determined using the plurality system in which voters select one candidate and the candidate who receives the most votes is declared the winner2. If there is a tie, the winner is chosen by lot.
State law does not prohibit the implementation of ranked-choice voting by home rule charter counties.
Ranked-choice voting3. Ranked-choice voting (RCV) is a system of voting that allows voters to rank candidates for a single office in order of preference (first choice, second choice, etc.). The votes are tallied based on the first choice on every ballot. If a candidate receives over 50 percent of the first-choice preferences, that candidate would be declared the winner. If no single candidate wins a first-round majority of the votes, then the candidate with the lowest number of votes is eliminated and another round of vote tallying commences. If a voter's first choice is eliminated, then their vote is transferred to their second-choice preference. This process repeats and the last-place candidate is eliminated in each round until one candidate reaches a majority (over 50 percent) and wins the election.
When RCV is conducted to elect one candidate (instead of multiple candidates in a multi-member district4) the result is similar to traditional runoff elections and, in those situations, the terms “ranked-choice voting” and “instant run-off voting” are used interchangeably. Illustrations 1 through 3 provide hypothetical scenario examples for this process.
2 The county’s canvassing board is responsible for conducting a formal assessment (“canvass”) of an election. The assessment includes reviewing vote totals, determining validity of challenged ballots, certifying the vote and administering a recount. Every county in Washington must have a canvassing board.URL:https://kingcounty.gov/depts/elections/about-us/boards-and-committees/canvassing- board.aspx. Last accessed on June 29, 2021. 3 National Conference of State Legislatures (NCSL). Alternative Voting Systems. URL: https://www.ncsl.org/research/elections-and-campaigns/alternative-voting-systems.aspx. Last accessed on June 28, 2021. 4 In elections for multiple-member offices, votes are tabulated using the single transferable vote method. In this method, the winning threshold is calculated based on the number of seats to be filled and the number of votes cast. Ballots are counted in rounds, and votes are transferred to next-ranked candidates from candidates with the fewest votes, who are eliminated, as well as candidates who have already surpassed the threshold to win.
COW Meeting Materials Page 9 July 7, 2021 Illustrations 1-3. Ranked Choice Voting/Instant Runoff Voting Hypothetical Scenarios
ScenarioScenario 1: Candidate 1: Candidate B receives B receives a majority a majorityof 1st-choice of 1st preference-choice preference votes (54 votes percent) in Round 1(54 of votepercent) tallying in Round and wins 1 of the vote election tallying. and wins the election; no further rounds necessary. 120
100
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60 Choice Preference Votes Preference Choice
- 40
20
0
Percent of 1st Round 1
Candidate A Candidate B Candidate C Candidate D
Scenario 2: No candidate receives a majority of 1st-choice preference votes in Scenario 2: No candidate receives a majority of 1st-choice preference votes in Round 1 of Round 1 of vote tallying. The candidate with the fewest number of votes in vote tallying. The candidate with the fewest number of votes in Round 1 (Candidate D) is Round 1 (Candidate D) is eliminated and Candidate D's votes are redistributed eliminated and Candidate D's votes are redistributed based on the voters' 2nd-choice based on the voters' 2n preference.
Candidate B receives a majority of votes (53 percent) in Round 2 of vote tallying and wins the election.
120
100
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60
40
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0 Round 1 Round 2 Candidate A Candidate B Candidate C Candidate D
COW Meeting Materials Page 10 July 7, 2021 ScenarioScenario 3: No candidate 3: No candidate receives receives a majority a majority of 1st-choice of 1st -preferencechoice preference votes in votes Round in 1 of vote tallying.Round The 1 of candidate vote tallying. with Thethe fewestcandidate number with theof votes fewest in numberRound 1 of (Candidate votes in D) is eliminatedRound and 1Candidate (Candidate D's D) votes is eliminated are redistributed and Candidate based onD's the votes voters' are redistributed2nd-choice preference.based on the voters' 2n
No candidate receives a majority of votes in Round 2 of vote tallying. The candidate with the fewest number of votes in Round 2 (Candidate C) is eliminated and Candidate C's votes are redistributed based on the voters' 2nd choice preference (or 3rd choice if their 2nd choice has already been eliminated).
Candidate B receives a majority of votes (60 percent) in Round 3 of vote tallying and wins the election.
120
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40
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0 Round 1 Round 2 Round 3
Candidate A Candidate B Candidate C Candidate D
Use of RCV in the United States. Municipalities in several states, including California, Colorado, Maine, Maryland, Massachusetts, Minnesota, New Mexico, New York and Oregon have used RCV in municipal elections. One state, Maine, has used RCV in statewide and federal elections. Alaska voters approved a ballot measure in 2020 that will require use of RCV in state and federal general elections beginning in 2022. The City of New York, beginning in 2021, is using ranked-choice voting for primary and special elections for the offices of the Mayor, Public Advocate, Comptroller, Borough President and City Council due to an amendment to the city’s charter that was approved by voters in 2019.
In Washington State, City of Vancouver voters in 1999 approved an amendment to its city charter that allows the City Council, if a resolution authorizing its use is passed at least 30 days before the candidate filing deadline for any special or regular election, to authorize single-election instant runoff voting for the election of city officers. Additionally, Pierce County voters approved an amendment in 2006 to its county charter authorizing RCV, which was subsequently implemented in the 2008 and 2009 general elections for county elected officials (except judges and prosecuting attorney). However, the authorization was later repealed by Pierce County voters in 2009.
Substitute House Bill 1156. Multiple bills relating to ranked-choice voting have been introduced in recent years in the State Legislature that would have expanded the use of RCV in the state. Most recently, during the 2021 Legislative Session, HB 1156 was introduced, which would have permitted RCV in elections for offices in counties, cities, towns, school districts, fire districts and port districts, and would have established
COW Meeting Materials Page 11 July 7, 2021 certain requirements for RCV ballot design and vote tabulation. Additionally, the bill would have included a cost-recovery provision to the Washington Voting Rights Act (WA VRA) to allow a person who files a notice alleging a violation of the Act to recoup research costs, up to $30,000, if the political subdivision were to adopt a remedy in response to the notice. The bill would also have (subject to appropriation) allowed the Secretary of State to provide grants to local governments to implement RCV or make changes to their electoral system in response to a notice filed under the WA VRA.
Of note, the bill would have allowed implementing jurisdictions to eliminate or hold a primary (in the event of five or more filed candidates for an office) when using RCV to narrow the list of candidates to appear on the general election ballot to five candidates. Additionally, for offices in which there is more than one position with the same name, district number or title, the bill would have allowed implementing jurisdictions to choose whether the positions would be addressed as separate offices or as a multi-member office. If addressed as separate offices, the bill directed that RCV would be conducted using instant-runoff voting (IRV). If addressed as a multi-member office, the bill directed that RCV would be conducted using the single-transferable vote method.
Also of note, the bill directed that jurisdictions adopting RCV before 2022 would have to implement RCV for elections beginning in 2024, whereas jurisdictions adopting RCV during or after 2022 would have to implement RCV for elections beginning within two years of adoption. The bill would also have directed the Secretary of State’s office to establish a workgroup to consult with when developing administrative rules relating to RCV. This legislation ultimately did not advance out of its house of origin during the 2021 session.
King County Charter Review Commission recommendation regarding RCV. The King County Charter provides for a resident commission to be assembled every ten years for the purpose of reviewing the charter and presenting a written report to the King County Council recommending amendments. In the 2018-2019 King County Charter Review Commission’s final report to the Council,5 ranked-choice voting was an issue recommended for further study. As described in the report, the Commission invested significant time during its deliberations about a proposal to move the county to RCV for county elected offices, but the Commission could not reach a consensus on whether the move should be pursued or what model should be implemented. Specifically, the Commission recommended in its report that the County Council study this issue by forming a task force to determine if it is in the best interest of the public.
Potential for impact of RCV on underrepresented populations. A 2016 study6 which analyzed the candidates running for office after the implementation of RCV in the cities of San Francisco, Oakland, Berkeley, and San Leandro, California found that the voting structure increased “descriptive representation for women, people of color, and women
5 2018-2019 King County Charter Review Commission: Report to the King County Council. URL: https://mkcclegisearch.kingcounty.gov/LegislationDetail.aspx?ID=4342681&GUID=94BD6562-0CDC- 410F-B14A-939410A85336. Last accessed on June 28, 2021. 6 Sarah John, Haley Smith, and Elizabeth Zack, The Impact of Ranked Choice Voting on Representation: How Ranked Choice Voting Affects Women and People of Color Candidates in California, 1 (July 2016). URL: https://fairvote.app.box.com/v/RCV-Representation-BayArea. Last accessed on June 29, 2021. This study information is also included in the staff report on RCV included in the 2018-2019 Charter Review Commission’s final report to the Council.
COW Meeting Materials Page 12 July 7, 2021 of color.” Descriptive representation refers to the idea that a body of elected representatives should reflect the outward characteristics, such as such as occupation, race, ethnicity, or gender, of the populations they represent.
The study analyzed races in 11 California cities for various city-wide elected positions between 1995 and 2014, including the four California cities that implemented RCV and seven cities that did not implement the new structure but were similar in population size, racial makeup, and income. The seven non-RCV cities were Alameda, Anaheim, Richmond, San Jose, Santa Ana, Santa Clara, and Stockton, California. The study measured the percentage of candidates who were women, people of color, and women of color as well as the percentage of winners who identified with those categories.
In a section of the study that did not control for differing characteristics of the cities, such as gender and racial demographics, median household income, education levels, partisanship, and others, researchers found the following: • Although the percentage of female candidates running for election declined slightly after the implementation of RCV in the cities that had adopted it, the overall percentage of female candidates running for election was higher and declined less in those cities versus non-RCV cities; • The percentage of candidates of color for elective office increased by five percentage points, and the percentage of female candidates of color increased by three percentage points, once RCV was implemented; • The percentage of elective offices won by women increased slightly after implementation of RCV, while the percentage of elective offices won by women decreased over the same time period in cities that did not implement RCV; and • The percentage of people of color winning elective office increased more than 18 points after implementation of RCV while the increase was three points over the same time period in cities that did not implement RCV.
These findings were more pronounced for open seat races than in races where an incumbent ran. In a section of the study that did control for the above-mentioned differing characteristics of the cities researchers found: • Over time, there was a 26 percent increase in the probability of women being elected to office in cities that had adopted RCV and a 28 percent decrease in probability of the same outcome in non-RCV cities; • Over time, the predicted probability of a woman of color being elected to office remained at 21 percent in RCV cities but declined from 19 percent to six percent in non-RCV cities; and • There was a 5-percentage point increase in the percentage of female candidates of color running for office in RCV cities.
Ballot exhaustion. An expressed concern regarding ranked-choice voting is the potential for ballot exhaustion. Ballot exhaustion occurs when a ballot is no longer countable in a tally, such as when there are still remaining candidates but all the candidates a voter ranked have already been eliminated. For example, in the case of the 2009 election of the Pierce County Auditor that was conducted using RCV, the RCV algorithm results showed that nearly three percent of ballots were exhausted in the last (2nd) round of
COW Meeting Materials Page 13 July 7, 2021 vote tallying.7 In another example to highlight the range potential for ballot exhaustion, in the 2011 San Francisco mayoral election conducted using RCV, approximately 27 percent of ballots cast did not rank the final two candidates who reached the last (12th) round of vote tallying.8
ANALYSIS
Proposed Ordinance 2021-0232 would place on the November 2, 2021 election ballot a charter amendment proposal to utilize ranked-choice voting (RCV) for the election of county officers, including the King County Executive, the King County Assessor, the King County Director of Elections, the King County Councilmembers and the King County Prosecuting Attorney. If approved by voters, and subject to Council’s adoption of an ordinance approving protocols for ranked-choice voting, the amendment would take effect January 1 following Council’s adoption of the RCV protocols ordinance.
The ordinance directs that ranked-choice voting (if approved) would give voters the option of ranking candidates in order or preference and would be conducted in rounds. In each round, each voter’s ballot would count as a single vote for whichever continuing candidate the voter has ranked highest, and the candidate with the fewest votes after each round would be eliminated, and the eliminated candidate’s votes would be redistributed to the next -ranked continuing candidate. This process would repeat until one candidate receives a majority of votes for all remaining candidates. Per the ordinance, that candidate would be deemed elected at the time of election certification. Additionally, when RCV is conducted, there would be no primary for the impacted office(s) and all qualified candidates would appear directly on the general election ballot.
Lastly, in a scenario where no more than candidates have filed for a county office, the ordinance permits that the election for that office may be conducted by either ranked- choice voting or according to general law governing nonpartisan offices.
RCV implementation timing and cost considerations. According to King County Department of Elections (KCE) staff, approximately three to five years is the estimated timeframe needed for the department to prepare for RCV implementation. KCE staff note the timeframe is primarily driven by the amount of time necessary to develop, certify, and test updates to its ballot tabulation system capable of handling RCV, including extensive internal testing by the department. KCE staff currently anticipate the other activities the department would need to complete (e.g. coordinating with the Secretary of State’s office, voter outreach/education) could be done within the time needed for the tabulation system updates.
While a comprehensive cost estimate for implementing ranked-choice voting is not available, KCE staff expect (subject to change as the specifics around the exact
7 Pierce County Department of Elections. Ranked Choice Voting Algorithm Results, Pierce County Auditor. URL: https://www.piercecountywa.gov/2941/Ranked-Choice-Results. Last accessed on June 29, 2021. 8 City and County of San Francisco Department of Elections. Results Summary, November 8, 2011 – Consolidated Municipal Election. URL: https://sfelections.org/results/20111108/. Last accessed on June 29, 2021. Also see New York Times. How Ranked-Choice Voting Could Affect New York’s Mayoral Race. Updated June 10, 2021. URL: https://www.nytimes.com/2021/05/28/us/politics/ranked-choice-voting-new- york-mayoral-race.html. Last accessed on June 29, 2021.
COW Meeting Materials Page 14 July 7, 2021 procedures and protocol of RCV are decided) that the major costs associated with implementing RCV would include the following:
• Tabulation System: KCE staff estimate the major capital cost would be the development costs for updating the ballot tabulation system so it can count RCV ballots. • Voter Education Campaign: According to KCE staff, an extensive voter education campaign would be needed during the initial implementation of RCV in order to ensure voters understand and trust the new system of voting and to ensure that the change does not disenfranchise historically underserved communities. KCE is currently estimating that this initial campaign would cost at least $500,000, which is roughly based on the recent experiences of New York City’s implementation of RCV and its associated voter education campaign. Of note, this estimate does not include the costs of ongoing voter education on the topic after initial implementation. • Multiple Page Ballots: KCE staff indicate that the extra space RCV races take up on the ballot would likely require multiple page ballots, which would lead to an increase in printing costs.9 • Staffing: The department anticipates that additional staff would be needed to implement RCV, both for the initial implementation and ongoing after that. According to department staff, some of this staffing need is directly related to RCV itself, while some of this staffing need is more directly related to conducting an election with multiple page ballots. Estimated additional staffing includes the following: - Three additional full-time equivalent employees at an annual cost of about $200,000, to support the additional processes and workload around ballot processing created by RCV and multiple page ballots. - Two term limited temporary (TLT) employees to help support the initial rollout of RCV at an annual cost of about $212,000. The department notes it has not made a final determination on how long these TLT employees would be needed, but the initial estimate is at least one year. - Upwards of 40 additional short-term temporary (STT) employees during elections where RCV is utilized at an estimated cost of at least about $175,000 per election with RCV. According to KCE staff, the majority of these additional STT employees would be needed to support the increased workload on ballot opening processes created by multiple page ballots, while the rest would be needed to support various ballot processing and customer service work made more complicated by both RCV and multiple page ballots. It is important to note that KCE indicates this is an initial estimate and the exact number of additional STT employees needed would vary from election to election.
9 For context, printing single page ballots currently costs KCE $0.28 per ballot, while printing two-page ballots would cost KCE $0.66 per ballot (an additional $0.28 for the second page plus a $0.10 assembly surcharge). KCE staff note that exactly how much this would increase costs in each election where RCV is used would vary, but as an example if all ballots in the 2020 November General Election had been two pages then the cost of printing ballots for that election would have increased from roughly $407,000 to roughly $960,000.
COW Meeting Materials Page 15 July 7, 2021 Potential policy issues. A summary of some potential policy issues is provided below.
Charter amendment effective date. As currently drafted in the proposed ordinance (2020-0232.1), the proposed charter amendment (if approved by the voters) would take effect the January following Council’s adoption of an ordinance approving ranked-choice voting protocols. It is important to note that Proposed Ordinance 2021-0232.1 is silent regarding when, and whether, the Council would be required to adopt the ordinance approving RCV protocols. Hypothetically, as currently drafted, if the voters were to approve the charter amendment but the Council does not adopt an ordinance approving RCV protocols, then the charter amendment would not take effect. The effective date for the proposed charter amendment presents a policy choice.
Definitions. The proposed ordinance currently lacks a definitions section (to define terms such as “majority”), which presents a policy choice to the Council as to whether to keep the proposed ordinance language as is, to include a definitions section in this proposed ordinance, or to provide direction in this proposed ordinance regarding specific terms to be defined in the RCV protocols ordinance.
RCV protocols ordinance direction. The proposed ordinance, as currently drafted, does not provide direction as to the process for determining whether RCV would be conducted in an event of two or few candidates having filed for a county office. This presents a policy choice as to whether to provide this direction in the proposed ordinance or wait to address this issue in the RCV protocols ordinance. It is also important to note that the proposed ordinance does not provide direction on specific issues to be addressed in the RCV protocols ordinance.
As indicated by KCE staff, as part of the activities to prepare for RCV implementation, the department would need to coordinate with the Council on certain decisions relating to RCV protocols, such as: the number of candidates the voter is allowed to rank; the handling of ballots with a skipped ranking or more than on consecutively skipped ranking; the handling of ballots where more than one candidate is indicated for the same rank; and the format and frequency in which results are posted online for the public, media and campaigns. Of note, the department indicates it would also need to, in coordination with the Council and its process for developing the ordinance on RCV protocols, draft and submit to the review process a new Public Rule containing any necessary administrative rules for implementing RCV not included in the protocols ordinance.
Next steps and key dates. Proposed Ordinance 2021-0232 was introduced and referred to the Committee of the Whole on June 15, 2021. An initial briefing was held in the Committee of the Whole at its June 16, 2021 meeting. To place this potential charter amendment on the November 2, 2021 ballot, the last regular Council meeting date for adoption as a non-emergency is July 20, 2021.10 The deadline for Elections to receive the effective ordinance is August 3, 2021.
10 An ordinance adopting a charter amendment is not subject to Executive veto, so the legislation is effective ten days after the Council adopts it.
COW Meeting Materials Page 16 July 7, 2021 AMENDMENTS
Staff have prepared a line amendment, and an accompanying title amendment, which are included as attachments to this staff report. Amendment 1, and accompanying Title Amendment T1, would correct the reference to the election date in the ordinance to align with state law pertaining to general elections held in odd-numbered years. Additionally, Amendment 1 would make a correction in the proposed ordinance language when referring to a scenario where no more than two candidates have filed for a county office in King County by changing “only two candidates have filed” to “two or fewer candidates have filed”.
INVITED
• Julie Wise, Director, King County Elections
ATTACHMENTS
1. Proposed Ordinance 2021-0232 2. Amendment 1 3. Title Amendment T1
COW Meeting Materials Page 17 July 7, 2021 ATTACHMENT 1 KING COUNTY 1200 King County Courthouse 516 Third Avenue Signature Report Seattle, WA 98104
Ordinance
Proposed No. 2021-0232.1 Sponsors Zahilay and Kohl-Welles
1 AN ORDINANCE proposing to amend the King County
2 Charter to utilize ranked-choice voting for the election of
3 county officers, including the King County executive, the
4 King County assessor, the King County director of elections,
5 the King County councilmembers and the King County
6 prosecuting attorney, effective January 1 following the
7 council's adoption of an ordinance approving protocols for
8 ranked-choice voting; amending Section 610 of the King
9 County Charter; and submitting the same to the voters of the
10 county for their ratification or rejection at the November 2,
11 2021, general election.
12 BE IT ORDAINED BY THE COUNCIL OF KING COUNTY:
13 SECTION 1. There shall be submitted to the qualified voters of King County for
14 their ratification or rejection, at the November 2, 2021, general election, an amendment to
15 Section 610 of the King County Charter to read as follows:
16 Section 610 Election Procedures.
17 The nominating primaries and elections for the offices of the King County
18 executive, the King County assessor, the King County councilmembers and the King
19 County prosecuting attorney shall be conducted in accordance with general law governing
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20 the election of nonpartisan county officers. However, the elections of county officers,
21 including the King County executive, the King County assessor, the King County director
22 of elections, the King County councilmembers and the King County prosecuting attorney,
23 shall be conducted using ranked-choice voting, effective January 1 following the county
24 council's adoption of an ordinance approving protocols for ranked-choice voting.
25 Ranked-choice voting shall give voters the option of ranking candidates in order
26 of preference and shall be conducted in rounds. In each round, each voter's ballot shall
27 count as a single vote for whichever continuing candidate the voter has ranked highest.
28 The candidate with the fewest votes after each round shall be eliminated. The eliminated
29 candidate's votes shall be redistributed to the next-ranked continuing candidate, until one
30 candidate receives the majority of votes for all remaining candidates. That candidate shall
31 be deemed elected at the time of certification.
32 Notwithstanding any other provision of this section, if at the end of the candidate
33 filing period only two candidates have filed for the office of the King County executive, the
34 King County assessor, the King County director of elections, the King County
35 councilmembers or the King County prosecuting attorney, the election for that office may
36 be conducted by either ranked-choice voting or according to general law governing
37 nonpartisan county offices.
38 When ranked-choice voting is conducted, there shall not be a primary for impacted
39 offices and all qualified candidates shall appear directly on the general election ballot.
40 SECTION 2. The clerk of the council shall certify the proposition to the director
41 of elections in substantially the following form, with such additions, deletions or
42 modifications as may be required by the prosecuting attorney:
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43 Shall Section 610 of the King County Charter be amended to utilize
44 ranked-choice voting, effective January 1 following the county council's
45 adoption of an ordinance approving protocols for ranked-choice voting,
46 for the election of county officers, including the King County executive,
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47 the King County assessor, the King County director of elections, the King
48 County councilmembers and the King County prosecuting attorney.
49
KING COUNTY COUNCIL KING COUNTY, WASHINGTON
______
Claudia Balducci, Chair ATTEST:
______
Melani Pedroza, Clerk of the Council
APPROVED this _____ day of ______, ______.
______
Dow Constantine, County Executive
Attachments: None
4
COW Meeting Materials Page 21 July 7, 2021 ATTACHMENT 2
July 7, 2021 1 Technical corrections
Sponsor: Zahilay [M.Leskinen] Proposed No.: 2021-0232
1 AMENDMENT TO PROPOSED ORDINANCE 2021-0232, VERSION 1
2 On page 1, line 14, after "at" insert "a special election to be held in conjunction with"
3
4 On page 2, line 33, after "period" strike "only two" and insert "two or fewer"
5
6 EFFECT prepared by M.Leskinen: Corrects the reference to the election date to
7 comport with RCW 29A.04.321. Also makes a correction in the proposed ordinance
8 language when referring to a scenario where no more than two candidates have filed
9 for a county office in King County by changing ‘only two candidates have filed’ to ‘two
10 or fewer candidates have filed’.
11
- 1 - COW Meeting Materials Page 22 July 7, 2021 ATTACHMENT 3
July 7, 2021 T1 Title Amendment
Sponsor: Zahilay [M.Leskinen] Proposed No.: 2021-0232
1 TITLE AMENDMENT TO PROPOSED ORDINANCE 2021-0232, VERSION 1
2 On page 1, line 10, after "at" insert "a special election to be held in conjunction with"
3 EFFECT prepared by M.Leskinen: Corrects the title of the ordinance to comport with
4 the body of the ordinance as amended by Amendment 1.
- 1 - COW Meeting Materials Page 23 July 7, 2021
Metropolitan King County Council Committee of the Whole
STAFF REPORT
Agenda Item: 7 Name: Mike Reed Proposed No.: 2021-0245 Date: July 7, 2021
SUBJECT
A Proposed Ordinance authorizing submittal to King County voters of an amendment to the County Charter establishing the name of the County Council as the Reverend Doctor Martin Luther King Jr. County Council.
SUMMARY
Proposed Ordinance 2021-0245 would authorize a ballot measure for the November 2, 2021 ballot to amend the County Charter to establish the name of the County Council as the Reverend Doctor Martin Luther King Jr. County Council.
BACKGROUND
King County Origins and Naming. King County was originally named by the Oregon Territorial Legislature in 1852 after William Rufus DeVane King, U.S. vice president. In 1853, Washington Territory separated from Oregon Territory, and when Washington was granted statehood in 1889, the counties then extant were retained in their status as counties:
Article 11, Section 1, Constitution of the State of Washington “The several counties of the territory of Washington existing at the time of the adoption of this constitution are hereby recognized as legal subdivisions of this state.”
In 2005, the State Legislature approved a measure renaming King County in honor of the Reverend Doctor Martin Luther King Jr. This action had the effect of changing the county’s namesake, though the actual name of the county remained “King County.” Counties, as creatures of state government, are created and defined by the state; in communications with the Prosecuting Attorney’s Office, a change to the name of King County would require action at the state level.
In 2006, the Council approved Ordinance 8227, which changed the county’s logo from the image of a crown, traditionally worn by royalty as a sign of authority, to the image of Dr. King.
COW Meeting Materials Page 24 July 7, 2021
The County Charter describes the role and function of county government, including the County Council. The Council is referred to in the Charter as “County Council” and “Metropolitan County Council” and “King County Council.”
Dr. King. The Reverend Doctor Martin Luther King Jr. was born in 1929. Dr. King was an internationally recognized advocate for non-violent resistance to oppression and discrimination directed at African Americans. He was one of the most prominent leaders of the civil rights movement of the 1960s. Dr. King came to national prominence in 1955 during his leadership of the Montgomery Bus Boycott, challenging disparate treatment of African Americans on public transportation. He was a winner of the Nobel Peace Prize in 1964. He was among the leaders of the March on Washington in 1963; his “I Have A Dream” speech, delivered at that march, is one of the most recognized and iconic speeches in the nation’s history.
Dr. King was assassinated in 1968 in Memphis, Tennessee.
Cities and states have honored Dr. King with a holiday in his honor beginning in 1971. In 1986, President Ronald Reagan signed legislation establishing January 18 as a federal holiday honoring Dr. King’s birthday.
ANALYSIS
Proposed Ordinance 2021-0245 would authorize a ballot measure for the November 2, 2021 ballot to establish The Reverend Doctor Martin Luther King Jr. County Council as the designated name of the County Council. For consistency, the term “Metropolitan” would be stricken from the County Council name in the Charter. The charter amendment would provide that all references to “County Council” or “King County Council” are intended to refer to the Reverend Doctor Martin Luther King Jr. County Council, which is established as the designated name of the legislative branch of county government.
Timing. As a proposed charter amendment for the November ballot, the authorizing ordinance would need to be delivered to the Elections Division by August 3, 2021. This allows time for consideration and recommendation by the Committee of the Whole at the July 7, 2021 meeting; expedited consideration and possible approval at the July 13, 2021 meeting of the Council; and a final opportunity for Council approval at the July 20, 2021 meeting of the Council.
ATTACHMENTS
1. Proposed Ordinance 2021-0245
COW Meeting Materials Page 25 July 7, 2021 ATTACHMENT 1 KING COUNTY 1200 King County Courthouse 516 Third Avenue Signature Report Seattle, WA 98104
Ordinance
Proposed No. 2021-0245.1 Sponsors Zahilay
1 AN ORDINANCE proposing to amend the King County
2 Charter to establish Reverend Doctor Martin Luther King,
3 Jr., County council as the designated name for the
4 legislative branch of county government in King County
5 where applicable in the king county charter; amending
6 Sections 210, 220, 220.10, 230.50.10, 270.10, 270.20,
7 270.30, 270.40 and 680.10 of the King County Charter; and
8 submitting the same to the voters of the county for their
9 ratification or rejection at a special election to be held in
10 conjunction with the November 2, 2021, general election.
11 BE IT ORDAINED BY THE COUNCIL OF KING COUNTY:
12 SECTION 1. There shall be submitted to the qualified voters of King County for
13 their ratification or rejection, at a special election to be held in conjunction with the
14 November 2, 2021, general election, an amendment to Sections 210, 220, 220.10,
15 230.50.10, 270.10, 270.20, 270.30, 270.40 and 680.10 of the King County Charter, to
16 read as follows:
17 Section 210 Composition.
18 The legislative branch shall be composed of the ((metropolitan)) Reverend Doctor
19 Martin Luther King, Jr., county council. All references to the county council or the King
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20 County council provided in this charter are intended to refer to the Reverend Doctor
21 Martin Luther King, Jr., County council, which is hereby established as the designated
22 name of the legislative branch of county government in King County.
23 Section 220 The ((Metropolitan)) County Council.
24 220.10 Composition and Terms of Office.
25 The ((metropolitan)) county council shall consist of nine members. The county
26 shall be divided into nine districts, and one councilmember shall be nominated and elected
27 by the voters of each district. The term of office of each councilmember shall be four years
28 and until the councilmember’s successor is elected and qualified.
29 230.50.10 Institutional Initiative.
30 Any city or town located within the county may, after securing the consent, by
31 motion or resolution, of at least one half of the cities within the county, propose an
32 ordinance of county-wide significance directly to the ((metropolitan)) county council,
33 except an ordinance which is not subject to a referendum under the provisions of Section
34 230.40 of this charter. Such proposed legislation shall be in ordinance form. The
35 ((metropolitan)) county council shall take action on such proposed legislation within ninety
36 (((90))) days of its filing with the county council.
37 270.10 Regional Committees.
38 Three regional committees shall be established by ordinance to develop,
39 recommend and review regional policies and plans for consideration by the
40 ((metropolitan)) county council: one for transit, one for water quality and one for other
41 regional policies and plans.
42 270.20 Composition of regional committees.
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43 Each regional committee shall consist of nine voting members. Three members
44 shall be ((metropolitan)) county councilmembers appointed by the chair of the council, and
45 shall include councilmembers from districts with unincorporated residents. Each county
46 councilmember vote shall be weighted as two votes. The remaining six members of each
47 committee except the water quality committee shall be local elected city officials appointed
48 from and in proportion to the relative populations of: (i) the city with the largest population
49 in the county and (ii) the other cities and towns in the county. Committee members from
50 the city with the largest population in the county shall be appointed by the legislative
51 authority of that city. Committee members from the other cities and towns in the county
52 shall be appointed in a manner agreed to by and among those cities and towns representing
53 a majority of the populations of such cities and towns, provided, however, that such cities
54 and towns may appoint two representatives for each allocated committee membership, each
55 with fractional (1/2) voting rights.
56 The special purpose districts providing sewer service in the county shall appoint
57 two members to serve on the water quality committee in a manner agreed to by districts
58 representing a majority of the population within the county served by such districts. The
59 remaining four local government members of the water quality committee shall be
60 appointed in the manner set forth above for other regional committees. The council may by
61 ordinance authorize the appointment to the water quality committee of additional,
62 nonvoting members representing entities outside of the county that receive sewerage
63 treatment services from the county. Allocation of membership of each committee's
64 members who are city and town representatives shall be adjusted January 1 of each even-
65 numbered year beginning in 1996 based upon current census information or, if more recent,
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66 official state office of financial management population statistics.
67 In the event any areas are annexed pursuant to powers granted to metropolitan
68 municipal corporations under state law, the populations of any cities and towns in such
69 annexed areas shall be considered as if they were within the county for purposes in this
70 section with regard to regional committee participation on policies and plans which would
71 be effective in such annexed areas.
72 Members representing six and one-half votes constitute a quorum of a regional
73 committee. In the absence of a quorum, the committee may perform all committee
74 functions except for voting on legislation or a work program. Each committee shall have a
75 chair and a vice-chair with authority as specified by ordinance. The chair shall be a county
76 councilmember appointed by the chair of the county council. The vice-chair shall be
77 appointed by majority vote of those committee members who are not county
78 councilmembers, in accordance with voting rights that are apportioned as provided in this
79 section.
80 270.30 Powers and Duties.
81 Each regional committee shall develop, propose, review and recommend action on
82 ordinances and motions adopting, repealing, or amending transit, water quality or other
83 regional countywide policies and plans within the subject matter area of the committee.
84 The subject matter area of the regional policies committee shall consist of those
85 countywide plans and policies included in the committee's work program by a majority of
86 the members present and voting, with no fewer than three and one-half affirmative votes.
87 The county council shall refer each such proposed ordinance or motion, except
88 those developed and proposed by a regional committee, to a regional committee for review.
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89 The regional committee shall complete review and recommend action within one hundred
90 twenty days or such other time as is jointly established by the county council and the
91 committee, which shall be confirmed in the form of a motion by the ((metropolitan))
92 county council. If the committee fails to act upon the proposed ordinance or motion within
93 the established time limit, the county council may adopt the proposed ordinance or motion
94 upon six affirmative votes. The committee may request, by motion to the county council,
95 additional time for review.
96 A proposed ordinance or motion that has been reviewed and recommended or
97 developed and proposed by a regional committee may be adopted, without amendment, by
98 the county council by five affirmative votes. If the county council votes prior to final
99 passage thereof to amend a proposed ordinance or motion that has been reviewed or
100 recommended or proposed by a regional committee, the proposed ordinance or motion, as
101 amended, shall be referred back to the appropriate committee for further review and
102 recommendation. The committee may concur in, dissent from, or recommend additional
103 amendments to the ordinance or motion. After the regional committee has had the
104 opportunity to review all county council amendments, final action to adopt any proposed
105 ordinance or motion that differs from the committee recommendation shall require six
106 affirmative votes of the county council.
107 Each regional committee may develop and propose directly to the council an
108 ordinance or motion adopting, amending or repealing a countywide policy or plan within
109 the subject matter area of the committee. Such proposals must be approved by a majority of
110 the members present and voting, with no fewer than three and one-half affirmative votes.
