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HomeMy WebLinkAboutItem 35 - Housing Opportunity Ordinance Planning and Building Agency www.santa-ana.org/pb Item # 35 City of Santa Ana 20 Civic Center Plaza, Santa Ana, CA 92701 Staff Report September 7, 2021 TOPIC: Housing Opportunity Ordinance AGENDA TITLE: Summary of City Council Policy Direction Received on July 26, 2021, and the Corresponding Proposed Amendments to the Housing Opportunity Ordinance RECOMMENDED ACTION Receive staff presentation and summary of the City Council policy direction received on July 26, 2021, and provide direction regarding the proposed amendments to the Housing Opportunity Ordinance. DISCUSSION On July 6, 2021, City Council received a progress report from the Housing Ad Hoc Committee and discussed the Committee’s recommended amendments to the Housing Opportunity Ordinance. On July 26, 2021, City Council conducted a work study session to receive input from the community and stakeholders. Following the work study session, City Council provided direction to staff regarding proposed amendments to the Housing Opportunity Ordinance (HOO). Following this direction, staff have summarized and incorporated City Council’s policy amendments to the HOO. The summary of proposed amendments to the HOO are provided below followed by an analysis and options for implementing a sliding scale in- lieu fee structure when coupled with the requirement to use a skilled and trained workforce. Summary of City Council Policy Direction Regarding the Housing Opportunity Ordinance Three members of the City Council are generally supportive of maintaining the existing HOO regulations and policies. Among their points of discussion, the three members share consensus that they would like to see staff develop a reasonable sliding scale incentivizing the employment of a skilled and trained workforce (STW) by a developer opting for the in-lieu fee payment option. Housing Opportunity Ordinance September 7, 2021 Page 2 2 0 5 1 Balancing this policy direction, the remaining majority of the City Council was supportive of the Housing Ad Hoc Committee recommendations to amend the HOO. Staff identified consensus by the majority members to further evaluate the following policies: Require a mandatory skilled and trained workforce to create a living wage for projects that trigger the HOO or that receive funding from the inclusionary housing fund. Develop a sliding scale for the in-lieu fee for projects that incorporate a skilled and trained workforce. Incorporate local hire requirements. Prioritize production of housing for large families. Prioritize down payment assistance. Add rental protections for tenants. Address displacement and protection. Table 1 below is a summary and description of the draft amendments to the HOO which incorporates the recommendations of the Housing Ad Hoc Committee as well as the policy direction received from the City Council on July 6th and July 26th. The draft HOO is attached as Exhibit 1 in red line and clean format with the amendments summarized below. Table 1: Summary of Amendments Code Section Subject City Council Recommendations Title Update Title: 2021 AFFORDABLE HOUSING OPPORTUNITY & CREATION ORDINANCE The updated title will provide clarity and distinction from prior versions of the ordinance. 41-1901 Definition: Deletes “Entitled Residential Project” and “Prior Project” definition The provisions for “Entitled Residential Projects” and “Prior Projects” no longer apply after October 1, 2021. Housing Opportunity Ordinance September 7, 2021 Page 3 2 0 5 1 41-1902 Applicability: Establishes new standards for projects that need to comply with the ordinance This section is amended to revert the language to the previous HOO before it was previously amended in October 2020. The HOO would apply to projects that will require a zone change or general plan amendment, including city initiated zone changes and general plan amendments since November 28, 2011. The current ordinance only applies to projects that are requesting an increase in the density permitted by the General Plan. Pending City Council direction, this section will also be amended with one of two options for applicability of the Ordinance between projects that have received entitlement approvals and projects that been issued a building permit/paid the HOO in-lieu fee. In an effort to incentivize the construction of extremely low-income units the amendment also adds a percentage of rental units that may be built on-site for extremely low-income households equal to 5 percent of the total number of units. 41-1903 Exempt Projects: Clarifies which projects are not subject to the ordinance This section is amended to delete the language regarding applications deemed complete prior to November 28, 2011 and further clarify the exclusions to the HOO that may be agreed upon by City Council in a development agreement. Housing Opportunity Ordinance September 7, 2021 Page 4 2 0 5 1 41-1904 In-Lieu Fee Option: Revises the in-lieu fee and changes the timing of payment This section is amended to increase the in-lieu fee from $5 per habitable square foot to $15 per habitable square foot. This section also removes the incentive for “Entitled Residential Projects” to obtain building permits during the current economic climate. The provision for “Entitled Residential Projects” no longer applies after October 1, 2021. The amendments also extend the timing of payment from issuance of the building permit to issuance of the certificate of occupancy, allowing a developer the option to pay after the project is developed in order to make the larger fee more reasonable. 41-1904 (c)(ii) 41-1909(a)(5) Skilled and Trained Workforce and Sliding In-Lieu Fee Schedule: Incorporates a skilled and trained workforce requirement and a local hire requirement This section is amended to incorporate a skilled and trained workforce requirement and a sliding scale for the payment of an in-lieu fee pending City Council direction. The amendment also incorporates a local hire requirement where a developer of 20 or more housing units must ensure a minimum 30% local hire. 41-1906 Standards: Revised the term of affordability for ownership and rental units on-site This section is amended to require units for sale and rental units that are built on- site to be affordable in perpetuity as an enhancement. Housing Opportunity Ordinance September 7, 2021 Page 5 2 0 5 1 Regarding the other policy areas that were discussed by City Council, these policy areas were also discussed by the Housing Ad Hoc Committee and will be addressed as follows: Prioritize production of housing for large families: o The summary of amendments to the HOO under Sec. 41-1909(a)(1) includes a priority on the creation of new affordable housing opportunities for large families currently living in the City. Prioritize down payment assistance. o The Inclusionary Housing Fund eligible activities has already been modified as part of the October 2020 update to include down payment assistance to enable moderate-income families at 120% of the Area Median Income to purchase a home. Add rental protections for tenants. o This is a policy area that is under review by the Housing Ad Hoc Committee. Address displacement and protection. o This is a policy area that is under review by the Housing Ad Hoc Committee. Regulatory Applicability and Vesting This issue was raised at the July 26th study session and staff are seeking direction from City Council on the applicability of the proposed amendments to the HOO and the vesting trigger. This issue is most critical during the initial implementation of the amended 41-1909 Inclusionary Housing Fund: Clarifies the use of the in-lieu fees collected This section is amended to further clarify the use of in-lieu fees paid to the City. It provides the Community Development Agency with a priority for the use of the funds for large families and allows the funds to be used for additional one-time programs addressing housing security, eviction prevention, and housing legal assistance for city residents. This section is also amended to require projects that receive inclusionary housing funds to have a skilled and trained workforce and a minimum 30% local hire. 41-1910 In-lieu fee calculation: Provides for periodic review at the option of the City Council; deletes “Prior Projects” This section is amended to provide for periodic review of the in-lieu fee when determined to be appropriate by the City Council. The amendment also deletes the paragraph on “Prior projects” since it is no longer applicable. Housing Opportunity Ordinance September 7, 2021 Page 6 2 0 5 1 Ordinance to serve as a cut-off threshold and provide clarity for development project proposals currently undergoing the development approval process with the City. One option is to apply the amended HOO policies to projects that have not yet received final entitlement approvals from the City Council. Alternatively, another option is to apply the amended HOO policies to projects that have not vested their entitlements by obtaining a building permit or have not paid the HOO in-lieu fee payment as of the effective date of the Ordinance. Both vesting options meet legal standards and are commonly practiced by local governments when implementing new regulations and policies effecting land use and development issues. As requested by the City Council, staff have provided maps showing the current HOO and how the amended HOO will apply to various areas of the City (Exhibit 2). Analysis of Skilled and Trained Workforce and Sliding Scale for In-Lieu Fee The consensus from the City Council is to evaluate and implement a mandatory skilled and trained workforce requirement to create a living wage for projects that trigger the HOO and develop a sliding scale for the in-lieu fee for projects that incorporate a skilled and trained workforce. To analyze this policy area, staff reached out to three developers (two market-rate and one affordable), The Building Industry Association (BIA) of Southern California, and three labor unions to request data on the financial impact of a requirement to use a skilled and trained workforce. As part of that outreach, staff requested data to provide an understanding of the impacts and to facilitate the development of a sliding scale option of the in-lieu fee amount if a developer provides an enforceable commitment to use a STW. The BIA indicated that their members typically do not share this information; the labor organizations representing the various construction trades in Orange County are not privy to project level financial data; and the development community indicated this type of data was confidential and therefore did not share it. Staff met with the local labor unions at their request and received input regarding the STW and the various benefits that it will bring to the City and residents. This meeting included the Building and Construction Trades Council, Local 652 of the Laborers’ International Union of North America based in Santa Ana, Local 441 of the International Brotherhood of Electrical Workers, Local Union 105, and the Southwest Regional Council of Carpenters (collectively referred to as the building trade labor unions). The labor unions recognize that there is a cost increase when using a skilled and trained workforce and contend that the waterfall of benefits are tangible and address the core of the affordable housing crisis. An employee earning a living wage with employment benefits can attain decent housing and a higher quality of life. Other key benefits include a reliable and stable workforce, reduced public reliance on government assistance programs, higher efficiency from a trained employee, a career pathway to the various construction trades, promote regional jobs-housing balance, promote environmental benefits from reduced vehicle miles traveled, local pride