Article II

• A. Applicability. The inclusionary housing requirements of this chapter shall apply to all new residential for-sale and rental projects, including mixed residential and non-residential projects, consisting of 10 or more residential units or parcels. The project unit count used to determine applicability of this chapter shall be exclusive of any accessory dwelling units or junior accessory dwelling units.

The percentage of inclusionary units required for a particular project shall be determined at the time of tentative map approval, or, for projects not processing a map, prior to issuance of building permit. If the project design changes, which results in a change in the number of inclusionary units required, the number of inclusionary units required shall be recalculated to coincide with the final approved project. In applying and calculating the number of inclusionary units required based on the specified percentage, any decimal fraction less than or equal to 0.50 may be disregarded, and any decimal fraction greater than 0.50 shall be construed as one unit.

• B. Residential For-Sale Projects. For all new for-sale residential project, and where the project would include 10 residential units or more, at least 15 percent of the project's dwelling units shall be affordable to very-low, low- or moderate-income households as specified. These units shall be referred to as "inclusionary units." The applicant shall not be prohibited from deepening the level of affordability in the project listed in subsection 1 below. The inclusionary units shall be reserved for purchase by eligible households, in the following proportions. The applicant shall not be prohibited from deepening the level of affordability in the project:

  1. 100 percent of the inclusionary units at a sales price affordable to a household whose income is no more than 120 percent of the area median income.

• C. Residential rental projects. For all new residential rental projects, including where the rental units are part of a mixed use projects, and where the project would include 10 residential units or more, at least 15 percent of the project's dwelling units shall be affordable to very-low [and/] or low-income households as specified. These units shall be referred to as "inclusionary units." The applicant is not precluded from deepening the level of affordability in the project listed in subsection 1 and 2 below. The inclusionary units shall be reserved for rent to eligible households within each income category as specified, in the following proportions. The applicant is not precluded from deepening the level of affordability in the project:

  1. 50 percent of the inclusionary units at a sales price affordable to a household whose income is no more than 50 percent of the area median income.

  2. 50 percent of the inclusionary units at a sales price affordable to a household whose income is no more than 60 percent of the area median income.

• D. Commercial, Office, and Industrial (COI) Development. COI projects shall be subject to the affordable housing fee as set forth in Chapter 17.40. In lieu of paying the affordable housing fee, COI developments as defined in this chapter may provide rental or for-sale affordable housing consistent with this chapter, and with the requirements of Section

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City of Pleasanton, CA § 17.44.040

PLANNING AND RELATED MATTERS

§ 17.44.050

17.40.060. A COI development proposing to provide affordable housing in lieu of paying the fee shall submit an affordable housing proposal as set forth in Section 17.44.090 of this chapter. Upon submittal of the affordable housing proposal, city staff will meet with the developer to discuss the potential for providing incentives to encourage on-site construction of affordable housing units and alternatives to constructing affordable units as set forth in this chapter. In the event a developer requests incentives or alternatives as a means of providing affordable housing in connection with a COI development, the affordable housing proposal will be reviewed as set forth in Section 17.44.090 of this chapter.

• E. Residential projects with fewer than 10 dwelling units shall be subject to the affordable housing fee as set forth in Chapter 17.40.

• (Ord. 1818 § 1, 2000; Ord. 2287, 12/3/2024)

• A. For those projects with both market-rate and inclusionary units, the inclusionary units shall be dispersed throughout the project so as not to concentrate inclusionary units in a specific geographic area (including a floor) of the project, except as provided in this section. The inclusionary units shall be located in comparable locations to the market-rate units, and shall be located on each floor, and throughout the site such that: (1) a proportionate number of inclusionary units are located on each floor of a multi-story apartment or condominium building, and that within such buildings no more than 20 percent of units are located adjacent to one another; (2) no more than 20 percent of the units are located adjacent to one another in a single-family detached project; and (3) in developments containing more than one multi-unit structure, including groups of attached townhomes, condominiums or apartments, no more than 50 percent of the proposed inclusionary units are consolidated into one structure.

  1. For a project where the market rate units are proposed to be detached single-family homes, it is permitted for the inclusionary units to be paired single-family, duets, duplexes, or townhomes. In such case, the townhomes, duets, or duplexes shall be dispersed throughout the project.