111 Within one hundred twenty days of introduction or such other time as is jointly established
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112 by the county council and the committee, which shall be confirmed in the form of a motion
113 by the county council, the council shall consider the proposed legislation and take such
114 action thereon as it deems appropriate, as provided by ordinance.
115 The council shall not call a special election to authorize the performance of an
116 additional metropolitan municipal function under state law unless such additional function
117 is recommended by a regional policy committee, notwithstanding the provisions of Section
118 230.50.10 of this charter. Such recommendation shall require an affirmative vote of at least
119 two-thirds of the membership of each of: (1) metropolitan councilmembers of the
120 committee; (2) members from the city with the largest population in the county; and (3)
121 other city or town members of the committee. Nothing in this section prohibits the
122 ((metropolitan)) county council from calling a special election on the authorization of the
123 performance of one or more additional metropolitan functions after receiving a valid
124 resolution adopted by city councils as permitted by RCW 35.58.100(1)(a) and RCW
125 35.58.100(1)(b), or a duly certified petition as permitted by RCW 35.58.100(2).
126 270.40 Invalidity - Development of Proposed Amendment.
127 If any provision of section 270 of this charter is declared invalid, the
128 ((metropolitan)) county council shall initiate a process with representatives of cities and
129 towns within the county to develop a proposed charter amendment providing for effective
130 city, town, and unincorporated area participation in regional decisions.
131 680.10 Designation, Appointment and Election to Fill Vacancy.
132 Immediately upon commencing their terms of office, the county executive, county
133 assessor, county director of elections and county prosecuting attorney shall each designate
134 one or more employees who serve as a deputy or assistant in such office to serve as an
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135 interim official in the event of a vacancy in the elective office of the county executive,
136 county assessor, county director of elections or county prosecuting attorney, respectively.
137 Except for a designation made by the ((metropolitan)) county council, a
138 designation of an interim official shall only be effective if the county executive, county
139 assessor, county director of elections and county prosecuting attorney, each for that
140 officer’s elective office, complies with the following procedure; commits the designation to
141 writing; identifies the order of precedence if more than one county officer or employee is
142 designated; signs the written designation; has the written designation notarized; files the
143 written designation with the county office responsible for records; and provides a copy of
144 the written designation to the chair of the ((metropolitan)) county council. The county
145 executive, county assessor, county director of elections and county prosecuting attorney
146 may, at any time, amend such designation by complying with the same procedure
147 established for making the designation.
148 In the event the county executive, county assessor, county director of elections and
149 county prosecuting attorney neglects or fails to make such a designation within seven
150 calendar days of commencing ((his or her)) their terms of office, the ((metropolitan))
151 county council may by ordinance designate one or more employees who serve as a deputy
152 or assistant in such offices to serve as an interim official in the event of a vacancy in the
153 elective office of the county executive, county assessor, county director of elections or
154 county prosecuting attorney, respectively. A designation made by the ((metropolitan))
155 county council shall be effective upon adoption of the ordinance therefor and may be
156 amended by ordinance; provided that a designation by the county executive, county
157 assessor, county director of elections or county prosecuting attorney which occurs
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158 subsequent to the adoption of an ordinance shall take precedence over the designation by
159 ordinance.
160 The designated county officer or employee shall immediately upon the occurrence
161 of a vacancy serve as the interim official and shall exercise all the powers and duties of the
162 office granted by this charter and general law until an acting official is appointed as
163 provided in this section.
164 The ((metropolitan)) county council shall, after being appraised of a vacancy in the
165 elective office of county executive, county assessor, county director of elections or county
166 prosecuting attorney, fill the vacancy by the appointment of an employee who served as a
167 deputy or assistant in such office at the time the vacancy occurred as an acting official to
168 perform all necessary duties to continue normal office operations. The acting official shall
169 serve until the vacancy is filled by appointment pursuant to general law for nonpartisan
170 county elective offices.
171 A vacancy in an elective county office shall be filled at the next primary and
172 general elections which occur in the county; provided that an election to fill the vacancy
173 shall not be held if the successor to the vacated office will be elected at the next general
174 election as provided in Section 640 of this charter. The term of office of an officer who has
175 been elected to fill a vacancy shall only be for the unexpired portion of the term of the
176 officer whose office has become vacant and shall commence as soon as he or she is elected
177 and qualified.
178 A majority of the county council may temporarily fill a vacancy by appointment
179 until the vacancy has been filled by election or the successor to the office has been elected
180 and qualified.
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181 SECTION 2. The clerk of the council shall certify the proposition to the director of
182 elections in substantially the following form, with such additions, deletions or
183 modifications as may be required by the prosecuting attorney.
184 Shall Sections 210, 220, 220.10, 230.50.10, 270.10, 270.20, 270.30,
185 270.40 and 680.10 of the King County Charter be amended to establish
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186 Reverend Doctor Martin Luther King, Jr., County council as the
187 designated name for the county council?
188
KING COUNTY COUNCIL KING COUNTY, WASHINGTON
______
Claudia Balducci, Chair ATTEST:
______
Melani Pedroza, Clerk of the Council
APPROVED this _____ day of ______, ______.
______
Dow Constantine, County Executive
Attachments: None
10
COW Meeting Materials Page 35 July 7, 2021
Metropolitan King County Council Committee of the Whole
STAFF REPORT
Agenda Item: 8 Name: Terra Rose Proposed No.: 2021-0237 Date: July 7, 2020
SUBJECT
Proposed Ordinance 2021-0237 would authorize the Executive to convey a 9.81-acre surplus property owned by the Solid Waste Division and located at 13620 SE Eastgate Way in Bellevue to Polaris at Eastgate, LLC, Horizon Housing Alliance, and Congregations for the Homeless through a negotiated direct sale of nearly $18.89 million. The buyers are proposing to develop the property to contain a men's shelter, as well as workforce housing and affordable housing.
SUMMARY
Proposed Ordinance 2021-0237 would authorize the Executive to sell the surplus property at 13620 SE Eastgate Way in Bellevue to Polaris at Eastgate, LLC, Horizon Housing Alliance, and Congregations for the Homeless for nearly $18.89 million. The property was purchased in 1993 by the Solid Waste Division ("SWD") using solid waste funds as a site for construction of a new transfer station, which was ultimately not built on the site for financial reasons, according to the Property Summary. SWD notified the Facilities and Management Division ("FMD") that the property was surplus to its needs on January 22, 2018 and FMD declared it surplus to the County's needs on September 4, 2019. Since the property was purchased using solid waste funds, proceeds would accrue to the Solid Waste Division operating fund.
The Executive is proposing a negotiated direct sale with the buyers, citing authority under K.C.C. 4.56.100.A.2, which provides that the Council, by ordinance, may determine that unique circumstances make such a sale in the best interests of the public and under K.C.C. 4.56.100.A.8, which exempts the county from selling to the highest responsible bidder when it is deemed to be in the public interest to restrict the use of the project for the provision of social or health services. The proposed ordinance states that "Unique circumstances are present because of the community partnerships necessary to complete this sale and create a permanent adult shelter to serve the eastside of King County." According to the Property Summary, this sale would provide the first permanent shelter on the eastside of King County. In addition to a men's shelter, the buyers are also proposing to develop the property for workforce housing and affordable housing.
COW Meeting Materials Page 36 July 7, 2021 The proposed Purchase and Sale Agreement ("PSA") was executed by all parties on or before June 4, 2021 and is subject to Council approval. Executive staff indicate that the buyers have expressed strong interest in closing on July 30, 2021 due to financing pressures, which would mean that the July 13th Council meeting would be the last regular Council meeting to adopt the ordinance.1
BACKGROUND
Property History. The property located at 13620 SE Eastgate Way in Bellevue in Council District 6 is approximately 9.81 acres and is bordered to the north by the Factoria Recycling and Transfer Station with office development along its west and east property boundaries and SE Eastgate Way to the south. This staff report refers to the property as the "Eastgate property." (Note that the PSA and the Binding Site Plan described later in the staff report identify it as Parcel B of Boundary Line Adjustment No. 11-114500-LW.) King County also owns the property adjacent to and immediately north of the Eastgate property, which is used by the Factoria Recycling and Transfer Station and is referred to as Parcel A of the Boundary Line Adjustment No. 11-114500-LW in the PSA.
The Property Summary indicates that the Eastgate property was originally purchased in 1993 by the Solid Waste Division using solid waste funds as a site for construction of a new transfer station that was ultimately not built on the site for financial reasons. Executive staff note that the site has in the past supported a series of short-term leases, however, that there is not a current tenant in place. Since the Eastgate property was purchased using solid waste funds, proceeds would accrue to the Solid Waste Division operating fund. Sale of the Eastgate property has been assumed in the adopted budget for the biennium and in the proposed solid waste fee ordinance that has been transmitted to the Council.2
According to the Property Summary, SWD notified FMD that the property was surplus to its needs on January 22, 2018 and FMD declared it surplus to the County's needs on September 4, 2019.
Proposal to Develop Shelter and Affordable Housing. The King County Executive on November 2, 2015 made a Local Proclamation of Emergency due to homelessness affecting King County and stating that the County will continue to work with all the cities within King County on plans to address homelessness. The proclamation commits the County to take actions that support its goals of making homelessness rare, brief and one-time; reducing racial disparities; and engaging the full community in ending homelessness.
The recitals to the PSA indicate that on February 12, 2019, King County and Congregations for the Homeless entered into an Exclusive Negotiation Agreement for the Purchase and Sale of Real Property, subsequently amended, which provided
1 Note that this assumes the Council Chair and Executive will sign the legislation shortly after adoption, and also that Executive staff exercise the 30-day extension of the Council approval period allowable under the terms of the PSA. 2 PO 2021-0225
COW Meeting Materials Page 37 July 7, 2021 Congregations for the Homeless the exclusive right to negotiate with the County for purchase of the Eastgate property until October 31, 2019. Congregations for the Homeless and King County also previously entered into a Real Estate Purchase and Sale Agreement as of September 9, 2019, subsequently amended. Executive staff indicated that CFH had to secure project partnerships in order for the project to be financially viable. The transmitted PSA was executed by all parties on or before June 4, 2021 and would replace and supersede both previously described agreements.
According to the Property Summary, the Eastgate property is zoned OLB2, Office and Limited Business 2, but Executive staff indicate that in order to situate a shelter and affordable housing on the site, the proposed buyers completed a Binding Site Plan with the City of Bellevue to authorize construction and operation of a shelter. The Binding Site Plan was approved on April 1, 2021. The Binding Site Plan, according to the PSA, would also segregate the Eastgate property into three separate properties with each to be acquired by one of the three buyers, and which is further described below.
Proposed Ordinance 2021-0237 would authorize the Executive to convey the surplus property at 13620 SE Eastgate Way in Bellevue to three buyers: • Polaris at Eastgate, LLC ("Polaris") -- The transmitted documents describe Polaris as an affiliate of the Inland Group, a high-density residential development and construction company that specializes in income restricted multi-family housing, with a specific focus on workforce housing for households earning less than 60 percent of area median income. Under the PSA, Polaris would acquire a portion of the Eastgate property -- identified as Lot 1 on the Binding Site Plan and as the "Workforce Housing Parcel" in the PSA -- for the anticipated construction and operation of affordable workforce housing; • Horizon Housing Alliance ("HHA") -- The transmitted documents describe HHA as a California nonprofit public benefit corporation with a mission of producing top quality affordable housing inclusive of exceptional support services, with a specific focus on permanent housing for formerly homeless families and individuals. Under the PSA, HHA would acquire a portion of the Eastgate property -- identified as Lot 3 on the Binding Site Plan and as the "Affordable Housing Parcel" in the PSA -- for the anticipated construction and operation of affordable housing, including, but not limited to, units designed for households who have experienced homelessness. It is anticipated in the PSA that HHA may be replaced before the sale closes. The PSA specifically contemplates that HHA may be replaced by Plymouth Housing Group, a local nonprofit provider of low income housing in King County; and • Congregations for the Homeless ("CFH") -- The transmitted documents describe CFH as a Washington nonprofit corporation and faith-based community organization that provides a continuum of services to help men transition out of homelessness, including street outreach, shelter and day center operation, comprehensive case management, and subsidized housing. Under the PSA, CFH would acquire a portion of the Eastgate property -- identified as Lot 2 on the Binding Site Plan and as the "Shelter Parcel" in the PSA -- for the anticipated construction and operation of an 80-100 bed overnight shelter and drop-in day center for individuals experiencing homelessness. According to the Property
COW Meeting Materials Page 38 July 7, 2021 Summary, the development of this property with a men's shelter would provide the first permanent shelter on the Eastside of King County.
ANALYSIS
Proposed Ordinance 2021-0237 would authorize the sale of 13620 SE Eastgate Way in Bellevue to Polaris at Eastgate, LLC, Horizon Housing Alliance, and Congregations for the Homeless for nearly $18.89 million. Proceeds would accrue to the Solid Waste Division operating fund and sale of the Eastgate property has been assumed in the adopted budget for the biennium and in the proposed solid waste fee ordinance that has been transmitted to the Council.3
The requirements related to the sale of surplus properties that are outlined in King County Code Section 4.56, as well as the status of these requirements for the Eastgate property, are shown in Table 1 below.
Table 1. Surplus Property Sale Requirements
# Requirement K.C.C. Outcome/Status Reference
SWD notified FMD that the property was Solid Waste Division 1. 4.56.070 surplus to its needs on January 22, 2018, Surplus Notification according to the Property Summary.
The Property Summary indicated that FMD FMD Offer of Property to offered the property to other county agencies 2. 4.56.070 other County Agencies and received "none that would interfere with the proposed sale."
According to the Property Summary, the County determined the property to be suitable for affordable housing and the Property Evaluated for 3. 4.56.070.C.1 buyers are proposing to develop the property Affordable Housing to contain a men's shelter, as well as workforce and affordable housing.
FMD declared the property surplus on 4. Final Surplus Declaration 4.56.070 September 4, 2019.
According to the Property Summary, the property was appraised on October 16, 2020 by Integra Realty and found to have an 5. FMD Appraisal N/A estimated fair market value of $21.435 million. This value was validated by a review appraisal by ABS Valuation on March 16, 2021.
3 PO 2021-0225
COW Meeting Materials Page 39 July 7, 2021 # Requirement K.C.C. Outcome/Status Reference
Under King County Code, sales of real property shall be sold to the highest responsible bidder at public auction or by sealed bid, except in certain circumstances. The proposed ordinance would authorize the Executive to covey the Eastgate property through a negotiated direct sale, citing two exceptions to the highest responsible bidder Public Notification of Sale requirement -- that unique circumstances 6. 4.56.090 make direct sale in the best interests of the public (K.C.C. 4.56.100.A.2) and the use of a portion of the surplus property would be restricted to the provision of social or health purposes (K.C.C. 4.56.100.A.8).
Under K.C.C. 4.56.100.A.2, public notification is not required.
As noted above, sales of real property are exempt from being sold to the highest responsible bidder at public auction or by sealed bid under certain circumstances Bid Process described in King County Code. The 7. 4.56.100 proposed ordinance has cited exceptions under K.C.C 4.56.100.A.2 and 4.56.100.A.8 to justify a negotiated direct sale. This is further discussed later in this staff report.
The Purchase and Sale Agreement (PSA) Purchase and Sale was executed by all parties on or before 8. N/A Agreement June 4, 2021.
As the value of the surplus property being conveyed exceeds $100,000, Council approval of the sale is required. Additionally, the PSA includes a provision that the PSA is subject to approval by ordinance by the Council and this contingency is satisfied if an 9. Council Approval 4.56.080 ordinance approving the conveyance of the property becomes effective on or before July 15, 2021. The County may unilaterally extend the Council approval period one time for an additional thirty days by notice to the buyers prior to the expiration of the initial Council review period.
COW Meeting Materials Page 40 July 7, 2021 # Requirement K.C.C. Outcome/Status Reference If approved by the Council, $236,807 of the sale proceeds would be disbursed to FMD for costs associated with the sale of the Disposition of Sale 10. 4.56.130 surplus property. The remaining proceeds of Proceeds $18,649,193 would be deposited into the SWD operating fund.
Appraisal. The Eastgate property appraisal was prepared by Integra Realty and reviewed by ABS Valuation, according to the Property Summary. Two approaches were used to determine the appraised value; the first analyzed eight sales and after adjustment resulted in a value of $21.36 million and the second used a Land Residual Approach based on a theoretical development consistent with highest and best use, which resulted in a value of $21.435 million. As reconciled, the estimated fair market value ("FMV") was determined to be $21.435 million, dated October 16, 2020. The estimated FMV amount was validated by a review appraisal completed by ABS Valuation and dated March 16, 2021.
The proposed purchase price in the PSA of $18.885 million is equal to the amount of the appraised FMV ($21.435 million) less $2.55 million, which the Property Summary indicates is "the estimated cost to remediate the environmental contamination of the property to meet current regulatory cleanup criteria and provide King County protection from future claims." Executive staff indicate that the work will be the responsibility of the buyers and the amount was based on a review by a consultant that analyzed the conditions and proposed remediation plan. They further note that once the sale closes, the County will have full indemnification for environmental liability from the buyers.
Direct Negotiated Sale. Under King County Code, sales of real property shall be sold to the highest responsible bidder at public auction or by sealed bid except under certain circumstances, including the Council determining that unique circumstances make a direct negotiated sale in the best interests of the public and for provision of social or health services in the public interest.4 According to the proposed ordinance language, "Unique circumstances are present because of the community partnerships necessary to complete this sale and create a permanent adult shelter to serve the eastside of King County." Executive staff indicate that CFH had expressed interest in the Eastgate property but had to secure project partnerships in order for the project to be financially viable.
Adoption of the proposed ordinance would serve as the Council's determination that unique circumstances make a negotiated direct sale in the best interests of the public under K.C.C. 4.56.100.A.2. The proposed ordinance also would authorize the Executive to convey the Eastgate property to Polaris, HHS, and CFH, consistent with the transmitted PSA, which is Attachment A to the proposed ordinance.
Summary of Key PSA Terms. Table 2 beginning on the following page provides a high-level summary of key terms in each section of the PSA.
4 K.C.C. 4.56.100.A.2. and K.C.C. 4.56.100.A.8.
COW Meeting Materials Page 41 July 7, 2021
Table 2. Summary of Key PSA Terms
PSA Section Summary of Key Terms Beginning Page in PSA Article 1. Seller (King County) shall sell and convey to the buyers p. 3 Purchase and (Polaris, HHS, CFH) on the closing date and the buyers Transfer of shall buy and accept from the seller the following assets and Assets properties: • Eastgate property -- specifically, the Shelter Parcel within the Eastgate property would be acquired by CFH, the Workforce Housing Parcel by Polaris, and the Affordable Housing Parcel by HHS, as determined by the Binding Site Plan approved by the City of Bellevue on April 1, 2021 or as the parties jointly agree; • The easements described below and a street dedication.5
Recordation of the Binding Site Plan is a condition of closing.
No later than fourteen days prior to the closing date, the seller (King County) agrees to grant the following easements, so that they may be recorded prior to the Binding Site Plan: • A private sanitary sewer easement over and across Parcel A for the benefit of the Workforce Housing Parcel (see also Exhibit H); • A private sanitary sewer easement over and across Parcel A and the Affordable Housing Parcel, for the benefit of the Shelter Parcel and the Affordable Housing Parcel (see also Exhibit I); • A private storm drainage easement over and across Parcel A for the benefit of the Workforce Housing Parcel (see also Exhibit J); • A temporary shoring wall/tie-back easement over and across Parcel A for the benefit of the Workforce Housing Parcel (see also Exhibit K); and • A temporary construction easement to Polaris over and across a section of Parcel A allowing grading and the demolition of certain abandoned improvements (e.g., asphalt pavement, concrete, utilities, etc.) (see also Exhibit M).
5 The Binding Site Plan creates a small parcel along SE Eastgate Way (identified on the Binding Site Plan as Parcel A, which is not to be confused with the Parcel A of the Boundary Line Adjustment No. 11- 114500-LW described earlier in this staff report). The PSA requires this small parcel be dedicated to the City of Bellevue for right-of-way purposes.
COW Meeting Materials Page 42 July 7, 2021 PSA Section Summary of Key Terms Beginning Page in PSA Article 2. Establishes total purchase price of $18.885 million, which is p. 6 Purchase Price equal to the appraised fair market value of $21.435 million less $2.55 million, which is the amount of the estimated cost to "remediate the environmental contamination of the Property per the requirements of MTCA [Model Toxics Control Act]..." (p. 6)
Seller agrees that CFH, Polaris, and HHA may allocate the purchase price as follows: $1.7 million to CFH for the Shelter Parcel, $14.885 million to Polaris for the Workforce Housing Parcel, and $2.3 million to HHA for the Affordable Housing Parcel. Seller further agrees that CFH, Polaris, and Horizon may reallocate the purchase price among the parcels as such parties may agree.
Outlines terms for deposit of earnest money.
Article 3. Outlines terms for representations and warranties of the p. 7 Representations seller and buyers, seller disclosure statement, and Warranties indemnification requirements, acceptance of the condition of of the Parties the respective parcels "as is, where is" with all faults and and Condition of patent or latent defects. the Property Provides for terms for and a schedule outlining the percentage of net profit due to the County should any of the buyers lease or convey their respective parcels within a certain period of time. This is further described later in this staff report.
Article 4. Outlines terms related to the title and title insurance. p. 15 Title Matters
COW Meeting Materials Page 43 July 7, 2021 PSA Section Summary of Key Terms Beginning Page in PSA Article 5. Outlines terms for buyers' inspection and right of entry. p. 16 Contingencies The PSA is subject to approval by ordinance by the Council. This is further described later in this staff report.
The Parties acknowledge and agree (1) that the entire deposit will be made by Polaris; (2) that HHA will have no earnest money or deposits at risk prior to closing; (3) that HHA's acquisition of the Affordable Housing Parcel is subject to a determination by Horizon on the desirability of the parcel for the Affordable Housing Project as a result of the completion of the environmental review in accordance with 24 C.F.R. Part 58; (4) and that HHA's interest in this agreement is therefore an allowable option. In the event HHA declines to exercise its allowable option, Horizon shall assign its rights to an affiliate of Polaris and the Polaris affiliate shall assume HHA's obligations and responsibilities.
Use Covenants in Exhibit G shall be executed by Seller and Buyers, and recorded against the Shelter Parcel, Workforce Housing Parcel, and Affordable Housing Parcel. The Use Covenants shall each contain release mechanisms providing for the termination of the Use Covenants in the event the applicable buyer is prevented from building or operating the Shelter Project, the Workforce Housing Project or the Affordable Housing Project due to circumstances beyond its control. Circumstances beyond the buyer's control shall include: inability to obtain essential permits and entitlements from the relevant governmental entities; or the issuance of a final judgment or permanent injunctive relief by a court of competent jurisdiction that prevents compliance with the applicable Use Covenants. This is further described later in this staff report.
Outlines terms for buyers to notify seller on obtaining satisfactory financing or grant funding or both, in an amount sufficient to consummate the closing.
Article 6. Outlines terms for seller in assuring the representations and p. 19 Covenants of warranties, and all covenants. Seller Pending Closure Article 7. Outlines terms for buyers in assuring the representations p. 19 Covenants of and warranties, and all covenants. Buyer Pending Closure Article 8. Outlines the obligations of buyers to close on the closing p. 20 Conditions date. Precedent to Buyer's Obligations
COW Meeting Materials Page 44 July 7, 2021 PSA Section Summary of Key Terms Beginning Page in PSA Article 9. Outlines the obligations of the seller to close on the closing p. 20 Conditions date. Precedent to Seller's Obligations Article 10. The closing to occur under the PSA shall take place no p. 21 Closing earlier than July 30, 2021 and no later than September 30, 2021.
Outlines terms related to prorations of property taxes and assessments, seller's delivery of documents at closing, and buyers' delivery of purchase price at closing.
Article 11. Outlines terms related to default and attorneys' fees, p. 22 Miscellaneous computation of time, notice delivery, severability, and other Provisions miscellaneous provisions.
HHA is authorized to assign its rights under the PSA to purchase the Affordable Housing Parcel to the Polaris affiliate; or a special purpose entity managed or controlled by HHA, or to a special purpose entity managed or controlled by Plymouth Housing Group, conditioned only upon assuming HHA's obligations under the PSA.
Signature Pages PSA was executed by all parties on or before June 4, 2021. p. 28
Exhibit A Legal Description p. 30
Exhibit B Binding Site Plan p. 31
Exhibit C Bargain and Sale Deed p. 32
Exhibit D Seller's Certification of Non-Foreign Status under Foreign p. 35 Investment in Real Property Tax Act
Exhibit E Memorandum of Seller's Share of Consideration upon p. 36 Future Conveyance
Exhibit F Form of Earnest Money Promissory Note (Deposit) p. 38
Exhibit G Use Covenants p. 39 The Use Covenants are further described later in this staff report.
Exhibit H West Private Sanitary Sewer Easement p. 40 Easements are further described later in this staff report.
Exhibit I East Private Sanitary Sewer Easement p. 41 Easements are further described later in this staff report.
COW Meeting Materials Page 45 July 7, 2021 PSA Section Summary of Key Terms Beginning Page in PSA Exhibit J Private Storm Drainage Easement p. 42 Easements are further described later in this staff report.
Exhibit K Temporary Shoring Easement p. 43 Easements are further described later in this staff report.
Exhibit L Demolition Plan p. 44
Exhibit M Temporary Construction Easement p. 45 Easements are further described later in this staff report.
Profit-sharing Upon Future Conveyance. Under Section 3.5 of the PSA, the County is entitled to receive certain payments from the buyers or their affiliates in the event of future conveyance of the property.6 The PSA provides the terms for and schedule outlining the percentage of net profit7 due to the County should this occur from the closing date through and including the day ten years from the closing date. Table 3 summarizes the schedule for the profit-sharing. Executive staff indicate that the profit- sharing schedule and terms are primarily intended to ensure the developer does not "flip" the property, which is more likely to occur in the early years following the closing date.
Note that profit-sharing may terminate earlier under the following circumstances: • For the Shelter Parcel, after commencement of construction of the Shelter Project; • For the Workforce Housing Parcel, upon the closing of financing for construction of the Workforce Housing Project that is funded with at least $10.0 million in documented, verifiable, and commercially reasonable construction financing; or • For the Affordable Housing Parcel, upon the closing of financing for construction of the Affordable Housing Project that is funded with at least $10.0 million in documented, verifiable, and commercial reasonable construction financing.
6 This may include, as more specifically defined in the PSA, a transfer, conveyance, sale, disposition, condemnation, assignment, encumbrance, mortgage, pledge or grant of any legal or beneficial right, title or interest in the property (or any portion of the property), or the grant of an option with respect to any of the foregoing. 7 In the PSA, net profit is "defined as the sales proceeds and all other sums received by or due to CFH, Polaris or Horizon (or an Affiliate) from the Conveyance ("Proceeds") after subtracting the actual and reasonable third party closing costs and the purchase price such entity paid to Seller hereunder; and also subtracting its actual out-of-pocket expenses incurred by such entity associated with acquiring the Applicable Parcel and obtaining all necessary permits and entitlements in order to build and operate the applicable project…" (p. 13). Note that the net profits for a long-term lease has its own methodology as described in the PSA.
COW Meeting Materials Page 46 July 7, 2021
Table 3. Profit-Sharing Schedule for Future Conveyance of Parcels
Duration Duration Amount of Profit- Amount of Profit- From To Sharing for Sharing for LEASE of CONVEYANCE of Parcel Parcel Limited to leases with terms of 10+ years for all or a substantial part of the parcel Closing Date On/before 3rd anniversary of 70% of net profits 70% of net profits Closing Date After 3rd On/before the 4th 60% of net profits 60% of net profits anniversary anniversary of Closing Date After 4th On/before the 5th No profit sharing 50% of net profits anniversary anniversary of Closing Date After 5th On/before the 6th No profit sharing 40% of net profits anniversary anniversary of Closing Date After 6th On/before the 7th No profit sharing 30% of net profits anniversary anniversary of Closing Date After 7th On/before the 8th No profit sharing 20% of net profits anniversary anniversary of Closing Date After 8th On/before the 10th No profit sharing 10% of net profits anniversary anniversary of Closing Date
However, as noted above, once the two housing entities receive their financing or when CFH begins construction on the shelter, this provision would terminate.
Use Covenants. Section 5.6 of the PSA and Exhibit G both concern the three use covenants included in the PSA, and which are further described below:
• Restrictive Covenant for Shelter Use - Shelter Parcel: CFH covenants and declares that during the term of the covenant the use of the Shelter Parcel shall be restricted principally to the construction, operation, and maintenance of a low- barrier8 shelter serving "literally homeless" persons, a term which under the PSA is tied to the definition of homelessness under United States Department of Housing and Urban Development regulations. Additionally, under the PSA, the Shelter Parcel may also be used for the administrative and business operations of CFH and its assigns. This covenant is to be in place until the twentieth anniversary of the date the covenant is recorded, and it automatically terminates upon the expiration of its term. • Declaration of Covenant for Low-Income Housing - Workforce Housing Project: This covenant specifies that each housing unit for the Workforce Housing Project shall be both rent-restricted and occupied by (or held available for rental to) individuals whose income at the time of initial occupancy is sixty percent or less of Area Median Income ("AMI").9 For the purposes of the covenant, a housing unit is rent-restricted if the gross rent with respect to such housing unit does not
8 Low barrier is defined in the PSA as "accepting anyone experiencing homelessness who can sufficiently manage his/her behavior to live in community with others. Individuals will not be denied access due to criminal history, mental illness, or drug/alcohol use or addiction" (Exhibit E, CFH, p. 3) 9 According to HUD for FY 2021, 60% of AMI for a family of four was $69,400.
COW Meeting Materials Page 47 July 7, 2021 exceed thirty percent of the "imputed income limitation," which scales the income limitation to the size of unit and associated occupancy. For example, in the case of a housing unit that does not have a separate bedroom, the income limitation would be calculated assuming one individual and for a housing unit that has one or more separate bedrooms, the income limitation would be calculated assuming one and one-half individuals for each separate bedroom. Additionally, the covenant requires Polaris (and its successors and assigns) to pay residential prevailing wages for initial construction of the Workforce Housing Project and shall have an apprentice utilization goal of fifteen percent in accordance with K.C.C. 4.56.100.C1-2.10 The covenant shall be binding on all successors and assigns of Polaris and is to be in place until the twentieth anniversary of the date the covenant is recorded. The covenant automatically terminates upon the expiration of its term. In the event that Polaris (or its successors and assigns) is prevented from building or operating the Workforce Housing Project during the term of this covenant due to circumstances beyond its control, King County agrees to release and terminate this covenant. • Declaration of Covenant for Low-Income Housing - Affordable Housing Project: This covenant specifies that each housing unit for the Affordable Housing Project shall be both rent-restricted and occupied by (or held available for rental to) individuals whose income at the time of initial occupancy is fifty percent or less of AMI.11 For the purposes of the covenant, a housing unit is rent-restricted if the gross rent with respect to such housing unit does not exceed thirty percent of the imputed income limitation, which was described in the previous bullet. Additionally, the covenant requires HHA (and its successors and assigns) to pay residential prevailing wages for initial construction of the Affordable Housing Project and shall have an apprentice utilization goal of fifteen percent in accordance with K.C.C. 4.56.100.C.1-2. The covenant shall be binding on all successors and assigns of HHA and is to be in place until the twentieth anniversary of the date the covenant is recorded. The covenant automatically terminates upon the expiration of its term. In the event that HHA (or its successors and assigns) is prevented from building or operating the Affordable Housing Project during the term of this covenant due to circumstances beyond its control, King County agrees to release and terminate this covenant.
In addition to these covenants, the attorneys representing the workforce and affordable housing entities have confirmed that the Washington state12 financing for such housing will require similarly restrictive covenants for a periods of not less than thirty-eight years and that there is no mechanism by which these state-required covenants can be released. Council staff have requested copies of these covenants.
Easements. Section 1.2.2 of the PSA and Exhibits H through M concern the easements that would be granted in the transaction. As noted earlier, King County owns the property adjacent to and immediately north of the Eastgate property, which is referred to
10 The PSA notes that Polaris shall use September 8, 2020 as the wage publication date. Executive staff indicate that Polaris requested this date because it was tied to when they went out to bid and got under contract for construction. 11 According to HUD for FY2021, 50% of AMI for a family of four was $57,850. 12 Washington State Housing commission and the state’s Department of Commerce.
COW Meeting Materials Page 48 July 7, 2021 as Parcel A of the Boundary Line Adjustment No. 11-114500-LW in the PSA. The five easements are described below:
• West Private Sanitary Sewer Easement: Under Exhibit H of the PSA, King County would grant a non-exclusive, perpetual private sanitary sewer easement over and across a portion of Parcel A for the benefit of the Workforce Housing Parcel. This easement, approximately 185 square feet in size, is to be used solely for the construction, maintenance, and operation of a sanitary sewer pipeline. The sanitary sewer easement shall run with the land and shall be binding and obligate all persons and/or entities having or acquiring any right, title or interest in the land. • East Private Sanitary Sewer Easement: Under Exhibit I of the PSA, King County would grant a non-exclusive, perpetual private sanitary sewer easement over and across a portion of Parcel A and the Affordable Housing Parcel ("Burdened Property"), for the benefit of the Shelter Parcel and the Affordable Housing Parcel ("Benefited Property"). This easement, approximately 1,698 square feet in size, is to be used solely for the construction, maintenance, and operation of a sanitary sewer pipeline. The sanitary sewer easement shall run with the Benefitted Property and Burdened Property, and shall inure to the benefit of and be binding on and obligate all persons and/or entities having or acquiring any right, title, or interest in the Benefitted Property and the Burdened Property, respectively. • Private Storm Drainage Easement: Under Exhibit J of the PSA, King County would grant a non-exclusive, perpetual storm drainage easement over and across a portion of Parcel A for the benefit of the Workforce Housing Parcel. This easement is to be used solely for installing, removing, maintaining, and utilizing storm water drainage facilities. The storm drainage easement runs with the land and shall be binding on and obligate all persons and/or entities having or acquiring any right, title, or interest in the land. • Temporary Shoring Easement: Under Exhibit K of the PSA, King County would grant a temporary shoring wall/tie-back easement on, over, across, and under a portion of Parcel A for the benefit of the Workforce Housing Parcel. This easement, approximately 5,200 square feet in size, is to be used to install shoring and/or retaining walls near the northern property line of the County's property, including the installation of temporary underground tiebacks. The agreement requires that tiebacks be placed below and not penetrate or damage existing improvements on Parcel A. The term of this easement would begin on the date that the agreement is fully executed by all parties and recorded in King County and would terminate automatically upon completion of the project, or December 31, 2023, whichever comes earlier. Following the termination, any tiebacks remaining under Parcel A become property of the County, who may remove, destroy, or leave the tiebacks in place. The temporary shoring easement agreement shall inure to the benefit of and be binding upon the heirs, successors, and assigns of the parties. • Temporary Construction Easement: Under Exhibit M of the PSA, King County would grant a temporary construction easement to Polaris over, across, and under a section of Parcel A. This easement, approximately 3,512 square feet in size, is to be used for grading work and the demolition of certain abandoned improvements. The term of this easement would begin on the date that the agreement is fully executed by all parties and recorded in King County and would
COW Meeting Materials Page 49 July 7, 2021 terminate automatically upon completion of the project or December 31, 2023, whichever comes earlier. The temporary shoring easement agreement shall inure to the benefit of and be binding upon the heirs, successors and assigns of the parties.