of working on a project developed in Santa Ana, and many other social and economic benefits. The labor unions also expressed support for a sliding scale approach to incentivize the use of a STW. Housing Opportunity Ordinance September 7, 2021 Page 7 2 0 5 1 Staff also met with the BIA and received feedback that the proposed $15 per square foot cannot be absorbed by a project. While no specific data were provided by the BIA regarding the cost differential using STW, the verbal indication is a STW requirement will significantly impact the feasibility of constructing a project in the City. As an alternative data source to this outreach, staff obtained data from the Terner Center for Housing and Innovation at the University of California, Berkeley (Terner Center). According to a study, “The Hard Costs of Construction”, completed in March of 2020 by the Terner Center, hard construction costs per square foot from 2008 to 2018 generally fluctuated between $177 to $222 per square foot. Hard construction costs include materials and labor only where materials make up approximately 85% of the hard construction costs and labor makes up the remaining 15%. The study also found that prevailing wage requirements are associated with higher hard costs and on the average, add $30 or more per square foot than those without. While prevailing wage requirements do not have the exact same stringent requirements as a STW represented by a labor organization, they share similar labor monitoring and wage requirements and characteristics. Depending on the per square foot total indicated in the study, the addition of a $30 per square foot in labor, increases the hard construction costs of a project on the average between 14% to 17%. Anecdotally, verbal feedback received from the development community indicates the average per square foot hard construction costs for a residential project range between $130 and $250 depending on construction and housing type and the inclusion of a STW requirement would increase their estimated cost per square foot approximately 15% to 20%. The labor union and BIA representatives all acknowledged the percentage increase in costs and the information that staff had gathered from the research. Blending the above information collectively, it is reasonable to conservatively estimate that the financial impact of a STW requirement on a residential project opting to pay the in-lieu fee would be approximately 15% or higher of the hard construction costs. Table 2 below shows the estimated total increase to a project’s hard construction costs when combining a STW requirement with the HOO in-lieu fee at $5 and $15 per square foot. Table 2: Estimated Financial Impact of Skilled and Trained Workforce Requirement Range of Per Square Foot Cost of Labor and Materials Without STW Range of STW at 15% Per Square Foot HOO In-Lieu Fee Per Square Foot Range of Percentage of Financial Increase on Hard Construction Costs (STW + HOO) $15 21% - 27%$130 - $250 $19.50 - $37.50 $5 17% - 19% Housing Opportunity Ordinance September 7, 2021 Page 8 2 0 5 1 As shown in the table above, the conservative estimated impact of including a skilled and trained workforce requirement ranges between $19.50 and $37.50 per square foot of hard construction costs. When combined with the HOO per square foot fee at $5 or $15, the two amounts increase hard construction costs between 17 to 27 percent depending on the project’s baseline hard costs. Using the lowest estimates, even reducing the HOO in- lieu fee to $0 will not fully offset the estimated amounts. Given benefits such as living wages, a better quality of life for residents who work on the projects, a stable workforce, and other social and economic benefit information shared by the labor unions, the City Council may want to consider a sliding scale for the in-lieu fee wherein projects with 20 or more units provide an enforceable commitment to use a skilled and trained workforce would pay the current fee of $5 per square foot and projects that do not agree to an enforceable commitment will pay the $15 per square foot or an amount in between as determined appropriate by the City Council. The requirement to incorporate a STW would not apply to projects with less than 20 units as it will be challenging for small projects to meet the additional requirements. Similarly, the City Council can also consider a requirement for projects with an enforceable STW commitment to include a local hire requirement. A development with an enforceable STW commitment will be able to negotiate and rely upon the STW labor organizations to draw from the local labor pool. Next Steps If the City Council desires to move forward with these proposed amendments to the HOO, it is feasible to complete the final drafting of the ordinance and initiate the ordinance adoption process within 30 to 45 days upon receiving final direction. Following approval of the amendments to the HOO, the Housing Ad Hoc Committee will reconvene and continue to discuss the remaining topics below and may return in the future with recommendations for each topic: a.Rent stabilization/rent control b. Rental protections for tenants c.Just cause eviction policies d. Tenant displacement and protection policies ENVIRONMENTAL IMPACT There is no environmental impact associated with this action. FISCAL IMPACT Housing Opportunity Ordinance September 7, 2021 Page 9 2 0 5 1 There is no fiscal impact associated with initial direction from City Council. However, the future City Council action to accept some of the recommendations would have an impact on program revenue. EXHIBIT(S) 1. Proposed Amendments to the HOO for Discussion 2. HOO Maps Submitted By: Minh Thai, Executive Director of Planning and Building Agency Approved By: Kristine Ridge, City Manager Ordinance No. NS-XXX Page 1 of 14 ORDINANCE NO. NS-XXX AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA ANA AMENDING SECTIONS 41-1900, 41-1901, 41-1902, 41-1903, 41-1904, 41-1906, 41-1909, AND 41- 1910 OF THE SANTA ANA MUNICIPAL CODE RELATING TO THE HOUSING OPPORTUNITY ORDINANCE THE CITY COUNCIL OF THE CITY OF SANTA ANA HEREBY ORDAINS AS FOLLOWS: Section 1. The City Council of the City of Santa Ana hereby finds, determines, and declares as follows: A. On November 28, 2011, the Santa Ana City Council adopted Ordinance No. NS-2825, known as the Housing Opportunity Ordinance and appearing as Article XVIII.1 of Chapter 41 of the Santa Ana Municipal Code. The Housing Opportunity Ordinance was adopted to implement the City’s Housing Element Goal of providing affordable housing within the City. B. On September 1, 2015, the City Council adopted Ordinance No. NS-2881, which amended the Housing Opportunity Ordinance in various respects, including applicability, options to satisfy inclusionary requirements, and calculation of the in-lieu housing fee. These amendments were intended to make the inclusionary housing requirements more predictable for housing developers and to incentivize more affordable housing production on-site in conjunction with new market rate housing development. C. In response to impacts of the COVID-19 pandemic on the development and construction of housing in the City, including the reduction of housing starts, the City Council adopted Ordinance No. NS-2994 on September 1, 2020. Ordinance No. NS-2994 further amended the Housing Opportunity Ordinance to lower the in-lieu housing fee for all projects from $15 to $5 per square foot, adjust the trigger of the ordinance, and expand the eligible uses of in-lieu fees collected by the City. D. In early 2021, at the direction of the City Council, an Ad Hoc Committee for Housing was formed. The Ad Hoc Committee reviewed the Housing Opportunity Ordinance and recommended certain changes. The Ad Hoc Committee’s recommendations were presented and discussed at the City Council Meeting on July 6, 2021. E. On July 26, 2021, the City Council conducted a work-study session to further evaluate the Committee’s recommendations and to receive input from key stakeholders and members of the public. The City Council provided direction to staff to prepare amendments to the Housing Opportunity Ordinance concerning the applicability Ordinance No. NS-XXX Page 2 of 14 and triggers for the ordinance, adjustments to the in-lieu fee calculation, set-aside units, and options for satisfaction of inclusionary requirements. F. On September 7, 2021, the City Council further considered this matter and provided additional direction to staff regarding proposed amendments to the Housing Opportunity Ordinance. G. On _________, 2021, the Planning Commission held a duly noticed public hearing on the proposed amendments. H. The Request for City Council Action for this ordinance dated __________, 2021 and duly signed by the Executive Director of the Planning and Building Agency shall, by this reference, be incorporated herein, and together with this ordinance, any amendments or supplements, and oral testimony, constitute the necessary findings for this ordinance. Section 2. The City Council finds and determines that this ordinance is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the State CEQA Guidelines because it will not result in a direct or reasonably foreseeable indirect physical change in the environment, as there is no possibility it will have a significant effect on the environment and it is not a "project", as defined in Section 15378 of the CEQA Guidelines. Section 3. The title of Article XVIII.1 of Chapter 41 of the Santa Ana Municipal Code is amended to read in its entirety as follows: 2021 AFFORDABLE HOUSING OPPORTUNITY AND CREATION ORDINANCE Section 4. Section 41-1900 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1900. - Purpose. This article establishes standards and procedures to encourage the development of housing that is affordable to a range of households with varying income levels. The purpose of this article is to encourage the development and availability of affordable housing by requiring the inclusion of affordable housing units within new developments when the number of units exceed the densities permitted under the general plan, zoning classification, or the conversion of rental units to condominium ownership. Section 5. Section 41-1901 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1901. - Definitions. Ordinance No. NS-XXX Page 3 of 14 As used in this article, the following terms shall have the following meanings: Adjusted for household size appropriate for the unit means a household of one person in the case of a studio unit, two (2) persons in the case of a one-bedroom unit, three (3) persons in the case of a two-bedroom unit, four (4) persons in the case of a three-bedroom unit, and five (5) persons in the case of a four-bedroom unit. Administrative procedures means those regulations promulgated by the executive director pursuant to section 41-1910 of this article. Affordable housing cost means the total housing costs paid by a qualifying household, which shall not exceed the fraction of gross income specified, as follows: Extremely low-income households. Thirty (30) percent of the income of a household earning thirty (30) percent of the Orange County median income adjusted for family size appropriate for the unit. Very low-income households. Thirty (30) percent of the income of a household earning fifty (50) percent of the Orange County median income adjusted for family size appropriate for the unit. Low-income households. Thirty (30) percent of the income of a household earning eighty (80) percent of the Orange County median income for family size appropriate for the unit. Moderate-income households. Thirty (30) percent of the income of a household earning one hundred twenty (120) percent of the Orange County median income adjusted for family size appropriate for the unit. The qualifying limits for extremely low-income, very low-income, low-income and