Modesto Municipal Code Art. 8 Density Bonus: Calculations

(a) An applicant who requests a density bonus pursuant to this subdivision shall elect whether the bonus shall be awarded on the basis of section 10-8.801, 10-8.802, 10-8.803, 10-8.804, 10-8.805, 10-8.806, 10-8.807, or 10-8.808, below. (b) All density calculations resulting in fractional units shall be rounded up to the next whole number. (c) The granting of a density bonus shall not require, or be interpreted, in and of itself to require a general plan amendment, zone change, or other discretionary approval. (d) An applicant shall agree to, and the city shall ensure, the continued affordability of all very low and low-income rental units that qualified the applicant for an award of a density bonus for fifty-five (55) years or a longer period of time if required by a construction or mortgage financing assistance program, mortgage insurance program, or rental subsidy program. (e) Except as specified in Section 10-8.807, rents for the lower income density bonus units shall be set at an affordable rent, as defined in Section 50053 of the Health and Safety Code. (f) The City shall grant one (1) density bonus, the amount of which as specified in this Article, if the applicant for a housing development seeks and agrees to construct a housing development, excluding any units permitted by the density bonus awarded pursuant to this Article, that will contain at least any one (1) of the following:

If ten (10) percent of the total units of a housing development for rental or sale to lower income households, as defined in Section 50079.5 of the Health and Safety Code, the density bonus shall be calculated as follows:

TABLE 10-8.801 - Low-Income Units

(Ord. No. 3762-C.S., effective § 4, effective 5-11-23)

If five (5) percent of the total dwelling units of a housing development are reserved for rent or sale to very low-income households, as defined in Section 50105 of the Health and Safety Code, the density bonus shall be calculated as follows:

TABLE 10-8.802 - Very Low-Income Units

(Ord. No. 3762-C.S., effective § 4, effective 5-11-23)

A senior citizen housing development, as defined in Sections 51.3 and 51.12 of the Civil code, or a mobile home park that limits residency based on age requirements for housing for older persons pursuant to Section 798.76 or 799.5 of the Civil code shall receive a density bonus equal to twenty (20) percent of the number of senior housing units.

(Ord. No. 3762-C.S., effective § 4, effective 5-11-23)

If ten (10) percent of the total dwelling units of a housing development are sold to persons and families of moderate income, as defined in Section 50093 of the Health and Safety Code, provided that all units in the development are offered to the public for purchase.

TABLE 10-8.804 - Moderate-Income Units (For Purchase)

(Ord. No. 3762-C.S., effective § 4, effective 5-11-23)

If ten (10) percent of the total dwelling units of a housing development are reserved for any of the following groups: (1) transitional foster youth, as defined in Section 66025.9 of the Education Code; (2) disabled veterans, as defined in Section 18541 of the Government Code; or (3) homeless persons, as defined in the Federal McKinney-Vento Homeless Assistance Act (42 U.S.C. Sec. 11301 et seq.), the project shall receive a density bonus equal to twenty (20) percent of the number of units reserved for those groups, provided the following requirements are met:

(a) The units shall be subject to a recorded affordability restriction of fifty-five (55) years; and,

(b) The units shall be provided at the same affordability level as very low-income units.

(Ord. No. 3762-C.S., effective § 4, effective 5-11-23)

If twenty (20) percent of the total units in a student housing development are reserved for lower income students, the density bonus awarded shall be thirty-five (35) percent of the total number of student housing units, if the student housing development meets all of the following requirements:

(a) The applicable twenty (20) percent units will be used for lower income students.

(b) The rent provided in the applicable units of the development for lower income students shall be calculated at thirty (30) percent of sixty-five (65) percent of the area median income for a single room occupancy unit type.

(c) All units in the development shall be used exclusively for undergraduate, graduate, or professional students enrolled full time at an institution of higher education accredited by the Western Association of Schools and Colleges or the Accrediting Commission for Community and Junior Colleges.

(1) In order to be eligible under this section, the developer shall, as a condition of receiving a certificate of occupancy, provide evidence to the city that the developer has entered into an operating agreement or master lease with one (1) or more institutions of higher education for the institution(s) to occupy all units of the student housing development with students from that institution or institutions.

(2) An operating agreement or master lease entered into pursuant to this subclause is not violated or breached if, in any subsequent year, there are not sufficient students enrolled in the institution of higher education to fill all of the units in the student housing development.

(d) The development provides priority for the applicable affordable units for lower income students experiencing homelessness. A homeless service provider, as defined in paragraph (3) of subdivision (e) of Section 103577 of the Health and Safety Code, or institution of higher education that has knowledge of a person's homeless status may verify a person's status as homeless for purposes of this section.

(e) For purposes of calculating a density bonus granted pursuant to this section, the term "unit" means one (1) rental bed and its pro rata share of associated common area facilities.

(f) The units described in this section shall be subject to a recorded affordability restriction of fifty-five (55) years.

