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1981-0708_JULIAN, STEPHEN B._Housing AgreementHOUSING AGREEMENT This AGREEMENT, made and entered into this day of 1981, by and between the City of San Juan Capistrano% State of California, a municipal corporation, here- inafter called "EMPLOYER," and STEPHEN B. JULIAN, City Manager, hereinafter called "EMPLOYEE." WITNESSETH: WHEREAS, the City of San Juan Capistrano Municipal Code requires the City Manager to reside within the City limits; and, WHEREAS, the City derives a real value and is benefited by requiring the residency of the EMPLOYEE in accommodations fitting and suitable for the performance of his day-to-day duties and responsibilities as.the City's Chief Operating Officer; and, WHEREAS, EMPLOYEE in the conduct of his aforesaid duties and responsibilities is required, from time to time, to use his residence not only for the transaction of City business and affairs, but for the maintenance of goodwill in the community; and, WHEREAS, the City does accordingly enjoy and derive a real value and benefit from EMPLOYEE'S residing in a suitable and fitting home in the City of San Juan Capistrano; NOW, THEREFORE, in consideration of the mutual covenants herein contained, the parties hereto agree as follows: 1. This agreement is entered into pursuant to the pro- visions of the Employment Agreement, Section 4(c), between EMPLOYER and EMPLOYEE, dated June 9, 1981. 2. LOAN CONDITIONS (a) Amount and Purpose of Loan The principal amount of the loan shall not exceed $250,000.00 and shall be used exclusively for the purchase of an appropriate single family dwelling unit, including appropriate improve- ments to the dwelling unit and land thereof, and other related expenses. Said dwelling unit shall be located within the corporate limits of the City of San Juan Capistrano. -1- 0 (b) Term The term of this loan shall be for a period of five (5) years, and may be extended for such additional periods of time as the parties may mutually agree. (c) Interest Rate The interest rate shall be equal to the average rate of return earned on City investments. The annual interest rate shall be established by computing the average rate of return earned on City investments for the period of March to March of the year immediately preceding. The annual interest rate so determined shall become effective on July 1 of each year and shall remain in effect throughout the fiscal year. (d) Loan Repayment (1) A monthly payment of not less than Eight Hundred Dollars ($800.00) shall be required of EMPLOYEE. Said payment shall be made through payroll deduction and shall be applied first to the interest and then to the principal amount of the loan. (2) EMPLOYEE may repay the principal amount of the loan in whole or in part at any time without penalty, and the annual amount of interest due shall be adjusted accordingly. (3) All principal and interest remaining and unpaid shall be due and payable upon the termination of this agreement, as herein- after provided. (e) Loan Security The loan shall be secured by a Deed of Trust executed in favor of the City of San Juan Capistrano, a municipal corporation. -2- 3. 0 0 (f) Title Title to the property shall be vested in Stephen B. and Robyn L. Julian, Husband and Wife as Joint Tenants. (g) Escrow Required Proceeds of the loan shall not be disbursed except through Escrow to be approved by the City Attorney. (h) Taxes and Assessments EMPLOYEE shall be responsible for payment of all taxes and assessments levied against said property. (i) Residence Restrictions EMPLOYEE is required unit purchased under of this agreement as place of residence. hibited from leasing said dwelling to any obtained the consent to establish the dwelling the terms and conditions his principal and legal Further, EMPLOYEE is pro - any and all portions of person without having first of EMPLOYER. (a) Notwithstanding anything herein contained to the contrary, this agreement or any renewal or exten- sion hereof may be terminated at any time by the mutual consent of the parties hereto. (b) This agreement shall be deemed terminated auto- matically upon the occurrence of any of the following events: (1) Termination of employment relationship between EMPLOYER and EMPLOYEE for any reason. (2) The death of EMPLOYEE or loss by EMPLOYEE of his legal capacity. (c) Upon termination of this agreement, EMPLOYEE or his heirs shall be entitled to a period of time, not to exceed six (6) months, to conclude such financial or other arrangements necessary to satisfy any unfulfilled terms of this agreement. -3- 4. NOTICES Unless waived by the other party, any notices to be provided by either party hereto to the other shall be in writing, sent by U.S. Mail, postage prepaid, registered, addressed as follows: (a) NOTICE TO EMPLOYER City Council of the City of San Juan Capistrano Attention: City Clerk 32400 Paseo Adelanto San Juan Capistrano, California 92675 (b) NOTICE TO EMPLOYEE Stephen B. Julian 28121 Calle San Remo San Juan Capistrano, California 92675 Change in the address of either party hereto shall be notified by the latter to the other party in writing sent by U.S. Mail, postage prepaid, registered, addressed to such other party's address as last notified to the notifying party. 