moderate-income households are established and amended annually pursuant to Section 8 of the United States Housing Act of 1937. The limits are published by the Secretary of Housing and Urban Development. Developer means any association, corporation, firm, joint venture, partnership, person, or any entity or combination of entities, which seeks city approval for all or part of a residential project. Development agreement means an agreement approved by the city council between a property owner and the city pursuant to Government Code section 65864, et seq. Executive director means the executive director of community development for the city. General plan means the adopted general plan for the City of Santa Ana. Inclusionary housing agreement means a legally binding agreement between the developer and the city, in a form and substance satisfactory to the executive director and the city attorney, and containing those provisions necessary to ensure that the requirements of this article are satisfied, whether through the provision of inclusionary units or through an approved alternative method. Ordinance No. NS-XXX Page 4 of 14 Inclusionary housing fund means the fund created by the city in which all fees collected in compliance with this article shall be deposited. Inclusionary housing plan means the plan submitted by the developer, in a form specified by the executive director, detailing how the provisions of this article will be implemented for the proposed residential project. Inclusionary unit means a dwelling unit that will be offered for sale or rent to extremely low, very low, low, or moderate-income households, at an affordable housing cost, in compliance with this article. Low-income units, very low-income units, and extremely low-income units means inclusionary units restricted to occupancy by low, very low, and extremely low-income households, respectively, at an affordable housing cost. Market rate units means dwelling units in a residential project that are not inclusionary units. Moderate-income units means inclusionary units restricted to occupancy by moderate-income households at an affordable housing cost. Regulatory agreement means an agreement entered into between the City of Santa Ana or the Santa Ana Community Development Agency and a developer by which the developer covenants to keep certain housing units at an affordable housing cost for a specified period of time. Rehabilitated units/rehabilitation means the improvement of a unit in substandard condition to a decent, safe and sanitary level. Units are in substandard condition when, while they may be structurally sound, they do not provide safe and adequate shelter, and in their present condition endanger the health, safety or well-being of the occupants. Residential project/project means any of the following: A subdivision resulting in the creation of five (5) or more residential lots or residential condominium units; or The new construction of a project consisting of five (5) or more multi-family units; or The new construction of five (5) or more separate houses or dwelling units; or The conversion of five (5) or more existing residential rental units to condominium ownership. Target area means that area designated by the city from time to time, on an as- needed basis, as a priority area for rehabilitation due to health and safety concerns. Ordinance No. NS-XXX Page 5 of 14 Total housing costs the total monthly or annual recurring expenses required of a household to obtain shelter. For a rental unit, total housing costs shall include the monthly rent payment and utilities paid by the tenant (excluding telephone and television). For an ownership unit, total housing costs shall include the mortgage payment (principal and interest), insurance, homeowners' association dues (if applicable), private mortgage insurance (if applicable), taxes, utilities, an allowance for maintenance and any other related assessments. Section 6. Section 41-1902 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1902. - Applicability and inclusionary unit requirements. (a) Applicability. The requirements of this article shall apply to any new project comprised of five (5) or more residential lots or residential units which has not ___[OPTIONS: a) received entitlement approval or, b) been issued a building permit or paid the in-lieu fee]___ as of [insert effective date], including new construction, and condominium conversions which meets one or all of the following applicability thresholds: (1) A change in use to allow for residential or that exceeds the general plan or zoning prescribed densities or percentage of residential development of the subject property at the time of application. (2) Implementation of the permitted residential density or percentage of residential development allowed as a result of city initiated zone changes or city initiated general plan amendments after November 28, 2011. (3) Increase of the permitted percentage of residential development allowed for a mixed-use development above the percentage permitted under the zoning classification at the time of application. (4) Development of new residential uses or increase of the permitted residential density or percentage of residential development within an overlay zone approved pursuant to Division 28 of Article I of this Chapter. (5) Conversion of rental units to condominium ownership. (b) Applications. The inclusionary requirements shall only apply to the incremental units beyond that which is allowed as prescribed in Subsection (a) above. (c) Units for sale. If the new residential project consists of units for sale, then a minimum of ten (10) percent of the total number of units in the project shall be sold to moderate-income households. Ordinance No. NS-XXX Page 6 of 14 (d) Rental units. If the new residential project consists of rental units, then a minimum of fifteen (15) percent of the units shall be rented to low-income households, ten (10) percent rented to very low-income households, or five (5) percent rented to extremely low-income households. (e) Rounding of quantities in calculations. In calculating the required number of inclusionary units, fractional units shall be rounded-up to the next whole unit. The developer may choose to pay an in-lieu fee set forth in section 41-1904(c) for the fractional units, which shall be calculated based on the number of habitable square feet applicable in each case. (f) Displacement of existing inclusionary units. Notwithstanding any other provision of this article, any residential project subject to this article that results in the displacement of very low and/or low-income household(s) shall be required to provide on-site inclusionary units as required by this article. (g) Compliance with article. All inclusionary units required by this article shall be sold or rented in compliance with this article. Section 7. Section 41-1903 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1903. - Exempt projects. The following are exempt from the requirements of this article: (a) Development agreements. A residential project that is the subject of a development agreement under applicable provisions of the California Government Code that expressly provides for an exclusion to this article, provides for a different amount of inclusionary units, or provides for a different specified method for determining the in-lieu fee provisions of this ordinance, such as the timing of payment or the point in time for determining the applicable in-lieu fee amount, to satisfy the inclusionary units from that specified by this article. (b) Project with regulatory agreement. A residential project for which a regulatory agreement has been approved, provided that the regulatory agreement is effective at the time the residential project would otherwise be required to comply with the requirements of this article, and there is no uncured breach of the regulatory agreement before issuance of a certificate of occupancy for the project. This may include a residential project that has obtained a density bonus under article XVI.I of the Santa Ana Municipal Code. Such projects cannot be used to satisfy the inclusionary requirement for another project. (c) Adaptive Reuse. Adaptive reuse development projects pursuant to Chapter 41, Article XVI.II - Adaptive Reuse. Ordinance No. NS-XXX Page 7 of 14 Section 8. Section 41-1904 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1904. - Options to satisfy inclusionary requirements. (a) On-site units. The primary means of complying with the inclusionary requirements of this article shall be the provision of on-site inclusionary units in accordance with section 41-1902 above. A developer may only satisfy the requirements of this article by means of an alternative to on-site inclusionary units in accordance with the requirements and procedures of this section. (b) Off-site units. 1. New units. The developer may satisfy the inclusionary unit requirements for the project, in whole or in part by constructing the required new inclusionary housing at a different location within the city borders at the ratio of one square foot of habitable inclusionary unit space for each required habitable square foot. While the total habitable square footage area of the required new inclusionary units must be the same as the sum-total of the number of habitable square feet for the project as directed by this ordinance, the number of units and bedrooms associated with the off-site units may be approved by the review authority of the city, consistent with the type of affordable housing needed at the time of project review. 2. Rehabilitated units outside a designated target area. The developer may satisfy the inclusionary unit requirements for the project, in whole or in part by substantially rehabilitating existing housing units elsewhere within the borders of the city at a rate of one and one-half (1½) habitable square feet per each required habitable square foot of inclusionary units. 3. Rehabilitated units within a designated target area. Upon application, the developer may satisfy the inclusionary unit requirements for the project, in whole or in part by substantially rehabilitating existing housing units elsewhere within the borders of the city at a rate of one habitable square foot per each required habitable square foot of affordable inclusionary units. (c) In-lieu fee. (1) Five (5) or more units. For a residential project comprised of five (5) or more residential lots or residential units, the developer may elect to satisfy the inclusionary unit requirements for the project, in whole or in part, by payment of a fee in- lieu of constructing some or all of the required units. The total amount of the fee allowed by this section shall be calculated using the In-Lieu Fee Schedule as shown below in section 41-1904(c)(1)(i) multiplied by the sum total of the number of habitable square feet within the entire project, as measured from the exterior walls of the residential units. Ordinance No. NS-XXX Page 8 of 14 This calculation does not include exterior hallways, common areas, landscape, open space or exterior stairways. (i) In-Lieu Fee Schedule Units Fee Per Square Foot of Habitable Area 5 – 9 $6.00 10 – 14 $9.00 15 – 19 $12.00 20 or more $15.00 (ii) Skilled and Trained Workforce Fee Reduction and Local Hire Requirements. A developer of a project consisting of 20 or more residential lots or units that selects the in-lieu fee payment option and provides a negotiated enforceable commitment that the developer will use a “Skilled and Trained Workforce” as defined in Public Contract Code section 2601 to complete the construction of the project shall pay a reduced fee of $5 (five) per square-foot as the in-lieu fee for the project. The negotiated enforceable commitment shall also ensure a minimum of 30% of all work- hours for the project be performed in accordance with local hire