  2. For a project where the market rate units are proposed to be attached or detached single-family homes, duets, or duplexes (or a combination thereof), it is permitted for the inclusionary units to be ownership condominiums or rental apartments, with such units also dispersed throughout the project. This provision shall not apply to affordable units that are financed with low-income tax credits.

  3. Clustering of inclusionary units in a manner other than that specified in this section may be allowed subject to city council approval, as specified in Section 17.44.080, Alternative Means of Compliance.

• B. Accessory dwelling units (ADUs) and junior accessory dwelling units (JADUs) shall not be permitted to satisfy the requirements of this Inclusionary Zoning Ordinance. This provision shall not be construed to discourage, prohibit or disallow the provision of ADUs and JADUs as a component of a market-rate residential project, in addition to any required inclusionary units.

• C. Inclusionary units shall be equivalent in exterior appearance and overall quality of

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City of Pleasanton, CA § 17.44.050

PLEASANTON CODE

• D. Inclusionary units may be of smaller size than the market-rate units in the project, subject to the following limitations:

  1. For for-sale units, the living area of each inclusionary units may be up to 50 percent smaller than the size of the average market rate unit in the project.

  2. For rental units, the living area of each inclusionary unit shall be as follows: (a) a studio shall be at least 450 net square feet; (b) a one-bedroom unit shall be at least 550 net square feet; (c) a two-bedroom unit shall be at least 750 net square feet; (d) a three bedroom unit shall be at least 1,000 net square feet; and (e) for units with more than three bedrooms an additional 200 net square feet for each additional bedroom.

• E. Inclusionary Units. Inclusionary units may have fewer interior amenities than the market rate units in the project, except that inclusionary units shall have air-conditioning, enclosed garages, and laundry facilities to the extent the market-rate units have those amenities. Interior finishes and amenities must be equivalent to those provided in the base model market-rate units.

• F. The residents of the inclusionary units shall have the same access to shared common areas, open space, parking, storage and other amenities as the market-rate residents when located in the same building or on the same site.

• G. Bedroom Mix. The project shall comply with the following standards with respect to the bedroom mix of the affordable/inclusionary units:

  1. For for-sale projects, the average number of bedrooms per unit for all affordable units in the project shall equal the average number of bedrooms for all other units in the project, up to a limit of three bedrooms per unit;

  2. For rental projects, a minimum of 10 percent of the total affordable units shall be three-bedroom units; a minimum of 40 percent of the total affordable units shall be two-bedroom units; and the remaining affordable units shall be studio or onebedroom units except that no more than 10 percent of units may be studios. Agerestricted projects shall not be required to provide three-bedroom units, and may instead provide additional studio, one- or two-bedroom units in lieu of the required three-bedroom units. This provision shall not apply to affordable units that are financed with low-income tax credits. The director of community development may approve deviations from the specified bedroom mix for projects with 10 or fewer inclusionary units, except that at least 50 percent of units shall have at least two bedrooms if the market rate project also provides units of that size.

• H. Inclusionary units shall remain affordable in perpetuity from the date of occupancy, which shall be the date the city of Pleasanton approves final inspection for the building permit, through recordation of an affordable housing agreement as described in Section 17.44.060 of this chapter.

All inclusionary units in a project shall be constructed concurrently with, or prior to, the construction of the project's market rate units, unless an alternative schedule for construction is approved by the city council in accordance with Section 17.44.080 below. "Concurrently" means that all inclusionary units shall be built prior to the build-out of

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City of Pleasanton, CA § 17.44.050

PLANNING AND RELATED MATTERS

§ 17.44.060

market rate units in the same residential development project. In phased developments, inclusionary units shall be constructed and occupied in proportion to the number of market rate units constructed and occupied in each phase as follows:

1. A building permit may not be issued for any market rate unit unless a proportional number of building permits has been issued for inclusionary units; and

2. A certificate of occupancy or final inspection may not be issued for market rate units unless a proportional number of certificates of occupancy or final inspections have been issued for inclusionary units.