Executive staff indicate that when the appraisal was completed, the location of any necessary utility easements was not yet known. They further state that as required and finalized in the Binding Site Plan, the easements were minimally intrusive into the remaining County property and valued at only a few thousand dollars, so no compensation was requested by the County.
Timing and Council Approval Requirement. The transmitted PSA includes a provision that the PSA is subject to approval by the Council ("Council Approval Contingency") and this contingency would be satisfied if an ordinance becomes effective on or before July 15, 2021. The provision also provides that the Seller may unilaterally extend the Council approval period one time for a period up to an additional 30 days by notice to the buyers prior to the expiration of the initial Council approval period. If the Council Approval Contingency is not satisfied within the Council approval period, either party may terminate the agreement.
Executive staff indicate that the buyers have expressed strong interest in closing on July 30, 2021, noting that if they cannot close by that date, one of the buyers would need a funding extension with the Washington Housing Finance Commission that would potentially take a few weeks. Executive staff have reported that the unilateral extension will be exercised with the hope that the Council will take this proposed ordinance up at the July 13th meeting so that the proposed ordinance can be effective in advance of the July 30th closing date. This assumes that the Council Chair and Executive would sign the adopted ordinance immediately or shortly after adoption.
INVITED
• Tony Wright, Director, Facilities Management Division • Pat McLaughlin, Director, Solid Waste Division
ATTACHMENTS
1. Proposed Ordinance 2021-0237 (and its attachments) 2. Transmittal Letter 3. Fiscal Note 4. Binding Site Plan
COW Meeting Materials Page 50 July 7, 2021 ATTACHMENT 1 KING COUNTY 1200 King County Courthouse 516 Third Avenue Signature Report Seattle, WA 98104
Ordinance
Proposed No. 2021-0237.1 Sponsors Balducci and Kohl-Welles
1 AN ORDINANCE relating to the sale of the surplus
2 property located at 13620 SE Eastgate Way, Bellevue,
3 Washington, in council district six.
4 STATEMENT OF FACTS:
5 For the property located at 13620 SE Eastgate Way, Bellevue,
6 Washington, located within council district six, the facilities management
7 division completed the surplus property, affordable housing, and public
8 notice requirements.
9 BE IT ORDAINED BY THE COUNCIL OF KING COUNTY:
10 SECTION 1. Findings: The sale of 13620 SE Eastgate Way, Bellevue,
11 Washington, through a negotiated direct sale is authorized under K.C.C. 4.56.100.A.2
12 and K.C.C. 4.56.100.A.8. because unique circumstances make the sale in the best
13 interests of the public, and the use of a portion of the surplus property will be restricted to
14 the provision of social or health purposes. Unique circumstances are present because of
15 the community partnerships necessary to complete this sale and create a permanent adult
16 shelter to serve the eastside of King County.
17 SECTION 2. The executive is authorized to convey the surplus property located
18 at 13620 SE Eastgate Way, Bellevue, Washington, to Polaris at Eastgate, LLC, an
19 affiliate of the Inland Group, Horizon Housing Alliance, a California nonprofit public
1
COW Meeting Materials Page 51 July 7, 2021 Ordinance
20 benefit corporation, and Congregations for the Homeless, a Washington nonprofit
21 corporation, consistent with a purchase and sale agreement substantially in the form of
22 Attachment A to this ordinance and to take all actions necessary to implement the terms
23 of the purchase and sale agreement.
24
KING COUNTY COUNCIL KING COUNTY, WASHINGTON
______
Claudia Balducci, Chair ATTEST:
______
Melani Pedroza, Clerk of the Council
APPROVED this _____ day of ______, ______.
______
Dow Constantine, County Executive
Attachments: A. Purchase and Sale Agreement
2
COW Meeting Materials Page 52 July 7, 2021 ATTACHMENT A:
PURCHASE AND SALE AGREEMENT
COW Meeting Materials Page 53 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B
AMENDED AND RESTATED
REAL ESTATE PURCHASE AND SALE AGREEMENT
(13620 SE Eastgate Way, Bellevue WA)
THIS AMENDED AND RESTATED REAL ESTATE PURCHASE AND SALE AGREEMENT ("Agreement") is made and entered by and between KING COUNTY, a political subdivision of the State of Washington (the "Seller") and Congregations for the Homeless, a Washington non profit corporation ("CFH"), Polaris at Eastgate, LLC, a Washington limited liability company ("Polaris"), and Horizon Housing Alliance, a California nonprofit public benefit corporation ("Horizon"). Each of CFH, Polaris and Horizon shall be referred to as a "Buyer Entity" and, collectively as, the "Buyer". Seller and Buyer are also referred to herein individually as a "Party" or collectively as "Parties." This Agreement shall be effective as of the date it has been executed by all Parties ("Effective Date"). The transaction contemplated herein is subject to authorization by ordinance of the Metropolitan King County Council as provided in Section 5.2.
RECITALS
A. Seller is the owner of that certain real property located at 13620 SE Eastgate Way, Bellevue, King County, State of Washington 98005, bearing King County Tax Parcel Number: l 02405-910 l, the legal description of which is attached hereto as EXHIBIT A (the "Real Property").
B. Since 1993, Congregations for the Homeless has held a m1ss1on to end homelessness in Bellevue, Washington, and the other metropolitan areas located on the east side of Lake Washington commonly known as the Eastside (the "Eastside") by helping men make the transition from life on the street to stable, independent living. Congregations for the Homeless provides a continuum of services from street outreach, year-round and winter shelters, a drop-in day center, comprehensive case management, and subsidized housing.
C. Polaris at Eastgate, LLC is an affiliate of the Inland Group, a high-density residential development and construction company that specializes in income restricted multifamily housing, with a specific focus of workforce housing for households earning less than 60% of area median income. Horizon Housing Alliance is a non-profit corporation that engages best-in-class partners to advance its mission of producing top quality affordable housing inclusive of exceptional support services, with a specific focus of permanent housing for formerly homeless families and individuals.
D. The King County Executive on November 2, 2015 made a Local Proclamation of Emergency due to homelessness affecting King County and stating that King County will continue to work with all the cities within King County on plans to address homelessness. The proclamation further commits King County to take actions that support, and are within the framework of, the All Home Strategic Plan and its goals of making homelessness rare, brief and one-time; reducing racial disparities; and engaging the full community in ending homelessness.
Page I of46 CFH KC Real Estate PSA
COW Meeting Materials Page 54 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B
E. The Property consists of approximately IO acres of surplus, undeveloped real property.
F. King County also owns the real property adjacent to and immediately north of the Property, legally described as Parcel A of Boundary Line Adjustment No. 11-114500-LW, recorded March 23, 2012 under King County Recording No. 20120323900003 ("Parcel A"), a portion of which is used for a King County transfer station. The zoning for Parcel A does not currently allow for residential use.
G. Consistent with the Parties' joint objectives of making homelessness rare, brief and one-time for residents of the Eastside: CFH desires to create as a separate parcel and acquire a portion of the Property (the "Shelter Parcel" - identified as Lot 2 on the Binding Site Plan defined below) for the construction and operation thereon of an 80 - 100 bed overnight shelter and drop in day center for individuals experiencing homelessness (the "Shelter Project"); Polaris desires to create another parcel within the Property (the "Workforce Housing Parcel" - identified as Lot l on the Binding Site Plan) for the anticipated construction and operation of affordable workforce housing (the "Workforce Housing Project"); and Horizon desires to create another parcel within the Property (the "Affordable Housing Parcel" - identified as Lot 3 on the Binding Site Plan) for the anticipated construction and operation of affordable housing, including, but not limited to, units designed for households experiencing homelessness (the "Affordable Housing Project"). Prior to the conveyance of the Property to Buyer by Seller, the Parties anticipate that the Property will be subdivided into the Shelter Parcel, the Workforce Housing Parcel and the Affordable Housing Parcel, with the Shelter Parcel to be acquired by CFH and used for the Shelter Project, the Workforce Housing Parcel to be acquired by Polaris and used for the Workforce Housing Project, and the Affordable Housing Parcel to be acquired by Horizon and used for the Affordable Housing Project.
H. CFH, Polaris and Horizon have entered into a Master Development Agreement to secure the necessary resources and expertise associated with obtaining a Master Development Plan and segregating the Property through a Binding Site Plan involving Parcel A.
I. King County and CFH have previously entered into that certain Exclusive Negotiation Agreement for the Purchase and Sale of Real Property dated February 12, 2019, as amended by Amendments dated March 18, 20 l 9 and August 9, 2019 (the "ENA"), which provided CFH the exclusive right to negotiate with Seller for purchase of the Property until October 31, 2019 and many of the recitals in the ENA are included in the Recitals herein. This Agreement replaces and supersedes the ENA in all respects.
J. Pursuant to King County Code 4.56. l 00.A.2, and 4.56.100.A.8, Seller possesses the authority to sell real property through a direct negotiation when: the Metropolitan King County Council, by ordinance, has determined that unique circumstances make a negotiated direct sale in the best interests of the public; and when it is deemed in the public interest to restrict the use of the property for the provision of social or health services, respectively. In consideration of the substantial benefits that will accrue to Seller and the public stemming from Buyer's proposed Shelter Project, Workforce Housing Project, and Affordable Housing Project, Seller is engaging in a direct negotiation with Buyer, and entering into this Agreement.
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K. CFH and Seller previously entered into that certain Real Estate Purchase and Sale Agreement pertaining to the Property fully executed as of September 9, 2019, which agreement has been amended by six (6) preceding amendments (as amended, the "Original PSA"). This Agreement amends, restates, replaces and supersedes the Original PSA in all respects. Pursuant to an Assignment Agreement dated September 9, 2020, CFH designated CAP Acquisitions, LLC, a Washington limited liability company, Inland Construction & Development, Co., a Washington corporation, and Horizon Housing Alliance, a California non-profit corporation (collectively "Assignee") as the Affordable Housing Developer under the Original PSA and assigned all of CFH's rights under the Original PSA to purchase the Affordable Housing Parcel to Assignee. CFH and Assignee have terminated the Assignment Agreement. Neither Seller nor Buyer has any claims against the other with respect to the Original PSA and neither Seller nor Buyer shall assert any claim against the other with respect to the Original PSA.
L. Subject to Buyer's continuing right of inspection and entry, as provided in Section 5. l, and except for Horizon's environmental review, as provided in Section 5.3, Buyer has completed its due diligence evaluation of the Property.
M. Seller and Buyer intend to submit this Agreement to the King County Council for its review and approval promptly after the Effective Date. This Agreement is subject to the approval of the Metropolitan King County Council.
N. Seller desires to sell the Property and CFH desires to purchase the Shelter Parcel, Polaris desires to purchase the Workforce Housing Parcel and Horizon desires to purchase the Affordable Housing Parcel on and subject to the terms and conditions set forth in this Agreement.
AGREEMENT
Now, THEREFORE, in consideration of the promises and mutual covenants contained herein, and other valuable consideration, receipt and sufficiency of which are hereby acknowledged, the Parties hereto covenant and agree as follows:
ARTICLE 1. PURCHASE AND TRANSFER OF ASSETS
The foregoing Recitals are, to the best of Seller's and Buyer's knowledge, true and correct in all material respects and such Recitals are incorporated by reference into this Agreement.
1.1 Property to Be Sold. Seller shall sell and convey to Buyer on the Closing Date (as hereinafter defined) and Buyer shall buy and accept from Seller on the Closing Date the following assets and properties:
1.1.1 all the Seller's right, title and interest in the Real Property as legally described in EXHIBIT A;
1.1.2 the Easements and Street Dedication (as hereinafter defined in Section 1.2.2 below); and
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J.J.3 all easements and other rights and interests that are appurtenant to the Real Property including but not limited to, Seller's right, title, and interest in and to streets, alleys or other public ways adjacent to the Real Property, sewers and service drainage easements, rights of connection to the sewers, rights of ingress and egress, and government approvals and permits affecting the Real Property; provided, however, that Seller may retain nonexclusive rights in any existing easements or other rights in the Property that are of record and that are appurtenant to other King County property or that serve other King County programs or projects (e.g. utility easements, stormwater management easements, stream maintenance easements, access easements, etc.). Hereinafter, the items listed in Section l. l are collectively referred to as the "Property." Notwithstanding the foregoing, with respect to the Real Property to be purchased and conveyed, as to CFH, the term "Real Property" shall mean the Shelter Parcel only, as to Polaris, the term "Real Property" shall mean the Workforce Housing Parcel only, and as to Horizon, the term "Real Property" shall mean the Affordable Housing Parcel only.
1.2 Segregation of Property. The design and configuration for the segregation of the Property into the Shelter Parcel, the Workforce Housing Parcel, and the Affordable Housing Parcel shalt be determined by Buyer, at Buyer's sole cost and expense. The method of so segregating the Property shall be accomplished by a Binding Site Plan revising the Boundary Line Adjustment No. 11-114500-LW, recorded March 23, 2012 under King County Recording No. 201220323900003, which consolidated various tax parcels within the Real Property and Parcel A ("Binding Site Plan"). The Binding Site Plan was approved by the City of Bellevue on April 1, 2021. Seller hereby approves the Binding Site Plan attached hereto as EXHIBIT B, along with any minor administrative changes thereto that do not have any adverse impact on Seller. The recordation of the Binding Site Plan in the real property records of King County, Washington, shall be a condition precedent to Closing. In the event that the approved Binding Site Plan has not been recorded by the Closing Date (defined in Section 10. 1), this Agreement shall terminate, and the Parties will have no further obligations hereunder, other than those that expressly survive herein. Notwithstanding the foregoing, the Parties may decide to mutually extend the Closing Date in the event the approved Binding Site Plan has not been recorded by the Closing Date.
1.2.1 Recording of Binding Site Plan. To facilitate the Closing by segregating the Property beforehand so that, on the Closing Date, the Shelter Parcel may be conveyed to CFH, the Workforce Housing Parcel may be conveyed to Polaris, and the Affordable Housing Parcel may be conveyed to Horizon, Setler authorizes and/or agrees to assist with the recording of the approved Binding Site Plan up to fourteen (14) days prior to the Closing Date, subject to the following conditions: (i) the preparation and recording of the Binding Site Plan shall be at Buyer's sole cost and expense; (ii) prior to recording the Binding Site Plan, Polaris shall deposit an additional One Hundred Thousand Dollars ($100,000) of earnest money, which additional earnest money shall be added to the Deposit, and shall be non-refundable, but applicable to the Purchase Price; (iii) Polaris shall indemnify, defend and hold Seller harmless from any and all claims, expenses and liabilities arising from or related to the recording of the Binding Site Plan; and (iv) in the event the Closing does not occur for any reason other than Seller's default, Polaris shall vacate the Binding Site Plan (and the Easements set forth in Section 1.2.2 below) at Polaris' sole cost and expense.
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1.2.2 Easements. No later than fourteen (14) days prior to the Closing Date, Seller agrees to grant the following easements, so that they may be recorded prior to the Binding Site Plan:
(a) a private sanitary sewer easement over and across Parcel A for the benefit of the Workforce Housing Parcel, as shown on the Binding Site Plan and in substantially the form attached hereto as EXHIBIT H (the "West Private Sanitary Sewer Easement");
(b) a private sanitary sewer easement over and across Parcel A and the Affordable Housing Parcel, for the benefit of the Shelter Parcel and the Affordable Housing Parcel, as shown on the Binding Site Plan and in substantially the form attached hereto as EXHIBIT I (the "East Private Sanitary Sewer Easement");
( c) a private storm drainage easement over and across Parcel A for the benefit of the Workforce Housing Parcel, as shown on the Binding Site Plan and in substantially the form attached hereto as EXHIBIT J (the "Private Storm Drainage Easement");
( d) a temporary shoring wall/tie-back easement over and across Parcel A for the benefit of the Workforce Housing Parcel in substantially the form attached hereto as EXHIBIT K (the "Temporary Shoring Easement"); and
( e) a temporary construction easement to Polaris over and across a portion of Parcel A allowing grading and the demolition of certain abandoned improvements (asphalt pavement, concrete, utilities, etc.) as shown on the Demolition Plan attached hereto as EXHIBIT L, in substantially the form attached hereto as EXHIBIT M (the "Temporary Construction Easement" and, collectively with the West Private Sanitary Sewer Easement, the East Private Sanitary Sewer Easement, the Private Storm Drainage Easement, the Shoring Easement, and the Temporary Construction Easement~the "Easements").
To the extent required by Puget Sound Energy, Seller further agrees to consent to PSE installing power to the Property from PSE's underground distribution main that is located in the existing easement on Parcel A that is within four (4) feet of the Property.
1.2.3 Dedication. In addition to segregating the Property into the Shelter Parcel, the Workforce Housing Parcel, and the Affordable Housing Parcel, the Binding Site Plan creates a small parcel along SE Eastgate Way (identified on the Binding Site Plan as Parcel A) that the City of Bellevue requires to be dedicated for right-of-way purposes (the "ROW Parcel"). At Closing, Seller shall dedicate the ROW Parcel to the City of Bellevue pursuant to a dedication deed approved by both Seller and Buyer, such approval not to be unreasonably withheld.
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ARTICLE 2. PURCHASE PRICE
2.1 PURCHASE PRICE AND PAYMENT. In consideration of the conveyance of the Property, subject to the contingencies set forth in Article 5 below, Buyer shall, in full payment therefor, pay to Seller on the Closing Date a total purchase price in the amount of Eighteen Million Eight Hundred Eighty-Five Thousand Dollars ($18,885,000) (the "Purchase Price"), which is equal to the amount of the appraised fair market value of the Property as determined by Seller's appraisal dated October 16, 2020 by Lori Safer, MAI, of Integra Realty Resources - Seattle, Twenty One Million Four Hundred Thirty Five Thousand Dollar~ ($21,435,000), less Two Million Five Hundred Fifty Thousand Dollars $2,550,000), the amount of the estimated cost to remediate the environmental contamination of the Property per the requirements of MTCA to meet current regulatory cleanup criteria for the protection of human health and the environment assuming a change in land use to workforce housing, affordable housing and shelter use with the objective of obtaining a No Further Action determination from the Washington State Department of Ecology.
2.2 ALLOCATION OF PURCHASE PRICE. Seller and Buyer agree that (i) the entire Purchase Price is allocable to the Real Property, (ii) the value of the Easements described in Section l .2.2 and the appurtenant rights and interests described in Section 1.1.3 are inseparable from and included in the value of the Real Property, and (iii) there is no personal property included in this sale. Seller agrees that CFH, Polaris and Horizon may allocate the Purchase Price among the Shelter Parcel, the Workforce Housing Parcel and the Affordable Housing Parcel as follows: (x) One Million Seven Hundred Thousand ($1,700,000) to CFH for the Shelter Parcel; (y) Fourteen Million Eight Hundred Eighty-Five Thousand Dollars ($14,885,000) to Polaris for the Workforce Housing Parcel; and (z) Two Million Three Hundred Thousand Dollars ($2,300,000) to Horizon for the Affordable Housing Parcel. Seller further agrees that CFH, Polaris and Horizon may reallocate the Purchase Price among the Shelter Parcel, the Workforce Housing Parcel and the Affordable Housing Parcel as such parties may agree, in their sole discretion.
2.3 DEPOSIT. Within two (2) business days after the Effective Date, Polaris shall deliver to the National Commercial Services (Seattle) office of Chicago Title of Washington (the "Escrow Agent"), in its capacity as the Parties' closing agent, an earnest money deposit in the amount of two hundred and fifty thousand dollars ($250,000.00) (the "Deposit") in the form of a Promissory Note, a copy of which is attached hereto as Exhibit F. As set forth in the Promissory Note, the Deposit shall be converted to cash by cashier's check payable to Escrow Agent or by wire transfer of ready funds to the account of Escrow Agent upon the later of (i) waiver of the Council Approval Contingency set forth in Section 5.2 below, or (ii) waiver of the Financing Contingency set forth in Section 5.8 below, provided that Buyer does not elect to cancel this Agreement prior to waiving such Financing Contingency (in which case Escrow Agent shall immediately return the Promissory Note to Polaris). Upon conversion of the Promissory Note to cash, the Deposit shall be invested by the Escrow Agent in a money market account, a federally insured investment or such other investment as may be approved by Seller and Polaris in writing. Accrued interest will be added to and become part of the Deposit. Upon deposit with Escrow Agent, the Deposit shall be non-refundable except as otherwise provided in this Agreement. The Deposit shall be applied as a credit against Polaris' allocation of the Purchase Price at the Closing.
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ARTICLE 3. REPRESENTATIONS AND WARRANTIES OF THE PARTIES AND CONDITION OF PROPERTY
3.1 WARRANTIES AND REPRESENTATIONS OF SELLER. As of the date hereof and as of the Closing Date, Seller represents and warrants as follows:
3.1.1 ORGANIZATION. The Seller is a political subdivision of the State of Washington duly organized, validly existing and in good standing under the laws of the State of Washington.
3.1.2 EXECUTION, DELIVERY AND PERFORMANCE OF AGREEMENT, AUTHORITY. The execution, delivery and performance of this Agreement by Seller (i) is within the powers of Seller as a political subdivision of the State of Washington, and (ii) subject to the contingency in Section 5.2 of this Agreement, has been duly authorized by all necessary action of the Seller's legislative authority. This Agreement constitutes the legal, valid and binding obligation of Seller enforceable against Seller in accordance with the tenns herein.
3.1.3 No BROKER. No broker, finder, agent or similar intermediary has acted for or on behalf of Seller in connection with this Agreement or the transactions contemplated hereby, and no broker, finder, agent or similar intermediary is entitled to any broker's, finder's or similar fee or commission in connection with this Agreement based on an agreement, arrangement or understanding with Seller or any action taken by Seller.
3.1.4 FUTURE AGREEMENTS. From and after the Effective Date unless this Agreement is terminated in accordance with its tenns, Seller shall not without the prior written consent of Buyer: enter into any agreement, contract, commitment, lease or other transaction that affects the Property in any way; or sell, dispose of or encumber or change the land use or zoning status or condition of any portion of the Property prior to Closing.
3.1.5 FOREIGN PERSON. Seller is not a foreign person and is a "United States Person" as such term is defined in Section 770 l ( a)(30) of the Internal Revenue Code of 1986 ("Code"), as amended and shall deliver to Buyer prior to the Closing an affidavit, as set forth in EXHIBIT D, evidencing such fact, and such other documents as may be required under the Code.
3.1.6 All Due Diligence Materials Provided; No Unrecorded Agreements. To Seller's knowledge as defined in Section 11.16, Seller has provided or made available to Buyer copies of all studies, reports, agreements, licenses, permits, approvals, notices and other materials pertaining to the Property in Seller's possession and control. To Seller's knowledge, there are no leases, or any unrecorded agreements, licenses, restrictions, encumbrances or easements pertaining to the Property; provided, however, if there are such agreements then Seller will cause them to be terminated prior to Closing; provided, further, Seller will cause any such tenants and/or occupants to have fully vacated the Property and removed all of their personal property from the Property prior to Closing.
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3.2 REPRESENTATIONS AND WARRANTIES OF BUYER. As of the date hereof and as of the Closing Date, each of CFH, Polaris and Horizon represents and warrants on behalf of itself only and not with respect to or on behalf of the other Buyer Entities as follows:
3.2.1 ORGANIZATION. CFH is a non-profit corporation duly organized and validly existing and in good standing under the laws of the State of Washington and has all requisite entity power and authority to carry on its business as it is now being conducted in the place where such businesses are now conducted. Polaris is a limited liability company duly organized and validly existing and in good standing under the laws of the State of Washington and has all requisite entity power and authority to carry on its business as it is now being conducted in the place where such businesses are now conducted. Horizon is a nonprofit public benefit corporation duly organized and validly existing and in good standing under the laws of the State of California and has all requisite entity power and authority to carry on its business as it is now being conducted in the place where such businesses are now conducted.
3.2.2 EXECUTION, DELIVERY AND PERFORMANCE OF AGREEMENT, AUTHORITY. The execution, delivery and performance of this Agreement by CFH, Polaris and Horizon (i) is within the powers of such entity, and (ii) has been duly authorized by all necessary action of each entity's governing authority. This Agreement constitutes the legal, valid and binding obligation of CFH, Polaris and Horizon enforceable against such entity in accordance with the terms hereof.
3.2.3 No BROKER. No broker, finder, agent or similar intermediary has acted for or on behalf of Buyer in connection with this Agreement or the transactions contemplated hereby, and no broker, finder, agent, or similar intennediary is entitled to any broker's, finder's or similar fee or commission in connection with this Agreement based on an agreement, arrangement, or understanding with the Buyer or any action taken by the Buyer.
3.3 CONDITION OF PROPERTY.
3.3.1 SELLER DISCLOSURE STATEMENT. To the maximum extent permitted by RCW Ch. 64.06, Buyer expressly waives its right to receive from Seller a seller disclosure statement ("Seller Disclosure Statement") and to rescind this Agreement, both as provided for in RCW Ch. 64.06. Seller and Buyer acknowledge and agree that Buyer cannot waive its right to receive the section of the Seller Disclosure Statement entitled "Environmental" if the answer to any of the questions in that section would be "yes." Nothing in any Seller Disclosure Statement delivered by Seller creates a representation or warranty by the Seller, nor does it create any rights or obligations in the Parties except as set forth in RCW Ch. 64.06. Buyer is advised to use its due diligence to inspect the Property as allowed for by this Agreement, and that Seller may not have knowledge of defects that careful inspection might reveal. Buyer specifically acknowledges and agrees that any Seller Disclosure Statement delivered by Seller is not part of this Agreement, and Seller has no duties to Buyer other than those set forth in this Agreement.
3.3.2 SELLER DISCLAIMER OF CONDITION OF THE PROPERTY. Except to the extent of Seller's representations and warranties in Section 3.1. of this Agreement and the warranties contained in the Deeds, Seller has not made, does not make, and specifically negates and disclaims any representations, warranties, promises, covenants, contracts or guarantees of any
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kind or character whatsoever, whether express or implied, oral or written, past, present or future, of, as to, concerning, or with respect to the value, nature, quality, or condition of the Property ( collectively "Condition of the Property"), including, without limitation:
(a) The water, soil and geology;
(b) The income to be derived from the Property;
( c) The suitability of the Property for any and all activities and uses that Buyer or anyone else may conduct thereon;
( d) The compliance or noncompliance of or by the Property or its operation with any laws, rules, ordinances, regulations or decrees of any applicable governmental authority or body or the zoning or land use designation for the Property;
(e) The habitability, merchantability, marketability, profitability or fitness for a particular purpose of the Property;
(t) The manner or quality of the construction or materials, if any, incorporated into the Property and the existence, nonexistence or condition of utilities serving the Property;
(g) The actual, threatened or alleged existence, release, use, storage, generation, manufacture, transport, deposit, leak, seepage, spill, migration, escape, disposal or other handling of any Hazardous Substances in, on, under or emanating from or into the Property, and the compliance or noncompliance of or by the Property or its operation with applicable federal, state, county and local laws and regulations, including, without limitation, Environmental Laws and regulations and seismic/building codes, laws and regulations. For purposes of this Agreement, the term "Environmental Law" shall mean: any federal, state or local statute, regulation, code, rule, ordinance, order, judgment, decree, injunction or common law pertaining in any way to the protection of human health, safety, or the environment, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U .S.C. § 9602 et. seq. ("CERCLA"); the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 690 l et seq. ("RCRA"); the Washington State Model Toxics Control Act, RCW Ch. 70.1050 ("MTCA"); the Washington Hazardous Waste Management Act, RCW Ch. 70.105; the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq., the Washington Water Pollution Control Act, RCW Ch. 90.48, and any laws concerning above ground or underground storage tanks. For the purposes of this Agreement, the term "Hazardous Substance" shall mean: any waste, pollutant, contaminant, or other material that now or in the future becomes regulated or defined under any Environmental Law; or
(h) Any other matter with respect to the Condition of the Property.
3.3.3 Buyer Acceptance of Condition of Property.
(a) Buyer acknowledges and accepts Seller's disclaimer of the Condition of the Property in Section 3.3.2 of this Agreement.
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(b) Buyer acknowledges and agrees that Buyer has or will have conducted a physical inspection and made all investigations as to the physical condition of the Property that Buyer deems necessary in connection with its purchase of the Property; and the foregoing disclaimer will apply to environmental conditions (including, without limitation, the presence of Hazardous Substances). Buyer further acknowledges and agrees that, having been given the opportunity to inspect the Property, Buyer is relying solely on its own investigation of the Property and is not relying on any infonnation provided or to be provided by Seller. Buyer further acknowledges and agrees that any information provided or to be provided with respect to the Property was obtained from a variety of sources and that Seller has not made any independent investigation or verification of such information and makes no representations as to the accuracy or completeness of such information and no employee or agent of Seller is authorized otherwise. Buyer further acknowledges and agrees that Seller is not liable or bound in any manner by any verbal or written statements, representations, or information pertaining to the Property, or the operation thereof, furnished by any agent, employee, or contractor of Seller, any real estate broker, or any other person.
(c) Upon waiver or satisfaction by Buyer of its contingencies pursuant to Article 5, each Buyer Entity acknowledges and agrees that it will thereby approve and accept the Condition of its respective parcel of the Property and accordingly agrees to purchase its respective parcel of the Property and accept the Condition of its respective parcel of the Property "AS IS, WHERE IS" with all faults and patent or latent defects, including, without limitation, the actual, threatened or alleged existence, release, use, storage, generation, manufacture, transport, deposit, leak, seepage, spill, migration, escape, disposal or other handling of any Hazardous Substances in, on, under or emanating from or into its respective parcel of the Property, and the compliance or noncompliance of or by its respective parcel of the Property or its operation with applicable federal , state, county and local laws and regulations including, without limitation, Environmental Laws and regulations and seismic/building codes, laws and regulations. Each Buyer Entity acknowledges and agrees that, except to the extent of Seller's representations and warranties in Section 3. I. of this Agreement and the warranties contained in the Deeds, such Buyer Entity, and any person or entity claiming by or through such Buyer Entity, shall have no recourse against the Seller for, and waives, releases and discharges forever the Seller from, any and all past, present or future claims or demands, and any and all past, present or future damages, losses, injuries, liabilities, agency orders or requirements, causes of actions (including, without limitation, causes of action in tort) costs and expenses (including, without limitation fines, penalties and judgments, and attorneys' fees) of any and every kind or character, known or unknown relating to or arising out of, directly or indirectly, the Condition of its respective parcel of the Property ( collectively, "Losses"), including Losses arising from or in any way related to the actual, threatened or alleged existence, release, use, storage, generation, manufacture, transport, deposit, leak, seepage, spill, migration, escape, disposal or other handling of any Hazardous Substances that are located in, on, under or migrating from or to its respective parcel of the Property. Losses shall include without limitation (a) the cost of any investigation, removal, remedial or other response action that is required by any Environmental Law, that is required by judicial order or decree or by order of or agreement with any governmental authority, or that is conducted voluntarily, (b) losses for injury or death of any person, and (c) losses arising under any Environmental Law, whether or not enacted after transfer of its respective parcel of the Property. Notwithstanding the foregoing, no Buyer Entity waives, releases, or discharges Seller for or from
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any Losses arising from any Hazardous Substances, migrating from or through Parcel A that migrate onto its respective parcel on or after the Closing Date.
3.3.4 INDEMNIFICATION. From and after the Closing Date, (i) CFH shall indemnify, defend and hold Seller, its officers, agents and employees harmless from and against any and all Losses relating to or arising out of, directly or indirectly, the Condition of the Shelter Parcel (but not the Workforce Housing Parcel or the Affordable Housing Parcel), including, without limitation, those relating to the actual or threatened release, disposal, deposit, seepage, migration or escape of Hazardous Substances at, from, into, or underneath the Shelter Parcel (but not the Workforce Housing Parcel or the Affordable Housing Parcel), and the compliance or noncompliance of the Shelter Parcel (but not the Workforce Housing Parcel or the Affordable Housing Parcel) with applicable federal, state, county and local laws and regulations including, without limitation, Environmental Laws and regulations, (ii) Polaris shall indemnify, defend and hold Seller, its officers, agents and employees harmless from and against any and all Losses relating to or arising out of, directly or indirectly, the Condition of the Workforce Housing Parcel (but not the Shelter Parcel or the Affordable Housing Parcel), including, without limitation, those relating to the actual or threatened release, disposal, deposit, seepage, migration or escape of Hazardous Substances at, from, into, or underneath the Workforce Housing Parcel (but not the Shelter Parcel or the Affordable Housing Parcel), and the compliance or noncompliance of the Workforce Housing Parcel (but not the Shelter Parcel or the Affordable Housing Parcel) with applicable federal, state, county and local laws and regulations including, without limitation, Environmental Laws and regulations, and (iii) Horizon shall indemnify, defend and hold Seller, its officers, agents and employees harmless from and against any and all Losses relating to or arising out of, directly or indirectly, the Condition of the Affordable Housing Parcel (but not the Shelter Parcel or the Workforce Housing Parcel), including without limitation, those relating to the actual or threatened release, disposal, deposit, seepage, migration or escape of Hazardous Substances at, from, into, or underneath the Affordable Housing Parcel (but not the Shelter Parcel or the Workforce Housing Parcel), and the compliance or noncompliance of the Affordable Housing Parcel (but not the Shelter Parcel or the Workforce Housing Parcel) with applicable federal, state, county and local laws and regulations including, without limitation, Environmental
Laws and regulations; provided~ however1 (i) no Buyer Entity shall have any such defense or indemnification obligation for or with respect to any Losses arising from any Hazardous Substances, migrating from or through Parcel A that migrate onto its respective parcel on or after the Closing Date and (ii) the foregoing provision (Buyer's indemnification obligations) shall not apply to any contractual liability that the Seller has assumed related to the Property (such as Seller's agreement to indemnify other parties for Losses). For the purposes of this Article 3.3.4, each Buyer Entity, by negotiation, hereby waives, with respect to Seller only, any immunity that would otherwise be available against such claims under the industrial insurance provisions of Title 51 RCW.