policies approved by the City Council. (2) Timing of payment. The total fee amount for the entirety of a project is calculated, determined, and set at the time of issuance of the first building permit for the project. The developer shall pay all in-lieu fees allowed by this section for the entire project prior to issuance of the first occupancy approval for any construction which adds net residential units. The in-lieu fees collected by the city are city funds over which the city has complete and absolute discretion. (3) Inclusionary housing fund. Fees collected in compliance with this section shall be deposited in the inclusionary housing fund. Section 9. Section 41-1906 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1906. - Standards. (a) Location within project, relationship to non-inclusionary units. All inclusionary units shall be: (1) Reasonably dispersed throughout the residential project; (2) Proportional, in number of bedrooms, gross floor area of habitable space, and location, to the market rate units; Ordinance No. NS-XXX Page 9 of 14 (3) Comparable to the market rate units included in the residential project in terms of design, materials, finished quality, and appearance; and (4) Permitted the same access to project amenities and recreational facilities, as are market rate units. (b) Timing of construction. All inclusionary units in a residential project shall be constructed concurrent with, or before the construction of the market rate units. If the city approves a phased project, a proportional share of the required inclusionary units shall be provided within each phase of the residential project. (c) Location outside the proposed original project. For projects where the developer proposes to either produce new inclusionary units or rehabilitate existing off- site units to meet the inclusionary affordable housing requirements of this ordinance, the off-site project(s) containing the required inclusionary units shall be subject to the following requirements: (1) The sum-total area (in habitable square feet) of all the newly constructed off-site inclusionary units shall be the same number of habitable square feet of inclusionary area as required by this ordinance. For the purpose of the calculation of the number of square feet of required inclusionary housing, the total gross habitable square feet of the housing units of the original market rate project shall be used, as measured from exterior walls to exterior walls of the market units provided as the base for calculation either ten (10) percent for very low income or fifteen (15) percent for low income inclusionary units. The common areas, exterior hallways, stairways, patios, and balconies shall not be calculated in determining the number of required square feet of inclusionary housing production. All new or rehabilitated units must meet all current zoning and general plan standards. (2) While the total number of square feet of inclusionary housing requirement is calculated based on the requirements of this ordinance, the number of units, bedrooms and other amenities on the proposed off-site inclusionary housing location shall be approved by the review authority commensurate with the size and type of units most in demand at the time of submittal of the application. (3) Any off-site affordable inclusionary housing project shall be substantially comparable to the market rate units included in the residential project in terms of quality of design, materials and finishes. (4) If tenants are displaced due to rehabilitation of housing to meet the inclusionary unit requirement, the developer shall be responsible for relocation costs as required by state law. Ordinance No. NS-XXX Page 10 of 14 (5) No city, housing authority, or public funds, subsidies, or participation of any kind shall be expended on the production or building of any inclusionary housing projects associated with meeting the inclusionary unit requirement. (d) Timing of construction. All inclusionary units in a residential project or proposed off-site new inclusionary units or rehabilitated units shall be constructed concurrent with, or before the construction of the market rate units. If the city approves a phased project, a proportional share of the required inclusionary units shall be provided within each phase of the residential project. (e) Units for sale. (1) Time limit for inclusionary restrictions. A unit for sale shall be restricted to the target income level group at the applicable affordable housing cost in perpetuity. (2) Certification of purchasers. The developer and all subsequent owners of an inclusionary unit offered for sale shall certify, on a form provided by the city, the income of the purchaser and that such owners will live in such inclusionary unit as their primary residence. (3) Resale price control. In order to maintain the availability of inclusionary units required by this article, the resale price of an owner occupied inclusionary unit shall be limited to the lesser of the fair market value of the unit as established by a licensed real estate agent based upon three (3) comparable properties or the restricted resale price. For these purposes, the restricted resale price shall be the applicable affordable housing cost. (4) Inheritance of inclusionary units. Upon the death of an owner of an owner-occupied inclusionary unit, title in the property may transfer to the surviving joint tenant or heir (in the case of the death of a sole owner or all owners of the household). (5) Forfeiture. If an inclusionary unit for sale is sold for an amount in excess of the resale price controls required by this section, the buyer and the seller shall be jointly and severally liable to the city for the amount in excess of the affordable housing cost at the time of such sale of the inclusionary unit. Recovered funds shall be deposited into the inclusionary housing fund. Notwithstanding the foregoing, city may allow the buyer and seller to cure any violation of the resale price controls within one hundred eighty (180) days. (f) Rental units. (1) Time limit for inclusionary restrictions. A rental inclusionary unit shall remain restricted to the target income level group at the applicable affordable housing cost in perpetuity. Ordinance No. NS-XXX Page 11 of 14 (2) Certification of renters. The owner of any rental inclusionary unit shall certify, on a form provided by the city, the income of all members of the household above the age of eighteen (18) at the time of the initial rental and annually thereafter. (3) Forfeiture. Any lessor who leases an inclusionary unit in violation of this article shall be required to forfeit to the city all money so obtained. Recovered funds shall be deposited into the inclusionary housing fund. (g) Execution and recording of documents. The executive director may require the execution and recording of whatever documents are required to ensure enforcement of this section; including, but not limited to, promissory notes, deeds of trust, resale restrictions, rights of first refusal, options to purchase, and/or other documents, which shall be recorded against all inclusionary units. (h) General prohibitions. (1) No person shall sell or rent an inclusionary unit at a price or rent in excess of the maximum amount allowed by any restriction placed on the unit in accordance with this article. (2) No person shall sell or rent an inclusionary unit to a person or persons that do not meet the income restrictions placed on the unit in accordance with this article. (3) No person shall provide false or materially incomplete information to the city or to a seller or lessor of an inclusionary unit to obtain occupancy of housing for which that person is not eligible. (i) Principal residency requirement. (1) The owner or lessee of an inclusionary unit shall reside in the unit for not less than ten (10) out of every twelve (12) months. (2) No owner or lessee of an inclusionary unit shall lease or sublease, as applicable, an inclusionary unit without the prior permission of the executive director. Section 10. Section 41-1909 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1909. - Inclusionary housing fund. (a) Inclusionary housing fund. There is hereby established a separate fund of the city, to be known as the inclusionary housing fund. All monies collected pursuant to this article shall be deposited in the inclusionary housing fund. Additional monies from Ordinance No. NS-XXX Page 12 of 14 other sources may be deposited in the inclusionary housing fund. The monies deposited in the inclusionary housing fund shall be subject to the following conditions: (1) Monies deposited into the inclusionary housing fund must be used to increase and improve the supply of housing affordable to moderate, low, very low, and extremely low income households in the city as specified in the city's affordable housing funds policies and procedures. A priority will be on the creation of new affordable housing opportunities for large families currently living in the City. Other eligible uses of the inclusionary housing fund include but are not limited to: (i) Creating affordable units from the existing market rate housing stock including but not limited to, the purchase and rehabilitation of units. (ii) Funding one-time programs for code enforcement, quality of life, and general health and safety activities. (iii) Implementing and promoting programs addressing housing security, eviction prevention, and housing legal assistance for city residents. (iv) Funding reasonable administrative or related expenses associated with the administration of this article. (2) The fund shall be administered by the executive director, or his or her designee, who may develop procedures in the city's affordable housing funds policies and procedures to implement the purposes of the inclusionary housing fund consistent with the requirements of this article and any adopted budget of the city. (3) Monies deposited in accordance with this section shall be used in accordance with the affordable housing funds policies and procedures, housing element, consolidated plan, or subsequent plan adopted by the city council to construct, rehabilitate, or subsidize affordable housing or to recapture affordable housing at risk of market conversion, or to assist other government entities, private organizations, or individuals to do so. Permissible uses include, but are not limited to, assistance to housing development corporations, equity participation loans, grants, pre-home ownership co-investment, pre-development loan funds, participation leases, or other public-private partnership arrangements. The inclusionary housing fund may be used for the benefit of both rental and owner-occupied housing. (4) A developer receiving funding from the inclusionary housing fund shall implement a local preference in their resident selection criteria and marketing policies meeting guidelines established by the executive director. (5) A developer receiving funding from the inclusionary housing fund shall provide a negotiated enforceable commitment that the developer will use a “Skilled and Trained Workforce” as defined in Public Contract Code section 2601 to complete Ordinance No. NS-XXX Page 13 of 14 the construction of the project. The negotiated enforceable commitment shall also ensure a minimum of 30% of all work-hours for the project be performed in accordance with local hire policies approved by the City Council. Section 11. Section 41-1910 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1910. - Administrative. (a) In-lieu fee calculation. The amount per square foot of the inclusionary housing in-lieu fee shall be subject to city council review and consideration. (b) Administration fees. The council may by resolution establish reasonable fees and deposits for the administration of this article including an annual monitoring fee and an