090704 Jt PH Adotpion Amend Merger SA Redvlp Proj Areas EXHIBIT 2

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Should Agency acquisition by means including eminent domain result in the removal of dwelling units occupied by person or families of low and moderate incomes, the Agency will be required to construct, develop or rehabilitate, or cause the construction, development or rehabilitation of, low and moderate income dwelling units equal in number to those destroyed or removed. These "replacement housing units" must be constructed within four years of their destruction or removal, and must be available at affordable housing cost to, and occupied by, persons in the same or a lower income category (very low -, low or moderate) as the persons displaced from those destroyed or removed units. The units must remain affordable for the longest feasible time, but not less than 55 -years for rental units and 45 -years for owner - occupied units as set forth in the CRL Section 33334.3. 2. Projected Residential Displacement As mentioned above, the Agency does not have any approved specific plans at this time that would involve the removal of low and moderate income housing units or displacement of low and moderate income residents. Should such displacement be contemplated, the Agency will conduct individual household surveys to determine the exact number, type and location of comparable replacement housing units and the required number of referrals thereto prior to displacement of any person of low or moderate income. Section VI (Method and Plan for Relocation) of this Report provides an overview of the relocation process that must be undertaken by the Agency prior to displacing any person(s) or family(ies). 3. Number and Location of Replacement Housing Units The specific number and type of replacement housing units required pursuant to CRL Section 33413 has not been determined. Should housing units be destroyed or removed from the low and moderate income housing market by the Agency, suitable replacement housing locations are available within the Project Areas or other areas of the City as identified in the City's General Plan as residential infill areas. The City Council and the Agency will make findings as may be necessary to provide such replacement housing. When the Agency acquires property, enters into a disposition and development agreement, participation agreement or other agreement, or undertakes any other activities requiring or causing the destruction or removal of housing units from the low and moderate income housing market, the Agency will provide replacement housing required pursuant to Section 33413 of the CRL and replacement housing plan pursuant to Section 33413.5. Page 63 of 190 Report to the City Council for the Merger of the Keyser Marston Associates, Inc. Santa Ana Redevelopment Projects Page 52 PA0403012.S NTA:CK:gbd