5. ENTIRE AGREEMENT This agreement supersedes any and all other agreements, either oral or in writing, between the parties hereto with respect to an Housing Agreement between EMPLOYER and EMPLOYEE, and contains all the covenants and agree- ments between the parties with respect to such agreement. Any modifications to this agreement shall be effective only if it is in writing signed by both parties hereto. 6. PARTIAL INVALIDITY If any provision in this agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions shall none- theless continue in full force, without impairment. 7. ATTORNEY'S FEES AND COSTS If any actions at law or in equity are necessary to enforce or interpret the terms of this agreement, the prevailing party shall be entitled to reasonable attorney's fees, costs and necessary disbursements in addition to any other relief to which he may be entitled. -4- Executed at San Juan Capistrano, California, on the day and year first above written. CITY OF SAN JUAN CAPISTRANO, A Municipal Corporation, EMPLOYER By PHIL P R. SCHWARTZE, Mayo ,51 STEPHEN B. JULIAN, Employee -5- 0 AGENDA ITEM July 7, 1981 TO: Honorable Mayor and City Council FROM: Stephen B. Julian, City Manager SUBJECT: Provision for Housing - City Manager SITUATION: The attached memorandum, prepared by then City Manager, James S. Mocalis, addresses the conditions and need for assistance from the City in securing suitable and appropriate housing for the new City Manager. ALTERNATE ACTIONS: See attached memorandum. RECOMMENDATION: This is a matter for Council discretion. Respectfully submitted, SBJ:ch Attachment Lian FOR CITY COUNCIL AGENDA ...... � 2J AGENDA ITEM 0 0 RESUBMITTED July 7, 1981 June 16, 1981 TO: Honorable Mayor and City Council FROM: James S. Mocalis, City Manager SUBJECT: Provision for Housing - City Manager SITUATION When the City recently began the City Manager selection process, the City Council was informed by the City's consultant that the City would probably have to offer housing assistance to the successful candidate. The cost of housing in the south Orange County area is so high, in comparison with other parts of the western United States, that many desirable City Manager candidates would be precluded from considering competing for the City Manager position if no housing assistance was offered. Consequently, the prospective candidates were informed that the City would offer some form of housing assistance to the successful candidate. (It is unconstitutional to require residency as a condition of employment, but it is obviously to the City's benefit to have its Manager reside within the City.) In negotiating conditions of employment, it became apparent that housing assistance would be required by the new City Manager. There are several ways in which such assistance can be offered. Some of the types of assistance offered include offering a low interest loan; advancing the down payment and a portion of the principal; purchasing a dwelling and offering favorable lease conditions; and jointly purchasing a dwelling with shared equity. After examining these alternatives, the most desirable one, from an economic return to the City, would involve the City purchasing a dwelling and offering a lease back arrangement. In this way, the City could reasonably expect to make an appropriate return on the capital investment, and at the same time, would retain greater control over its investment. FINANCIAL CONSIDERATION The amount of City financial involvement will depend upon which of the housing alternatives is selected. J/, Provision for Housing - • City Manager June 16, 1981 Page 2 ALTERNATE ACTIONS 1. Determine the appropriate level of housing stock to be offered; purchase a dwelling selected by the City Manager from such stock; and offer a lease back agreement. 2. Let the City Manager select his own type and location of dwelling and make available a low interest loan for the down payment and a portion or all of the principal. 3. Jointly purchase a dwelling with shared equity. RECOMMENDATION Determine the appropriate level of housing stock to be offered; purchase a dwelling selected by the City Manager from such stock; and offer a lease back agreement. espectfully submitted, h� James S. Mocalis City Manager JSM/nep