• I. For purposes of calculating the affordable rent or affordable sales price of an inclusionary unit, the following household size assumptions shall be used for each applicable dwelling unit type:

==> picture [401 x 130] intentionally omitted <==

----- Start of picture text -----
HUD Income Category by Household
Unit Size Size
Studio unit 1 person
1 bedroom unit 2 persons
2 bedroom unit 3 persons
3 bedroom unit 4 persons
4 or more bedroom unit 5 or more persons
----- End of picture text -----

• J. The city's adopted preference and priority system shall be used for determining eligibility among prospective beneficiaries for affordable housing units created through this inclusionary zoning ordinance.

• (Ord. 1818 § 1, 2000; Ord. 2287, 12/3/2024)

An affordable housing agreement shall be entered into by the city and the project owner. The agreement shall record the method and terms by which a project owner shall comply with the requirements of this chapter. The approval and/or recordation of this agreement shall take place prior to final map approval or, where a map is not being processed, prior to the issuance of building permits for such lots or units.

The affordable housing agreement shall state the methodology for determining a unit's initial and ongoing rent or sales and resale price(s), any resale restrictions, occupancy requirements, eligibility requirements, city incentives including second mortgages, recapture mechanisms, the administrative process for monitoring unit management to assure ongoing affordability and other matters related to the development and retention of the inclusionary units.

In addition to the above, the affordable housing agreement shall set forth any waiver of the affordable housing fee. For projects which meet the affordability threshold with very low and/or low-income units, all units in the project shall be eligible for a waiver of the affordable housing fee. For ownership residential projects which meet the affordability threshold with moderate income units, only the inclusionary units shall be eligible for a waiver of the affordable housing fee except as otherwise approved by the city council.

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City of Pleasanton, CA

PLEASANTON CODE

§ 17.44.060

§ 17.44.070

To assure affordability in accordance with the terms of this chapter and over the life of the unit (i.e. in perpetuity) the affordable housing agreement shall be recorded with the property deed or other method approved by the city attorney.

The community development director may waive the requirement for an affordable housing agreement for projects that have their affordable housing requirements included in a development agreement or other city document.

If a project is permitted to pay the affordable housing fee to meet the requirements of this chapter, pursuant to Sections 17.44.040(D), 17.44.040(E), or Section 17.44.080, an affordable housing agreement shall not be required. In the case of approval pursuant to Section 17.44.080, such provision shall be included in a resolution for approval adopted by city council. (Ord. 1818 § 1, 2000; Ord. 2000 § 1, 2009; Ord. 2287, 12/3/2024)

The city shall consider making available to the applicant incentives to increase the feasibility of residential projects to provide inclusionary units. Incentives or financial assistance will be offered only to the extent resources for this purpose are available and approved for such use by the city council or city manager, as defined below, and to the extent that the project, with the use of incentives or financial assistance, assists in achieving the city's housing goals. However, nothing in this chapter establishes, directly or through implication, a right of an applicant to receive any assistance or incentive from the city.

Any incentives provided by the city shall be set out in the affordable housing agreement pursuant to Section 17.44.060 of this chapter. The granting of the additional incentives shall require demonstration of exceptional circumstances that necessitate assistance from the city, as well as documentation of how such incentives increase the feasibility of providing affordable housing.

The following incentives may be approved for applicants who construct inclusionary units onsite:

• A. Fee Waiver or Deferral. The city council, by resolution, may waive or defer payment of city development impact fees and/or building permit fees applicable to the inclusionary units or the project of which they are a part. Fee waivers shall meet the criteria included in the city's adopted policy for evaluating waivers of city fees for affordable housing projects. The affordable housing agreement shall include the terms of the fee waiver.

• B. Design Modifications. The granting of design modifications relative to the inclusionary requirement shall require the approval of the city council and shall meet all applicable zoning requirements of the city of Pleasanton. Modifications to typical design standards may include the following:

  1. Reduced setbacks;

  2. Reduction in infrastructure requirements;

  3. Reduced open space requirements;

  4. Reduced landscaping requirements;

  5. Reduced interior or exterior amenities;

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City of Pleasanton, CA § 17.44.070

PLANNING AND RELATED MATTERS

7. Height restriction waivers.

• C. Second Mortgages. The city may utilize available affordable housing funds for the purpose of providing second mortgages to prospective unit owners or to subsidize the cost of a unit to establish an affordable rent or an affordable sales price. Terms of the second mortgage or subsidy shall be stated in the affordable housing agreement. The utilization of these incentives shall not be the sole source of providing the inclusionary units and they are intended to augment the developer's proposal.

