Part 4 — SUBSIDY EXCLUSIONS

This Part 4 sets forth exclusions from the definition of Subsidy.

(Ord. 30292)

A City contribution of land, money or other direct financial assistance, or a City reduction in a fee or tax, that is De Minimis in the context of the Private Construction Project is not a Subsidy.

(Ord. 30292)

A.

A City contribution of land, money or other direct financial assistance, or a City reduction in a fee or tax, benefitting a Private Construction Project is not a Subsidy if the Project is subject to a recorded restriction meeting the following requirements:

The term of the recorded restriction is at least 55 years,

The recorded restriction is applicable to all non-manager units,

The recorded restriction limits household income to no more than 100 percent of Area Median Income, and

The recorded restriction limits rent or sales price to no more than the Affordable Housing Cost pro-rated as appropriate for such maximum income.

B.

A City contribution of land, money or other direct financial assistance, or a City reduction in a fee or tax, to benefit a housing project subject to Resolution Numbers 72518, 61144 or 61716, as they may be amended, is not a Subsidy.

C.

A City contribution of money or other direct financial assistance to benefit a Private Construction Project is not a Subsidy if the funds were originally granted to the City by the State or Federal Government and the project is subject to Federal Labor Standards.

D.

Any housing project covered by Resolutions Numbers 72518, 61144 or 61716, as they may be amended, will remain subject to the requirements of those resolutions.

(Ord. 30292)

A.

A City contribution of land, money or other direct financial assistance, or a City reduction in a fee or tax, to benefit a homeowner in the construction of a Secondary Dwelling Unit or Accessory Dwelling Unit, as those terms are used Title 20, is not a Subsidy.

B.

A City contribution of land, money or other direct financial assistance, or a City reduction in a fee or tax, to benefit a City housing project involving the construction or rehabilitation of less than eight (8) units is not a Subsidy.

C.

The portion of a City housing project involving volunteers or self-help construction or rehabilitation that is not contracted out by the developer is not subject to any of the requirements of this Chapter 14.10.

(Ord. 30292)

Construction by the City or another public entity of infrastructure benefitting a Private Construction Project is not a Subsidy if:

A.

The cost of constructing the infrastructure is paid entirely from the collection of impact fees or taxes, and

B.

Regarding the impact fees or taxes being used to pay for construction of the infrastructure, the benefitted Private Construction Project paid the full amount of the impact fees or taxes that would normally be assessed on such a project under the applicable assessment schedule.

(Ord. 30292)

The City's reimbursement of a Private Construction Project for the cost of constructing infrastructure that would normally be borne by the public as set forth in California Labor Code 1720(c)(3), as it may be amended, is not a Subsidy.

(Ord. 30292)

A fee or tax reduction applied to a Private Construction Project or uniformly to all Private Construction Projects within a specified Subcategory of Use, and resulting from changes to any federal or state law or regulation, is not a Subsidy.

(Ord. 30292)

A fee or tax reduction applied uniformly to all Private Construction Projects throughout the City within any of the following five general land use categories is not a Subsidy: residential, office, retail, research and development, or industrial.

(Ord. 30292)

A fee or tax reduction applied uniformly to all Private Construction Projects within a specified Subcategory of Use is not a Subsidy if the Council determines, in accordance with the requirements of this Section, that construction of the projects is Financially Infeasible.

A.

The Council must make its determination that a fee or tax reduction is not a Subsidy, supported by findings, following a public hearing.

B.

The Council's findings must be supported by evidence presented at the public hearing, including a study analyzing whether construction of the Private Construction Projects within the specified Subcategory of Use is Financially Infeasible.

C.

The financial feasibility study referenced in Subsection B of this Section 14.10.310 must be performed by a consultant qualified to provide real-estate analytic services.

The City will select and retain the consultant using its normal procurement process.

The required consultant study must address the following issues:

a.

Whether construction of the Private Construction Projects in the specified Subcategory of Use is Financially Infeasible;

b.

The reason(s) for any conclusion that construction of the Private Construction Projects in the specified Subcategory of Use is Financially Infeasible;

c.

The anticipated duration of any condition(s) making construction of the Private Construction Projects in the specified Subcategory of Use Financially Infeasible;

d.

The estimated size of the financial gap between the Private Construction Projects in the specified Subcategory of Use being Financially Infeasible and financially feasible;

e.

Options for making construction of the Private Construction Projects in the specified Subcategory of Use financially feasible, including the following:

i.

Providing the proposed fee or tax reduction without requiring the payment of prevailing wages;

ii.

Providing the proposed fee or tax reduction along with requiring the payment of prevailing wages; and

iii.

Any additional options, other than the proposed fee or tax reduction, that would make construction of the Private Construction Projects within the specified Subcategory of Use financially feasible, provided that any such options must comply with all applicable laws and regulations, including the City's current general plan.

Consultant's preparation of the required study will include the opportunity for stakeholder input.

The Council will use reasonable efforts to conduct the required public hearing within ninety (90) calendar days following the completion of the study referred to in Subsections B and C of this Section 14.10.310.

(Ord. 30292)