3.3.5 NON-ENVIRONMENT AL LOSSES. Notwithstanding the terms of Section 3.3.3, Buyer shall not release Seller from Losses not arising under any Environmental Law ("Non-Environmental Losses") that result from Seller's violations of law, gross negligence or willful misconduct. Additionally, notwithstanding the terms of Section 3.3.4, Buyer's indemnification obligations hereunder shall not apply to Non-Environmental Losses that result from Seller's violations of law, gross negligence or willful misconduct. Nothing in this Section
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3.3.5 shall limit Buyer's release of Seller under Section 3.3.3 or Buyer's indemnification obligations under Section 3.3.4 concerning Losses arising under any Environmental Law.
3.4 RISK OF Loss. Until the Closing Date, the risk of loss relating to the Property shall rest with the Seller. Risk of Loss shall be deemed to include, without limitation, any property damage occurring as a result of an "Act of God," including, but not limited to, earthquakes, earth movement, landslides, tremors, wind, rain or other natural occurrence.
3.5 SELLER'S SHARE OF CONSIDERATION UPON FUTURE CONVEYANCE. In the event Buyer acquires the Property and then (i) CFH conveys the Shelter Parcel to a third party through a Conveyance (hereinafter defined), (ii) Polaris conveys the Workforce Housing Parcel to a third party through a Conveyance, or (iii) Horizon conveys the Affordable Housing Parcel to a third party through a Conveyance, then such entity shall pay to Seller a percentage (the "Profit Percentage") of the Net Profit (hereinafter defined) received by such entity in the Conveyance of the Applicable Parcel at any time from and after the Closing Date and through and including the day that is ten (10) years from the Closing Date (the "Participation Period"). For the purposes of this Section 3.5, the term "Applicable Parcel" shall mean: the Shelter Parcel with respect to any covered actions or Conveyance by CFH; the Workforce Housing Parcel with respect to any covered actions or Conveyance by Polaris; and the Affordable Housing Parcel with respect to any covered actions or Conveyance by Horizon. The Profit Percentage shall be seventy percent (70%) if the Conveyance occurs on or before the third (3rd) anniversary of the Closing Date, shall be sixty percent (60%) if the Conveyance occurs after the third (3rd) anniversary and on or before the fourth ( 4th) anniversary of the Closing Date, shall be fifty percent (50%) if the Conveyance occurs after the fourth ( 4th) anniversary and on or before the fifth ( 5th) anniversary of the Closing Date, shall be forty percent (40%) if the Conveyance occurs after the fifth (5th) anniversary and on or before the sixth (61h) anniversary of the Closing Date, shall be thirty percent (30%) if the Conveyance occurs after the sixth (61h) anniversary and on or before the seventh (7th) anniversary, shall be twenty percent (20%) if the Conveyance occurs after the seventh (7th) anniversary and on or before the eighth (81h) anniversary. and shall be ten percent (l 0%) for the remainder of the Participation Period. No percentage of the Net Profit shall be payable to Seller for any Conveyance after the fourth (4 t1i) anniversary of the Closing Date, except such payment for a lease that qualifies as a "Conveyance" under subsection 3.5. l below and is entered into within the Participation Period, will occur as provided in subsection 3.5.3. Such amounts shall be paid (i) for a sale, within thirty (30) days after receipt by Buyer of such consideration, or (ii) for a lease under subsection 3.5.3 within thirty (30) days of the Conveyance and, if applicable, within thirty (30) days of an option term commencement, as provided under subsection 3.5.3. Such amounts shall bear interest from the due date at a rate equal to ten percent (10%) per annum until paid.
3.5.1 For the purposes of this Section 3.5, a "Conveyance" shall include any and all transfer, conveyance, sale, disposition, condemnation, assignment, encumbrance, mortgage, pledge or grant of any legal or beneficial right, title or interest in the Applicable Parcel ( or any portion of the Applicable Parcel), or the grant of an option with respect to any of the foregoing, by the applicable Buyer Entity or Affiliate (hereinafter defined) and shall include a lease by such Buyer Entity or Affiliate to a tenant, the term of which, including any unilateral options held by tenant, is ten ( 10) years or more for all or substantial part of or interest in the Applicable Parcel.
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3.5.2 Notwithstanding anything to the contrary herein, a Conveyance shall not include: ( l) any single lease for actual occupancy of space by a tenant whose tenn, including any unilateral options held by tenant, is less than ten ( l 0) years; (2) any grant of an easement, license, or other interest in the Applicable Parcel that provides the grantee, licensee or another party exclusive use or possession of all or a portion of the Applicable Parcel for a term less than ten ( 10) years or that provides the grantee, licensee or another party nonexclusive use or possession; (3) a transfer to an Affiliate without consideration; or (4) the initial financing from such Buyer Entity's lender for the acquisition of the Applicable Parcel ("Acquisition Financing") that provides such financing in good faith and for value, provided such Acquisition Financing shall include only secured interests in the Applicable Parcel pursuant to a deed of trust or mortgage; or (5) any transfer, conveyance, sale, disposition, condemnation, assignment, encumbrance, mortgage, pledge or grant of any legal or beneficial right, title or interest in the Applicable Parcel ( or any portion of the Applicable Parcel) after (i) commencement of construction of the Shelter Project, (ii) the closing of financing for construction of the Workforce Housing Project (on the Workforce Housing Parcel) that is funded with at least ten million dollars ($10,000,000.00) in documented, verifiable, and commercially reasonable construction financing (the "Workforce Housing Financing"), or (iii) the closing of financing for construction of the Affordable Housing Project ( on the Affordable Housing Parcel) that is funded with at least ten million dollars ($10,000,000.00) in documented, verifiable, and commercially reasonable construction financing (the" Affordable Housing Financing"). For the avoidance of doubt, the provisions of this Section 3.5 shall not apply to the Shelter Parcel upon commencement of construction of the Shelter Project; shall not apply to the Workforce Housing Parcel upon closing of the Workforce Housing Financing; and shall not apply to the Affordable Housing Parcel upon closing of the Affordable Housing Financing. Seller shall subordinate its interest in the Project Percentage under this Section 3.5 to the deed of trust or mortgage securing Acquisition Financing pursuant to a subordination agreement in form reasonably required by CFH's, Polaris' and/or Horizon's respective lender(s).
3.5.3 The term "Affiliate" shall mean, with respect to CFH, Polaris and Horizonj each of such entity's parent companies, subsidiaries, or a company controlled by such entity's parent companies, subsidiaries or the shareholders thereof, and all references to Buyer in this Section 3.5 shall also apply to an Affiliate. The term "Net Profit" shall be defined as the sales proceeds and all other sums received by or due to CFH, Polaris or Horizon (or an Affiliate) from the Conveyance ("Proceeds") after subtracting the actual and reasonable third party closing costs and the purchase price such entity paid to Seller hereunder; and also subtracting its actual out-of pocket expenses incurred by such entity associated with acquiring the Applicable Parcel and obtaining all necessary permits and entitlements in order to build and operate the applicable project (collectively, the "Acquisition Cost Deduction"). Pursuant to this Section 3.5, the maximum amount of the Acquisition Cost Deduction that any Buyer Entity will be permitted to deduct from the Net Profit shall be five hundred thousand dollar ($500,000.00). Proceeds from a lease shall be calculated as follows: if the term of the lease is ten ( 10) years or more, including any unilateral options held by tenant, the Proceeds shall be the present value at the time of lease execution of the rent to be received during the original term of the lease, if that amount is ascertainable from the lease. If that amount is not ascertainable from the lease because the calculation of future rent relies on an index, market rate increase or other methodology that can only be determined in future years ("Variable Rent Increase Terms"), then a rate of three percent per year shall be used as a substitute for any Variable Rent Increase Terms. The Proceeds from an option term of a lease that is exercised by the tenant and which extends the term of the lease to be ten ( 10) years or more shall Page 13 of46 CFH - KC Real Estate PSA
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be the present value at the time of the commencement of the option term of the rent to be received during that option term of the lease, determined as set forth above. In such case for the purpose of calculating the Profit Percentage, the Conveyance will be considered to have occurred on the date of the execution of the original lease. In the event the Conveyance is only a portion of the Applicable Parcel, a proportionate share of the Proceeds paid to Seller shall be subtracted to determine the Net Profit. In the event that such proportionate amount shall be, in Seller's reasonable determination, an inaccurate measurement of the fair market value of the portion of the Applicable Parcel subject to the Conveyance, then the amount based on an appraisal of said portion of the Applicable Parcel (which appraisal shall be obtained at such Buyer Entity's cost and expense) shall be used in lieu of the actual amount paid by grantee of the Conveyance to calculate Net Profit.
3.5.4 If a Buyer Entity desires to carry out a Conveyance of the Applicable Parcel or any portion of it, such Buyer Entity shall notify Seller in writing of said desire and the details of the proposed Conveyance at least twenty (20) days prior to the proposed date of the Conveyance. The notification shall include but not be limited to a full disclosure of the monetary payment or any other consideration involved in the Conveyance of the Applicable Parcel and the proposed date of Conveyance. Buyer shall also provide any financial or other information regarding the proposed Conveyance reasonably requested by Seller. For a lease term that is extended to be ten ( 10) years or more through exercise of a unilateral option held by tenant, such Buyer Entity shall provide the infonnation specified in this subsection at least twenty (20) days prior to the proposed extension.
3.5.5 A memorandum of this Section 3.5, Seller's Share of Consideration upon Future Conveyance, in substantially the form attached hereto as EXHIBIT E shall be executed by Seller and each Buyer Entity and recorded against the Applicable Parcel it is buying at Closing; provided, however, (i) that if Polaris simultaneously closes on its Workforce Housing Financing, then the memorandum shall not be recorded against the Workforce Housing Parcel; and (ii) that if Horizon simultaneously closes on its Affordable Housing Financing, then the memorandum shall not be recorded against the Affordable Housing Parcel. The obligations hereunder shall run with the land and be binding upon any Affiliate. In the event of a Conveyance to a party other than an Affiliate, then concurrent with such Conveyance the memorandum shall be released by Seller as to the conveyed Applicable Parcel, provided that commercially reasonably arrangements have been made to provide for payment to Seller of the applicable Profit Percentage of the Net Profit.
3.5.6 If there is a foreclosure Uudicial or non-judicial), or a deed in lieu of foreclosure of the Applicable Parcel, at any time on or prior to the expiration of the Participation Period, and if at that time such Buyer Entity or Affiliate has failed to pay any and all amounts of Profit Percentage due and owing by it hereunder, then Seller's rights under this Section 3.5 shall be prior and superior to and over any and all recorded security interests in the Applicable Parcel that are then existing, except the security interests of a lender that provided Acquisition Financing and holds a recorded security interest in the applicable parcel pursuant to a deed of trust or a mortgage to which Seller has subordinated its interests under this Section 3.5.
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ARTICLE 4. TITLE MATTERS
4.1 CONVEYANCE. Seller shall convey (i) to CFH, a fee simple estate in the Shelter Parcel, (ii) to Polaris, a fee simple estate in the Workforce Housing Parcel, and (iii) to Horizon, a fee simple estate in the Affordable Housing Parcel, all by Washington State statutory bargain and sale deeds in substantially the fonn attached hereto as EXHIBIT C (the "Deeds"), subject only to the Permitted Exceptions (as defined below), the lien of current real property taxes, fees and/or charges not yet due and payable, rights reserved in federal patents or state deeds, building or use restrictions general to the governing jurisdiction, and the matters excluded from coverage by the printed general exceptions and exclusions contained in the fonn oftitle insurance policy required by Section 4.4 of this Agreement.
4.2 TITLE COMMITMENT. Buyer has obtained a preliminary commitment for an owner's extended coverage owner's policy of title insurance covering the Property (File No. 193774-NCS, dated September 20, 2019) (the "Original Title Commitment") issued by Chicago Title of Washington (the "Title Company"), which included legible copies of all instruments referred to in the Title Commitment as restrictions or exceptions to title to the Property. Buyer has also obtained updated preliminary commitments for owner's extended coverage owner's policies of title insurance covering the Shelter Parcel (File No. l 93774B-NCS, dated April 13, 2021 ), the Workforce Housing Parcel (File No. l 93774A-NCS, dated April 13, 2021 ), and the Affordable Housing Parcel (File No. 193774C-NCS, dated April 13, 2021), and such title commitments show all changes to the condition of title since the Original Title Commitment and show CFH as the proposed insured for the Shelter Parcel in the insured amount allocated to the Shelter Parcel in Section 2.2 above, show Polaris as the proposed insured for the Workforce Housing Parcel in the insured amount allocated to the Workforce Housing Parcel in Section 2.2 above, and show Horizon as the proposed insured for the Affordable Housing Parcel in the insured amount allocated to the Affordable Housing Parcel in Section 2.2 above (collectively the "Updated and Segregated Title Commitments").
4.3 REVIEW OF TITLE COMMITMENT. The Special Exceptions that are set forth in Schedule B, Part II of the Updated and Segregated Title Commitments shall be deemed to be permitted exceptions ("Permitted Exceptions"). If the Title Company issues a supplement to the Updated and Segregated Title Commitments that identifies new exceptions, then each Buyer Entity shall have until ten ( 10) days after receipt of the new exceptions (the "Review Period") in which to notify Seller (and the other Buyer Entities) in writing of any objections Buyer has to any new exceptions affecting such Buyer Entity's respective parcel ("Buyer's Objections"). Seller shall notify all Buyer Entities within seven (7) days after Seller receives Buyer's Objections of any new exceptions to title which Seller will not remove or otherwise resolve to such Buyer Entities' satisfaction prior to Closing ("Seller's Response"). If Seller does not provide Seller's Response within such 7-day period, Seller shall be deemed to have agreed to remove or resolve to Buyer's satisfaction all of Buyer's Objections prior to Closing; and as to any Buyer's Objections not addressed in Seller's Response, Seller shall likewise be deemed to have agreed to remove or resolve them to the applicable Buyer Entities' satisfaction prior to Closing. As to any Buyer's Objections that Seller has timely notified Buyer in Seller's Response that it will not remove or resolve to the applicable Buyer Entities' satisfaction prior to Closing, such applicable Buyer Entity may, at its sole option, either waive such Buyer's Objections, in which case such exceptions to Page 15 of 46 CFH - KC Real Estate PSA
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title shall be Permitted Exceptions, or Buyer may terminate this Agreement by notice to Seller within ten ( l 0) days after receipt of Seller's Response.
4.4 OWNER'S TITLE INSURANCE POLICY. At the Closing, as a condition to Buyer's obligation to close, the Title Company shall issue an extended coverage owner's policy of title insurance to each of the Buyer Entities in the full amount of such Buyer Entity's allocated portion of the Purchase Price, together with such endorsements thereto that Buyer may require, effective as of the Closing Date, insuring each respective Buyer Entity that the fee simple title to the applicable parcel of the Property is vested in such Buyer Entity, subject only to the Pennitted Exceptions, the lien of current real property taxes, fees and/or charges not yet due and payable, rights reserved in federal patents or state deeds, building or use restrictions general to the governing jurisdiction, and the matters excluded from coverage by the printed exceptions and exclusions contained in the form of owner's extended coverage title insurance policy required by the Title Company ("Buyers' Title Policies"). Seller shall be responsible for the cost of the standard owner's policies oftitle insurance in the full amount of the allocated Purchase Price for each parcel, and each Buyer Entity shall be responsible for any excess premium attributable to obtained extended coverage and/or any endorsements that such Buyer Entity may require. The condition based on the issuance of Buyers' Title Policies shall be satisfied if, at the Closing, the Title Company has given a binding, unconditional commitment, in a form reasonably satisfactory to each Buyer Entity, to issue the Buyers' Title Policies in the form required by this Section. At closing, Seller will sign and provide the Title Company with a fonn of owner's affidavit as the Title Company may require to issue Buyers' Title Policies. Seller shall pay any sum owing to the Title Company for the preparation of the preliminary and binding commitments generated by the Title Company. Notwithstanding the foregoing, references herein to the Buyers' Title Policies
shall mean, respectively1 the owner's extended coverage title policy to be issued to CFH on the Shelter Parcel pursuant to the Updated and Segregated Title Commitment for the Shelter Parcel (the "Shelter Parcel Title Policy"), the owner's extended coverage title policy to be issued to Polaris on the Workforce Housing Parcel pursuant to the Updated and Segregated Title Commitment for the Workforce Housing Parcel (the "Workforce Housing Parcel Title Policy"), and the owner's extended coverage title policy to be issued to Horizon on the Affordable Housing Parcel pursuant to the Updated and Segregated Title Commitment for the Affordable Housing Parcel (the "Affordable Housing Parcel Title Policy").
ARTICLE 5. CONTINGENCIES
5.1 INSPECTIONS AND RIGHT OF ENTRY. Buyer shall satisfy itself by investigation and inspection, at its cost and expense, in its sole and absolute discretion, that the condition of the Property for Buyer's contemplated uses meets with its approval.
5.1.1 INSPECTIONS. Buyer, its designated representatives or agents (and Assignees and their representatives and agents if they provide Seller with the insurance required under Section 5.1.3 and the indemnity required under Section 5.1.2) shall have the right at its own expense to (a) perform any and all tests, inspections, studies, surveys or appraisals of the Property deemed necessary, on any subject, by the Buyer (subject to the limitations set forth below and Section 5. l.2 Right of Entry); (b) obtain a Phase I or Phase II Environmental Assessment on the Property and perform any and all tests, inspections and studies deemed necessary therewith; (c)
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examine all due diligence materials related to the Property that are in Seller's possession and about which Seller has knowledge, and that are not protected as attorney work product, by the attorney client privilege or by other similar confidentiality protections; (d) preliminarily determine to its satisfaction whether approvals, permits and variances can be obtained under applicable land use and zoning codes for Buyer's proposed development of the property; and (e) preliminarily determine whether Buyer's proposed development of the Property is economically feasible.
5.1.2 RIGHT OF ENTRY. Buyer and Buyer's designated representatives or agents (and Assignees and their representatives and agents if they provide Seller with the insurance required under Section 5.1.3 and the indemnity required under Section 5.1.4) shall have the right and Seller hereby grants to Buyer and Buyer's designated representatives (and assignees and their representatives and agents if they provide Seller with the insurance required under Section 5.1.3 and the indemnity required under this Section 5.1.2) the right to enter the Property and conduct tests, investigations and studies set forth in this Article 5 upon three (3) days advance written notice; provided that such right of entry will be conducted so as to not unreasonably interfere with the activities of Seller's month-to-month tenants on the Property. Invasive tests of the Property, such as drilling or excavation shall be subject to Seller's prior written approval, which shall not be unreasonably withheld, conditioned or delayed. If invasive tests are performed by Buyer, Seller may elect to obtain split samples of any sampling that is obtained and reimburse the Buyer for the costs thereof. The Buyer will not be permitted to undertake activities that damage the Property. In connection with any such inspections and tests, each Buyer Entity agrees to hold harmless, indemnify and defend Seller, its officers, agents and employees, from and against all claims, losses, or liability for injuries, sickness or death of persons, including employees of such Buyer Entity ("Claims") caused by or arising out of any act, error or omission of such Buyer Entity, its officers, agents, contractors, subcontractors or employees in entering the Property for the above purposes, except to the extent the Claims are caused by or arise out of any act, error or omission of Seller, its officers, agents and employees.
5.1.3 RIGHT OF ENTRY INSURANCE. Prior to the entry of any Buyer Entity or its contractors for invasive testing of the Property such as drilling or excavation, the entering party(ies) shall submit evidence of (l) Commercial General Liability coverage in the amount of $1,000,000 per occurrence and $2,000,000 in the aggregate; (2) Automobile liability insurance in the amount of $1,000,000; (3) Contractor's Pollution insurance in the amount of $1,000,000 per claim and in the aggregate; and ( 4) Stop Gap/Employers Liability coverage in the amount of $1,000,000. King County, its officers, officials, agents and employees shall be named as additional insureds.
5.2 METROPOLITAN KING COUNTY COUNCIL APPROVAL. Seller's and Buyer's performance under this Agreement is subject to approval by ordinance of the Conveyance of the Property by the Metropolitan King County Council (the "Council Approval Contingency"). The Council Approval Contingency will be satisfied if an ordinance passed by the Metropolitan King County Council approving the conveyance of the Property becomes effective on or before July 15, 2021 (the "Council Approval Period"). Seller may unilaterally extend the Council Approval Period one time for a period up to an additional thirty (30) days by notice to Buyer prior to the expiration of the initial Council Approval Period. If the Council Approval Contingency is not satisfied within the Council Approval Period, either Party may terminate this Agreement by sending notice thereof to the other Party. Upon such termination, the Page 17 of 46 CFH - KC Real Estate PSA
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Deposit shall be returned to Buyer and the Parties shall have no further obligations hereunder, except those that expressly survive hereunder.
S.3 HORIZON'S ENVIRONMENTAL REVIEW. The Parties acknowledge and agree: ( l) that the entire Deposit will be made by Polaris; (2) that Horizon will have no earnest money or deposits at risk prior to the Closing; (3) that Horizon's acquisition of the Affordable Housing Parcel is subject to a determination by Horizon on the desirability of the Affordable Housing Parcel for the Affordable Housing Project as a result of the completion of the environmental review in accordance with 24 C.F.R. Part 58; (4) and that Horizon's interest in this Agreement is therefore an allowable option in accordance with 24 C.F.R. §58.22(d). Buyer shall provide notice to Seller upon Horizon either exercising or declining to exercise its allowable option under this Agreement. In the event Horizon declines to exercise its allowable option under this Agreement, Horizon shall assign its rights under this Agreement to an Affiliate of Polaris (the "Polaris Affiliate"), and the Polaris Affiliate shall assume all of Horizon's obligations and responsibilities under this Agreement.
5.4 UNIFORM RELOCATION ACT. Buyer anticipates that it may receive federal funds in connection with Buyer's future development activities on the Property. If Buyer chooses to use such funds, it could be required to comply with the federal Unifonn Relocation Assistance and Real Property Acquisition Policies Act of 1970 ("URA"). In accordance with the URA, owner occupants who move as a result of a voluntary acquisition of their property are not eligible for relocation assistance. Buyer is prepared to acquire the Property for the Purchase Price, subject to the terms and conditions of this Agreement. Buyer believes the Purchase Price represents the current market value of the Property on the date hereof. Buyer does not have authority to acquire the Property by eminent domain (i.e. Buyer cannot obtain the Property through condemnation). Therefore, Buyer cannot purchase the Property if Seller is not willing to sell it to Buyer. The URA requires that Buyer provide this information to Seller.
S.S [Intentionally Deleted].
5.6 Use Covenants. Covenants to ensure the long-term (at least 20 years) use of the Shelter Parcel for the Shelter Project, the Workforce Housing Parcel for the Workforce Housing Project, and the Affordable Housing Parcel for the Affordable Housing Project (together, the "Use Covenants/ ' individually the "Shelter Covenant," the "Workforce Housing Covenant" and the "Affordable Housing Covenant"), substantially in the forms attached hereto as EXHIBIT G, shall be executed by Seller and the respective Buyer Entity and recorded against the Shelter Parcel, Workforce Housing Parcel, and Affordable Housing Parcel, respectively, at Closing. The respective Use Covenants shall be fully enforceable against CFH, Polaris and Horizon, respectively, and any assignees or successors. To the extent King County Code 4.56. l 00.C. l .-2 applies to the Workforce Housing Project or the Affordable Housing Project, the Workforce Housing Covenant and/or the Affordable Housing Covenant shall include provisions requiring Polaris and/or Horizon to pay prevailing wages for any construction work and have an apprentice utilization goal of fifteen percent (15%). Notwithstanding the foregoing, the Use Covenants shall each contain release mechanisms providing for the termination of the Use Covenants in the event the applicable Buyer Entity is prevented from building or operating the Shelter Project, the Workforce Housing Project or the Affordable Housing Project, respectively (as contemplated by the Use Covenants) due to circumstances beyond its control. For the purposes
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of this Section 5.6, circumstances beyond the applicable Buyer Entity's control shall include: the inability to obtain essential permits and entitlements from the relevant governmental entities; or the issuance of a final judgment or permanent injunctive relief by a court of competent jurisdiction that prevents compliance with the applicable Use Covenants.
5.7 [Intentionally Deleted].
5.8 Financing Contingency. Buyer's obligation under this Agreement is contingent upon Buyer notifying Seller, within fifteen ( 15) days following Metropolitan King County Counci I's approval by ordinance of the Conveyance of the Property pursuant to Section 5.2 above, that it has obtained satisfactory financing or grant funding or both, in an amount sufficient to allow Buyer to consummate the Closing under this Agreement ("Financing Contingency Notice"). If Buyer does not timely deliver the Financing Contingency Notice, then Buyer will be deemed to have elected to have waived this contingency. If Buyer does timely deliver the Financing Contingency Notice indicating that Buyer is not waiving this contingency, then this Agreement shall terminate, the Deposit shall be returned to Buyer and the Parties shall have no further obligations hereunder, except those that expressly survive herein.
ARTICLE 6. COVENANTS OF SELLER PENDING CLOSING
6.1 CONDUCT, NOTICE OF CHANGE. Seller covenants that between the Effective Date and the Closing Seller shall take all such actions as may be necessary to assure that the representations and warranties set forth in Article 3 hereof will be true and complete as of the Closing ( except such representations, warranties and matters which relate solely to an earlier date), and all covenants of Seller set forth in this Agreement which are required to be performed by it at or prior to the Closing shall have been performed at or prior to the Closing as provided for in this Agreement. Seller shall give Buyer prompt written notice of any material change in any of the information contained in the representations and warranties made in Article 3 or elsewhere in this Agreement that occurs prior to the Closing. Seller shall not make nor permit any third party to make any improvements or any physical changes to the Property prior to the Closing except as Buyer may approve in writing, such approval not to be unreasonably withheld, conditioned, or delayed.
ARTICLE 7. COVENANTS OF BUYER PENDING CLOSING
7.I CONDUCT, NOTICE OF CHANGE. Each Buyer Entity covenants that between the Effective Date and the Closing such Buyer Entity shall take all such actions as may be necessary to assure that the representations and warranties of such Buyer Entity set forth in Article 3 hereof will be true and complete as of the Closing (except such representations, warranties and matters which relate solely to an earlier date), and that all covenants of such Buyer Entity set forth in this Agreement which are required to be performed by it at or prior to the Closing shall have been performed at or prior to the Closing as provided in this Agreement. Each Buyer Entity shall give Seller prompt written notice of any material change in any of the information contained in the representations and warranties it made in Article 3 or elsewhere in this Agreement that occurs prior to the Closing.
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ARTICLE 8. CONDITIONS PRECEDENT TO BUYER'S OBLIGATIONS
All obligations of Buyer to close on the Closing Date are subject to the fulfillment of each of the following conditions at or prior to the Closing, and Seller shall exert its best efforts to cause each such condition to be fulfilled:
8.1 DELIVERYOF DOCUMENTS. Seller shall have delivered to Buyer at or prior to the Closing all documents required by the terms of this Agreement to be delivered to Buyer.
8.2 OBLIGATIONS; WARRANTIES. All obligations required by the tenns of this Agreement to be performed by Seller at or before the Closing shall have been properly performed in all material respects. All representations and warranties of Seller herein shall be true and correct in all material respects as of the Closing.
8.3 TITLE. Seller shall have cured any exceptions to title to which Buyer objected within the Review Period in Section 4.3 and to which Seller agreed to remove or resolve under Section 4.3, unless Seller's obligation to remove or resolve has been waived by Buyer.
8.4 TITLE INSURANCE. The Title Company has issued or unconditionally committed to issue the Shelter Parcel Title Policy to CFH, the Workforce Housing Parcel Title Policy to Polaris, and the Affordable Housing Parcel Title Policy to Horizon.
8.5 CONDEMNATION/ACTS OF GOD. No portion of the Property shall have been taken or damaged by any public or quasi-public body, and Seller shall not have transferred any portion of the Property to any such body in lieu of condemnation, and no Act of God shall have resulted in material damage to the Property.
8.6 BINDING SITE PLAN. Buyer shall have recorded the Binding Site Plan pursuant to Section 1.2.
ARTICLE 9. CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS
All obligations of Seller to close on the Closing Date are subject to the fulfillment of each of the following conditions at or prior to the Closing, and Buyer shall exert its best efforts to cause each such condition to be so fulfilled:
9.1 DELIVERYOF DOCUMENTS. Buyer shall have delivered to Seller at or prior to Closing all documents required by the terms of this Agreement to be delivered to Seller.
9.2 OBLIGATIONS; WARRANTIES. All obligations required by the terms of this Agreement to be performed by Buyer at or before the Closing shall have been properly performed in all material respects. All representations and warranties of Buyer herein shall be true and correct in all material respects as of the Closing.
9.3 CONVEYANCE OF ENTIRE PROPERTY. Seller shall not be obligated hereunder to close the sale of the Property except as a conveyance of the entire Property for the
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entire Purchase Price as provided herein, although in such Closing, Seller shall convey the Shelter Parcel to CFH, the Workforce Housing Parcel to Polaris, and the Affordable Housing Parcel to Horizon. Notwithstanding the foregoing, CFH shall have no obligation or liability under this Agreement to Seller with respect to Polaris' or Horizon's breach of this Agreement; Polaris shall have no obligation or liability under this Agreement to Seller with respect to CFH's or Horizon's breach of this Agreement; and Horizon shall have no obligation or liability under this Agreement to Seller with respect to CFH's or Polaris' breach of this Agreement.
ARTICLE 10. CLOSING
10.l CLOSING/CLOSING DATE. The Closing to occur under this Agreement shall take place no earlier than July 30, 2021 and no later than September 30, 2021 ("Closing Date"). Buyer shall provide Seller with fourteen (14) days' written notice of the Closing Date, which shall also serve as notice of Buyer proceeding with the recordings of the Easements and Binding Site Plan in accordance with Section 1.2 above. The Parties have set up an escrow account with the Escrow Agent. The Escrow Agent shall serve as closing agent for the transactions contemplated herein and Closing shall occur in the offices of the Escrow Agent in Seattle, Washington. Unless otherwise agreed by the Parties, Michael Costello, Commercial Escrow Specialist for Escrow Agent, whose phone number is 206-628-5619 and whose email address is [email protected], shall serve Escrow Agent's closer for the transactions contemplated hereunder.
10.2 PRORATIONS. Real property taxes and assessments shall be prorated as of the Closing Date. Seller shall pay the cost of Buyer's Title Policy (to the extent applicable to standard coverage) and any costs of the preliminary and binding title commitments, one-half (Y2) of the escrow fee charged by the Escrow Agent, any real estate excise or other transfer tax due, and its own attorneys' fees. Buyer shall pay one-half(Yi) of the escrow fee charged by the Escrow Agent, the recording fees for the Deeds and its own attorneys' fees. Each Buyer Entity shall be responsible for the cost of any excess premium attributable to obtaining an extended coverage title policy and/or any endorsements that such Buyer Entity may require. Except as otherwise provided in this Section 10.2, all other expenses hereunder shall be paid by the Party incurring such expenses.
10.3 SELLER'S DELIVERY OF DOCUMENTS AT CLOSING. At the Closing, Seller will deliver to Buyer via escrow with the Escrow Agent the following properly executed documents:
10.3.l The Deeds conveying the Property substantially m the form of EXHIBIT C attached hereto;
10.3.2 Washington real estate excise tax affidavits as required for recording of the Deeds and owner's affidavits in form required by the Title Company for issuance of the Shelter Parcel Title Policy, the Workforce Housing Parcel Title Policy, and the Affordable Housing Parcel Title Policy;
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10.3.3 Seller's certificates of non-foreign status substantially in the form of EXHIBIT D, attached hereto;
10.3.4 The Use Covenants substantially m the forms of EXHIBIT G, attached hereto; and
10.3.5 The Memoranda of Seller's Share of Consideration Upon Future Conveyance, substantially in the fonn of EXHIBIT E, attached hereto.
10.4 POSSESSION. Possession of the Property shall be delivered to Buyer at the Closing, free from any leases, tenants, occupants, and persons in possession, and in a vacant condition free from any temporary improvements and personal property, including, but not limited to, the tents and temporary structures currently on the Property.
10.5 BUYER'S DELIVERY OF PURCHASE PRICE AT CLOSING. At the Closing, Buyer shall deliver to Seller via escrow with the Escrow Agent cash or immediately available funds in the amount of the Purchase Price, less (as to the Workforce Housing Parcel sale) the Deposit made under Section 2.3 of this Agreement. Each Buyer Entity shall be responsible to pay only the portion of the Purchase Price allocable to the parcel it is acquiring, as provided in Section 2.2 above. Each respective Buyer Entity shall deliver the following properly executed documents as to its applicable parcel of the Property: Real Estate Excise Tax Affidavit; Use Covenants substantially in the fonns of EXHIBIT G, attached hereto; and Memorandum of Seller's Share of Consideration Upon Future Conveyance substantially in the fonns of EXHIBIT E, attached hereto (if applicable).
ARTICLE 11. MISCELLANEOUS PROVISIONS
11.1 NON-MERGER. Each statement, representation, warranty, indemnity, covenant. agreement and provision in this Agreement shall not merge in, but shall survive the Closing of the transactions contemplated by this Agreement unless a different time period is expressly provided for in this Agreement.