inclusionary housing plan submittal fee. (c) Monitoring/audits. At the time of initial occupancy, and annually thereafter, the city will monitor the project to ensure that the income verifications are correct and in compliance with the inclusionary housing administrative procedures. For ownership units, the city shall monitor to verify that owner-occupancy requirements are maintained. Developer/property owners are required to cooperate with the city in promptly providing all information requested by the city in monitoring compliance with program requirements. The city will conduct periodic random quality control audits of inclusionary units to assure compliance with rules and requirements. Such audits may include verification of continued occupancy in inclusionary units by eligible tenants, compliance with the inclusionary housing plan and agreement, and physical inspections of the residential project. (d) Administrative procedures. The city manager is hereby authorized and directed to promulgate administrative procedures for the implementation of this article. Section 12. If any section, subsection, sentence, clause, phrase or portion of this ordinance is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this ordinance. The City Council of the City of Santa Ana hereby declares that it would have adopted this ordinance and each section, subsection, sentence, clause, phrase or portion thereof irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases, or portions be declared invalid or unconstitutional. Section 13. This Ordinance shall become effective thirty (30) days after its adoption. Ordinance No. NS-XXX Page 14 of 14 Section 14. The Clerk of the Council shall certify the adoption of this ordinance and shall cause the same to be published as required by law. ADOPTED this _______ day of ___________, 2021. _________________________ Vicente Sarmiento Mayor APPROVED AS TO FORM: Sonia R. Carvalho, City Attorney By:_________________________ John M. Funk Sr. Assistant City Attorney AYES: Councilmembers ______________________________________ NOES: Councilmembers _______________________________________ ABSTAIN: Councilmembers _______________________________________ NOT PRESENT: Councilmembers _______________________________________ CERTIFICATE OF ATTESTATION AND ORIGINALITY I, Daisy Gomez, Clerk of the Council, do hereby attest to and certify the attached Ordinance No. NS-XXX to be the original ordinance adopted by the City Council of the City of Santa Ana on _______________, and that said ordinance was published in accordance with the Charter of the City of Santa Ana. Date: ________________ ____________________________________ Clerk of the Council City of Santa Ana Ordinance No. NS-XXX Page 1 of 16 ORDINANCE NO. NS-XXX AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA ANA AMENDING SECTIONS 41-1900, 41-1901, 41-1902, 41-1903, 41-1904, 41-1906, 41-1909, AND 41- 1910 OF THE SANTA ANA MUNICIPAL CODE RELATING TO THE HOUSING OPPORTUNITY ORDINANCE THE CITY COUNCIL OF THE CITY OF SANTA ANA HEREBY ORDAINS AS FOLLOWS: Section 1. The City Council of the City of Santa Ana hereby finds, determines, and declares as follows: A. On November 28, 2011, the Santa Ana City Council adopted Ordinance No. NS-2825, known as the Housing Opportunity Ordinance and appearing as Article XVIII.1 of Chapter 41 of the Santa Ana Municipal Code. The Housing Opportunity Ordinance was adopted to implement the City’s Housing Element Goal of providing affordable housing within the City. B. On September 1, 2015, the City Council adopted Ordinance No. NS-2881, which amended the Housing Opportunity Ordinance in various respects, including applicability, options to satisfy inclusionary requirements, and calculation of the in-lieu housing fee. These amendments were intended to make the inclusionary housing requirements more predictable for housing developers and to incentivize more affordable housing production on-site in conjunction with new market rate housing development. C. In response to impacts of the COVID-19 pandemic on the development and construction of housing in the City, including the reduction of housing starts, the City Council adopted Ordinance No. NS-2994 on September 1, 2020. Ordinance No. NS-2994 further amended the Housing Opportunity Ordinance to lower the in-lieu housing fee for all projects from $15 to $5 per square foot, adjust the trigger of the ordinance, and expand the eligible uses of in-lieu fees collected by the City. D. In early 2021, at the direction of the City Council, an Ad Hoc Committee for Housing was formed. The Ad Hoc Committee reviewed the Housing Opportunity Ordinance and recommended certain changes. The Ad Hoc Committee’s recommendations were presented and discussed at the City Council Meeting on July 6, 2021. E. On July 26, 2021, the City Council conducted a work-study session to further evaluate the Committee’s recommendations and to receive input from key stakeholders and members of the public. The City Council provided direction to staff to prepare amendments to the Housing Opportunity Ordinance concerning the applicability Ordinance No. NS-XXX Page 2 of 16 and triggers for the ordinance, adjustments to the in-lieu fee calculation, set-aside units, and options for satisfaction of inclusionary requirements. F. On September 7, 2021, the City Council further considered this matter and provided additional direction to staff regarding proposed amendments to the Housing Opportunity Ordinance. FG. On _________, 2021, the Planning Commission held a duly noticed public hearing on the proposed amendments. GH. The Request for City Council Action for this ordinance dated __________, 2021 and duly signed by the Executive Director of the Planning and Building Agency shall, by this reference, be incorporated herein, and together with this ordinance, any amendments or supplements, and oral testimony, constitute the necessary findings for this ordinance. Section 2. The City Council finds and determines that this ordinance is not subject to the California Environmental Quality Act (CEQA) pursuant to Sections 15060(c)(2) and 15060(c)(3) of the State CEQA Guidelines because it will not result in a direct or reasonably foreseeable indirect physical change in the environment, as there is no possibility it will have a significant effect on the environment and it is not a "project", as defined in Section 15378 of the CEQA Guidelines. Section 3. The title of Article XVIII.1 of Chapter 41 of the Santa Ana Municipal Code is amended to read in its entirety as follows: 2021 AFFORDABLE HOUSING OPPORTUNITY AND CREATION ORDINANCE Section 4. Section 41-1900 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1900. - Purpose. This article establishes standards and procedures to encourage the development of housing that is affordable to a range of households with varying income levels. The purpose of this article is to encourage the development and availability of affordable housing by requiring the inclusion of affordable housing units within new developments or the conversion of rental units to condominium ownership when the number of units exceed the densities permitted under the general plan, zoning classification, or the conversion of rental units to condominium ownership. Section 5. Section 41-1901 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1901. - Definitions. Ordinance No. NS-XXX Page 3 of 16 As used in this article, the following terms shall have the following meanings: Adjusted for household size appropriate for the unit means a household of one person in the case of a studio unit, two (2) persons in the case of a one-bedroom unit, three (3) persons in the case of a two-bedroom unit, four (4) persons in the case of a three-bedroom unit, and five (5) persons in the case of a four-bedroom unit. Administrative procedures means those regulations promulgated by the executive director pursuant to section 41-1910 of this article. Affordable housing cost means the total housing costs paid by a qualifying household, which shall not exceed the fraction of gross income specified, as follows: Extremely low-income households. Thirty (30) percent of the income of a household earning thirty (30) percent of the Orange County median income adjusted for family size appropriate for the unit. Very low-income households. Thirty (30) percent of the income of a household earning fifty (50) percent of the Orange County median income adjusted for family size appropriate for the unit. Low-income households. Thirty (30) percent of the income of a household earning eighty (80) percent of the Orange County median income for family size appropriate for the unit. Moderate-income households. Thirty (30) percent of the income of a household earning one hundred twenty (120) percent of the Orange County median income adjusted for family size appropriate for the unit. The qualifying limits for extremely low-income, very low-income, low-income and moderate-income households are established and amended annually pursuant to Section 8 of the United States Housing Act of 1937. The limits are published by the Secretary of Housing and Urban Development. Developer means any association, corporation, firm, joint venture, partnership, person, or any entity or combination of entities, which seeks city approval for all or part of a residential project. Development agreement means an agreement approved by the city council between a property owner and the city pursuant to Government Code section 65864, et seq. Entitled residential project means a development project that includes residential units subject to the provisions and applicability of this Article XVIII.I. that received entitlement approvals by city council action between August 4, 2015 and August 17, 2020 to construct the residential project and which has not been issued a building permit prior to August 18, 2020. A list of the currently entitled residential projects is attached hereto as Exhibit A and is incorporated by reference. Ordinance No. NS-XXX Page 4 of 16 Executive director means the executive director of community development for the city. General plan means the adopted general plan for the City of Santa Ana. Inclusionary housing agreement means a legally binding agreement between the developer and the city, in a form and substance satisfactory to the executive director and the city attorney, and containing those provisions necessary to ensure that the requirements of this article are satisfied, whether through the provision of inclusionary units or through an approved alternative method. Inclusionary housing fund means the fund created by the city in which all fees collected in compliance with this article shall be deposited. Inclusionary housing plan means the plan submitted by the developer, in a form specified by the executive director, detailing how the provisions of this article will be implemented for the proposed residential project. Inclusionary unit means a dwelling unit that will be offered for sale or rent to extremely low, very low, low, or moderate incomemoderate-income households, at an affordable housing cost, in compliance with this article. Low-income units, and very low-income units, and extremely low-income units means inclusionary units restricted to occupancy by low, or very low-income, and extremely low-income households, respectively, at an affordable housing cost. Market rate units means dwelling units in a residential project that are not inclusionary units. Moderate-income units means inclusionary units restricted to occupancy by moderate-income households at an affordable housing cost. Prior project means any project for which an application was submitted and the application was deemed complete prior to August 4, 2015. Regulatory agreement means an agreement entered into between the City of Santa Ana or the Santa Ana Community Development Agency and a developer by which the