• (Ord. 1818 § 1, 2000; Ord. 2287, 12/3/2024)

In general, and where specified by this chapter, projects shall be required to construct inclusionary units on-site and in conjunction with market rate units within the same project in all new residential projects. However, pursuant to state law and in the interests of avoiding undue impediments to housing production, the city acknowledges that it may be beneficial to provide alternative means of compliance with this chapter.

• A. Provisions Applicable to All Alternatives.

  1. Approval of any alternative proposal is subject to city council review and approval, based on the criteria and findings set forth in subsections B through H as applicable.

  2. The applicant shall bear the burden of providing substantial evidence to support the findings set forth in this section, and to support the feasibility of any proposed alternative. The applicant shall set forth the factual and legal basis for any request under this section.

  3. Any request under this section shall be submitted to the director of community development together with an economic analysis, if required, or other supporting documentation.

  4. The city council may approve or conditionally approve any alternative set forth in this section if it makes all of the following findings and any additional findings required for the selected alternative:

     • a. It is not feasible or desirable to accommodate the inclusionary units on site, or to otherwise construct the units in strict accordance with the requirements of this chapter, due to specific site conditions or constraints, project location, or other unique characteristics of the project or project site.

     • b. The number of affordable units provided by the alternative equals or exceeds that provided by the on-site units or by the payment of the affordable housing fee, as applicable to the project;

     • c. The level of affordability provided by the alternative is the same or lower (i.e. has "deeper" affordability) as provided by on-site units or the payment of fees, as applicable;

     • d. The alternative is consistent with the general plan and housing element, and the provisions of this chapter.

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City of Pleasanton, CA

PLEASANTON CODE

§ 17.44.080

§ 17.44.080

• B. Alternative Proposals. If the provision of on-site affordable units under Section 17.44.040(B) or (C) is financially or otherwise infeasible, an applicant for a residential project may request, in order of priority: (1) alternative on-site unit type, size, configuration or clustering of units in a manner other than that specified in subsection 17.44.050, as provided in subsection C below; (2) provide off-site units as provided in subsection D, below; (3) dedicate land for affordable housing as provided in subsection E, below; (4) pay the affordable housing fee as set forth in Chapter 17.40 and in subsection F, below. The applicant must demonstrate, through provision of substantial evidence as described in subsection A, above, that each of the higher priority options is infeasible before the city will consider a lower-priority option.

  1. Notwithstanding Section 17.44.080(A)(4), the city council may accept fees in lieu of the alternatives in subsection B, above, provided it makes a finding that special circumstances justify payment of fees over provision of units.

• C. Alternative Unit Type, Size, Configuration or Clustering of Units.

  1. An applicant may propose alternatives for the on-site units that deviate from the strict standards of this chapter with respect to unit size, bedroom mix, clustering, unit type, and interior amenities of the affordable units.

  2. Proposed units shall comply with requirements of the Building Code and Fire Code, and in no circumstance shall otherwise required amenities be waived that are necessary to ensure the health, safety and welfare of the building and its residents.

  3. Alternative on-site locations or clustering of affordable units shall provide equivalent access to shared amenities within the project, unless the affordable units would have suitable alternative shared amenities available for the exclusive use of the residents of the affordable units.

• D. Off-Site Projects. Upon approval by the city council, inclusionary units required pursuant to this chapter may be permitted to be constructed at a location within the city other than the project site. Any off-site inclusionary units must meet the following criteria:

  1. The off-site inclusionary units must not result in a significant concentration of inclusionary units in any one particular neighborhood or cause residential segregation.

  2. The off-site location is suitable for the proposed affordable housing, and the off-site inclusionary units shall conform to the requirements of all applicable city ordinances and standards, and the provisions of this chapter.

