RES 2024040 - Laserfiche WebLink

4854-3151-6602 v3 4 Loans (provided however, expenditure of such proceeds for repair or restoration of the Project shall be included within Annual Operating Expenses in the year of the expenditure, and with City’s written consent, proceeds of casualty insurance may be excluded from Gross Revenue until the year such proceeds will be expended for repair or restoration of the Project provided that Borrower provides adequate assurance that such proceeds will be expended for such purposes); condemnation awards for a taking of part or all of the Property or the Project for a temporary period; and the fair market value of any goods or services provided to Borrower in consideration for the leasing or other use of any part of the Project. Gross Revenue shall include any release of funds from replacement, operating, and other reserve accounts other than for the purposes for which such reserves were established. Gross Revenue shall not include tenant security deposits, loan or grant proceeds, capital contributions, or similar advances. 1.3.3 “Annual Operating Expenses” shall mean for each calendar year during term hereof, the following costs reasonably and actually incurred for the operation and maintenance of the Project to the extent that they are consistent with an annual independent audit performed by a certified public accountant using generally accepted accounting principles: property taxes and assessments; debt service currently due and payable on a non-optional basis (excluding debt service due from residual receipts or surplus cash of the Project) on loans which have been approved in writing by the City and which are secured by deeds of trust senior in priority to the Deed of Trust (“Approved Senior Loans”); reasonable property management fees and reimbursements in an amount not to exceed Sixty Dollars ($60) per unit per month, increasing by two percent (2%) annually, but in no event greater than six percent (6%) of the Project’s effective gross income for the applicable year, and paid pursuant to a property management agreement approved by City (or with respect to units subject to a Section 8 Housing Assistance Payments contract, if any, such greater amount as permitted by HUD); premiums for property damage and liability insurance; utility service costs not paid for directly or indirectly by tenants; maintenance and repair costs; fees for licenses and permits required for the operation of the Project; organizational costs (e.g., annual franchise tax payments) and costs associated with accounting, tax preparation and legal fees of Borrower incurred in the ordinary course of business; expenses for security services; advertising and marketing costs; payment of deductibles in connection with casualty insurance claims not paid from reserves; tenant services; the amount of uninsured losses actually replaced, repaired or restored and not paid from reserves; cash deposits into reserves for capital replacements in an amount no more than Five Hundred Forty- Five Dollars $545 per unit per year or such greater amount as reasonably required by the holder of an Approved Senior Loan or as required by a physical needs assessment prepared by a third- party selected or approved by City and prepared at Borrower’s expense; any required annual loan and monitoring fees payable to the City or other public agency lenders; cash deposits into operating reserves in an amount reasonably approved by the City or required by the holder of an Approved Senior Loan or the Investor Limited Partner, but only if the accumulated operating reserve does not exceed four (4) months’ projected Project operating expenses and debt service; and other ordinary and reasonable operating expenses in accordance with the approved annual budget. Commencing on the Project placed in service date, Annual Operating Expenses shall also include a partnership management fee payable to Borrower’s general partner in the maximum annual amount of Twenty-Five Thousand Dollars ($25,000), and during the first fifteen (15) years following the date upon which the Project is placed in service, an asset management fee payable to the Investor Limited Partner in the maximum annual amount of Seven Thousand Five Hundred Dollars ($7,500), each payable in accordance with Borrower’s