developer covenants to keep certain housing units at an affordable housing cost for a specified period of time. Rehabilitated units/rehabilitation means the improvement of a unit in substandard condition to a decent, safe and sanitary level. Units are in substandard condition when, while they may be structurally sound, they do not provide safe and adequate shelter, and in their present condition endanger the health, safety or well-being of the occupants. Residential project/project means any of the following: A subdivision resulting in the creation of five (5) or more residential lots or residential condominium units; or Ordinance No. NS-XXX Page 5 of 16 The new construction of a project consisting of five (5) or more multi-family units; or The new construction of five (5) or more separate houses or dwelling units; or The conversion of five (5) or more existing residential rental units to condominium ownership. Target area means that area designated by the city from time to time, on an as- needed basis, as a priority area for rehabilitation due to health and safety concerns. Total housing costs the total monthly or annual recurring expenses required of a household to obtain shelter. For a rental unit, total housing costs shall include the monthly rent payment and utilities paid by the tenant (excluding telephone and television). For an ownership unit, total housing costs shall include the mortgage payment (principal and interest), insurance, homeowners' association dues (if applicable), private mortgage insurance (if applicable), taxes, utilities, an allowance for maintenance and any other related assessments. Section 6. Section 41-1902 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1902. - Applicability and inclusionary unit requirements. (a) Applicability. The requirements of this article shall apply to any new residential project comprised of twenty five (205) or more residential lots or residential units located withinwhich has not ___[OPTIONS: a) received entitlement approval or, b) been issued a building permit or paid the in-lieu fee]___ the cityas of [insert effective date], including new construction, and condominium conversions which exceedmeets one or all of the general plan prescribed densities.following applicability thresholds: (1) A change in use to allow for residential or that exceeds the general plan or zoning prescribed densities or percentage of residential development of the subject property at the time of application. (2) ImplementionImplementation of (b) Applications. The requirements of this article shall apply to any new residential project proposed in connection with an application to do any of the following:(1) Increase the permitted residential density of the subject property above the density or percentage of residential development allowed as a result of city initiated zone changes or city initiated general plan amendments after November 28, 2011. permitted by the general plan at the time of the application. The inclusionary requirements shall only apply to the incremental increase in the number of units beyond that which is allowed by the applicable density permitted by the general plan. Ordinance No. NS-XXX Page 6 of 16 (2) (3) Increase of the permitted percentage of residential development allowed for a mixed-use development above the percentage at the time of the application. The inclusionary requirements shall only apply to the incremental increase in the number of units beyond that which is allowed by the density permitted by the general plan. permitted under the zoning classification at the time of application. (3) (4) Development of new residential uses or increase of the permitted residential density or percentage of residential development within an overlay zone approved pursuant to Division 28 of Article I of this Chapter. (5) Conversion oft rental units to condominium ownership. (b) Applications. The inclusionary requirements shall only apply to the incremental increase in the number of units beyond that which is allowed by the density permitted by the general plan. as prescribed in Subsection (a) above. (c) Units for sale. If the new residential project consists of units for sale, then a minimum of ten (10) percent of the total number of units in the project shall be sold to moderate incomemoderate-income households. (d) Rental units. If the new residential project consists of rental units, then a minimum of fifteen (15) percent of the units shall be rented to low-income households, or ten (10) percent rented to very low-income households, or five (5) percent rented to extremely low-income households. (e) Rounding of quantities in calculations. In calculating the required number of inclusionary units, fractional units shall be rounded-up to the next whole unit. The developer may choose to pay an in-lieu fee set forth in section 41-1904(c) for the fractional units, which shall be calculated based on the number of habitable square feet applicable in each case. (f) Displacement of existing inclusionary units. Notwithstanding any other provision of this article, any residential project subject to this article that results in the displacement of very low and/or low-income household(s) shall be required to provide on-site inclusionary units as required by this article. (g) Compliance with article. All inclusionary units required by this article shall be sold or rented in compliance with this article. Section 7. Section 41-1903 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1903. - Exempt projects. Ordinance No. NS-XXX Page 7 of 16 The following are exempt from the requirements of this article: (a) Applications deemed complete. Applications that include a residential project for which a development application has been deemed complete prior to November 28, 2011. (ab) Development agreements. A residential project that is the subject of a development agreement under applicable provisions of the California Government Code that expressly provides for an exclusion to this article or provides for a different amount of, provides for a different amount of inclusionary units, or provides for a different specified method for determining the in- lieu fee provisions of this ordinance, such as the timing of payment or the point in time for determining the applicable in- lieu fee amount, to satisfy the inclusionary units from that specified by this article, provided the development agreement was adopted on or before November 28, 2011. (bc) Project with regulatory agreement. A residential project for which a regulatory agreement has been approved, provided that the regulatory agreement is effective at the time the residential project would otherwise be required to comply with the requirements of this article, and there is no uncured breach of the regulatory agreement before issuance of a certificate of occupancy for the project. This may include a residential project that has obtained a density bonus under article XVI.I of the Santa Ana Municipal Code. Such projects cannot be used to satisfy the inclusionary requirement for another project. (cd) Adaptive Reuse. Adaptive reuse development projects pursuant to Chapter 41, Article XVI.II - Adaptive Reuse. Section 8. Section 41-1904 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1904. - Options to satisfy inclusionary requirements. (a) On-site units. The primary means of complying with the inclusionary requirements of this article shall be the provision of on-site inclusionary units in accordance with section 41-19011902 above. A developer may only satisfy the requirements of this article by means of an alternative to on-site inclusionary units in accordance with the requirements and procedures of this section. (b) Off-site units. 1. New units. The developer may satisfy the inclusionary unit requirements for the project, in whole or in part by constructing the required new inclusionary housing at a different location within the city borders at the ratio of one square foot of habitable inclusionary unit space for each required habitable square foot. While the total habitable square footage area of the required new inclusionary units Ordinance No. NS-XXX Page 8 of 16 must be the same as the sum-total of the number of habitable square feet for the project as directed by this ordinance, the number of units and bedrooms associated with the off-site units may be approved by the review authority of the city, consistent with the type of affordable housing needed at the time of project review. 2. Rehabilitated units outside a designated target area. The developer may satisfy the inclusionary unit requirements for the project, in whole or in part by substantially rehabilitating existing housing units elsewhere within the borders of the city at a rate of one and one-half (1½) habitable square feet per each required habitable square foot of inclusionary units. 3. Rehabilitated units within a designated target area. Upon application, the developer may satisfy the inclusionary unit requirements for the project, in whole or in part by substantially rehabilitating existing housing units elsewhere within the borders of the city at a rate of one habitable square foot per each required habitable square foot of affordable inclusionary units. (c) In-lieu fee. (1) More than twenty Five (205) or more units. For aA residential project comprised of five (5) or more than twenty (20) residential lots or residential units, the developer may elect to satisfy the inclusionary unit requirements for the project, in whole or in part, by payment of a fee in-lieu of constructing some or all of the required units. The total amount of the fee allowed by this section shall be calculated using the In-Lieu Fee Schedule as shown below in section 41-1904(c)(1)(i) multiplied by five dollars per square foot ($5.00/ft. 2 ) of the sum total of the number of habitable square feet within the entire project, as measured from the exterior walls of the residential units. This calculation does not include exterior hallways, common areas, landscape, open space or exterior stairways. (i) In-Lieu Fee Schedule In-Lieu Fee Schedule Units Fee Per Square Foot of Habitable Area 5 – 9 $6.00 10 – 14 $9.00 15 – 19 $12.00 20 or more $15.00 (ii) Skilled and Trained Workforce Fee Reduction and Local Hire Requirements. A developer of a project consisting of 20 or more residential lots or units that housing unit development optsing for the selects the in-lieu fee payment option and provides a negotiated enforceable commitment that the developer.. will use a “Skilled Ordinance No. NS-XXX Page 9 of 16 and Trained Workforce” as defined in Public Contract Code §§section 2601 to complete the construction of the project shall pay a reduced fee of $5 (five) per square-foot as the in-lieu fee for the project. The negotiated enforceable commitment shall also ensure a minimum of 30% of all work-hours for the project be performed in accordance with local hire policies approved by the City Council. (2) Entitled residential projects. Timing of payment. The applicant(s) of an entitled residential total fee amount for the entirety of a project (see Exhibit A) may either construct the inclusionary units or pay an in lieu fee as follows: (i) Twenty (20) or fewer units. In the case of an entitled residential project containing between five (5)is calculated, determined, and twenty (20) residential lots or residential units, the developer may elect to satisfy the inclusionary unit requirements for the project, in whole or in part, by payment of a fee in lieu of constructing some or all of the required units. The amount of the fee allowed by this section shall be five dollars per square foot ($5.00/ft.) of the sum total of the number of habitable square feet within the entire project, as measured from the exterior walls of the residential units. This calculation does not include exterior hallways, common areas, landscape, open