  3. The occupancy and rents of the off-site inclusionary units shall be governed by the terms of a deed restriction, and if applicable, a declaration of covenants, conditions and restrictions similar to that used for the on-site inclusionary units.

4. The affordable housing agreement shall stipulate the terms by which the off-site inclusionary units will be built. Construction of the off-site affordable units shall occur concurrently with construction of the market-rate units in the residential project, unless otherwise approved by the city council. If the construction does not take place at the same time as construction of the market-rate units, the agreement shall require the units to be constructed within a specified time frame, but in no event longer than

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City of Pleasanton, CA § 17.44.080

PLANNING AND RELATED MATTERS

§ 17.44.080

two years after the first building permit is issued for the market-rate project. A cash deposit, bond or other financial security may be required by the city, refundable upon construction, as assurance that the units will be built.

5. Off-site construction of affordable units does not qualify the residential project for a density bonus or other regulatory incentives allowed by Government Code Section 65915 unless the off-site development includes the dedication of land conforming to the provisions of Section 65915(g). No off-site alternative may be approved by the city if a density bonus or other regulatory incentive is requested for the site on which the affordable housing is to be built.

Any off-site alternative must comply with the density, intensity and other development standards that are permitted under the zone for the site.

• E. Land Dedication. Upon approval by the city council, an applicant may dedicate land to the city or a qualified nonprofit housing developer in place of actual construction of inclusionary units upon approval of the city council. The intent of allowing a land dedication option is to provide the city or a local nonprofit housing developer the free land needed to make an inclusionary unit development feasible, thus furthering the intent of this chapter. The following criteria shall be met for any dedication of land:

  1. The dedicated land must be appropriately zoned, buildable, free of toxic substances, contaminated soils, or geologic or other physical constraints that make it unsuitable for residential development.

  2. The developable area of the site is large enough to accommodate the number of inclusionary units required for the project. The city's acceptance of land dedication shall require that the lots be fully improved, with infrastructure, adjacent utilities, grading, and fees paid.

  3. The land is appraised by the city at a value equal to or greater than the in-lieu-fee in place at time of the market-rate project application, multiplied by the number of required inclusionary units that would be satisfied by construction of units on the land to be dedicated. If the appraised value is less than the in-lieu fee, the developer shall be subject to payment of the difference as a cash contribution to the affordable housing fund.

equal to or greater than the in-lieu-fee in place at time of the market-rate project application, multiplied by the number of required inclusionary units that would be satisfied by construction of units on the land to be dedicated. If the appraised value is less than the in-lieu fee, the developer shall be subject to payment of the difference as a cash contribution to the affordable housing fund.

• F. Affordable Housing Fee. In lieu of providing inclusionary units in a project, the city council may approve payment of the city's affordable housing fee, as set forth in Chapter 17.40 of this title. Such alternative shall only be approved if the city council determines that:

  1. The proposal would be consistent with and further the purpose of this chapter, as set forth in Section 17.44.020.

  2. Greater benefit would accrue to the city's with respect to furthering affordable housing and the ability to provide housing affordable to all segments of the community through payment of the fee, versus requiring construction of the units onsite.

  3. Projects requesting a density bonus, incentive or concession, waiver, or parking ratio under Government Code Section 65915 or Chapter 17.38 of the Pleasanton Municipal Code shall not be permitted to pay in-lieu fees as an alternative to satisfying the

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City of Pleasanton, CA § 17.44.080

PLEASANTON CODE

§ 17.44.080

• affordable housing requirements of this chapter. Payment of fees in lieu of providing affordable units under Chapter 17.44 of the code does not qualify a housing development for a density bonus.

• G. Other Alternate Methods of Compliance. Applicants may propose other creative concepts for meeting the requirements of this chapter, in order to bring down the cost of providing inclusionary units, whether on- or off-site. The city council may approve such alternate methods of compliance with this chapter if the applicant demonstrates that such alternate method meets the purpose of this chapter (as set forth in Section 17.44.020 of this chapter).

• (Ord. 1818 § 1, 2000; Ord. 2287, 12/3/2024)

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City of Pleasanton, CA § 17.44.090

PLANNING AND RELATED MATTERS