11.2 DEFAULT AND ATTORNEYS' FEES.
11.2.1 Default by Buyer. In the event Closing does not occur due to default by Buyer, Seller's sole and exclusive remedy shall be to terminate this Agreement and, then Seller's sole and exclusive remedy shall be to retain the Deposit as liquidated damages. Buyer expressly agrees that the payment of such amounts to Seller represents a reasonable estimation of the damages in the event of Buyer's default, that actual damages may be difficult to ascertain and that this provision does not constitute a penalty. Buyer and Seller acknowledge and agree that these damages have been specifically negotiated and are to compensate Seller for taking the Property off the market and for its costs and expenses associated with this Agreement.
11.2.2 Default by Seller. In the event Closing does not occur due to default of Seller, Buyer's remedies shall be, at Buyer's option, (a) to terminate this Agreement and receive a refund of the Deposit, or (b) bring suit to specifically enforce this Agreement; provided that Buyer may not bring suit for specific performance unless: (i) Buyer is not in default under this Page 22 of46 CFH KC Real Estate PSA
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Agreement; (ii) Buyer demonstrates that it would have been in pos1tton to have tendered performance on its part as of the Closing Date; (iii) Buyer files suit for specific performance within one hundred twenty ( l 20) days of Seller's alleged default; and (iv) said suit for specific performance seeks to convey the entire Property. In the event specific performance is not an available remedy (because, for example, Seller has conveyed the Property to another party in breach of this Agreement), then each Buyer Entity may bring suit against Seller for its actual damages resulting from Seller's default; provided however, Buyer shall have no right to seek lost profits, consequential damages, indirect damages or punitive damages in any amount.
11.2.3 Attorney's Fees. In the event of a legal action or other proceeding between the Parties that arises out of or relates to an alleged default under this Agreement, the prevailing party in any such legal action or proceeding, in addition to any other relief which may be granted, whether legal or equitable, shall be entitled to recover from the losing party in any such legal action or proceeding its reasonable costs and expenses of suit, including reasonable attorneys' fees and expert witness fees. In all other actions or proceedings arising out of or relating to this Agreement each party shall bear its own costs and expenses of suit, including attorney's fees and costs.
11.3 TIME.
11.3.1 TIME Is OF THE ESSENCE. Time IS of the essence m the perfonnance of this Agreement.
11.3.2 COMPUTATION OF TIME. Any reference to "day" in this Agreement shall refer to a calendar day, which is every day of the year. Any reference to business day in this Agreement shall mean any calendar day that is not a "Legal Holiday." A Legal Holiday under this Agreement is a Saturday, Sunday or legal holiday as defined in RCW 1.16.050. Any period of time in this Agreement shall begin the calendar day or business day, as the case may be, after the event starting the period and shall expire at 5:00 p.m. Pacific Time of the last calendar day or business day, as the case may be, of the specified period of time, unless with regard to calendar days the last day is a Legal Holiday, in which case the specified period of time shall expire on the next day that is not a Legal Holiday.
11.4 NOTICES. Any and all notices or other communications required or permitted to be given under any of the provisions of this Agreement shall be in writing and shall be deemed to have been duly given upon receipt when personally delivered or sent by overnight courier or two (2) business days after deposit in the United States mail if by first class, certified or registered mail, return receipt requested, or upon receipt by email; notices sent by email shall concurrently be transmitted by one of the other permitted means of giving notice. All notices and communications shall be addressed to the Parties and their designated notices recipients at the addresses set forth below or at such other addresses as a Party may specify by notice to the other Party and given as provided herein, and copies of all such notices and communications to a Party shall be concurrently given to such recipient Party's designated notice recipients:
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Ifto Buyer: Congregations for the Homeless 515 - 1161h Avenue NE, Suite 150 Bellevue, WA 98004 Attn: Mr. David Bowling, Executive Director Email: davidb(i"4cfchomelss.org
With a copy to: Congregations for the Homeless 515 - 1161h Avenue NE, Suite 150 Bellevue, WA 98004 Attn: Linda Hall, Project Manager Email: [email protected]
With a copy to: Davis Wright Tremaine LLC 929 - I 081h A venue NE, Suite 1500 Bellevue, WA 98004 Email: [email protected]
With a copy to: Davis Wright Tremaine LLC 920 Fifth Avenue, Suite 3300 Seattle, WA 98104-1610 Email: [email protected]
Polaris at Eastgate, LLC 120 W. Cataldo Ave., Suite 100 Spokane, WA 9920 I
Email: scottm((V,inlandconstruction.com and [email protected]
Horizon Housing Alliance 905 W. Riverside Ave., Suite 202 Spokane, WA 9920 I Email: [email protected] and [email protected]
Plymouth Housing Group 2113 Third A venue Seattle, WA 98121 Attn: John Torrence, Senior Real Estate Developer Email: jtorrence@p l ymouthhousing.org
With a copy to: Kantor Taylor PC 1200 Fifth Avenue, Suite 1910 Seattle, WA 9810 I Attn: Andrea Y. Sato Email: asato= kantortaylor.com
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If to Seller: King County King County Facility Management Division Real Estate Services Section 500 Fourth A venue, Room 830 Seattle, WA 98104 Attn: Bryan Hague Email: [email protected]
With a copy to: King County Prosecuting Attorney's Office Civil Division King County Courthouse 516 3rd Avenue, Suite W400 Seattle, WA 981 04 Attention: Chris Leopold Email: chris.leopold kingcounty.gov
11.5 ENTIRE AGREEMENT AND AMENDMENT. This Agreement (including the Exhibits attached hereto) constitutes the entire agreement of the Seller and Buyer with respect to the subject matter hereof and may not be modified or amended except by a written agreement specifically referring to this Agreement and signed by all Parties.
11.6 SEVERABILITY. In the event any portion of this Agreement shall be found to be invalid by any court of competent jurisdiction, then such holding shall not impact or affect the remaining provisions of this Agreement unless that court of competent jurisdiction rules that the principal purpose and intent of this contract should and/or must be defeated, invalidated or voided.
11. 7 WAIVER . No waiver of any breach or default hereunder shall be considered valid unless in writing and signed by the Party giving such waiver and no such waiver shall be deemed a waiver of any prior or subsequent breach or default.
11.8 BINDING EFFECT . Subject to Section 11.14 below, this Agreement shall be binding upon and inure to the benefit of each Party, its successors and assigns.
11.9 LEGAL RELATIONSHIP. The Parties to this Agreement execute and implement this Agreement solely as Seller and Buyer. No partnership, joint venture or joint undertaking shall be construed from this Agreement.
11.10 CAPTIONS. The captions of any articles, paragraphs or sections contained herein are for purposes of convenience only and are not intended to define or limit the contents of said articles, paragraphs or sections.
11.11 COOPERATION . Prior to and after Closing the Parties shall cooperate, shall take such further action and shall execute and deliver further documents as may be reasonably requested by the other Party in order to carry out the provisions and purposes of this Agreement.
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11.12 GOVERNING LAW AND VENUE. This Agreement and all amendments hereto shall be governed by and construed in accordance with the laws of the State of Washington applicable to contracts made and to be performed therein, without giving effect to its conflicts of law rules or choice of law provisions. In the event that either Party shall bring a lawsuit related to or arising out of this Agreement, the Superior Court of King County, Washington shall have exclusive jurisdiction and venue.
11.13 No THIRD PARTY BENEFICIARIES. This Agreement is made only to and for the benefit of the Parties, and shall not create any rights in any other person or entity.
11.14 ASSIGNMENT; RELEASE. Buyer shall not assign this Agreement or any rights hereunder without Seller's prior written consent, which consent shall not be unreasonably withheld or delayed; provided, however, that, subject to Seller's prior written approval upon review of the assignment agreement and suitability of the assignee, which shall not be unreasonably withheld, conditioned, or delayed, Horizon is authorized to assign its rights under this Agreement to purchase the Affordable Housing Parcel to (i) the Polaris Affiliate in accordance with Section 5.3 above; or (ii) a special purpose entity managed or controlled by Horizon, or to a special purpose entity managed or controlled by Plymouth Housing Group, a Washington nonprofit corporation ("Plymouth"), conditioned only upon such special purpose entity and/or Plymouth assuming Horizon's obligations under this Agreement with respect to the Affordable Housing Parcel pursuant to an assignment and assumption agreement, a copy of which shall, upon its mutual execution, be promptly provided to Seller. Following such assignment, all notices required hereunder to be sent to or from Buyer shall also be sent to or from such assignee.
11.15 NEGOTIATION AND CONSTRUCTION. This Agreement and each of its terms and provisions are deemed to have been explicitly negotiated between the Parties, and shall not be construed as if it has been prepared by one of the Parties, but rather as if the Parties had jointly prepared it. The language in all parts of this Agreement will, in all cases, be construed according to its fair meaning and not strictly for or against any Party. The Parties acknowledge and represent, as an express term of this Agreement, that they have had the opportunity to obtain and utilize legal review of the tenns and conditions outlined in this Agreement. Each Party shall be and is separately responsible for payment of any legal services rendered on their behalf regarding negotiation and drafting of this Agreement.
11.16 SELLER'S KNOWLEDGE. Any and all representations or warranties or other provisions in this Agreement that are conditioned on terms such as "to Seller's knowledge" or "about which Seller has knowledge" are made to and limited by the present, actual knowledge of Bryan Hague, who is an employee of King County, is the Manager of the King County Facilities Management Division, and who Seller represents is the person with the most knowledge concerning the Property and the most appropriate employee to make such representations and warranties on behalf of Seller. Bryan Hague has made no inquiries or investigations with respect to Seller's representations or warranties or other provisions prior to the making thereof and has no duty to undertake the same.
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11.17 INDEMNIFICATION TITLE 51 WAIVER. The indemnification provisions of this Agreement are specifically and expressly intended to constitute a waiver of the indemnifying Party's immunity under Washington's Industrial Insurance Act, RCW Title 51, as respects the other Party only, and only to the extent necessary to provide the other Party with a full and complete indemnity of claims made by the indemnifying Party's employees. The Parties acknowledge that these provisions were specifically negotiated and agreed upon by them.
11.18 COUNTERPARTS. To facilitate execution, this Agreement may be executed in as many counterparts as may be convenient or required. It shall not be necessary that the signature of, or on behalf of, each Party, or that the signature of all persons required to bind any Party, appear on each counterpart. All counterparts shall collectively constitute a single instrument. It shall not be necessary in making proof of this Agreement to produce or account for more than a single counterpart containing the respective signatures of, or on behalf of, each Party hereto. Any signature page to any counterpart may be detached from such counterpart without impairing the legal effect of the signatures thereon and thereafter may be attached to another counterpart identical thereto except having attached to it additional signature pages. Executed counterparts of this Agreement may be delivered electronically, such as by an email to the other Party of a PDF of such signed counterpart.
11.19 EXHIBITS. The following exhibits described herein and attached hereto are fully incorporated into this Agreement by this reference:
EXHIBIT A Legal Description EXHIBIT 8 Binding Site Plan EXHIBITC Bargain and Sale Deed EXHIBIT D Certificate of Non-Foreign Status EXHIBITE Memorandum of Seller's Share of Consideration Upon Future Conveyance EXHIBIT F Form of Earnest Money Promissory Note (Deposit) EXHIBITG Use Covenants EXHIBIT H West Private Sanitary Sewer Easement EXHIBIT I East Private Sanitary Sewer Easement EXHIBIT J Private Storm Drainage Easement EXHIBIT K Temporary Shoring Easement EXHIBIT L Demolition Plan EXHIBITM Temporary Construction Easement
[SIGNATURES ON THE NEXT PAGE]
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6/4/2021
6/3/2021
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BUYER: POLARIS AT EASTGATE, LLC
By: _ __._li/b;...... __ ,_ ~ Darin Davidson, Manager -
Date: " • l · 1 f
BUYER: HORIZON HOUSING ALLIANCE
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EXHIBIT A
LEGAL DESCRIPTION
PARCEL B OF BOUNDARY LINE ADJUSTMENT N0.11-114500-LW, RECORDED MARCH 23, 2012 UNDER RECORDING NO. 20120323900003, IN THE OFFICIAL RECORDS OF KING COUNTY, WASHINGTON.
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EXHIBIT B
BINDING SITE PLAN
(Attached)
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COW Meeting Materials Page 84 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B COW My Notory GIi/EN corporation NATIVE In By. By. known roads requirements bufflf"lnc; mon09ement limited STATE corporation Sy. &.llevue f'urthsr, 8eU.we 8indin9 On COUNTY derlYlng stoled sgld acknowledged ond tonda VARIANCE ACKNOWLEDGEMENT: OWNER'S mono9emont, conveyed to vcrtor1c.. 1treet., ,toted b• indudin9 KNOW 9radln9 ea,ements except Thfs The the to to thot for for Approvot An the the Meeting witness enter make me th• onuronc. commission oll the this Kfn9 publlc lone! City easements In 8indi19 native corporation. Name Nome of . Olld/or AU under public occordonco where OF to, to known graphic Public thot purpose Sile of eoHl'l'UN'ltl. t!Ue hos we or1d doy of by this lhe but herein County OF and oll to whereof be fareffl PEOPL£ controtlln9 sakt or WASHINGTON GROWlH . YOQetoUon, 1tolw Be!le,ue of of the Pion noC'fllCl,Y Sito o that KING lta lhe propet1y ~om In ,eaponsibility. he/she Blndln9 not personolly purposes ollow6d prctectfng my CERTIFICATE and drolnoge thot tracts the oihckii Official person In sold to RESTRICTION Nl9'e1entatior1 ond . effect dee I MO DIil£: ••111 r NE NW ~~~~:~:.:~ 1/4, 1/4, 4/26/2021 (U ...... ~4 s,i,.,r."'- SITE SW I SW 1/4 1/4 Ill SHEET I I I I PLAN GRAPHIC SEC. SEC. July City Bellevue I NO lD.eb ( Ill 10 10 DURYEA T .ASSOCIATES www 2702 • 2 rnT) NO. Surveying WA j 7, T. T 100 . SCALE OF N .duryeo-associot~.com 24 24 99207 talt . 2021 ft. of Peny @:JobNo 20-119453 N., N., 2 and fS09) Street R R. . Mapping 5 5 46.5-8007 Spokane E E, •• W.M W.M ,1 9 . - LF . 2814 .:I' I DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBITC BARGAIN AND SALE DEED AFTER RECORDING RETURN TO: Attn: ------BARGAIN AND SALE DEED Grantor -- King County, Washington Grantee- - Legal ---- Tax Acct.------The Granter, KING COUNTY, a political subdivision of the State of Washington, for and in consideration of mutual benefits, pursuant to King County Ordinance No. , does hereby bargain, sell and convey unto the Grantee, , a , the following the real property situate in King County, Washington and legally described in EXHIBIT A, attached hereto and incorporated herein by this reference, subject to the permitted exceptions set forth in EXHIBIT A. GRANTOR: KING COUNTY BY: TITLE: Director, Facilities Management Division-----~ ------ Approved as to Fonn: By ______~ Senior Deputy Prosecuting Attorney NOTARY BLOCK APPEARS ON NEXT PAGE Page 32 of 46 CFH KC Real Estate PSA COW Meeting Materials Page 87 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B NOT ARY BLOCK FOR KING COUNTY STATE OF WASHINGTON) ) ss COUNTY OF KJNG ) On this day of , 20/ _, before me, the undersigned, a Notary Public in and/or the State of Washington, duly commissioned and sworn, personally appeared ANTHONY WRIGHT. lo me known to be the Director of the Facilities Management Division of the King County Department of Execulive Services. and who executed the foregoing ins/rumen/ and acknowledged to me that HE was aulhorized lo execute said instrument on behalf of KJNG COUNTY for !he uses and pwposes therein mentioned. WITNESS my hand and official seal hereto affixed the day and year in this certificate above wrilten. Notary Public in and for the State of Washington, residing City and State My appointment expires _ _ _ Page 33 of 46 CFH - KC Real Estate PSA COW Meeting Materials Page 88 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT A TO BARGAIN AND SALE DEED LEGAL DESCRIPTION [Insert legal description after recording of Binding Site Plan] Together with: [Insert applicable Easements after recording] EXCEPTIONS TO TITLE SUBJECT TO: [permitted exceptions will be determined in accordance with the process identified in Article 4 of the Agreement and inserted in the final deed]. Page 34 of46 CFH - KC Real Estate PSA COW Meeting Materials Page 89 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBITD Seller's Certification of Non-Foreign Status under Foreign Investment in Real Property Tax Act (26 U.S.C. 1445) Section 1445 of the Internal Revenue Code provides that a transferee ofa U.S. real property interest must withhold tax if the transferor is a foreign person. For U.S. tax purposes (including Section 1445), the owner of a disregarded entity (which has legal title to a U.S. real property interest under local law) will be the transferor of the property and not the disregarded entity. To infonn the transferee that withholding of tax is not required upon the disposition of a U.S. real property interest by King County ("Transferor"), the undersigned hereby certifies the following on behalf of Transferor: 1. Transferor is not a foreign corporation, foreign partnership, foreign trust, or foreign estate (as those tenns are defined in the Internal Revenue Code and Income Tax Regulations); 2. Transferor is not a disregarded entity as defined in Section l.1445-2(b)(2)(iii); 3. Transferor's U.S. employer identification number is 91-6001327; 4. Transferor's office address is King County Facilities Management Division, Real Estate Services Section, Room 800 King County Administration Building, 500 Fourth Avenue, Seattle, WA 98104. Transferor understands that this certification may be disclosed to the Internal Revenue Service by transferee and that any false statement contained herein could be punished by fine, imprisonment, or both. Under penalties of perjury, I declare that I have examined this certification and to the best of my knowledge and belief it is true, correct, and complete, and I further declare that I have authority to sign this document on behalf of Transferor. Dated this _ day of ______, 20_ King County, Transferor: By: Name:------Anthony Wright Title: Director, Facilities Management Division Page 35 of 46 CFH KC Real Estate PSA COW Meeting Materials Page 90 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBITE Memorandum of Seller's Share of Consideration upon Future Conveyance After Recording, Return to: Reference Number of Related Document: NIA Grantor(s): Congregations for the Homeless Grantee(s): King County Abbreviated Legal Description: [insert) Additional Legal Description is on Exhibit A of Document Assessor's Property Tax Parcel or Account No.: MEMORANDUM OF SELLER'S SHARE OF CONSIDERATION UPON FUTURE CONVEYANCE THIS MEMORANDUM OF SELLER'S SHARE OF CONSIDERATION UPON FUTURE CONVEYANCE is made this __ day of , 2021, by and between [Buyer Entity], a [state] [form of entity] ("Buyer"), and King County, a political subdivision of the State of Washington ("Seller"). l. Pursuant to an Amended and Restated Real Estate Purchase and Sale Agreement dated , 202 l ("PSA"), Buyer has, concurrently with the execution of this Memorandum, acquired the real property described on Exhibit A hereto ("Property"). Terms defined in the PSA shall have the same meaning herein. 2. Under the PSA, Seller is entitled to receive certain payments from Buyer or its Affiliate in the event of any Conveyance of the vacant Property, which may include, as more specifically defined in the PSA, a transfer, conveyance; sale, disposition, condemnation, assignment, encumbrance, mortgage, pledge or grant of any legal or beneficial right, title or interest in the Property ( or any portion of the Property). or the grant of an option with respect to any of the foregoing, or a lease with a term of ten ( l 0) years or more, including any unilateral options held by tenant, for all or a substantial part of the Property. 3. This memorandum shall automatically terminate and be released on the earlier of: (a) [ ], which is the day after the tenth ( l01h) anniversary of the last day of the Participation Period; or (b) upon [commencement of construction of the Shelter Project] [the closing of financing for construction of an [affordable/workforce] housing project on that is funded Page 36 of46 CFH KC Real Estate PSA COW Meeting Materials Page 91 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B with at least ten million dollars ($ l 0,000,000.00) in documented, verifiable, and commercially reasonable construction financing.] 4. Seller's rights under Section 3.5 of the PSA shall be prior to and superior to and over any and all security interests in the Property, except the security interests of Buyer's lender for the acquisition of the Property that holds a recorded security interest in the Property pursuant to a deed of trust or a mortgage as provided in Section 3.5 of the PSA. 5. This Notice is for the sole purpose of providing notice of the PSA, and the PSA contains all terms and conditions of any payment due Seller in the event of a Conveyance. In the event of any conflict, the PSA shall govern over this memorandum. DA TED as of the day and year first above written. KING COUNTY: (BUYER ENTITY): Name: Anthony Wright Name: ------ Title: Director, Facilities Management Division Title: ------ APPROVED AS TO FORM: By: ------~ -- ~ Senior Deputy Prosecuting Attorney Exhibit A - Legal Description of the Property Page 37 of 46 CFH - KC Real Estate PSA COW Meeting Materials Page 92 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT F FORM OF EARNEST MONEY PROMISSORY NOTE (DEPOSIT) $250,000.00 Seattle, Washington [Date] FOR VALUE RECEIVED, the undersigned promises to pay to Chicago Title of Washington the sum of Two Hundred Fifty Thousand and no/ 100 Dollars ($250,000.00), with no interest thereon, on the later of (i) the date that the undersigned gives written notice of the satisfaction or waiver of the Financing Contingency pursuant to Section 5.8 of the Amended and Restated Real Estate Purchase and Sale Agreement, as amended, between King County, a political subdivision of the State of Washington ("Seller") and Congregations for the Homeless, Polaris at Eastgate, LLC, and Horizon Housing Alliance, as Buyer (the "PSA"); or (ii) upon satisfaction or waiver of the Council Approval Contingency pursuant to Section 5.2 of the PSA. Upon satisfaction or waiver of the Financing Contingency and Council Approval Contingency, the amount due under this Note shall be converted to cash, which shall be held in escrow with Chicago Title of Washington pursuant to the PSA. This Promissory Note shall bear interest after maturity at the rate of twelve percent (12%) per annum. If this Promissory Note shall be placed in the hands of an attorney for collection or if suit shall be brought to collect any of the principal or interest of this Promissory Note, the undersigned promises to pay reasonable attorneys' fees, including any on appeal. POLARIS AT EASTGATE, LLC By: ______Its: ~~~ ~ ~~~~~~~~~~~ Page 38 of46 CFH - KC Real Estate PSA COW Meeting Materials Page 93 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT G USE COVENANTS (Attached) Page 39 of 46 CFH - KC Real Estate PSA COW Meeting Materials Page 94 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B ---AFTER RECORDING RETURN TO: Document Title: RESTRICTIVE COVENANT FOR SHELTER USE Grantor: Congregations for the Homeless, a Washington nonprofit corporation Grantee: King County, a political subdivision of the state of Washington Abbreviated Legal Description: [Insert] (Full Legal on Exhibit A) Assessor's Tax Parcel Number: Related Document: NIA Restrictive Covenant for Shelter Use (Shelter Project) Page - I 4850-4148-1954v.6 0112852-000002 COW Meeting Materials Page 95 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B RESTRICTIVE COVENANT FOR SHELTER USE (Shelter Parcel) THIS RESTRICTIVE COVENANT FOR SHELTER USE (''Covenant') is made as of ______, 2021, by Congregations for the Homeless, a Washington nonprofit corporation ("CFH') and by and in favor of King County, a political subdivision of the State of Washington ("King Cou11ty"). This Covenant burdens the real property located in the City of Bellevue, Washington, and legally described on the attached Exhibit A (the "Burdened Property") and benefits King County. RECITALS A. King County, as Seller, and CFH, as one of three Buyer Entities, have entered into that certain Amended and Restated Real Estate Purchase and Sale Agreement, dated May_, 2021 (the "PSA"} with respect to the sale of the Burdened Property to CFH. The Property is defined as the "Shelter Parcel" in the PSA. B. As set forth in the PSA, King County wants to ensure the long-term (at least 20 years) use of the Shelter Parcel for the Shelter Project as defined in the PSA. C. In furtherance of such purpose, and in consideration, in part, for the sale of the Property to CFH, CFH agreed in the PSA to convey a restrictive covenant to King County limiting the use of the Burdened Property principally to an overnight shelter and drop-in day center for individuals experiencing homelessness along with providing associated services to such individuals and to uses associated with the administrative operations of CFH and its assigns. D. CFH has acquired from King County and King County has conveyed to CFH, the Burdened Property pursuant to the PSA and pursuant to the Bargain and Sale Deed as of the date hereof and recorded against the Burdened Property with the King County Recorder under No. _____ on _ , 2021 (the "Deed''). AGREEMENT NOW THEREFORE, CFH and King County agree, covenant and declare that the Deed is subject to the following restrictive covenants, reserved from King County's conveyance of the Burdened Property to CFH by the Deed, which covenants shall run with the land and burden the Burdened Property for the sole benefit of King County. 1. Definitions. Capitalized terms not otherwise defined in this Covenant (including the recitals hereto} shall have the respective meanings ascribed such terms in the PSA. The following terms shall have the meanings defined herein: Restrictive Covenant for Shelter Use (Shelter Project) Page - 2 4850-4148-1954v.6 0112852-000002 COW Meeting Materials Page 96 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B (a) "Literally Homeless" shall have the meaning set forth in subsection (1) of the definition of "homeless" set forth in HUD regulation 24 CFR §582.5 as now or hereinafter amended. Subsection ( 1) of the definition of "homeless" set forth in HUD regulation 24 CFR §582.5 currently defines "homeless" as: "(I) An individual or family who lacks a fixed, regular, and adequate nighttime residence, meaning: (i) An individual or family with a primary nighttime residence that is a public or private place not designed for or ordinarily used as a regular sleeping accommodation for human beings, including a car, park, abandoned building, bus or train station, airport, or camping ground; (ii) An individual or family living in a supervised publicly or privately operated shelter designated to provide temporary living arrangements (including congregate shelters, transitional housing, and hotels and motels paid for by charitable organizations or by federal, state, or local government programs for low-income individuals); or (iii) An individual who is exiting an institution where he or she resided for 90 days or less and who resided in an emergency shelter or place not meant for human habitation immediately before entering that institution". (b) "HUD" means the United States Department of Housing and Urban Development, or any successor governmental agency. (c) "Low Barrier" means accepting anyone experiencing homelessness who can sufficiently manage his/her behavior to live in community with others. Individuals will not be denied access due to criminal history, mental illness, or drug/alcohol use or addiction. ( d) "Sl,e/ter" means a building providing temporary housing and drop-in day accommodations and critical basic support to temporary residents including, without limitation, meals, laundry, personal hygiene, and health services. 2. Shelter Use Covenant. CFH covenants and declares that during the Term of this Covenant the use of the Burdened Property shall be restricted principally to the construction, operation, and maintenance of a low barrier shelter serving Literally Homeless persons. The Burdened Property also may be used for the administrative and business operations of CFH and its assigns. CFH intends to subject the Property to one or more Regulatory Agreements (Extended Use Agreements) restricting the use of the Burdened Property to providing a shelter for persons experiencing homelessness (each such agreement, an "Ot/1er Covenant"). During any period during which the Burdened Property is subject to any Other Covenant, compliance with the Other Covenant shall be deemed compliance with this Covenant, so long as the Other Covenant restricts the use of the Burdened Property in a manner that is substantially the same as the terms and provisions of this Covenant. 3. Term. The covenants contained herein shall remain in place until the twentieth (201h) anniversary of the date this Covenant initially is recorded in the land records of King County, Washington. This Covenant shall automatically terminate and be of no further force or effect upon the expiration of its term. Restrictive Covenant for Shelter Use (Shelter Project) Page - 3 4850-4148-1954v.6 0112852-000002 COW Meeting Materials Page 97 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B 4. Enforcement Actions. If a violation of any of the foregoing covenants occurs, King County shall provide written notice specifying the default to CFH. CFH shall thereafter have a thirty (30) day period to cure such default ( or if such default is not capable of cure within thirty (30) days, then such additional period as is reasonably necessary for CFH to complete such cure, provided that CFH commences cure within such thirty (30) day period and thereafter diligently pursues it to completion). If after such period, CFH fails to cure such violation, or to commence such cure, as applicable, King County may institute and prosecute any proceeding at law or in equity to abate, prevent, or enjoin any such violation or to compel specific performance of the obligations hereunder. No delay in enforcing the provisions hereof as to any breach or violation, shall impair, damage or waive the right of King County to enforce the provisions hereof during the continuation or repetition of such breach, or upon a violation or any similar breach or violation hereof at any later time. In the event that legal proceedings are commenced to enforce any provision of this Covenant, the prevailing party in such action shall be entitled to an award of costs and reasonable legal and attorneys' fees, including those incurred on appeal, in addition to any other relief. Nothing contained herein shall be deemed to limit or restrict the rights of King County under any other agreement or contract. No third parties have any rights to enforce this Covenant. Time is of the essence. 5. Miscellaneous. (a) This Covenant shall run with the land and in favor of King County and shall be recorded by King County in the real property records of King County. (b) If any provision of this Covenant shall be held by a court of proper jurisdiction to be invalid, illegal or unenforceable, the remaining provisions shall survive and their validity, legality or unenforceability shall not in any way be affected or impaired thereby. Restrictive Covenant for Shelter Use (Shelter Project) Page - 4 4850-4148-1954v.6 0112852-000002 COW Meeting Materials Page 98 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B IN WITNESS WHEREOF, CFH has executed this Covenant as of the date first written above. CONGREGATIONS FOR THE HOMELESS, a Washington nonprofit corporation By: Its: NOTARY BLOCK FOR CONGREGATIONS FOR THE HOMELESS ST A TE OF WASHINGTON ) ) ss COUNTY OF KING ) On this day of , 2021 _, before me, the undersigned, a Notary Public in and for the State of Washington, duly commissioned and sworn, personally appeared DAVID BOWLING, to me known to be the Executive Director of CONGREGATIONS FOR THE HOMELESS, and who executed the foregoing instrument and acknowledged to me that HE was authorized to execute said instrument on behalf of CONGREGATIONS FOR THE HOMELESS for the uses and purposes therein mentioned. WITNESS my hand and official seal hereto affixed the day and year in this certificate above written. Notary Public in and for the State of Washington, residing at~~~~~~---~~~~~ ~ City and State My appointment expires ______ Restrictive Covenant for Shelter Use Page - 5 (Shelter Project) 4850-4148-1954v .6 0112852-000002 COW Meeting Materials Page 99 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B Acknowledged and Agreed to by: KING COUNTY BY: TITLE: Director, Facilities Management Division Approved as to Form: By Senior~------Deputy Prosecuting Attorney NOTARY BLOCK FOR KING COUNTY ST A TE OF WASHING TON ) ) ss COUNTY OF KING ) On this day of , 2021 _, before me, the undersigned, a Notary Public in and for the State of Washington, duly commissioned and sworn, personally appeared ANTHONY WRIGHT, to me known to be the Director of the Facilities Management Division of the King County Department of Executive Services, and who executed the foregoing instrument and acknowledged to me that HE was authorized to execute said instrument on behalf of KING COUNTY for the uses and purposes therein mentioned. WITNESS my hand and official seal hereto affixed the day and year in this certificate above written. Notary Public in and for the State of Washington, residing at ___ ~~--~-- ~ City and State ---- My appointment expires ------ Restrictive Covenant for Shelter Use Page - 6 (Shelter Project) 4850-4148-1954v.6 0112852-000002 COW Meeting Materials Page 100 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT A Legal Description Restrictive Covenant for Shelter Use Page - 7 (Shelter Project) 4850-4148-1954v.6 0112852-000002 COW Meeting Materials Page 101 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B AFTER RECORDING RETURN TO: Document Title: DECLARATION OF COVENANT FOR LOW-INCOME HOUSING Gra11tor: Polaris at Eastgate, LLC Gra11tee: King County Abbreviated Legal Description: [Insert] (Full Legal on Exhibit A) Assessor's Tax Parcel Number: Related Document: NIA DECLARATION OF COVENANT FOR LOW-INCOME HOUSING (Workforce Housing Parcel) THIS DECLARATION OF COVENANT FOR LOW-INCOME HOUSING ("Covenant") is made as of , 2021, by Polaris at Eastgate, LLC, a Washington limited liability company ("Polaris"), and by and in favor of King County, a political subdivision of the State of Washington ("King County"). This Covenant applies to the real property located in the City of Bellevue, Washington, and legally described on the attached Exhibit A (the "Property"). RECITALS A. King County is desirous of ensuring the long.term (at least 20 years) use of the Property for the purposes set forth herein. 8. In furtherance of such purpose, and in consideration of the sale of the Property to Polaris, Polaris intends to limit the rents charged and impose maximum income requirements for the residents of the individual dwelling units within the apartment complex constructed on the Property (the "Workforce Housing Project"). Declaration of Covenant for Low-Income Housing (Workforce Housing Project) Page - I COW Meeting Materials Page 102 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B AGREEMENT NOW THEREFORE, Polaris hereby covenants as follows: l. Definitions. The following terms shall have the following meanings: (a) "Area Median Income" or "AMr' means the area median income determined in a manner consistent with determination of area median gross income under section 8 of the United States Housing Act of l 937 (as amended from time to time), including adjustments for family size, for the Primary Metropolitan Statistical Area ("PMSA") which includes the City of Bellevue, Washington. (b) "Gross Rent" has the meaning ascribed such phrase in Section 42(g)(2) of the Internal Revenue Code, as the same may be amended and re-enacted from time to time; provided, if Section 42(g)(2) of the Internal Revenue Code is repealed, "Gross Rent" shall have the meaning ascribed such phrase in Section 42(g)(2) of the Internal Revenue Code as in effect immediately before such repeal; and provided further, "Gross Rent" shall only include that portion of rent that is payable by the tenant (and shall not include rent paid by others pursuant to one or more rental subsidy programs). (c) "Housing Unit' means a residential dwelling unit in the Workforce Housing Project available for rent by or rented to a tenant. (d) "HUD" means the United States Department of Housing and Urban Development, or any successor governmental agency. 2. Covenants. 