space or exterior stairways. (ii) More than twenty (20) units. In the case of an entitled residential project comprised of more than twenty (20) residential lots or residential units, the developer may elect to satisfy the inclusionary unit requirements for the project, in whole or in part, by payment of a fee in lieu of constructing some or all of the required units. The amount of the fee allowed by this section shall be five dollars per square foot ($5.00/ft.) of the sum total of the number of habitable square feet within the entire project, as measured from the exterior walls of the residential units. This calculation does not include exterior hallways, common areas, landscape, open space or exterior stairways. The in lieu fee amount allowed herein by this subsection shall revert to fifteen dollars per square foot ($15.00) on October 1, 2021 for any construction which adds net residential units, which has city- approved entitlements, that has not been issued aset at the time of issuance of the first building permit by October 1, 2021. (iii) A residential project that has been entitled and approved with conditions to pay a specific in lieu fee or has a city council approved development agreement to pay a specific in-lieu fee shall comply with the conditions or the development agreement as approved and shall not be modified by this ordinance. (3) Timing of payment. The developer shall pay the for the project. The developer shall pay all in-lieu fees allowed by this section for the entire project prior to issuance of the building permitfirst occupancy approval for any construction which adds net residential units. The developer may provide input regarding what project the in lieu fees should be applied towards, but such input shall not be dispositive. The in-lieu fees collected by the city are city funds over which the city has complete and absolute discretion. (43) Inclusionary housing fund. Fees collected in compliance with this section shall be deposited in the inclusionary housing fund. Ordinance No. NS-XXX Page 10 of 16 Section 9. Section 41-1906 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1906. - Standards. (a) Location within project, relationship to non-inclusionary units. All inclusionary units shall be: (1) Reasonably dispersed throughout the residential project; (2) Proportional, in number of bedrooms, gross floor area of habitable space, and location, to the market rate units; (3) Comparable to the market rate units included in the residential project in terms of design, materials, finished quality, and appearance; and (4) Permitted the same access to project amenities and recreational facilities, as are market rate units. (b) Timing of construction. All inclusionary units in a residential project shall be constructed concurrent with, or before the construction of the market rate units. If the city approves a phased project, a proportional share of the required inclusionary units shall be provided within each phase of the residential project. (c) Location outside the proposed original project. For projects where the developer proposes to either produce new inclusionary units or rehabilitate existing off- site units to meet the inclusionary affordable housing requirements of this ordinance, the off-site project(s) containing the required inclusionary units shall be subject to the following requirements: (1) The sum-total area (in habitable square feet) of all the newly constructed off-site inclusionary units shall be the same number of habitable square feet of inclusionary area as required by this ordinance. For the purpose of the calculation of the number of square feet of required inclusionary housing, the total gross habitable square feet of the housing units of the original market rate project shall be used, as measured from exterior walls to exterior walls of the market units provided as the base for calculation either ten (10) percent for very low income or fifteen (15) percent for low income inclusionary units. The common areas, exterior hallways, stairways, patios, and balconies shall not be calculated in determining the number of required square feet of inclusionary housing production. All new or rehabilitated units must meet all current zoning and general plan standards. Ordinance No. NS-XXX Page 11 of 16 (2) While the total number of square feet of inclusionary housing requirement is calculated based on the requirements of this ordinance, the number of units, bedrooms and other amenities on the proposed off-site inclusionary housing location shall be approved by the review authority commensurate with the size and type of units most in demand at the time of submittal of the application. (3) Any off-site affordable inclusionary housing project shall be substantially comparable to the market rate units included in the residential project in terms of quality of design, materials and finishes. (4) If tenants are displaced due to rehabilitation of housing to meet the inclusionary unit requirement, the developer shall be responsible for relocation costs as required by state law. (5) No city, housing authority, or public funds, subsidies, or participation of any kind shall be expended on the production or building of any inclusionary housing projects associated with meeting the inclusionary unit requirement. (d) Timing of construction. All inclusionary units in a residential project or proposed off-site new inclusionary units or rehabilitated units shall be constructed concurrent with, or before the construction of the market rate units. If the city approves a phased project, a proportional share of the required inclusionary units shall be provided within each phase of the residential project. (e) Units for sale. (1) Time limit for inclusionary restrictions. A unit for sale shall be restricted to the target income level group at the applicable affordable housing cost for a minimum of fifty-five (55) years.in perpetuity. (2) Certification of purchasers. The developer and all subsequent owners of an inclusionary unit offered for sale shall certify, on a form provided by the city, the income of the purchaser and that such owners will live in such inclusionary unit as their primary residence. (3) Resale price control. In order to maintain the availability of inclusionary units required by this article, the resale price of an owner occupied inclusionary unit shall be limited to the lesser of the fair market value of the unit as established by a licensed real estate agent based upon three (3) comparable properties or the restricted resale price. For these purposes, the restricted resale price shall be the applicable affordable housing cost. (4) Inheritance of inclusionary units. Upon the death of an owner of an owner-occupied inclusionary unit, title in the property may transfer to the surviving joint tenant or heir (in the case of the death of a sole owner or all owners of the household). Ordinance No. NS-XXX Page 12 of 16 (5) Forfeiture. If an inclusionary unit for sale is sold for an amount in excess of the resale price controls required by this section, the buyer and the seller shall be jointly and severally liable to the city for the amount in excess of the affordable housing cost at the time of such sale of the inclusionary unit. Recovered funds shall be deposited into the inclusionary housing fund. Notwithstanding the foregoing, city may allow the buyer and seller to cure any violation of the resale price controls within one hundred eighty (180) days. (f) Rental units. (1) Time limit for inclusionary restrictions. A rental inclusionary unit shall remain restricted to the target income level group at the applicable affordable housing cost for fifty-five (55) years.in perpetuity. (2) Certification of renters. The owner of any rental inclusionary unit shall certify, on a form provided by the city, the income of all members of the household above the age of eighteen (18) at the time of the initial rental and annually thereafter. (3) Forfeiture. Any lessor who leases an inclusionary unit in violation of this article shall be required to forfeit to the city all money so obtained. Recovered funds shall be deposited into the inclusionary housing fund. (g) Execution and recording of documents. The executive director may require the execution and recording of whatever documents are required to ensure enforcement of this section; including, but not limited to, promissory notes, deeds of trust, resale restrictions, rights of first refusal, options to purchase, and/or other documents, which shall be recorded against all inclusionary units. (h) General prohibitions. (1) No person shall sell or rent an inclusionary unit at a price or rent in excess of the maximum amount allowed by any restriction placed on the unit in accordance with this article. (2) No person shall sell or rent an inclusionary unit to a person or persons that do not meet the income restrictions placed on the unit in accordance with this article. (3) No person shall provide false or materially incomplete information to the city or to a seller or lessor of an inclusionary unit to obtain occupancy of housing for which that person is not eligible. (i) Principal residency requirement. Ordinance No. NS-XXX Page 13 of 16 (1) The owner or lessee of an inclusionary unit shall reside in the unit for not less than ten (10) out of every twelve (12) months. (2) No owner or lessee of an inclusionary unit shall lease or sublease, as applicable, an inclusionary unit without the prior permission of the executive director. Section 10. Section 41-1909 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1909. - Inclusionary housing fund. (a) Inclusionary housing fund. There is hereby established a separate fund of the city, to be known as the inclusionary housing fund. All monies collected pursuant to this article shall be deposited in the inclusionary housing fund. Additional monies from other sources may be deposited in the inclusionary housing fund. The monies deposited in the inclusionary housing fund shall be subject to the following conditions: (1) Monies deposited into the inclusionary housing fund must be used to increase and improve the supply of housing affordable to moderate, low, very low, and extremely low income households in the city as specified in the city's affordable housing funds policies and procedures. A priority will be on the creation of new affordable housing opportunities or units fromfor large families currently living in the existing market rateCity. Other eligible uses of the inclusionary housing stock rather than construction of new affordable housing units. This includes,fund include but isare not limited to, the purchase and rehabilitation of units for sale. Monies may also be used to pay for one-time programs for code enforcement, quality of life and general health and safety activities. Monies may also be used to cover reasonable administrative or related expenses associated with the administration of this article. : (i) Creating affordable units from the existing market rate housing stock including but not limited to, the purchase and rehabilitation of units. (ii) Funding one-time programs for code enforcement, quality of life, and general health and safety activities. (iii) Implementing and promoting programs addressing housing security, eviction prevention, and housing legal assistance for city residents. (iv) Funding reasonable administrative or related expenses associated with the administration of this article. (2) The fund shall be administered by the executive director, or his or her designee, who may develop procedures in the city's affordable housing funds policies and procedures to implement the purposes of the inclusionary housing fund consistent with the requirements of this article and any adopted budget of the city. Ordinance No. NS-XXX Page 14 of 16 (3) Monies deposited in accordance with this section