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Each eligible applicant selected to occupy a unit shall enter into a written occupancy agreement or lease with the Agency, and which shall contain those provisions as are required by this Loan Agreement, the HOME Regulations, (including 24 CFR § 92.253) and state law. The Agency shall establish reasonable rules of conduct and occupancy which shall be consistent with state, local and federal law and HOME Regulations. The rules shall be in writing and shall be given to each resident. Leases governing the landlord-tenant relationship shall be subject to Washington law, applicable local landlord-tenant ordinances, HOME Program statutes and HOME Regulations, and the provisions of this Loan Agreement. The Agency shall not charge tenants prohibited fees as identified in 24 CFR § 92.214. L. Damage/Replacement Charges The charges to residents covering damages to the Project property attributable to the resident shall be made in accordance with a schedule of replacement costs which shall be adopted by the Agency, posted in the management office of the Project, and shown to each applicant at the time the lease is signed. M. Termination of Lease The minimum term of each residential lease shall be twelve (12) months, unless otherwise mutually agreed upon by the resident and the Agency. Notice of termination of tenancy, refusal to renew the lease, and refund of any rent and/or security deposit shall be in strict conformance with all applicable federal, state, and local laws, regulations, and ordinances. The Agency may, in addition to pursuit of remedies provided by law, give written notice to the resident of substantial noncompliance by the resident of obligations contained in RCW 59.18.130 or RCW 59.18.140, and may commence an action for unlawful detainer to terminate the tenancy in accordance with the provisions of Chapter 59.12 RCW. N. Management and Maintenance The Agency is responsible for operating the Project in accordance with the Management Plan developed by the Agency pursuant to Section Ill of the Loan Agreement. The Agency is specifically responsible for all maintenance, repair, and management functions, including, without limitation, the following: selection of residents, occupancy standards, complaint and grievance proceedings, evictions, collection of rents and security deposits, routine and extraordinary repairs, and replacement of capital items. The Agency shall maintain units and common areas in a safe and sanitary manner in accordance with all applicable local codes (including health, building and housing codes), rehabilitation standards, ordinances and zoning ordinances at the time of Project completion, and the Management Plan provided for in this Loan Agreement. The Agency may, with the prior written approval of the City, contract with a management agent for the performance of the services or duties required above. However, such an arrangement does not relieve the Agency of responsibility for the proper performance of Loan Agreement Cocoon House Page 23 of 51