2.1 Each Housing Unit shall be both rent-restricted and occupied by (or held available for rental to) individuals whose income at the time of initial occupancy is sixty percent ( 60%) or less of Area Median Income. (a) For purposes of this Section 2, a Housing Unit is rent-restricted if the Gross Rent with respect to such Housing Unit does not exceed thirty percent (30%) of the Imputed Income Limitation applicable to such Housing Unit. (i) For purposes of Section 2(a), the "Imputed Income Limitation" applicable to a Housing Unit is the income limitation which would apply under the first sentence of this Section 2 to individuals occupying the Housing Unit if the number of individuals occupying the Housing Unit were as follows: (A) in the case of a Housing Unit which does not have a separate bedroom, one (I) individual and (B) in the case of a Housing Unit which has one ( l) or more separate bedrooms, one and one-half ( 1.5) individuals for each separate bedroom. (ii) The amount of the Imputed Income Limitation applicable for any calendar year (other than the calendar year in which the first Housing Unit in the Workforce Housing Project Declaration of Covenant for Low-Income Housing (Workforce Housing Project) Page - 2 COW Meeting Materials Page 103 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B is occupied) shall not be less than the Imputed Income Limitation applicable for the immediately preceding calendar year. (b) For purposes of this Section 2, an individual's income shall be determined in a manner consistent with determination of lower income families under section 8 of the United States Housing Act of 1937 (as amended from time to time). (c) The restrictions set forth in this Section 2 do not apply with respect to the Housing Units within the Workforce Housing Project that are occupied by (or held available for use by) on site property managers and/or providers or services to tenants, provided, however, that no more than three Housing Units will be used for such purposes. (d) Polaris intends to subject the Property to one or more Regulatory Agreements (Extended Use Agreements) in favor of Washington State Housing Finance Commission (or its successor agency) (each, an "Other Covenant"). During any period during which the Workforce Housing Project is subject to an Other Covenant, compliance with the Other Covenant shall be deemed to be compliance with this Covenant, so long as the Other Covenant restricts the incomes of tenants and the allowable rents in a manner that is substantially ( l) the same as set forth in Section 42(g) of the Internal Revenue Code, as in effect as of the date of this Covenant, and (2) the same as the terms and provisions of the Other Covenant as recorded on or about the date hereof. 2.2 In accordance with King County Code 4.56.100.C. l-2, Polaris (and its successors and assigns) shall pay residential prevailing wages (as defined in chapter 39.12 RCW) for initial construction of the Workforce Housing Project and shall have an apprentice utilization goal of fifteen percent (15%). For this purpose, Polaris shall use September 8, 2020, as the wage publication date (i.e. effective date for prevailing wages determinations) and shall use prevailing wages for King County, Washington. 3. Term. The covenants contained herein shall remain in place until the twentieth (201h) anniversary of the date this Covenant initially is recorded in the land records of King County, Washington. This Covenant shall automatically terminate and be of no further force or effect upon the expiration of its term. Additionally, in the event Polaris (or its successors and assigns) is prevented from building or operating the Workforce Housing Project during the term of this Covenant due to circumstances beyond its control, King County agrees to release and terminate this Covenant. 4. Enforcement Actions. If a violation of any of the foregoing covenants occurs, King County may, after thirty (30) days' written notice to the Polaris (or its successors and assigns), institute and prosecute any proceeding at law or in equity to abate, prevent, or enjoin any such violation or to compel specific performance of the obligations hereunder; provided, King County shall not have the right to cause any tenant of a Housing Unit to be evicted from a Housing Unit. No delay in enforcing the provisions hereof as to any breach or violation, shall impair, damage or waive the right of King County to enforce the provisions hereof during the continuation or repetition of such breach, or upon a violation or any similar breach or violation hereof at any later time. In the event that legal proceedings are commenced to enforce any provision of this Covenant, Declaration of Covenant for Low-Income Housing (Workforce Housing Project) Page - 3 COW Meeting Materials Page 104 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B the prevailing party in such action shall be entitled to an award of costs and reasonable legal and attorneys' fees in addition to any other relief. Nothing contained herein shall be deemed to limit or restrict the rights of King County under any other agreement or contract. No third parties have any rights to enforce this Covenant. 5. Miscellaneous. (a) This Covenant shall run with the land and in favor of King County, shall be binding on all successors and assigns of Polaris, and shall be recorded by King County in the real property records of King County. (b) If any provision of this Covenant shall be held by a court of proper jurisdiction to be invalid, illegal or unenforceable, the remaining provisions shall survive and their validity, legality or unenforceability shall not in any way be affected or impaired thereby. [Remainder of page intentionally blank.] Declaration of Covenant for Low-Income Housing (Workforce Housing Project) Page - 4 COW Meeting Materials Page 105 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B IN WITNESS WHEREOF, King County has executed this Covenant as of the date first written above. POLARIS AT EASTGATE, LLC, a Washington limited liability company By: Its: NOTARY BLOCK FOR POLARIS STA TE OF WASHINGTON ) ) ss COUNTY OF SPOKANE ) This record was acknowledged before me on , 2021, by ______Manager of Polaris at Eastgate, LLC, a Washington limited liability company. Notary Public for the State of Washington My commission expires: ______ Declaration of Covenant for Low-Income Housing Page - 5 (Workforce Housing Project) COW Meeting Materials Page 106 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B Acknowledged and Agreed to by: KING COUNTY BY: TITLE: Director, Facilities Management Division Approved as to Form: By ______Senior Deputy Prosecuting Attorney NOTARY BLOCK FOR KING COUNTY ST ATE OF WASHINGTON ) ) ss COUNTY OF KING ) On this day of , 2021, before me, the undersigned, a Notary Public in and for the State of Washington, duly commissioned and sworn, personally appeared ANTHONY WRIGHT, to me known to be the Director of the Facilities Management Division of the King County Department of Executive Services, and who executed the foregoing instrument and acknowledged to me that HE was authorized to execute said instrument on behalf of KING COUNTY for the uses and purposes therein mentioned. WITNESS my hand and official seal hereto affixed the day and year in this certificate above written. Notary Public in and for the State of Washington, residing at~~ ~~~~- --~~~~-~ City and State My appointment expires ______ Declaration of Covenant for Low-Income Housing Page - 6 (Workforce Housing Project) COW Meeting Materials Page 107 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT A Legal Description Declaration of Covenant for Low-Income Housing Page - 7 (Workforce Housing Project) COW Meeting Materials Page 108 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B AFTER RECORDING RETURN TO: Document Title: DECLARATION OF COVENANT FOR LOW-INCOME HOUSING Grantor: [Horizon Housing Alliance] Grantee: King County Abbreviated Legal Description: [Insert] (Full Legal on Exhibit A) Assessor's Tax Parcel Number: Related Document: NIA DECLARATION OF COVENANT FOR LOW-INCOME HOUSING (Affordable Housing Parcel) THIS DECLARATION OF COVENANT FOR LOW-INCOME HOUSING ("Covenant") is made as of , 2021, by [Horizon Housing Alliance, a California nonprofit public benefit corporation], and by and in favor of King County, a political subdivision of the St.ate of Washington ("King County"). This Covenant applies to the real property located in the City of Bellevue, Washington, and legally described on the attached Exhibit A (the "Property"). RECITALS A. King County is desirous of ensuring the long-term (at least 20 years) use of the Property for the purposes set forth herein. B. In furtherance of such purpose, and in consideration of the sale of the Property to Horizon, Horizon intends to limit the rents charged and impose maximum income requirements for the residents of the individual dwelling units within the apartment complex constructed on the Property (the "Affordable Housing Project"). Declaration of Covenant for Low-Income Housing (Affordable Housing Project) Page - I COW Meeting Materials Page 109 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B AGREEMENT NOW THEREFORE, Horizon hereby covenants as follows: I. Definitions. The following tenns shall have the following meanings: (a) "Area Median Income" or "AMF' means the area median income detennined in a manner consistent with detennination of area median gross income under section 8 of the United States Housing Act of 1937 (as amended from time to time), including adjustments for family size, for the Primary Metropolitan Statistical Area ("PMSA") which includes the City of Bellevue~ Washington. (b) "Gross Rent" has the meaning ascribed such phrase in Section 42(g)(2) of the Internal Revenue Code, as the same may be amended and re-enacted from time to time; provided, if Section 42(g)(2) of the Internal Revenue Code is repealed, "Gross Rent" shall have the meaning ascribed such phrase in Section 42(g)(2) of the Internal Revenue Code as in effect immediately before such repeal; and provided further, "Gross Rent" shall only include that portion of rent that is payable by the tenant (and shall not include rent paid by others pursuant to one or more rental subsidy programs). (c) "Housing Unit" means a residential dwelling unit in the Affordable Housing Project available for rent by or rented to a tenant. (d) "HUD" means the United States Department of Housing and Urban Development, or any successor governmental agency. 2. Covenants. 2.1 Each Housing Unit shall be both rent-restricted and occupied by ( or held available for rental to) individuals whose income at the time of initial occupancy is fifty percent (50%) or less of Area Median Income. (a) For purposes of this Section 2, a Housing Unit is rent-restricted if the Gross Rent with respect to such Housing Unit does not exceed thirty percent (30%) of the Imputed Income Limitation applicable to such Housing Unit. (i) For purposes of Section 2(a), the "Imputed Income Limitation" applicable to a Housing Unit is the income limitation which would apply under the first sentence of this Section 2 to individuals occupying the Housing Unit if the number of individuals occupying the Housing Unit were as follows: (A) in the case of a Housing Unit which does not have a separate bedroom, one (1) individual and (B) in the case of a Housing Unit which has one (1) or more separate bedrooms, one and one-half (1.5) individuals for each separate bedroom. (ii) The amount of the Imputed Income Limitation applicable for any calendar year ( other than the calendar year in which the first Housing Unit in the Affordable Housing Project Declaration of Covenant for Low-Income Housing (Affordable Housing Project) Page - 2 COW Meeting Materials Page 110 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B is occupied) shall not be less than the Imputed Income Limitation applicable for the immediately preceding calendar year. (b) For purposes of this Section 2, an individual's income shall be determined in a manner consistent with determination of lower income families under section 8 of the United States Housing Act of 1937 (as amended from time to time). (c) The restrictions set forth in this Section 2 do not apply with respect to the Housing Units within the Affordable Housing Project that are occupied by (or held available for use by) on site property managers and/or providers or services to tenants, provided, however, that no more than three Housing Units will be used for such purposes. (d) Horizon intends to subject the Property to one or more Regulatory Agreements (Extended Use Agreements) in favor of Washington State Housing Finance Commission (or its successor agency) ( each, an "Otl,er Covenant'). During any period during which the Affordable Housing Project is subject to an Other Covenant, compliance with the Other Covenant shall be deemed to be compliance with this Covenant, so long as the Other Covenant restricts the incomes of tenants and the allowable rents in a manner that is substantially (I) the same as set forth in Section 42(g) of the Internal Revenue Code, as in effect as of the date of this Covenant, and (2) the same as the terms and provisions of the Other Covenant as recorded on or about the date hereof. 2.2 In accordance with King County Code 4.56.100.C. l-2, Horizon (and its successors and assigns) shall pay not less than the equivalent of residential prevailing wages (as defined in chapter 39.12 RCW) for initial construction of the Affordable Housing Project and shall have an apprentice utilization goal of fifteen percent (15%). 3. Term. The covenants contained herein shall remain in place until the twentieth (201h) anniversary of the date this Covenant initially is recorded in the land records of King County, Washington. This Covenant shall automatically terminate and be of no further force or effect upon the expiration of its term. Additionally, in the event Horizon (or its successors and assigns) is prevented from building or operating the Affordable Housing Project during the term of this Covenant due to circumstances beyond its control, King County agrees to release and terminate this Covenant. 4. Enforcement Actions. If a violation of any of the foregoing covenants occurs, King County may, after thirty (30) days' written notice to Horizon (or its successors and assigns), institute and prosecute any proceeding at law or in equity to abate, prevent, or enjoin any such violation or to compel specific performance of the obligations hereunder; provided, King County shall not have the right to cause any tenant of a Housing Unit to be evicted from a Housing Unit. No delay in enforcing the provisions hereof as to any breach or violation, shall impair, damage or waive the right of King County to enforce the provisions hereof during the continuation or repetition of such breach, or upon a violation or any similar breach or violation hereof at any later time. In the event that legal proceedings are commenced to enforce any provision of this Covenant, the prevailing party in such action shall be entitled to an award of costs and reasonable legal and attorneys' fees in addition to any other relief. Nothing contained herein shall be deemed to limit Declaration of Covenant for Low-Income Housing (Affordable Housing Project) Page - 3 COW Meeting Materials Page 111 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B or restrict the rights of King County under any other agreement or contract. No third parties have any rights to enforce this Covenant. 5. Miscellaneous. (a) This Covenant shall run with the land and in favor of King County, shall be binding on all successors and assigns of Horizon, and shall be recorded by King County in the real property records of King County. (b) If any provision of this Covenant shall be held by a court of proper jurisdiction to be invalid, illegal or unenforceable, the remaining provisions shall survive and their validity, legality or unenforceability shall not in any way be affected or impaired thereby. [Remainder of page intentionally blank.] Declaration of Covenant for Low-Income Housing (Affordable Housing Project) Page - 4 COW Meeting Materials Page 112 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B IN WITNESS WHEREOF, King County has executed this Covenant as of the date first written above. [HORIZON HOUSING ALLIANCE, a California nonprofit public benefit corporation) By: Its: NOTARY BLOCK FOR HORIZON STA TE OF WASHING TON ) ) ss COUNTY OF KING ) This record was acknowledged before me on , 2021, by ______of [Horizon Housing Alliance, a California nonprofit public benefit corporation]. Notary Public for the State of Washington My commission expires: ______ Declaration of Covenant for Low-Income Housing Page - 5 (Affordable Housing Project) COW Meeting Materials Page 113 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B Acknowledged and Agreed to by: KING COUNTY BY: TITLE: Director, Facilities Management Division Approved as to Form: By ______~ Senior Deputy Prosecuting Attorney NOTARY BLOCK FOR KING COUNTY STATE OF WASHINGTON) ) ss COUNTY OF KING ) On this day of , 2021, before me, the undersigned, a Notary Public in and for the State of Washington, duly commissioned and sworn, personally appeared ANTHONY WRIGHT, to me known to be the Director of the Facilities Management Division of the King County Department of Executive Services, and who executed the foregoing instrument and acknowledged to me that HE was authorized to execute said instrument on behalf of KING COUNTY for the uses and purposes therein mentioned. WITNESS my hand and official seal hereto affixed the day and year in this certificate above written. Notary Public in and for the State of Washington, residing at~~~-~ ~~~~ ~~~ ~~~ City and State My appointment expires ______ Declaration of Covenant for Low-Income Housing Page - 6 (Affordable Housing Project) COW Meeting Materials Page 114 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT A Legal Description Declaration of Covenant for Low-Income Housing Page - 7 (Affordable Housing Project) COW Meeting Materials Page 115 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT H WEST PRIVATE SANITARY SEWER EASEMENT (Attached) Page 40 of46 CFH KC Real Estate PSA COW Meeting Materials Page 116 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B After Recording Return To: Document Title: Sanitary Sewer Easement Grantor : King County, a political subdivision of the State of Washington Grantee: King County, a political subdivision of the State of Washington, and its successors and assigns Ahr. Legal Description: PCL A BELLEVUE BLA #11-114500-LW REC #20120323900003 Tax Parcel No.: 545330-0320 SANITARY SEWER EASEMENT THIS SANITARY SEWER EASEMENT (the "Agreement") is made and entered into this _day of , 202 l. RECITALS: WHEREAS, King County, a political subdivision of the State of Washington ("King County"), owns the real property legally described on Exhibit 1 hereto ("Parcel A"); and WHEREAS, King County also owns the real property adjacent to and immediately south of Parcel A and legally described on Exhibit 2 hereto ("Parcel B"); and WHEREAS, King County is subdividing Parcel B into three (3) lots ("Lot l ", "Lot 2", and "Lot 3"; collectively, the "Subdivided Lots") pursuant to that City of Bellevue Binding Site Plan No. 20-119453 LF recorded herewith (the "Binding Site Plan"); and WHEREAS, King County is selling Lot l to Polaris at Eastgate, LLC, a Washington limited liability company ("Polaris"), Lot 2 to Congregations for the Homeless, a Washington non profit corporation ("CFH"), and Lot 3 to Horizon Housing Alliance, a California nonprofit public benefit corporation ("Horizon"); and WHEREAS, to facilitate the sale of the Subdivided Lots, King County, as owner of Parcel A ("Grantor"), desires to grant to King County, as current owner of Lot 1, and its successors and assigns, including Polaris, as future owner of Lot I ("Grantee"), a non-exclusive, perpetual easement over and across a portion of Parcel A for the purposes set forth herein (the "Sanitary Sewer Easement"); and COW Meeting Materials Page 117 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B WHEREAS, Grantor and Grantee each desire and intend for the Sanitary Sewer Easement to be subject to the terms and conditions set forth herein; NOW, THEREFORE, in consideration of the foregoing recitals, and in further consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt, value, and sufficiency of which is hereby acknowledged, Grantor and Grantee mutually covenant and agree as follows: AGREEMENT: 1. Easement Area. The area subject to the Sanitary Sewer Easement set forth in this Agreement is the area legally described and identified on the map attached hereto as Exhibit 3 (the "Easement Area"). 2. Grant of Easement. Grantor hereby grants to Grantee the Sanitary Sewer Easement, which is a non-exclusive, perpetual easement over and across the Easement Area, to be used solely for constructing, installing, reconstructing, replacing, maintaining, repairing and operating a sanitary sewer pipeline and all necessary connections and appurtenances thereto, together with the right of ingress thereto and egress therefrom for the purpose of enjoying the easement. Grantee shall be solely responsible for obtaining and complying with all government approvals necessary for completion of the work contemplated hereunder, and shall promptly comply with all conditions, requirements, or enforcement actions relating thereto. Prior to commencement of Construction/maintenance activities on Parcel A, Grantee shall provide Grantor with copies of project plans and documents for review and comment at major design stages for work on Parcel A. Grantee access to the Easement Area for maintenance/repair activities shall be during Grantee's normal working hours, with a minimum 72 hours advance notice; except in response to an emergency, in which case Grantor shall be notified as soon as possible (but not more than 24 hours from the occurrence). Grantee shall locate all underground utilities prior to commencement of construction. Adequate fencing between Parcels A and B, comparable to the existing fencing, shall be maintained by Grantee during the Term of the easement to retain the existing level of security for Grantor's Property (Parcel A). Grantor shall be provided with Grantee's Fence Construction and Phasing Plans and Specifications for review and approval, such approval not to be unreasonably conditioned, delayed or withheld, prior to relocating security fencing to enable Grantee access to, and use of, the Easement Area for initial construction within the Easement Area; and prior to any proposed subsequent fence modifications. Grantee shall not damage or modify the existing or replacement landscaping within the Easement Area during the Term of the easement, including employment of Best Management Practices (BMPs) and Temporary Erosion & Sediment Control measures (TESC) while conducting construction/repair activities within the Easement Area. Upon completing initial construction of sanitary sewer pipeline and appurtenances, Grantee shall relocate the fencing to the property line between Parcel A and Parcel B in its original or better condition. COW Meeting Materials Page 118 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B Grantee shall cause all necessary maintenance and repair to the sanitary sewer pipeline and connections within the Easement Area to be made at its sole cost for the duration of the Agreement. Following any construction, installation, repair or maintenance within the Easement Area, Grantee, at no expense to Grantor, shall remove all equipment and materials and restore the Easement Area to the condition in which it existed prior to the commencement of said activities. Upon completion of construction/maintenance and/or repair activities, Grantee shall provide a signed notice of completion to Grantor, including as-built drawing(s) and locations of utilities, facilities, and appurtenances; at which time Grantor and Grantee will inspect the Easement Area and Grantee shall make any additional modifications, to ensure the Easement Area has been restored to its prior existing condition to Grantor's reasonable satisfaction. If, at any time, Grantee causes a release in, on, or about the Easement Area of any Hazardous Substances, or disturbs or exacerbates any Hazardous Substances, the presence of which predates this Agreement, Grantee agrees to take all steps necessary to assure its containment and remediation, including any cleanup that may be required, in compliance with all applicable laws. For the purposes of this Agreement, the term "Hazardous Substance" shall mean: any waste, pollutant, contaminant, or other material that now or in the future becomes regulated or defined under any Environmental Law. For purposes of this Agreement, the term "Environmental Law" shall mean: any federal, state or local statute, regulation, code, rule, ordinance, order, judgment, decree, injunction or common law pertaining in any way to the protection of human health, safety, or the environment, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. § 9602 et. seq. ("CERCLA"); the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 690 l et seq. ("RCRA"); the Washington State Model Toxics Control Act, RCW Ch. 70.105D ("MTCA"); the Washington Hazardous Waste Management Act, RCW Ch. 70.105; the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq., the Washington Water Pollution Control Act, RCW Ch. 90.48, and any laws concerning above ground or underground storage tanks. Should any release of Hazardous Substances, or damage to existing utilities or facilities occur on Grantor's Property as a result of Grantee's actions, Grantee shall notify Grantor as soon as possible (but no longer than 24-hours from the time the Grantee learns of the occurrence) and shall immediately make all necessary repairs to the reasonable satisfaction of Grantor. Any costs incurred by Grantor as a result of damages or spills caused by Grantee shall be reimbursed to Grantor by Grantee. 3. Non-Exclusivity/Right to Relocate. Grantor reserves unto itself the right to utilize the Easement Area for such purposes as do not unreasonably obstruct, endanger or interfere with the Sanitary Sewer Easement or the rights granted to Grantee under this Agreement. Grantor shall have the right to grant such other easements, rights or privileges to other persons or parties and/or entities for such purposes as Grantor in its sole discretion may elect, so long as such purposes to do not unreasonably obstruct, endanger or interfere with the Sanitary Sewer Easement or the rights granted to Grantee under this Agreement. In addition, Grantor may, from time-to-time, change the location of the Sanitary Sewer Easement and related appurtenances, provided that: (a) such change shall not unreasonably interfere with or diminish the availability of the utilities serviced by the facilities to Grantee or to any third~party serviced thereby; (b) such change shall be performed at the sole cost of Gran tor; and (c) such change shall be made in accordance with and subject to COW Meeting Materials Page 119 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B all applicable municipal ordinances, building codes, required permits, requirements of the provider of such utility, and other applicable requirements of law. 4. Nature of Easement. The Sanitary Sewer Easement, and other rights granted under the terms of this Agreement, shall be appurtenant to and run with the land, and shall be binding on and obligate all persons and/or entities having or acquiring any right, title, or interest in the land. 5. Indemnification. Grantee, and its successors and assigns (including Polaris) shall indemnify, defend, and hold Grantor and its successors and assigns harmless from and against all claims, damages, losses and expenses, including reasonable attorney fees and costs, arising out of or resulting from Grantee's (or Grantee's tenants, subtenants, contractors, vendors or other invitees) use of the Easement Area. Grantee's obligations under this Section 5 shall also extend to: l) Grantee's violation or alleged violation of, or other failure to comply with, any state, federal, or local law, regulation or requirement, including without limitation, CERCLA and MTCA, by Grantee, its officers, employees and agents; and 2) Grantee's release in, on, from, or about the Easement Area, at any time, of any Hazardous Substances, or Grantee's disturbance or exacerbation of Hazardous Substances, the presence of which predates this Agreement. For the purpose of this Section 5, Grantee, by negotiation, hereby waives, with respect to Grantor only, any immunity that would otherwise be available against such claims under the industrial insurance provisions of Title 51 RCW. 6. General Provisions. 6.1 Modification. This Agreement may only be modified or amended by a written instrument executed by the parties. 6.2 Headings. The subject headings of the sections and paragraphs of this Agreement are included for purposes of convenience only and shall not affect the construction or interpretation of any of its provisions. 6.3 Severability. If any term or provision of this Agreement shall, to any extent, be held invalid or unenforceable, the remaining terms and provisions of this Agreement shall not be affected thereby, but each remaining tenn and provision shall be valid and enforced to the fullest extent of the law. 6.4 Waiver. No waiver ofany breach of any of the easements, covenants and/or agreements herein contained shall be construed as, or constitute, a waiver of any other breach or a waiver, acquiescence in or consent to any further or succeeding breach of the same or any other covenant and/or agreement. 6.5 Successors and Assigns. Each covenant and condition contained in this Agreement shall be binding on the owner of Parcel A and inure to the benefit of the owner of Lot I, and their respective heirs, executors, administrators, personal representatives, successors and assigns, except as otherwise provided herein. COW Meeting Materials Page 120 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B 6.6 Recording. This Agreement shall be recorded in the Office of the Recorder of King County, Washington. 6.7 Governing Law, Jurisdiction and Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Washington. Jurisdiction and venue will be King County for any dispute relating to or arising under this Agreement. 6.8 Remedies. In addition to all other remedies allowed by law or equity, the parties, and their successors and assigns, shall have the right to seek injunctive relief for the enforcement of the tenns and conditions of this Agreement. 6.9 Attorney's Fees. If any legal action or any other proceeding is brought for the enforcement of this Agreement, or because of any alleged breach, dispute or default in connection with any of the provisions of this Agreement, the successful or prevailing party shall be entitled to recover its reasonable attorney fees and costs incurred in that action or proceeding ( or any appeal thereof), in addition to any other relief to which it is entitled. 6.10 Breach. Except as specifically set forth herein, it is expressly agreed that no breach of this Agreement shall entitle any party to unilaterally cancel, rescind or otherwise tenninate this Agreement or the property rights granted herein. However, such limitation shall not affect in any manner any other rights or remedies which a party may have hereunder or under applicable law or equity by reason of any such breach, including any party's right to seek judicial tennination or rescission. 6.11 Counterparts. This Agreement may be executed in duplicate counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. [REMAINDER OF PAGE INTENTIONALLY BLANK - SIGNATURE PAGE FOLLOWS] COW Meeting Materials Page 121 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B IN WITNESS WHEREOF, the parties have caused this Agreement to be executed below. GRANTOR: King County, a political subdivision of the State of Washington By:.~ Its: _____------___ ----~-~______ GRANTEE: King County, a political subdivision of the State of Washington By: ______Its: ______ Acknowledged by: Polaris at Eastgate, LLC, a Washington limited liability company By:- lts: ___------_____ ----_____ ~-- _ COW Meeting Materials Page 122 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B Grantor Notary STA TE OF WASHINGTON ) ) ss. County of King ) I certify that I know or have satisfactory evidence that , the ______of King County, is the person who appeared before me, and said person acknowledged that he/she signed this instrument and acknowledged it to be the free and voluntary act of King County, for the uses and purposes mentioned in the instrument. DATED this _ day of _____ 2021. NOTARY PUBLIC IN AND FOR THE STATE OF WASHINGTON residing at ______My Commission Expires: ______Print Name: --~~ ------~ Grantee Notary STA TE OF WASHINGTON ) ) ss. County of King ) I certify that I know or have satisfactory evidence that , the ______of King County, is the person who appeared before me, and said person acknowledged that he/she signed this instrument and acknowledged it to be the free and voluntary act of King County, for the uses and purposes mentioned in the instrument. DATED this _ day of _____ 2021. NOTARY PUBLIC IN AND FOR THE STATE OF WASHINGTON residing at ______My Commission Expires: ------ Print Name: ------~~-~~ COW Meeting Materials Page 123 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B Polaris Notary ST A TE OF WASHINGTON ) ) ss. County of Spokane ) I certify that I know or have satisfactory evidence that , the ------of Polaris at Eastgate, LLC, is the person who appeared before me, and said person acknowledged that he/she signed this instrument and acknowledged it to be the free and voluntary act of Polaris at Eastgate, LLC, for the uses and purposes mentioned in the instrument. DA TED this _ day of _____ 2021. NOTARY PUBLIC IN AND FOR THE STATE OF WASHINGTON residing at ______My Commission Expires: ______Print Name: --~------~ - -~ COW Meeting Materials Page 124 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT 1 Legal Description of Parcel A Parcel A of Boundary Line Adjustment No. 11-114500-LW, Recorded March 23, 2012 under Recording No. 20120323900003, in the Official Records of King County, Washington. COW Meeting Materials Page 125 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT 2 Legal Description of Parcel B Parcel 8 of Boundary Line Adjustment No. 11-114500-LW, Recorded March 23, 2012 under Recording No. 20120323900003, in the Official Records of King County, Washington. COW Meeting Materials Page 126 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT 3 Easement Area All that cenain real property situate in the City of Bellevue. County of King. State of Washington, over a portion of P.,m:cl A. a,; said parcel is shown upon that c<..'11.ainmap entitkd "City of Be Ucvuc Boundary Linc Adjui.1ment No. I 1-114500-L \\'" fikd in Volume 286. page 275 in Man:h 23. 2012 under R(.-cording No. 20120323900003. and being dcscrilx.- COMMENCING at the Southeast comer of said Parcel A; theoce North 88°33' 04" We~1 a distance of 305.00 f<..-ctalong the South line of said Pan:cl A to an angle (Y.>inttherein: thence :-forth 52° 12' 48" We.st a distance of 11 X. 13 foet along the South line of .said Parcel A lO an angle point therein; thence North 83 °20' 35" Wci-1 a distance of 422.22 feet along the South line of said P.,m:cl A to the POINT OF BEGINNING; thence continuing North 83 ° 20' 35" West a distance of 15.0 I l~-ct along the South tine of said P..in:el A; thence. leaving said South line. North 4 °34' 49" East a distance of 12.34 lt.'Cl to a point on the South line of that certain Sanitary Sewer Easement n:corde COW Meeting Materials Page 127 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B LINE TABLE I LINE BEARING LENGTH I L1 N8Y20·,s·w 15.01' L2 No4•34••9•E 12.J4' I Ll S8Y2o·3s·E 15.01 I L4 so4·34•49•w 12.34' . N ~ J L__ b N II I EASEMENT AREA •..- 185 SQ. FT . EXIS1lNG SANITARY SEWER EASEMENT - - (NO. 20180927001107) NSJ·2o 'J5'"w POINT or J BEGINNING SE CORNER Of' PARCEL A SANITARYSEWER EASEMENT EXHIBIT: A PORTIONOf CtTY Of BELLEWE BOUNDARYLINE DURYEA & ASSOCIATES AO.AJS1MENTNO , 11-114500-LW, PARCEL A 2702 N ?orry Slrool NW1/4, SW1/4, SECTION 10, T24N, RSE. 'MA Sp olcorie. WA 99201 CITY or BE:U.EVUE:.KING COUNTY,WASHINGTON SHEET 1 or 1 J08 NO. 19-2814 COW Meeting Materials Page 128 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT I EAST PRIVATE SANITARY SEWER EASEMENT (Attached) Page 41 of 46 CFH KC Real Estate PSA COW Meeting Materials Page 129 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B After Recording Return To: Document Title: Sanitary Sewer Easement Grantor: King County, a political subdivision of the State of Washington Grantee: King County, a political subdivision of the State of Washington, and its successors and assigns Ahr. Legal Description: PCL A BELLEVUE BLA #11-114500-LW REC #20120323900003; PCL B BELLEVUE BLA #11-114500-LW REC #20120323900003 Tax Parcel No.: 545330-0320; 102405-9101 SANITARY SEWER EASEMENT AGREEMENT THIS SANITARY SEWER EASEMENT (the "Agreement") is made and entered into this _ day of , 2021. RECITALS: WHEREAS, King County, a political subdivision of the State of Washington ("King County"), owns the real property legally described on Exhibit 1 hereto ("Parcel A"); and WHEREAS, King County also owns the real property adjacent to and immediately south of Parcel A and legally described on Exhibit 2 hereto ("Parcel B"); and WHEREAS, King County is subdividing Parcel B into three (3) lots ("Lot I", "Lot 2", and "Lot 3"; collectively, the "Subdivided Lots") pursuant to that City of Bellevue Binding Site Plan No. 20-119453 LF recorded herewith (the "Binding Site Plan"); and WHEREAS, King County is selling Lot l to Polaris at Eastgate, LLC, a Washington limited liability company ("Polaris"), Lot 2 to Congregations for the Homeless, a Washington non profit corporation ("CFH"), and Lot 3 to [Horizon Housing Alliance, a California nonprofit public benefit corporation] ("PSH Owner"); and WHEREAS, to facilitate the sale of the Subdivided Lots, King County, as owner of Parcel A and current owner of Lot 3 ("Grantor"), desires to grant to King County, as current owner of Lot 2 and Lot 3, and its successors and assigns, including CFH, as future owner of Lot 2, and PSH COW Meeting Materials Page 130 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B Owner, as future owner of Lot 3 ("Grantee"), a non-exclusive, perpetual sanitary sewer easement over and across a portion of Parcel A and a portion of Lot 3 for the purposes set forth herein (the "Sanitary Sewer Easement"); and WHEREAS, Grantor and Grantee each desire and intend for the Sanitary Sewer Easement to be subject to the tenns and conditions set forth herein; NOW, THEREFORE, in consideration of the foregoing recitals, and in further consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt, value, and sufficiency of which is hereby acknowledged, Grantor and Grantee mutually covenant and agree as follows: AGREEMENT: 1. Easement Area. The area subject to the Sanitary Sewer Easement set forth in this Agreement is the area located within Parcel A and Lot 3 legally described and identified on the map attached hereto as Exhibit 3 (the "Easement Area"). As used herein, (i) the tenn the "Burdened Property" shall collectively refer to Parcel A and Lot 3; provided, however, if the boundary line between Lot 2 and Lot 3 is hereafter adjusted by amendment to the Binding Site Plan or otherwise such that a portion of the Easement Area is located on Lot 2, then Lot 2 shall also be included in the tenn the "Burdened Property" and (ii) the term the "Benefitted Property" shall collectively refer to Lot 2 and Lot 3, including, if the boundary line between Lot 2 and Lot 3 is hereafter adjusted by amendment to the Binding Site Plan or otherwise, such Lots as so reconfigured. If the boundary line between Lot 2 and Lot 3 is hereafter adjusted, references herein to Lot 2 or Lot 3 shall mean such Lot as its boundaries have been reconfigured. 