shall be used in accordance with the affordable housing funds policies and procedures, housing element, consolidated plan, or subsequent plan adopted by the city council to construct, rehabilitate, or subsidize affordable housing or to recapture affordable housing at risk of market conversion, or to assist other government entities, private organizations, or individuals to do so. Permissible uses include, but are not limited to, assistance to housing development corporations, equity participation loans, grants, pre-home ownership co-investment, pre-development loan funds, participation leases, or other public-private partnership arrangements. The inclusionary housing fund may be used for the benefit of both rental and owner-occupied housing. (4) A developer receiving funding from the inclusionary housing fund shall implement a local preference in their resident selection criteria and marketing policies meeting guidelines established by the executive director. (5) A developer opting for the in lieu payment option or receiving funding from the inclusionary housing fund shall provide a negotiated enforceable commitment that the developer will use a “Skilled and Trained Workforce” as defined in Public Contract Code section 2601 to complete the construction of the project,.section. The negotiated enforceable commitment shall also ensure a minimum of 30% of all work-hours for the project be performed in accordance with local hire policies approved by the City Council., as well as its contractors and subcontractors at every tier performing work for the new housing units is encouraged and should provide an enforceable commitment that a skilled and trained workforce will be used to complete a contract or project in accordance with Public Contract Code §§ 2601—2602. Section 11. Section 41-1910 of Chapter 41 of the Santa Ana Municipal Code is hereby amended to read in its entirety as follows: Sec. 41-1910. - Administrative. (a) In-lieu fee calculation. The amount per square foot of the inclusionary housing in-lieu fee shall be subject to city council review and consideration. before the end of calendar year 2018, but after June 30, 2018. Between July 1, 2018 and December 31, 2018, staff shall report on the effectiveness of this ordinance and provide options for council consideration on the components of this ordinance, including, but not limited to, the monetary amount of inclusionary in-lieu fee per square foot. (b) Prior projects. The applicant(s) of any project for which a site plan review application was submitted and such application was deemed complete prior to August 4, 2015, may either construct the inclusionary units pursuant to the prior housing opportunity ordinance (Ordinance No. NS-2825) or pay an in lieu fee calculated by the formula under the prior housing opportunity ordinance (Ordinance No. NS-2825) or Ordinance No. NS-XXX Page 15 of 16 request to revise its inclusionary housing plan and/or inclusionary housing agreement and pay an in-lieu fee of nine dollars and thirty-five cents ($9.35) per square foot of habitable space for the entire project's inclusionary housing obligation. (cb) Administration fees. The council may by resolution establish reasonable fees and deposits for the administration of this article including an annual monitoring fee and an inclusionary housing plan submittal fee. (dc) Monitoring/audits. At the time of initial occupancy, and annually thereafter, the city will monitor the project to ensure that the income verifications are correct and in compliance with the inclusionary housing administrative procedures. For ownership units, the city shall monitor to verify that owner-occupancy requirements are maintained. Developer/property owners are required to cooperate with the city in promptly providing all information requested by the city in monitoring compliance with program requirements. The city will conduct periodic random quality control audits of inclusionary units to assure compliance with rules and requirements. Such audits may include verification of continued occupancy in inclusionary units by eligible tenants, compliance with the inclusionary housing plan and agreement, and physical inspections of the residential project. (ed) Administrative procedures. The city manager is hereby authorized and directed to promulgate administrative procedures for the implementation of this article. Section 12. If any section, subsection, sentence, clause, phrase or portion of this ordinance is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this ordinance. The City Council of the City of Santa Ana hereby declares that it would have adopted this ordinance and each section, subsection, sentence, clause, phrase or portion thereof irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases, or portions be declared invalid or unconstitutional. Section 13. This Ordinance shall become effective thirty (30) days after its adoption. Section 14. The Clerk of the Council shall certify the adoption of this ordinance and shall cause the same to be published as required by law. ADOPTED this _______ day of ___________, 2021. _________________________ Vicente Sarmiento Mayor Ordinance No. NS-XXX Page 16 of 16 APPROVED AS TO FORM: Sonia R. Carvalho, City Attorney By:_________________________ John M. Funk Sr. Assistant City Attorney AYES: Councilmembers ______________________________________ NOES: Councilmembers _______________________________________ ABSTAIN: Councilmembers _______________________________________ NOT PRESENT: Councilmembers _______________________________________ CERTIFICATE OF ATTESTATION AND ORIGINALITY I, Daisy Gomez, Clerk of the Council, do hereby attest to and certify the attached Ordinance No. NS-XXX to be the original ordinance adopted by the City Council of the City of Santa Ana on _______________, and that said ordinance was published in accordance with the Charter of the City of Santa Ana. Date: ________________ ____________________________________ Clerk of the Council City of Santa Ana 2015 HOO Applicable Areas 1CITY OF SANTA ANA, PLANNING AND BUILDING AGENCY 20 CIVIC CENTER PLAZA, SANTA ANA, CA 92702 Potential HOO Applicable Areas 2CITY OF SANTA ANA, PLANNING AND BUILDING AGENCY 20 CIVIC CENTER PLAZA, SANTA ANA, CA 92702 2021 Affordable Housing Opportunity Creation Ordinance SEPTEMBER 07, 2021 ITEM #35 Recap o On July 6t", City Council received a report on the progress of the Housing Ad Hoc Committee and discussed the changes to the Housing Opportunity Ordinance recommended by the Committee. o On July 26t", City Council conducted a work study session to receive input from the community and stakeholders and provide feedback regarding the Housing Ad Hoc Committee recommendations on the HOO o Staff contacted developers and labor unions to obtain construction and labor costs Purpose Summary of feedback received from City Council o Review of amendments to HOO u Obtain City Council direction regarding changes to the HOO July 26, 2021 City Council Feedback olicy q Develop a sliding scale for the in -lieu fee for projects that incorporate skilled & trained workforce Require a mandatory skilled & trained workforce to create a living wage Incorporate local hire requirements Prioritize production of housing for large families Prioritize down payment assistance Regulatory applicability & vesting Add rental protection for tenants Address displacement & protection Industry Feedback & Perspective Staff met with local developers, the BIA & construction unions Building and Construction Trades Council Local 652 of the Laborers' International Union of North America based in Santa Ana Local 441 of the International Brotherhood of Electrical Workers Local Union 105 Southwest Regional Council of Carpenters The Building Industry Association (BIA) BIA Perspective The proposed $15 per square foot H00 fee cannot be absorbed by a residential project A STW requirement will significantly impact the feasibility of constructing a project in the City and will drive projects elsewhere Indicated no projects have paid the $15 fee Construction Trades Perspective The labor unions acknowledge a cost increase using a STW Contend a waterfall of tangible benefits addresses the core of the affordable housing crisis An employee earning a living wage with employment benefits can attain decent housing and a higher quality of life A reliable and stable workforce Reduced public reliance on government assistance programs Higher efficiency from a trained employee A career pathway to the various construction trades Promote regional jobs -housing balance Promote environmental benefits from reduced vehicle miles traveled Local pride of working on a project developed in Santa Ana The labor unions also expressed support for a sliding scale approach to incentivize the use of a STW. Terner Center 2020 Study Findings Figure 4: Hard Construction Cost Per Square Foot, California (2018 $) 250 200 2010 tiO~ 1 ryO~ ry tiO1 O~ ryOy tiOy ryO~ 0 2OO The Terner Study found Hard construction costs fluctuated between $177 to $222 per square foot STW/Prevailing wage adds approximately $30 per square foot in labor Increases the hard tiQ, construction costs of a project on the average between 14% to 17% TERNERoxoo SING ON CENTERUC BE KE LEY ATE RNER CENTER REPORT -MARCH 20M Development Cost Stack 100% 90 % 80% 70 % 60 % 50% 40 % 30% 20% 10% O% Acquisition 10% Total Project Costs Hard Soft A 7 C = 85% Materials & 15% Labor J Conversion r VI 0TERNER-HOus>rf0 CENTER0INNOVATIONFigure1: Total Development Costs for Mlultifamily Projects in California (Completed 2010-20191 u C B. E R K E L E Y ATERNER CENTER REPORT -MARCH 30A Local Hard Costs 19.50 - $37.50 $ 15 21% - 27% 5 17% - 19% o Estimated local hard costs range between $130-$250 depending on housing and construction o STW adds approximately 15% to 20% o STW and HOO adds 21 %-27% at $15 per sf 17%-19% at $5 per sf 2015 HOO Applicable Areas Legend l l l Harbor Mixed -Used Transit Corridor Specific Plan (SP-2) lL l Transit Zoning Code (SD-84) with Zoning Overlay J) Metro East Mixed -Use Overlay Zone 0 MainPlace Specific Plan (SP-4) 0. 5 1 2 Miles Potential HO0 Applicable Areas Legend Harbor Mixed -Used Transit Corridor Specific Plan (SP-2) O Transit Zoning Code (SD-84) with Zoning Overlay 30 Metro East Mixed -Use Overlay Zone MainPlace Specific Plan (SP-4) 0( West Santa Ana Boulevard Focus Area 6/ Grand Ave/77th Street Focus Area l/1 South Main Street Focus Area 80 South Bristol Street Focus Area 0 55 Fwy/Dyer Road Focus Area 0. 5 1 2 Miles Regulatory Applicability & Vesting Policy 0 Raised at the July 26t" study session Most critical during the initial implementation of the amended Ordinance Serve as a cut-off threshold and provide clarity for development project proposals currently undergoing approval process HOO applies to projects: without entitlement approvals No building permit or has not paid the HOO Both vesting options meet legal standards and are commonly practiced by local governments City Council Feedback & Draft Refinements Develop a reasonable sliding scale in -lieu fee schedule for projects with skilled & trained workforce (STW) 15 per sf for projects without STW Reduce to per sf for project incorporating a STW Mandatory skilled &trained labor to address living • Applies to 20 or more units & exempt 19 or less units Applies to projects receiving funding from the Inclusionary Housing wage Fund Applies to 20 or more units & exempt 19 or less units Applies to projects receiving funding from the Inclusionary Housing Local hire requirements Fund 30% of total workhours Policies & guidelines to be approved by City Council Prioritize production of housing for large families • Yes Prioritize down payment assistance • Yes Regulatory Applicability & Vesting • Options: Approved Entitlements or Building Permit Issuance Rental protection • Housing Ad Hoc Address displacement & protection 0 Housing Ad Hoc