(Ord. No. 3762-C.S., effective § 4, effective 5-11-23)

If one-hundred (100) percent of all the units in a housing development, including total units and density bonus units, but exclusive of a manager's unit(s) are set aside for lower income households, as defined by Section 50079.5 of the Health and Safety Code; except that up to twenty (20) percent of the units in the development may be for moderate-income households, as defined in Section 50053 of the Health and Safety Code, then the following shall apply:

(a) Except as otherwise provided in clause (b), below, the density bonus shall be eighty (80) percent of the number of units for lower income households.

(b) If the housing development is located within one-half (0.5) mile of a major transit stop, the city shall not impose any maximum controls on density.

(c) If the housing development is located in a very low vehicle travel area, the City shall not impose any maximum controls on density.

(d) For the purposes of this section, "Very low vehicle travel area" means an urbanized area, as designated by the United States Census Bureau, where the existing residential development generates vehicle miles traveled per capita that is below eighty-five (85) percent of either regional vehicle miles traveled per capita, or city vehicle miles traveled per capita. For purposes of this section, "area" may include a travel analysis zone, hexagon, or grid. For the purposes of determining "regional vehicle miles traveled per capita" pursuant to this paragraph, a "region" is the entirety of incorporated and unincorporated areas governed by a multicounty or single-county metropolitan planning organization, or the entirety of the incorporated and unincorporated areas of an individual county that is not part of a metropolitan planning organization.

(e) Rents for all units in the development, including both base and density bonus units, shall be as follows:

(1) The rent for at least twenty (20) percent of the units shall be set at an affordable rent, as defined in Section 50053 of the Health and Safety Code.

(2) The rent for the remaining units in the development shall be set at an amount consistent with the maximum rent levels for a housing development that receives an allocation of state or federal low-income housing tax credits form the California Tax Credit Allocation Committee.

(Ord. No. 3762-C.S., effective § 4, effective 5-11-23)

An applicant shall agree to ensure, and the city shall ensure, that a for-sale unit that qualified the applicant for the award of a density bonus meets either of the following conditions:

(a) The unit is initially occupied by a person or family of very low, low, or moderate income, as required, and it is offered at an affordable housing cost, as that cost is defined in Section 50052.5 of the Health and Safety Code and is subject to an equity sharing agreement; or

(b) The unit is purchased by a qualified nonprofit housing corporation pursuant to a recorded contract that satisfies all of the requirements specified in paragraph ten (10) of subdivision (a) of Section 402.1 of the Revenue and Taxation Code and that includes all of the following:

(1) A repurchase option that requires a subsequent purchaser of the property that desires to resell or convey the property to offer the qualified nonprofit corporation the right to repurchase the property prior to selling or conveying that property to any other purchaser.

(2) An equity sharing agreement.

(3) Affordability restrictions on the sale and conveyance of the property that ensure that the property will be preserved for lower income housing for at least forty-five (45) years for owner-occupied housing units and will be sold or resold only to persons or families of very low, low, or moderate income as defined in Section 50052.5 of the Health and Safety Code.

(c) For purposes of this section, a "qualified nonprofit housing corporation" is a nonprofit housing corporation organized pursuant to Section 501 (c)(3) of the Internal Revenue Code that has received a welfare exemption under Section 214.15 of the Revenue and Taxation Code for properties intended to be sold to low-income families who participate in a special no-interest loan program.

(Ord. No. 3762-C.S., effective § 4, effective 5-11-23)

The city shall enforce an equity sharing agreement required pursuant to Section 10-8.808, unless it is in conflict with the requirements of another public funding source or law. The following shall apply to the equity sharing agreement:

(a) Upon resale, the seller of the units shall retain the value of any improvements, the down payment, and the seller's proportionate share of appreciation.

(b) Except as provided in clause (c), below, the local government shall recapture any initial subsidy, as defined in clause (iii), and its proportionate share of appreciation, as defined in clause (d), below, which amount shall be used within five (5) years for any of the purposes described in subdivision (e) of Section 33334.2 of the Health and Safety Code that promote home ownership.

(c) For purposes of this subdivision, the local government's initial subsidy shall be equal to the fair market value of the home at the time of initial sale minus the initial sale price to the moderate-income household, plus the amount of any down payment assistance or mortgage assistance. If upon resale the market value is lower than the initial market value, then the value at the time of resale shall be used as the initial market value.

(d) For purposes of this subdivision, the local government's proportionate share of appreciation shall be equal to the ratio of the local government's initial subsidy to the fair market value of the home at the time of initial sale.

(e) If the unit is purchased ore developed by a qualified nonprofit housing corporation pursuant to Section 10-8.808 (b) the local government may enter into a contract with the qualified nonprofit housing corporation under which the qualified nonprofit housing corporation would recapture any initial subsidy and its proportionate share of appreciation if the qualified nonprofit housing corporation is required to use one-hundred (100) percent of the proceeds to promote homeownership for lower income households as defined by Health and Safety Code Section 50079.5 within the jurisdiction of the local government.

(Ord. No. 3762-C.S., effective § 4, effective 5-11-23)