2. Grant of Easement. Grantor hereby grants to Grantee the Sanitary Sewer Easement, which is a non-exclusive, perpetual easement over and across the Easement Area for the benefit of the Benefitted Property, to be used solely for constructing, installing, reconstructing, replacing, maintaining, repairing and operating a sanitary sewer pipeline and all necessary connections and appurtenances thereto, together with the right of ingress thereto and egress therefrom for the purpose of enjoying the easement. Grantee shall be solely responsible for obtaining and complying with all government approvals necessary for completion of the work contemplated hereunder, and shall promptly comply with all conditions, requirements, or enforcement actions relating thereto. Prior to commencement of construction/maintenance activities on the Owned Portion of the Easement Area (as defined below), Grantee shall provide Grantor with copies of project plans and documents for review and comment at major design stages for work on the Owned Portion of the Easement Area. Grantee access to the Easement Area for maintenance/repair activities shall be during Grantee's normal working hours, with a minimum 72 hours advance notice; except in response to an emergency, in which case Grantor shall be notified as soon as possible (but not more than 24 hours from the occurrence). Grantee shall locate all underground utilities prior to commencement of construction. Adequate fencing between Parcels A and B, comparable to the ex1stmg fencing, shall be maintained by Grantee during the Term of the easement to retain the existing level of security for COW Meeting Materials Page 131 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B Grantor's Property (Parcel A). Grantor shall be provided with Grantee's Fence Construction and Phasing Plans and Specifications for review and approval, such approval not to be unreasonably conditioned, delayed or withheld, prior to relocating security fencing to enable Grantee access to, and use of, the Easement Area for initial construction within the Easement Area; and prior to any proposed subsequent fence modifications. Grantee shall not damage or modify the existing or replacement landscaping within the Easement Area during the Term of the easement, including employment of Best Management Practices (BMPs) and Temporary Erosion & Sediment Control measures (TESC) while conducting construction/repair activities within the Easement Area. Upon completing initial construction of sanitary sewer pipeline and appurtenances, Grantee shall relocate the fencing to the property line between Parcel A and Parcel B in its original or better condition. Grantee shall cause all necessary maintenance and repair to the sanitary sewer pipeline and connections within the Owned Portion of the Easement Area to be made at its sole cost for the duration of the Agreement. Following any construction, installation, repair or maintenance within the Easement Area, Grantee, at no expense to Grantor, shall remove all equipment and materials and restore the Easement Area to the condition in which it existed prior to the commencement of said activities. Upon completion of construction/maintenance and/or repair activities, Grantee shall provide a signed notice of completion to Grantor, including as-built drawing(s) and locations of utilities, facilities, and appurtenances; at which time Grantor and Grantee will inspect the Easement Area and Grantee shall make any additional modifications, to ensure the Easement Area has been restored to its prior existing condition to Grantor's reasonable satisfaction. If, at any time, Grantee causes a release in, on, or about the Owned Portion of the Easement Area of any Hazardous Substances, or disturbs or exacerbates any Hazardous Substances, the presence of which predates this Agreement, Grantee agrees to take all steps necessary to assure its containment and remediation, including any cleanup that may be required, in compliance with all applicable laws. For the purposes of this Agreement, the term "Hazardous Substance" shall mean: any waste, pollutant, contaminant, or other material that now or in the future becomes regulated or defined under any Environmental Law. For purposes of this Agreement, the term "Environmental Law" shall mean: any federal, state or local statute, regulation, code, rule, ordinance, order, judgment, decree, injunction or common law pertaining in any way to the protection of human health, safety, or the environment, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. § 9602 et. seq. ("CERCLA"); the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 6901 et seq. ("RCRA"); the Washington State Model Toxics Control Act, RCW Ch. 70.105D ("MTCA"); the Washington Hazardous Waste Management Act, RCW Ch. 70.105; the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq., the Washington Water Pollution Control Act, RCW Ch. 90.48, and any laws concerning above ground or underground storage tanks. Should any release of Hazardous Substances, or damage to existing utilities or facilities occur on Grantor's Property as a result of Grantee's actions, Grantee shall notify Grantor as soon as possible (but no longer than 24-hours from the time Grantee learns of the occurrence) and shall immediately make all necessary repairs to the reasonable satisfaction of Grantor. Any costs incurred by Grantor as a result of damages or spills caused by Grantee shall be reimbursed to Grantor by Grantee. COW Meeting Materials Page 132 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B 3. Non-Exclusivity/Right to Relocate. Grantor reserves unto itself the right to utilize the portion of the Easement Area that Grantor then owns (the "Owned Portion of the Easement Area") for such purposes as do not obstruct, endanger or unreasonably interfere with the Sanitary Sewer Easement or the rights granted to Grantee under this Agreement. Grantor shall have the right to grant such other easements, rights or privileges on the Owned Portion of the Easement Area to other persons or parties and/or entities for such purposes as Grantor in its sole discretion may elect, so long as such purposes to do not obstruct, endanger or unreasonably interfere with the Sanitary Sewer Easement or the rights granted to Grantee under this Agreement. In addition, Grantor may, from time-to-time, change the location of the Owned Portion of the Easement Area to some other portion of the Burdened Property then owned by Gran tor and relocate or replace the related appurtenances, provided that: (a) such change shall not intenupt or unreasonably interfere with or diminish the operation of the sanitary sewer system established under the Sanitary Sewer Easement or availability of the utilities serviced by the sanitary sewer system to Grantee or to any third-party serviced thereby; (b) such change shall be perfonned at the sole cost of Grantor; and (c) such change shall be made in accordance with and subject to all applicable municipal ordinances, building codes, required permits, requirements of the provider of such utility, and other applicable requirements of law. 4. Nature of Easement. The Sanitary Sewer Easement, and other rights granted and obligations imposed under the terms of this Agreement, shall be appurtenant to and run with the Benefitted Property and the Burdened Property, respectively, and shall inure to the benefit of and be binding on and obligate all persons and/or entities having or acquiring any right, title, or interest in the Benefitted Property and the Burdened Property, respectively. 5. Indemnification. Grantee, and its successors and assigns (including CFH, as owner of Lot 2, and PSH Owner as owner of Lot 3) shall indemnify, defend, and hold Grantor and its successors and assigns hannless from and against all claims, damages, losses and expenses, including reasonable attorney fees and costs, arising out of or resulting from Grantee's (or Grantee's tenants, subtenants, contractors, vendors or other invitees) use of the Easement Area. For the avoidance of doubt, (i) the owner of Lot 2 shall not be obligated to defend or indemnity Grantor for the use of the Easement Area by the owner of Lot 3 (or such owner's tenants, subtenants, contractors, vendors or other invitees) and (ii) the owner of Lot 3 shall not be obligated to defend or indemnity Grantor for the use of the Easement Area by the owner of Lot 2 ( or such owner's tenants, subtenants, contractors, vendors or other invitees). Grantee's obligations to Grantor under this Section 5 shall also extend to: l) Grantee's violation or alleged violation of, or other failure to comply with, any state, federal, or local law, regulation or requirement, including without limitation, CERCLA and MTCA, by Grantee, its officers, employees and agents; and 2) Grantee's release in, on, from, or about the Owned Portion of the Easement Area, at any time, of any Hazardous Substances, or Grantee's disturbance or exacerbation of Hazardous Substances, the presence of which predates this Agreement. For the purpose of this Section 5, Grantee, by negotiation, hereby waives, with respect to Grantor only, any immunity that would otherwise be available against such claims under the industrial insurance provisions of Title 51 RCW. COW Meeting Materials Page 133 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B 6. General Provisions. 6.1 Modification. This Agreement may only be modified or amended by a written instrument executed by the owners of the Burdened Property and the owners of the Benefitted Property. 6.2 Headings. The subject headings of the sections and paragraphs of this Agreement are included for purposes of convenience only and shall not affect the construction or interpretation of any of its provisions. 6.3 Severability. If any term or provision of this Agreement shall, to any extent, be held invalid or unenforceable, the remaining terms and provisions of this Agreement shall not be affected thereby, but each remaining term and provision shall be valid and enforced to the fullest extent of the law. 6.4 Waiver. No waiver of any breach ofany of the easements, covenants and/or agreements herein contained shall be construed as, or constitute, a waiver of any other breach or a waiver, acquiescence in or consent to any further or succeeding breach of the same or any other covenant and/or agreement. 6.5 Successors and Assigns. Each covenant and condition contained in this Agreement shall be binding on the owners of the Easement Area and inure to the benefit of the owners of Lot 2 and Lot 3, and their respective heirs, executors, administrators, personal representatives, successors and assigns, except as otherwise provided herein. 6.6 Recording. This Agreement shall be recorded in the Office of the Recorder of King County, Washington. 6.7 Governing Law, Jurisdiction and Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Washington. Jurisdiction and venue will be King County for any dispute relating to or arising under this Agreement. 6.8 Remedies. In addition to all other remedies allowed by law or equity, the parties, and their successors and assigns, shall have the right to seek injunctive relief for the enforcement of the terms and conditions of this Agreement. 6.9 Attorney's Fees. If any legal action or any other proceeding is brought for the enforcement of this Agreement, or because of any alleged breach, dispute or default in connection with any of the provisions of this Agreement, the successful or prevailing party shall be entitled to recover its reasonable attorney fees and costs incurred in that action or proceeding (or any appeal thereof), in addition to any other relief to which it is entitled. 6.10 Breach. Except as specifically set forth herein, it is expressly agreed that no breach of this Agreement shall entitle any owner of the Burdened Property or any owner of the Benefitted Property to unilaterally cancel, rescind or otherwise terminate this Agreement or the property rights granted herein. However, such limitation shall not affect in any manner any other COW Meeting Materials Page 134 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B rights or remedies which any owner of the Burdened Property or Benefitted Property may have hereunder or under applicable law or equity by reason of any such breach, including any party's right to seek judicial termination or rescission. 6.11 Counterparts. This Agreement may be executed and acknowledged in duplicate counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. [REMAINDER OF PAGE INTENTIONALLY BLANK - SIGNATURE PAGE FOLLOWS] COW Meeting Materials Page 135 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B IN WITNESS WHEREOF, the parties have caused this Agreement to be executed below. GRANTOR: King County, a political subdivision of the State of Washington By:______Its: ______ GRANTEE: King County, a political subdivision of the State of Washington By:. Its:.______~------~---- _____ -~ _ Acknowledged by: Congregations for the Homeless. IHorizon Housing Alliance, a Washington non-profit corporation a California non-profit corporation] By:______By:______Its: ~------Its: ------~------~ COW Meeting Materials Page 136 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B Granter Notary ST A TE OF WASHINGTON ) ) ss. County of King ) I certify that I know or have satisfactory evidence that , the ------of King County, is the person who appeared before me, and said person acknowledged that he/she signed this instrument and acknowledged it to be the free and voluntary act of King County, for the uses and purposes mentioned in the instrument. DATED this _ day of _____ 2021. NOTARY PUBLIC IN AND FOR THE STA TE OF WASHINGTON residing at My Commission Expires: ______------_ Print Name: ------~- ~ Grantee Notary ST A TE OF WASHINGTON ) ) ss. County of King ) I certify that I know or have satisfactory evidence that , the ------of King County, is the person who appeared before me; and said person acknowledged that he/she signed this instrument and acknowledged it to be the free and voluntary act of King County, for the uses and purposes mentioned in the instrument. DATED this _ day of _____ 2021. NOTARY PUBLIC IN AND FOR THE ST ATE OF WASHINGTON residing at ------ My Commission Expires: ------ Print Name: ---~~ - - --~ - -- COW Meeting Materials Page 137 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B CFH Notary STATE OF ) ------) ss. County of______) I certify that I know or have satisfactory evidence that , the ______of Congregations for the Homeless, is the person who appeared before me, and said person acknowledged that he/she signed this instrument and acknowledged it to be the free and voluntary act of Congregations for the Homeless, for the uses and purposes mentioned in the instrument. DATED this _ day of _____ 2021. NOTARY PUBLIC IN AND FOR THE STATE OF ______residing at ______My Commission Expires: ------ Print Name: -- ~------~ PSH Owner Notary STATE OF ------) ) SS. County of______) I certify that I know or have satisfactory evidence that , the ______of[Horizon Housing Alliance], is the person who appeared before me, and said person acknowledged that he/she signed this instrument and acknowledged it to be the free and voluntary act of [Horizon Housing Alliance], for the uses and purposes mentioned in the instrument. DA TED this _ day of ----- 2021. NOTARY PUBLIC IN AND FOR THE STATE OF ______residing at ______My Commission Expires: ______Print Name: ~------~ COW Meeting Materials Page 138 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT l Legal Description of Parcel A Parcel A of Boundary Line Adjustment No. 11-114500-LW, Recorded March 23, 2012 under Recording No. 20120323900003, in the Official Records of King County, Washington. COW Meeting Materials Page 139 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT 2 Legal Description of Parcel 8 Parcel B of Boundary Line Adjustment No. l l-114500-LW, Recorded March 23, 2012 under Recording No. 20120323900003, in the Official Records of King County, Washington. COW Meeting Materials Page 140 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT 3 Easement Area All that c-crtain real property .situate in the City of Belle,·ue. County of King. State of Wa....hington, o\'er a portion of Parcel A and a portion of P.dn:el B. as said pan:cls an: shown upon that certain map entitlt.- COMMENCING at the Southeast comer of said Pared A; theoce North 88°33' 04" West a distam:c of 2TI.60 tc.-ct akmg the South line of said Pan:cl A to the POINT OF BEGl~NJ~G; thence, leaving said South tine and traversing into said Pan:d B. South 42°35' :!O" East a dis1ancc of48 .97 ft.-ct: thence South 47 <>24• 40" Wcst a distance of 15.00 l't.-ct; thence :'•forth 42 "35' 20" West a di.~tancc of 63.48 t~-ct to the South line of said Pan:e1 A; thence continuing :-.iorth 42 <>35• 20" Wes t a distmce of.57.00 ft.-ct to a point on the: South line of that ct.-rtain Sanitary Sewer Easement n:conlc..- COW Meeting Materials Page 141 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B "- - - EXHIBIT-- C ---- EXISTING SANITARY SEwtR EASEMENT (NO. 20180927001107) --- POINT Of -N- BEQNNING 277.60' 0 N •-II SE CORNER OF PARCELA SANITARY$EWER EASEMENT EXHIBIT; A PORTIONor CtTY Of BEU.EWE BOUNDARYLINE DURYEA & ASSOCIATES AO.AJS1MENTNO. 11-114500-LW, PARCELS A & B 2702 N. Pony St·oot Nl/2, SW1/4, SECTION 10, T24N, R5E, WM Spokone."NA 9920/ CITY or Bt'.U.£VUE.KING COUNTY,WASHINGTON SHEET 1 Of 1 JOB NO. 19-2814 COW Meeting Materials Page 142 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT J PRIVATE STORM DRAINAGE EASEMENT (Attached) Page 42 of 46 CFH - KC Real Estate PSA COW Meeting Materials Page 143 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B After Recording Return To: Document Title: Storm Drainage Easement Grantor: King County, a political subdivision of the State of Washington Grantee: King County, a political subdivision of the State of Washington, and its successors and assigns Ahr. Legal Description: PCL A BELLEVUE BLA #11-114500-LW REC #20120323900003 Tax Parcel No.: 545330-0320 STORM DRAINAGE EASEMENT AGREEMENT THIS STORM DRAINAGE EASEMENT (the "Agreement") is made and entered into this _day of , 2021. RECITALS: WHEREAS, King County, a political subdivision of the State of Washington ("King County"), owns the real property legally described on Exhibit 1 hereto ("Parcel A"); and WHEREAS, King County also owns the real property adjacent to and immediately south of Parcel A and legally described on Exhibit 2 hereto ("Parcel B''); and WHEREAS, King County is subdividing Parcel B into three (3) lots ("Lot l ", "Lot 2", and "Lot 3"; collectively, the "Subdivided Lots") pursuant to that City of Bellevue Binding Site Plan No. 20-119453 LF recorded herewith (the "Binding Site Plan"); and WHEREAS, King County is selling Lot I to Polaris at Eastgate, LLC, a Washington limited liability company ("Polaris"), Lot 2 to Congregations for the Homeless, a Washington non profit corporation ("CFH"), and Lot 3 to Horizon Housing Alliance, a California nonprofit public benefit corporation ("Horizon"); and WHEREAS, to facilitate the sale of the Subdivided Lots, King County, as owner of Parcel A ("Grantor"), desires to grant to King County, as current owner of Lot 1, and its successors and assigns, including Polaris, as future owner of Lot 1 ("Grantee"), a non-exclusive, perpetual easement over and across a portion of Parcel A for the purposes set forth herein (the "Storm Drainage Easement"); and COW Meeting Materials Page 144 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B WHEREAS, Grantor and Grantee each desire and intend for the Storm Drainage Easement to be subject to the terms and conditions set forth herein; NOW, THEREFORE, in consideration of the foregoing recitals, and in further consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt, value, and sufficiency of which is hereby acknowledged, Grantor and Grantee mutually covenant and agree as follows: AGREEMENT: I. Easement Area. The area subject to the Storm Drainage Easement set forth in this Agreement is the area legally described and identified on the map attached hereto as Exhibit 3 (the "Easement Area"). 2. Grant of Easement. Grantor hereby grants to Grantee the Storm Drainage Easement, which is a non-exclusive, perpetual easement over and across the Easement Area, to be used solely for installing, removing, replacing, maintaining, repairing and utilizing storm water drainage facilities, together with the right of ingress thereto and egress therefrom for the purpose of enjoying the easement. Grantee shall be solely responsible for obtaining and complying with all government approvals necessary for completion of the work contemplated hereunder, and shall promptly comply with all conditions, requirements, or enforcement actions relating thereto. Prior to commencement of Construction/maintenance activities on Parcel A, Grantee shall provide Gran tor with copies of project plans and documents for review and comment at major design stages for work on Parcel A. Grantee access to the Easement Area for maintenance/repair activities shall be during Grantee's normal working hours, with a minimum 72 hours advance notice; except in response to an emergency, in which case Grantor shall be notified as soon as possible (but not more than 24 hours from the occurrence). Grantee shall locate all underground utilities prior to commencement of construction. Adequate fencing between Parcels A and B, comparable to the ex1stmg fencing, shall be maintained by Grantee during the Term of the easement to retain the existing level of security for Grantor's Property (Parcel A). Grantor shall be provided with Grantee's Fence Construction and Phasing Plans and Specifications for review and comment prior to relocating security fencing to enable Grantee access to, and use of, the Easement Area for initial construction within the Easement Area; and prior to any proposed subsequent fence modifications. Grantee shall not damage or modify the existing or replacement landscaping within the Easement Area during the Term of the easement, including employment of Best Management Practices (BMPs) and Temporary Erosion & Sediment Control measures (TESC) while conducting construction/repair activities within the Easement Area. Upon completion of initial Storm drainage facility installation and/or maintenance work, Grantee shall relocate the fencing to the property line between Parcel A and Parcel B in its original or better condition. Grantee shall cause all necessary maintenance and repair to the stormwater drainage facilities and connections within the Easement Area to be made at its sole cost for the duration of the Agreement. COW Meeting Materials Page 145 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B Following any construction, installation, repair or maintenance within the Easement Area, Grantee, at no expense to Grantor, shall remove all equipment and materials and restore the Easement Area to the condition in which it existed prior to the commencement of said activities. Upon completion of construction/maintenance and/or repair activities, Grantee shall provide a signed notice of completion to Grantor, including as-built drawing(s) and locations of utilities, facilities, and appurtenances; at which time Grantor and Grantee will inspect the Easement Area and Grantee shall make any additional modifications, to ensure the Easement Area has been restored to its prior existing condition to Grantor's reasonable satisfaction. If, at any time, Grantee causes a release in, on, or about the Easement Area of any Hazardous Substances, or disturbs or exacerbates any Hazardous Substances, the presence of which predates this Agreement, Grantee agrees to take all steps necessary to assure its containment and remediation, including any cleanup that may be required, in compliance with all applicable laws. For the purposes of this Agreement, the term "Hazardous Substance" shall mean: any waste, pollutant, contaminant, or other material that now or in the future becomes regulated or defined under any Environmental Law. For purposes of this Agreement, the term "Environmental Law" shall mean: any federal, state or local statute, regulation, code, rule, ordinance, order, judgment, decree, injunction or common law pertaining in any way to the protection of human health, safety, or the environment, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. § 9602 et. seq. ("CERCLA"); the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 690 l et seq. ("RCRA"); the Washington State Model Toxics Control Act, RCW Ch. 70.1050 ("MTCA"); the Washington Hazardous Waste Management Act, RCW Ch. 70.105; the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq., the Washington Water Pollution Control Act, RCW Ch. 90.48, and any laws concerning above ground or underground storage tanks. Should any release of Hazardous Substances, or damage to existing utilities or facilities occur on Grantor's Property as a result of Grantee's actions, Grantee shall notify Grantor as soon as possible (but no longer than 24-hours from the time Grantee learns of the occurrence) and shall immediately make all necessary repairs to the reasonable satisfaction of Grantor. Any costs incurred by Grantor as a result of damages or spills caused by Grantee shall be reimbursed to Grantor by Grantee. 3. Non-Exclusivity of the Private Storm Drainage Easement. Grantor reserves unto itself the right to utilize the Easement Area for such purposes as do not unreasonably obstruct, endanger or interfere with the Storm Drainage Easement or the rights granted to Grantee under this Agreement. Grantor shall have the right to grant such other easements, rights or privileges to other persons or parties and/or entities for such purposes as Grantor in its sole discretion may elect, so long as such purposes to do not unreasonably obstruct, endanger or interfere with the Storm Drainage Easement or the rights granted to Grantee under this Agreement. In addition, Grantor may, from time-to-time, change the location of the Storm Drainage Easement and related appurtenances, provided that: (a) such change shall not unreasonably interfere with or diminish the availability of the utilities serviced by the facilities to Grantee or to any third-party serviced thereby; (b) such change shall be performed at the sole cost of Grantor; and (c) such change shall be made in accordance with and subject to all applicable municipal ordinances, building codes, required permits, requirements of the provider of such utility, and other applicable requirements of law. COW Meeting Materials Page 146 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B 4. Nature of Easement. The Storm Drainage Easement, and other rights granted under the terms of this Agreement, shall be appurtenant to and run with the land, and shall be binding on and obligate all persons and/or entities having or acquiring any right, title, or interest in the land. 5. Indemnification. Grantee, and its successors and assigns (including Polaris) shall indemnify, defend, and hold Grantor and its successors and assigns harmless from and against all claims, damages, losses and expenses, including reasonable attorney fees and costs, arising out of or resulting from Grantee's (or Grantee's tenants, subtenants, contractors, vendors or other invitees) use of the Easement Area. Grantee's obligations under this Section 5 shall also extend to: l) Grantee's violation or alleged violation of, or other failure to comply with, any state, federal, or local law, regulation or requirement, including without limitation, CERCLA and MTCA, by Grantee, its officers, employees and agents; and 2) Grantee's release in, on, from, or about the Easement Area, at any time, of any Hazardous Substances, or Grantee's disturbance or exacerbation of Hazardous Substances, the presence of which predates this Agreement. For the purpose of this Section 5, Grantee, by negotiation, hereby waives, with respect to Grantor only, any immunity that would otherwise be available against such claims under the industrial insurance provisions of Title 51 RCW. 6. General Provisions. 6.1 Modification. This Agreement may only be modified or amended by a written instrument executed by the parties. 6.2 Headings. The subject headings of the sections and paragraphs of this Agreement are included for purposes of convenience only and shall not affect the construction or interpretation of any of its provisions. 6.3 Severability. If any term or provision of this Agreement shall, to any extent, be held invalid or unenforceable, the remaining terms and provisions of this Agreement shall not be affected thereby, but each remaining term and provision shall be valid and enforced to the fullest extent of the law. 6.4 Waiver. No waiver ofany breach of any of the easements, covenants and/or agreements herein contained shall be construed as, or constitute, a waiver of any other breach or a waiver, acquiescence in or consent to any further or succeeding breach of the same or any other covenant and/or agreement. 6.5 Successors and Assigns. Each covenant and condition contained in this Agreement shall be binding on the owner of Parcel A and inure to the benefit of the owner of Lot I, and their respective heirs, executors, administrators, personal representatives, successors and assigns, except as otherwise provided herein. 6.6 Recording. This Agreement shall be recorded in the Office of the Recorder of King County, Washington. COW Meeting Materials Page 147 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B 6.7 Governing Law, Jurisdiction and Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Washington. Jurisdiction and venue will be King County for any dispute relating to or arising under this Agreement. 6.8 Remedies. In addition to all other remedies allowed by law or equity, the parties, and their successors and assigns, shall have the right to seek injunctive relief for the enforcement of the terms and conditions of this Agreement. 6.9 Attorney's Fees. If any legal action or any other proceeding is brought for the enforcement of this Agreement, or because of any alleged breach, dispute or default in connection with any of the provisions of this Agreement, the successful or prevailing party shall be entitled to recover its reasonable attorney fees and costs incurred in that action or proceeding (or any appeal thereof), in addition to any other relief to which it is entitled. 6.10 Breach. Except as specifically set forth herein, it is expressly agreed that no breach of this Agreement shall entitle any party to unilaterally cancel, rescind or otherwise terminate this Agreement or the property rights granted herein. However, such limitation shall not affect in any manner any other rights or remedies which a party may have hereunder or under applicable law or equity by reason of any such breach, including any party's right to seek judicial termination or rescission. 6.11 Counterparts. This Agreement may be executed in duplicate counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. [REMAINDER OF PAGE INTENTIONALLY BLANK - SIGNATURE PAGE FOLLOWS] COW Meeting Materials Page 148 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B IN WITNESS WHEREOF, the parties have caused this Agreement to be executed below. GRANTOR: King County, a political subdivision of the State of Washington GRANTEE: King County, a political subdivision of the State of Washington By:.______Its: ______ Acknowledged by: Polaris at Eastgate, LLC, a Washington limited liability company By: ______Its: ---~~~~-~---~ COW Meeting Materials Page 149 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B Grantor Notary ST A TE OF WASHINGTON ) ) ss. County of King ) I certify that I know or have satisfactory evidence that , the ------of King County, is the person who appeared before me, and said person acknowledged that he/she signed this instrument and acknowledged it to be the free and voluntary act of King County, for the uses and purposes mentioned in the instrument. DATED this _ day of _____ 2021. NOTARY PUBLIC IN AND FOR THE STATE OF WASHINGTON residing at ------My Commission Expires: ------Print Name: -- - --~ ------~ Grantee Notary ST A TE OF WASHINGTON ) ) ss. County of King ) I certify that I know or have satisfactory evidence that , the ______of King County, is the person who appeared before me, and said person acknowledged that he/she signed this instrument and acknowledged it to be the free and voluntary act of King County, for the uses and purposes mentioned in the instrument. DATED this _ day of _____ 2021. NOTARY PUBLIC IN AND FOR THE STA TE OF WASHINGTON residing at ------My Commission Expires: ______Print Name: ------~-~ - ~ COW Meeting Materials Page 150 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B Polaris Notary STA TE OF WASHINGTON ) ) ss. County of Spokane ) I certify that I know or have satisfactory evidence that , the of Polaris at Eastgate, LLC, is the person who appeared before me, and said ~------person acknowledged that he/she signed this instrument and acknowledged it to be the free and voluntary act of Polaris at Eastgate, LLC, for the uses and purposes mentioned in the instrument. DATED this _ day of _____ 2021. NOTARY PUBLIC IN AND FOR THE STA TE OF WASHINGTON residing at ______My Commission Expires: ______Print Name: ~---~------~~ COW Meeting Materials Page 151 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT 1 Legal Description of Parcel A Parcel A of Boundary Line Adjustment No. 11-114500-LW, Recorded March 23, 2012 under Recording No. 20 l 20323900003, in the Official Records of King County, Washington. COW Meeting Materials Page 152 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT 2 Legal Description of Parcel B Parcel B of Boundary Line Adjustment No. 11-114500-LW, Recorded March 23, 2012 under Recording No. 20120323900003, in the Official Records of King County, Washington. COW Meeting Materials Page 153 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT 3 Easement Area All that l'e11ain real propc11y situate in the City of lkllcvuc. ( 'mmty of King. State of Washington. ovcr a portion of Pan:c:I A. as said par<.:cl is shown upon that l'l'rtain map entitled '"City of l3cllc\'uc l3oundary Linc Adjustment No. 11-114500-LW'" liled in Volume 2X6. page 275 in Marl'h 23. 2012 under Rcrnrding No. 20120323900003. and heing descrihed as follt)\\s: COMMENCING at the Southeast corner of said Pan:el A: thence North 88°33' 04" West n distance of 305.00 Ice\ along the South line of said Parl'cl A to an angle point therein: thence North 52° 12' 48" West a distance of I I 8.13 feet along the South line or said Parcel A to an angle point therein: thence North 83 0-20• 35" West a distmtce of .132.60 feet along the South line of said Parcel A to the POINT OF BEGINNING: thence continuing North 83°20' 35" West a distance or 15.04 lcct along thi.: South line of said Pared A: thence. leaving said South line. North 2 °28' 2Y' bist a distanL·c of 41.41 lcct: thenl'e South 87°31' 37" East a distance of 15.00 feet: thence South 2°28' 23" West a distance of42.50 feet to lh'-' said Point oflkginning of this description. COW Meeting Materials Page 154 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B LINE TABLE EASEMENT LINE BEARING LENGlH AREA L1 N83"20' 35·w 15.04' L2 S87"31 37•E 15.00' -.- 0 N •-II POINT OF BEGINNING J SE CORNEROF PARCEL A STORMDRAINAGE EASEMENT EXHIBIT; A PORTION Of CITY Of BEU.EWE BOUNDARY LINE DURYEA & ASSOCIATES AD.AJS1MENT NO. 1\-114500-LW, PARCEL A 2702 N Po:ry St·ool NW1/4, SW1/4, SECTION 10, T24N. RSE. VfM Spokane. WA 99201 CITY OF BEllE\'\JE, KING COUNTY, WASHINGTON SHEET t or t J08 NO. 19-2814 COW Meeting Materials Page 155 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT K TEMPORARY SHORING EASEMENT (Attached) Page 43 of46 CFH KC Real Estate PSA COW Meeting Materials Page 156 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B After Recording Return To: Document Title: Temporary Shoring Easement Gran tor: King County, a political subdivision of the State of Washington Grantee: Polaris at Eastgate, LLC, a Washington limited liability company Ahr. Legal Description: PCL A BELLEVUE BLA #11-114500-LW REC #20120323900003 Tax Parcel No.: 545330-0320 TEMPORARY SHORING EASEMENT THIS TEMPORARY SHORING EASEMENT (this "Agreement") is made as of this __ day of , 2021, by and between KING COUNTY, a political subdivision of the State of Washington ("Grantor"), and POLARIS AT EASTGATE, LLC, a Washington limited liability company ("Grantee"). Grantee is constructing an apartment community (the "Project") on real property that Grantee is purchasing from Grantor (the "Grantee's Property" - which is legally described on Exhibit A hereto), which is adjacent to real property owned by Grantor (the "Grantor's Property" - which is legally described on Exhibit B hereto). In connection with construction of the Project, and subject to the terms of this Agreement, Grantor has granted Grantee permission to temporarily use a portion of the Grantor's Property to install shoring and/or retaining walls near the northern property line of the Grantee's Property, including the installation of temporary underground tiebacks, anchors, cables, helical tiebacks, and/or soil nails (collectively "Tiebacks") that will extend below the surface of the Grantor's Property. All tiebacks extending into the Grantor's Property shall be temporary. The excavation, shoring, installation of the Tiebacks, and associated activities incidental thereto are collectively referred to herein as the "Work." COW Meeting Materials Page 157 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B NOW, THEREFORE, in consideration of the foregoing recitals, and in further consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt, value and sufficiency of which is hereby acknowledged, Grantor and Grantee mutually covenant and agree as follows: l. Grant of Easement. Grantor hereby conveys and warrants to Grantee a temporary easement on, over, across, and under the area on Grantor's Property that is legally described and identified on the map attached hereto as Exhibit C (the "Temporary Shoring Easement Area") to perform the Work pursuant to this Agreement (the "Temporary Shoring Easement"). During the term of this easement, Grantor shall retain its rights to access and use the Temporary Shoring Easement Area as desired by Grantor, as long as such access/use does not prohibit Grantee's ability to use the Temporary Shoring Easement Area for purposes as described herein. The Tiebacks shall be placed below all existing improvements on the Grantor's Property and shall not penetrate or damage any existing improvements on the Grantor's Property. The Grantee shall use means and methods to limit the encroachment by tiebacks on existing underground utilities or facilities located on Grantor's Property. The Tiebacks shall not be structural members to support the Project and may or may not be destressed by Grantee at time of abandonment. Grantee shall locate all underground utilities prior to commencement of construction. 2. Term. The tenn of the Temporary Shoring Easement shall commence on that date that this Agreement is fully executed by all parties and recorded in the public records of King County, Washington (the "Effective Date"), which recording shall be completed at Grantee's sole expense. The Temporary Shoring Easement shall terminate automatically, without the need for further action by any party, upon the earlier of (a) completion of the Project, or (b) December 31, 2023 (the "Termination Date"). At no later than the Termination Date or completion of the Project, whichever occurs first, Grantee shall provide Grantor a signed notice confirming termination of this Temporary Shoring Easement and abandonment of the temporary tiebacks including as-built drawing(s) and locations of abandoned tiebacks. Following the Termination Date, any Tiebacks remaining under the Grantor's Property shall be deemed abandoned by Grantee and shall become the property of Grantor. Grantor may thereafter remove, destroy, cut through, or leave the abandoned Tiebacks in place. 3. The Work. The Work shall be completed by Grantee at its sole cost and expense. Grantee shall be solely responsible for obtaining and complying with all government approvals necessary for completion of the Work, and shall promptly comply with all conditions, requirements, or enforcement actions relating thereto. Prior to commencement of construction/ maintenance activities on Parcel A, Grantee shall provide Grantor with copies of project plans and documents for review and comment at major design stages for work on Parcel A. Grantee access to the Temporary Shoring Easement Area for maintenancelrepair activities shall be during Grantee's normal working hours, with a minimum 72 hours advance notice; except in response to an emergency, in which case Grantor shall be notified as soon as possible (but not more than 2 COW Meeting Materials Page 158 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B 24 hours from the occurrence). Grantee shall comply, and cause all of its agents, contractors and employees to comply, with all terms and conditions of this Agreement, all permit conditions and approvals, and all laws and regulations applicable to the Work or the Grantor's Property. Grantee shall coordinate with Grantor during the Tenn of this Temporary Shoring Easement, and Grantor shall have the right to periodically inspect the Easement Area, to ensure compliance with the terms of this Temporary Shoring Easement. Grantee covenants that no liens shall be allowed to attach to Grantor's Property as a result of the Work, and shall promptly remove any liens that are filed as a result of the Work. Adequate fencing between Parcels A and B, comparable to the ex1stmg fencing, shall be maintained by Grantee during the Tenn of the Agreement to retain the existing level of security for Grantor's Property (Parcel A). Grantor shall be provided with Grantee's Fence Construction and Phasing Plans and Specifications for review and comment prior to relocating security fencing to enable Grantee access to, and use of, the Temporary Shoring Easement Area. Grantee shall maintain existing landscaping within the Temporary Shoring Easement Area during the Tenn of the easement, including employment of Best Management Practices (BMPs) and Temporary Erosion & Sediment Control measures (TESC). Upon completion of Work, Grantee shall relocate the fencing to the property line between Parcel A and Parcel B in its original or better condition. Following the Work, Grantee, at no expense to Grantor, shall remove all equipment and materials and restore the Temporary Shoring Easement Area as close as reasonably practical to the condition in which it existed prior to the commencement of said activities. After Grantor receives the signed notice of termination of the Temporary Shoring Easement from Grantee, Grantor and Grantee will inspect the Temporary Shoring Easement Area and Grantee shall make any additional modifications to ensure the Temporary Shoring Easement Area has been restored to its prior existing condition to Grantor's reasonable satisfaction. Grantee's restoration obligations hereunder do not apply to any subsurface anchors, cables, tiebacks and associated equipment it elects to abandon in place. If, at any time, Grantee causes a release in, on, or about the Temporary Shoring Easement Area of any Hazardous Substances, or disturbs or exacerbates any Hazardous Substances, the presence of which predates this Agreement, Grantee agrees to take all steps necessary to assure its containment and remediation, including any cleanup that may be required, in compliance with all applicable laws. For the purposes of this Agreement, the term "Hazardous Substance" shall mean: any waste, pollutant, contaminant, or other material that now or in the future becomes regulated or defined under any Environmental Law. For purposes of this Agreement, the term "Environmental Law" shall mean: any federal, state or local statute, regulation, code, rule, ordinance, order, judgment, decree, injunction or common law pertaining in any way to the protection of human health, safety, or the environment, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U .S.C. § 9602 et. seq. ("CERCLA"); the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 3 COW Meeting Materials Page 159 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B 6901 et seq. ("RCRA"); the Washington State Model Toxics Control Act, RCW Ch. 70.105D ("MTCA"); the Washington Hazardous Waste Management Act, RCW Ch. 70.105; the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq., the Washington Water Pollution Control Act, RCW Ch. 90.48, and any laws concerning above ground or underground storage tanks. Should any release of Hazardous Substances, or damage to existing utilities or facilities occur on Grantor's Property as a result of Grantee's actions, Grantee shall notify Grantor as soon as possible (but no longer than 24-hours from the time Grantee learns of the occurrence) and shall immediately make all necessary repairs to the reasonable satisfaction of Grantor. Any costs incurred by Grantor as a result of damages or spills caused by Grantee shall be reimbursed to Grantor by Grantee. 4. Standard of Care; Indemnity. Grantee shall exercise due care and shall indemnify, defend and hold Grantor, and its agents and occupants, harmless from and against all damages, claims, expenses (including attorneys' fees and costs), and liabilities (collectively "Claims") arising out of Grantee's use of the Temporary Shoring Easement Area, except to the extent that such Claims are caused by the gross negligence or willful misconduct of Grantor or its agents or occupants. Grantee's obligations under this Section 4 shall also extend to: l) Grantee's violation or alleged violation of, or other failure to comply with, any state, federal, or local law, regulation or requirement, including without limitation, CERCLA and MTCA, by Grantee, its officers, employees and agents; and 2) Grantee's release in, on, from, or about the Easement Area, at any time, of any Hazardous Substances, or Grantee's disturbance or exacerbation of Hazardous Substances, the presence of which predates this Agreement. For the purpose of this Section 4, Grantee, by negotiation, hereby waives, with respect to Grantor only, any immunity that would otherwise be available against such claims under the industrial insurance provisions of Title 51 RCW. 5. Insurance. Grantee shall maintain at all times during the course of the Work commercial general liability, automobile liability, and pollution liability insurance with limits of not less than Two Million Dollars ($2,000,000) per occurrence and in the aggregate, insuring against personal injury, and loss or damage to property. The aforementioned policies shall name Grantor as an additional insured for full coverage and policy limits. In addition, at all times during the course of the Work, Grantee shall cause its design professional contractors and subcontractors associated with the design of the Work to maintain professional liability insurance with the limits of Two Million Dollars ($2,000,000) per claim. Prior to its use of the Temporary Shoring Easement Area, Grantee shall deliver to Grantor a Certificate of Insurance and additional insured endorsements evidencing that the foregoing insurance is in effect. 6. Miscellaneous. 6.1 Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the heirs, successors and assigns of the parties hereto. 4 COW Meeting Materials Page 160 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B 6.2. Notices. Any demand, request or notice which either party hereto desires or may be required to make or deliver to the other shall be in writing and shall be deemed effective when personally delivered, or when delivered by private courier service (such as Federal Express), addressed as follows: To Grantee: Polaris at Eastgate, LLC 120 W. Cataldo Ave., Suite 100 Spokane, WA 9920 l Attention: Scott Moms To Grantor: King County Attention:-- --- or to such other address and person as either party may communicate to the other by like written notice. 6.3 Grantor's Authority. Grantor represents and warrants that Grantor has full right, title and interest in and to Grantor's Property, has the full right and authority to grant the Temporary Shoring Easement and other rights set forth in this Agreement, and that the person executing this Agreement on behalf of Grantor has been duly authorized to do so. 6.4 Severability. If any terms or provisions of this Agreement shall, to any extent, be held invalid or unenforceable, the remaining terms and provisions of this Agreement shall not be affected thereby, but each remaining term and provision shall be valid and enforced to the full extent of the law. 6.5 Waiver. No waiver of any breach of any of the agreements herein contained shall be construed as, or constitute, a waiver of any other breach or a waiver, acquiescence in or consent to any further or succeeding breach of the same or another covenant and/or agreement. 6.6 Governing Law, Jurisdiction and Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Washington. Jurisdiction and venue will be King County for any disputes relating or arising under this Agreement. 6. 7 Attorneys' Fees. Should either party bring an action to interpret or enforce this Agreement, the prevailing party in such action shall be entitled to an award of its 5 COW Meeting Materials Page 161 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B reasonable attorneys' fees and costs incurred in connection with such action, whether at trial, on appeal, in arbitration or mediation, or in any bankruptcy proceeding. 6.8 Counterparts. This Agreement may be executed in duplicate counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Scanned signatures shall have the same force and effect as original signatures. [REMAINDER OF PAGE INTENTIONALLY BLANK - SIGNATURE PAGE FOLLOWS] 6 COW Meeting Materials Page 162 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B IN WITNESS WHEREOF, this Agreement is executed as of the date first above written. GRANTOR: KING COUNTY, a political subdivision of the State of Washington By: ______Name:______Its:______ GRANTEE: POLARIS AT EASTGATE, LLC a Washington limited liability company By: ______~------Name:______Its:--- ~------~ 7 COW Meeting Materials Page 163 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B STA TE OF WASHINGTON ) ) ss. County of King ) I certify that I know or have satisfactory evidence that , the ------of King County, is the person who appeared before me, and said person acknowledged that he/she signed this instrument and acknowledged it to be the free and voluntary act of King County, for the uses and purposes mentioned in the instrument. DATED this _ day of _____ 2021. NOTARY PUBLIC IN AND FOR THE STATE OF WASHINGTON residing at ------My Commission Expires: ______Print Name: -- --~----~ - -~ ST A TE OF WASHINGTON ) ) SS. County of Spokane ) I certify that I know or have satisfactory evidence that , the ______of Polaris at Eastgate, LLC, is the person who appeared before me, and said person acknowledged that he/she signed this instrument and acknowledged it to be the free and voluntary act of Polaris at Eastgate, LLC, for the uses and purposes mentioned in the instrument. DATED this _ day of _____ 2021. NOTARY PUBLIC IN AND FOR THE STATE OF WASHINGTON residing at ------ My Commission Expires: ------ Print Name: --~ ------ COW Meeting Materials Page 164 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT A Legal Description of Grantee's Property All that certain real property situate in the City of Bellevue, County of King, State of Washington, being a portion of Parcel B, as said parcel is shown upon that certain map entitled "City of Bellevue Boundary Line Adjustment No. 11-114500-LW" filed in Volume 286, page 275 on March 23, 2012 under Recording No. 20120323900003, King County Records, and being described as follows: BEGINNING at the Southwest corner of said Parcel B, being hereinabove described; thence from said point of beginning, North 1°26' 03" East a distance of 446.72 feet to a point on the South margin of Southeast 32nd Street; thence South 88°33' 04" East along said South margin a distance of 134.03 feet; thence, leaving said South margin, South 1° 18' 59" West a distance of 98.00 feet; thence South 83°20' 35" East a distance of 705.06 feet; thence South 52° 12' 48" East a distance of 118.13 feet; thence South 19°55' 32" West a distance of 280.05 feet to a point on the North margin of Southeast Eastgate Way; thence North 85°46' 25" West along said North margin a distance of 312. l 8 feet to an angle point therein; thence North 4° 13' 35" East along said North margin a distance of 10.00 feet to an angle point therein; thence North 85°46' 25" West along said North margin a distance of 531 .99 feet to the said point of beginning of this description. The hereinabove described real property contains 319,161 square feet or 7 .327 acres, more or less. COW Meeting Materials Page 165 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT B Legal Description of Grantor's Property Parcel A of Boundary Line Adjustment NO. 11-114500-LW, Recorded March 23, 2012 under Recording No. 20 l 20323900003, in the Official Records of King County, Washington. COW Meeting Materials Page 166 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBITC Temporary Shoring Easement Area (Attached) COW Meeting Materials Page 167 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B May 25, 2021 Job No. 19-2814 TEMPORARY SHORING EASEMENT All that certain real property situate in the City of Bellevue, County of King, State of Washington, being a portion of Parcel A, as said parcel is shown upon that certain map entitled "City of Bellevue Boundary Line Adjustment No. 11-114500-LW" filed in Volume 286, page 276 on March 23, 2012 under Recording No. 20120323900003, King County Records, and being described as follows: COMMENCING at the Southwest comer of said Parcel A, being hereinabove described; thence South 83 °20' 35" East along the South line of said Parcel A, a distance of 424. 71 feet to the POINT OF BEGINNING of this description; thence from said point of beginning and continuing along the South line of said Parcel A, South 83 °20' 35" East a distance of 130.00 feet; thence, leaving said South line, North 6 °39' 25" East a distance of 40.00 feet; thence North 83 °20' 35" West, parallel with the South line of said Parcel A, a distance of 130.00 feet; thence South 6 °391 25" West a distance of 40.00 feet to the said point of beginning of this description. The hereinabove described real property contains 5,200 square feet or 0.119 acres, more or less. Prepared by: James A. Locey PLS 46892 Expires: 12./19/2022 COW Meeting Materials Page 168 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B SE 32nd ST 302.04' 134.03' 168.01' •3 lt)OC,,• -co 0 • co •... ai 0 (I) ..... S8J'20'J5"£ I 424.71' SW CORNER, PARCEL A POINT OF BEGINNING TEMPORARYSHORING EASEMENT 5,200 SQ. FT. 0.119::1: ACRES LINE TABLE LINE BEARING LENGTH L1 Nos•39•25·E 40.00' L2 S06"39'25"W 40.00' NOTE: THIS DRAWINGDOES NOT REPRESENTA LAND SURVEY AND IS ONLY INTENDED TO DEPICT THE EASEMENTLOCA 110N. 5/25/2021 TEMPORARY SHORING EASEMENT A PORTION OF PARCEL A DURYEA & ASSOCIATES 2702 N. Perry Street BLA NO. 11-114500-LW Spokane, WA 99207 BELLEVUE, WASHINGTON SHEET 1 OF 1 JOB NO. 19- 2814 COW Meeting Materials Page 169 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT L DEMOLITION PLAN (Attached) Page 44 of 46 CFH KC Real Estate PSA COW Meeting Materials Page 170 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B ,; hs ~~~ ~~ -< n1 iiiiiiiiiiiiii®iiiiiiiiiiiii~ 1 1 I i ! ! I : ' ! i , I • ! ! !i •.'• ! ! i I ! i 1,•• ! ~ !1~lt 1 " 1 • I ,a •j ~1111~•• ~~ • =aal"1'1I.I ~ i,, •1 ·1 ~ 11 ·:= •IP ii ; i' I t 5 ~ ·1·1 lq i ! p ~! l~i ffl • n, ! ! I I .~ Ii ll1 i , Ii i i; i ~. I I I I I ii i ! ; I i ~ I I • I I • I I I I • I ~ ~ -- COW Meeting Materials Page 171 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT M TEMPORARY CONSTRUCTION EASEMENT (Attached) Page 45 of 46 CFH - KC Real Estate PSA COW Meeting Materials Page 172 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B After Recording Return To: Document Title: Temporary Construction Easement Grantor: King County, a political subdivision of the State of Washington Grantee: Polaris at Eastgate, LLC, a Washington limited liability company Ahr. Legal Description: PCL A BELLEVUE BLA #11-114500-LW REC #20120323900003 Tax Parcel No.: 545330-0320 TEMPORARY CONSTRUCTION EASEMENT THIS TEMPORARY CONSTRUCTION EASEMENT (this "Agreement") is made as of this __ day of , 2021, by and between KING COUNTY, a political subdivision of the State of Washington ("Grantor"), and POLARIS AT EASTGA TE, LLC, a Washington limited liability company ("Grantee"). Grantee is constructing an apartment community (the "Project") on real property that is adjacent to real property owned by Grantor and legally described on Exhibit A hereto (the "Grantor's Property"). In connection with construction of the Project, and subject to the terms of this Agreement, Grantor has granted Grantee permission to temporarily use a portion of the Grantor's Property to perform grading work and demolition of certain abandoned improvements (the "Work"). NOW, THEREFORE, in consideration of the foregoing recitals, and in further consideration of the mutual covenants and agreements contained herein, and for other good and valuable consideration, the receipt, value and sufficiency of which is hereby acknowledged, Grantor and Grantee mutually covenant and agree as follows: 1. Grant of Easement. Grantor hereby conveys and warrants to Grantee a temporary construction easement on, over, across, and under the area on Grantor's Property that is legally described and identified on the map attached hereto as Exhibit 8 (the "Temporary Construction Easement Area"), to perform the Work pursuant to this Agreement (the COW Meeting Materials Page 173 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B "Temporary Construction Easement"). During the term of this easement, Grantor shall retain its rights to access and use the Temporary Construction Easement Area as desired by Grantor, as long as such access/use does not prohibit Grantee's ability to use the Temporary Construction Easement Area for purposes as described herein. Grantee shall locate all underground utilities prior to commencement of construction. 2. Term. The term of the Temporary Construction Easement shall commence on that date that this Agreement is fully executed by all parties and recorded in the public records of King County, Washington (the "Effective Date"), which recording shall be completed at Grantee's sole expense. The Temporary Construction Easement shall terminate automatically, without the need for further action by any party, upon the earlier of (a) completion of the Project, or (b) December 31, 2023 (the "Termination Date"). At no later than the Termination Date, or completion of the Project, whichever occurs first, Grantee shall provide Grantor a signed notice confirming termination of this Temporary Construction Easement. 3. The Work. The Work shall be completed by Grantee at its sole cost and expense and is detailed on the Demolition Plan. Grantee shall be solely responsible for obtaining and complying with all government approvals necessary for completion of the Work, and shall promptly comply with all conditions, requirements, or enforcement actions relating thereto. Prior to commencement of construction/maintenance activities on Parcel A, Grantee shall provide Grantor with copies of project plans and documents for review and comment at major design stages for work on Parcel A. Grantee access to the Temporary Construction Easement Area for maintenance/repair activities shall be during Grantee's normal working hours, with a minimum 72 hours advance notice; except in response to an emergency, in which case Grantor shall be notified as soon as possible (but not more than 24 hours from the occurrence). Grantee shall comply, and cause all of its agents, contractors and employees to comply, with all terms and conditions of this Agreement, all permit conditions and approvals, and all laws and regulations applicable to the Work or the Grantor's Property. Grantee shall coordinate with Grantor during the Term of this Temporary Construction Easement, and Grantor shall have the right to periodically inspect the Temporary Construction Easement Area, to ensure compliance with the terms of this Easement. Grantee covenants that no liens shall be allowed to attach to Grantor's Property as a result of the Work, and shall promptly remove any liens that are filed as a result of the Work. Adequate fencing between Parcels A and B, comparable to the extstmg fencing, shall be maintained by Grantee during the Term of the easement to retain the existing level of security for Grantor's Property (Parcel A). Grantor shall be provided with Grantee's Fence Construction and Phasing Plans and Specifications for review and comment prior to relocating security fencing to enable Grantee access to, and use of, the Temporary Construction Easement Area. Grantee shall maintain existing landscaping within the Temporary Construction Easement Area during the Term of the easement, including employment of Best Management Practices (BMPs) and Temporary Erosion & Sediment Control measures (TESC). Upon completion of Work, Grantee 2 COW Meeting Materials Page 174 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B shall relocate the fencing to the property line between Parcel A and Parcel B in its original or better condition. Following the Work, Grantee, at no expense to Grantor, shall remove all equipment and materials and restore the Temporary Construction Easement Area as close as reasonably practical to the condition in which it existed prior to the commencement of said activities. After Grantor receives the signed notice of termination of the Temporary Construction Easement from Grantee, Grantor will inspect the Temporary Construction Easement Area and Grantee shall make any additional modifications to ensure the Temporary Construction Easement Area has been restored to its prior existing condition to Grantor's reasonable satisfaction. If, at any time, Grantee causes a release in, on, or about the Temporary Construction Easement Area of any Hazardous Substances, or disturbs or exacerbates any Hazardous Substances, the presence of which predates this Agreement, Grantee agrees to take all steps necessary to assure its containment and remediation, including any cleanup that may be required, in compliance with all applicable laws. For the purposes of this Agreement, the term "Hazardous Substance" shall mean: any waste, pollutant, contaminant, or other material that now or in the future becomes regulated or defined under any Environmental Law. For purposes of this Agreement, the term ··Environmental Law" shall mean: any federal, state or local statute, regulation, code, rule, ordinance, order, judgment, decree, injunction or common law pertaining in any way to the protection of human health, safety, or the environment, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. § 9602 et. seq. ("CERCLA"); the Resource Conservation and Recovery Act of 1976, 42 U.S.C. § 6901 et seq. ("RCRA"); the Washington State Model Toxics Control Act, RCW Ch. 70.105D ("MTCA"); the Washington Hazardous Waste Management Act, RCW Ch. 70.105; the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq., the Washington Water Pollution Control Act, RCW Ch. 90.48, and any laws concerning above ground or underground storage tanks. Should any release of Hazardous Substances, or damage to existing utilities or facilities occur on Grantor's Property as a result of Grantee's actions, Grantee shall notify Grantor as soon as possible (but no longer than 24-hours from the time Grantee learns of the occurrence) and shall immediately make all necessary repairs to the reasonable satisfaction of Grantor. Any costs incurred by Grantor as a result of damages or spills caused by Grantee shall be reimbursed to Grantor by Grantee. 4. Standard of Care; Indemnity. Grantee shall exercise due care and shall indemnify, defend and hold Grantor, and its agents and occupants, harmless from and against all damages, claims, expenses (including attorneys' fees and costs), and liabilities (collectively "'Claims") arising out of Grantee's use of the Temporary Construction Easement Area, except to the extent that such Claims are caused by the gross negligence or willful misconduct of Grantor or its agents or occupants. Grantee's obligations under this Section 4 shall also extend to: 1) Grantee's violation or alleged violation of, or other failure to comply with, any state, federal, or local law, regulation or requirement, including without limitation, CERCLA and MTCA, by 3 COW Meeting Materials Page 175 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B Grantee, its officers, employees and agents; and 2) Grantee's release in, on, from, or about the Easement Area, at any time, of any Hazardous Substances, or Grantee's disturbance or exacerbation of Hazardous Substances, the presence of which predates this Agreement. For the purpose of this Section 4, Grantee, by negotiation, hereby waives, with respect to Grantor only, any immunity that would otherwise be available against such claims under the industrial insurance provisions of Title 51 RCW. 5. Insurance. Grantee shall maintain at all times during the course of the Work commercial general liability, automobile liability, and pollution liability insurance with limits of not less than Two Million Dollars ($2,000,000) per occurrence and in the aggregate, insuring against personal injury, and loss or damage to property. The aforementioned policies shall name Grantor as an additional insured for full coverage and policy limits. Prior to its use of the Temporary Construction Easement Area, Grantee shall deliver to Grantor a Certificate of Insurance and additional insured endorsements evidencing that the foregoing insurance is in effect. 6. Miscellaneous. 6.1 Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the heirs, successors and assigns of the parties hereto. 6.2 Notices. Any demand, request or notice which either party hereto desires or may be required to make or deliver to the other shall be in writing and shall be deemed effective when personally delivered, or when delivered by private courier service (such as Federal Express), addressed as follows: To Grantee: Polaris at Eastgate, LLC 120 W. Cataldo Ave., Suite 100 Spokane, WA 99201 Attention: Scott Morris To Grantor: King County Attention: ----- or to such other address and person as either party may communicate to the other by like written notice. 6.3 Grantor's Authority. Grantor represents and warrants that Grantor has full right, title and interest in and to Grantor's Property, has the full right and authority to grant 4 COW Meeting Materials Page 176 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B the Temporary Construction Easement and other rights set forth in this Agreement, and that the person executing this Agreement on behalf of Grantor has been duly authorized to do so. 6.4 Severability. If any terms or provisions of this Agreement shall, to any extent, be held invalid or unenforceable, the remaining terms and provisions of this Agreement shall not be affected thereby, but each remaining term and provision shall be valid and enforced to the full extent of the law. 6.5 Waiver. No waiver of any breach of any of the agreements herein contained shall be construed as, or constitute, a waiver of any other breach or a waiver, acquiescence in or consent to any further or succeeding breach of the same or another covenant and/or agreement. 6.6 Governing Law, Jurisdiction and Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Washington. Jurisdiction and venue will be King County for any disputes relating or arising under this Agreement. 6. 7 Attorneys' Fees. Should either party bring an action to interpret or enforce this Agreement, the prevailing party in such action shall be entitled to an award of its reasonable attorneys' fees and costs incurred in connection with such action, whether at trial, on appeal, in arbitration or mediation, or in any bankruptcy proceeding. 6.8 Counterparts. This Agreement may be executed in duplicate counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. Scanned signatures shall have the same force and effect as original signatures. [REMAINDER OF PAGE INTENTIONALLY BLANK - SIGNATURE PAGE FOLLOWS] 5 COW Meeting Materials Page 177 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B IN WITNESS WHEREOF, this Agreement is executed as of the date first above written. GRANTOR: KING COUNTY, a political subdivision of the State of Washington By: ______Name:------~ Its: -~------~--~- ~ GRANTEE: POLARIS AT EASTGATE, LLC a Washington limited liability company By: ______Name: ------~ Its: --~------~ - 6 COW Meeting Materials Page 178 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B ST ATE OF WASHING TON ) ) ss. County of King ) I certify that I know or have satisfactory evidence that , the ______of King County, is the person who appeared before me, and said person acknowledged that he/she signed this instrument and acknowledged it to be the free and voluntary act of King County, for the uses and purposes mentioned in the instrument. DA TED this _ day of _____ 2021. NOTARY PUBLIC IN AND FOR THE ST ATE OF WASHINGTON residing at ------My Commission Expires: ------Print Name: - ~~-- ~------ ST ATE OF WASHINGTON ) ) ss. County of Spokane ) I certify that I know or have satisfactory evidence that , the ------of Polaris at Eastgate, LLC, is the person who appeared before me, and said person acknowledged that he/she signed this instrument and acknowledged it to be the free and voluntary act of Polaris at Eastgate, LLC, for the uses and purposes mentioned in the instrument. DA TED this _ day of ____ _ 2021. NOTARY PUBLIC IN AND FOR THE STATE OF WASHINGTON residing at ------ My Commission Expires: ------ Print Name: -~-~-- - - -~~-~ 7 COW Meeting Materials Page 179 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT A Legal Description of Grantor's Property Parcel A of Boundary Line Adjustment NO. l l-114500-LW, Recorded March 23, 2012 under Recording No. 20120323900003, in the Official Records of King County, Washington. COW Meeting Materials Page 180 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B EXHIBIT B Temporary Construction Easement Area (Attached) COW Meeting Materials Page 181 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B @~Hn~r~t May 25, 2021 Job No. 19-2814 TEMPORARY CONSTRUCTION EASEMENT All that certain real property situate in the City of Bellevue, County of King, State of Washington, being a portion of Parcel A, as said parcel is shown upon that certain map entitled "City of Bellevue Boundary Line Adjustment No. 11-114500-LW" filed in Volume 286, page 276 on March 23, 2012 under Recording No. 20120323900003, King County Records, and being described as follows: BEGINNING at the Southwest comer of said Parcel A, being hereinabove described; thence from said point of beginning, North l O 18' 59" East along the West line of said Parcel A a distance of 5.29 feet; thence, leaving said West line, North 74 ° 1O' 10" East a distance of 14.11 feet; thence North 87° 34' 17" East a distance of 16.81 feet; thence South 85°45' 07'' East a distance of 119.34 feet; thence South 71 ° 16' 0 l" East a distance of 16.81 feet; thence South 71 °30' 02" East a distance of 8.94 feet; thence South 85° 10' 13" East a distance of 53.43 feet; thence South 53°55' 27" East a distance of29.90 feet to a point on the South line of said Parcel A; thence North 83 °20' 35" West along the South line of said Parcel A, a distance of253.0 l feet to the said point of beginning of this description. The hereinabove described real property contains 3,512 square feet or 0.081 acres, more or less. Prepared by: James A. Locey PLS 46892 Expires: 12/19/2022 COW Meeting Materials Page 182 July 7, 2021 DocuSign Envelope ID: 30A26163-9A7F-446D-A987-D8E7CF07847B sea·33•04"E 259.19' SE 32nd ST sa5•33'04"E 302.04' 134.0J' 168.01' TEMPORARY CONSTRUCTION EASEMENT J,512 SQ. FT. 0.081± ACRES LINE TABLE LINE BEARING LENGlH L1 N01"18'59,.E 5.29' l L2 N74"10'1o•E 14.11' -•- LJ N87.34'17"E 16.81' L4 S71"16'01"E 16.81' L5 s11•3o'02"E 8.94' L6 SB5"10'13"E 53.43' L7 S5S55'27,.E 29.90' d NOTE: lHIS DRAWING DOES NOT REPRESENT A LAND SURVEY AND IS ONLY INTENDED TO DEPICT lHE EASEMENT LOCATION. 5/25/2021 TEMPORARY CONSTRUCTION EASEMENT A PORTION OF PARCEL A DURYEA& ASSOCIATES 2702 N. Perry Street BLA NO. 11- 114500-LW Spokane. WA 99207 BELLEVUE, WASHINGTON SHEET 1 OF 1 JOB NO. 19- 2814 COW Meeting Materials Page 183 July 7, 2021 ATTACHMENT 2 June 17, 2021 The Honorable Claudia Balducci Chair, King County Council Room 1200 C O U R T H O U S E Dear Councilmember Balducci: This letter transmits a proposed Ordinance that, if enacted, will enable King County to sell surplus property located at 13620 SE Eastgate Way, Bellevue, Washington, to Polaris at Eastgate, LLC. Polaris is an affiliate of the Inland Group, Horizon Housing Alliance, a California non-profit public benefit corporation and Congregations for the Homeless, a Washington non-profit corporation in support of the provision of King County operations and services. This transaction is recommended per the rationale and considerations provided in the attached property summary. This proposed sale furthers the King County’s Strategic Plan goal of increasing accessible, housing that is affordable to all and the objectives of providing affordable housing resources to communities and individuals that meet their specific needs; increasing housing stability for low-income families; and seeking innovative partnerships to expand the supply and funding of affordable housing. Thank you for your consideration of this proposed Ordinance. COW Meeting Materials Page 184 July 7, 2021 The Honorable Claudia Balducci June 17, 2021 Page 2 If your staff have any questions, contact Anthony Wright, Director, Facilities Management Division at 206-477-9352. Sincerely, for Dow Constantine King County Executive cc: King County Councilmembers ATTN: Carolyn Busch, Chief of Staff Melani Pedroza, Clerk of the Council Shannon Braddock, Deputy Chief of Staff, Office of the Executive Karan Gill, Director, Council Relations, Office of the Executive Dwight Dively, Director, Office of Performance, Strategy, and Budget Caroline Whalen, County Administrative Officer, Department of Executive Services (DES) Anthony Wright, Director, Facilities Management Division (FMD), DES Bryan Hague, Manager, Real Estate Services, FMD, DES Christie True, Director, Department of Natural Resources and Parks (DNRP) Patrick McLaughlin, Director, Solid Waste Division, DNRP COW Meeting Materials Page 185 July 7, 2021 KING COUNTY FISCAL NOTE - Property Leases and Sales ATTACHMENT 3 GENERAL TRANSACTION INFORMATION Ordinance/Motion: Title: Eastgate Sale Transaction Duration: NA yrs Affected Agency/Agencies: DNRP Solid Waste Fair Market Value: $ 18,885,000 Note Prepared By: Carolyn Mock / Bob Stier Date Prepared: 3/30/21 Legal Transaction Type: Sale Note Reviewed By: Sid Bender Date Reviewed: 6/11/2021 Fiscal Transaction Type: Stand Alone Description of Request: Sale of property at 13620 SE Eastgate Way, Bellevue FINANCIAL IMPACTS Part 1 - Net Present Value Analysis Results Net Present Value to King County Net Present Value to Primary Impacted Agency NA NA (all impacts): *** (customer of transaction): *** Part 2 - Revenue and Expenditure Impacts As of the preparation date of this fiscal note, the impact of the above legislation on the financial affairs of King County is estimated to be as indicated below: Revenue to: 2,3,5 Sum of Appr. Fund Project Revenue Account Code Revenues Prior Sum of Outyear 2 Appropriation Unit Number Department Number Number and Source/Description to 2021 2021 / 2022 2023 / 2024 2025 / 2026 Impacts DNRP Solid Waste A72000 DNRP 4040 1126854 39512 - Sale of Real Property $ - $ 18,648,193 $ - $ - $ - Facilities Management A44000 DES 0010 34187 - Costs Real Property Sales $ - $ 236,807 $ - $ - $ - $ - $ - $ - $ - $ - TOTAL $ - $ 18,885,000 $ - $ - $ - Expenditures from: 2,3,4,5 Sum of Appr. Fund Project Expenditures Sum of Outyear 2 Appropriation Unit/Expenditure Type Number Department Number Number Expenditure Notes Prior to 2021 2021 / 2022 2023 / 2024 2025 / 2026 Impacts DNRP Solid Waste A72000 DNRP 4040 1126854 Real Estate Services Labor Costs Facilities Management Division Labor $ - $ 220,376 $ - $ - $ - King County Project Management $ - $ - $ - $ - $ - Lease Payments/Associated O&M $ - $ - $ - $ - $ - Service Costs (Appraisal, Title, Move) Environmental Study $ - $ 16,431 $ - $ - $ - Tenant and Other Improvements $ - $ - $ - $ - $ - 10% Art for General Fund Transactions $ - $ - $ - $ - $ - Other Transaction Costs $ - $ - $ - $ - $ - SUBTOTAL $ - $ 236,807 $ - $ - $ - Real Estate Services Labor Costs $ - $ - $ - $ - $ - King County Project Management $ - $ - $ - $ - $ - Lease Payments/Associated O&M $ - $ - $ - $ - $ - Service Costs (Appraisal, Title, Move) $ - $ - $ - $ - $ - Tenant and Other Improvements $ - $ - $ - $ - $ - 10% Art for General Fund Transactions $ - $ - $ - $ - $ - Other Transaction Costs $ - $ - $ - $ - $ - SUBTOTAL $ - $ - $ - $ - $ - TOTAL $ - $ 236,807 $ - $ - $ - APPROPRIATION IMPACTS As of the preparation date of this fiscal note, the impact of the above legislation on the budget appropriation of King County is estimated to be as indicated below: 1 2021 / 2022 Total 6-Year CIP Outyear Appr. Fund Project Appropriation Planning Level Costs Appropriation Unit Number Department Number Number Appropriation Notes Change The transaction was anticipated in the current budget; no supplemental appropriation is required. $ - $ - $ - $ - $ - $ - TOTAL $ - $ - Assumption and Additional Notes: *** An NPV analysis was not performed because this is a sale of property determined to be surplus to King County needs. 1. If the expenditure impact equals or exceeds five percent of the fund expenditures, a copy of the most recent applicable appropriation unit financial plan is attached to this transmittal. 2. The sum of outyear impacts is provided for capital projects and agreements. This sum for revenue and expenditures includes all revenues/expenditures for the duration of the lease/other agreement or life of the capital investment. 3. This transaction does not require the use of fund balance or reallocated grant funding. 4. The transaction involves the sale of a property and the expenditures associated with this sale are limited to transaction costs. No long-term expenditures requiring resource backing are associated with this transaction. 5. A detailed explanation of how the revenue/expenditure impacts were developed is provided below, including major assumptions made in developing the values presented in the fiscal note and other supporting data: - Sale price of $18,885,000 is based on appraised value of $21,435,000 with an offset for environmental of $2,550,000. - Sale of the property will reduce King County operating costs and liabilities. COW Meeting Materials PagePage 1861 July 7, 2021 ATTACHMENT 4 COW Meeting Materials Page 187 July 7, 2021 COW Meeting Materials Page 188 July 7, 2021