Chapter 11-09 — INCLUSIONARY HOUSING

Sections:

Article 1. Purpose

11-09-100 Intent.

Article 2. Applicability 11-09-200 Applicability.

Article 3. Definitions 11-09-300 Definitions.

Article 4. Unit Reservation 11-09-400 Reservation requirements.

Article 5. In-Lieu Fees

11-09-500 In-lieu fee alternative – In-lieu fee authorized.

11-09-505 Amount of in-lieu fee.

11-09-510 Use of in-lieu fees.

Article 6. Reservation Options 11-09-600 Options for providing reserved units.

Article 1. Purpose

It is the intent of this Chapter to establish requirements for the reservation of housing units for very low- and low-income households in residential projects as provided for in the General Plan.

Article 2. Applicability

The provisions of this Chapter shall apply to all residential projects of six (6) or more units including, without limitation, condominium conversions and time extensions for previously approved residential projects.

Article 3. Definitions

(A) Affordable. For the purpose of this Chapter, the term “affordable” shall have the following meanings:

(1) A for-sale housing unit shall be affordable if the sales price does not exceed two hundred fifty percent (250%) of the area median income for San Benito County, adjusted for family size/bedroom size, as published by HUD. The family size/bedroom size adjustment shall be as follows:

(a) One (1) bedroom units shall be based on the median income for a family of two (2);

(b) Two (2) bedroom units shall be based on the median income for a family of three (3);

(c) Three (3) bedroom units shall be based on the median income for a family of four (4);

(d) Four (4) bedroom units shall be based on the median income for a family of five (5).

(2) Rental housing unit shall be affordable if the total housing cost, including rent and utilities, paid by a household does not exceed thirty percent (30%) of the monthly gross income of a household, as defined in subsection (C) of this Section, adjusted for household

size. A household size used to calculate the maximum affordable rent shall be those indicated in subsection(A)(1) of this Section.

(B) “Area median income” means the median household income of San Benito County or equivalent geographic area as annually estimated by HUD pursuant to Section 8 of the United States Housing Act of 1937. In the event such HUD determinations of area median income are discontinued, the area median income shall be that median household income as established and published by the State of California Department of Housing and Community Development pursuant to Health and Safety Code Section 50093.

(C) “Household” means a person or persons living together in the same residence, with an aggregate income not exceeding the limits to be designated as a very low-, low-, or moderate-income household under this Chapter.

(D) “HUD” means the United States Department of Housing and Urban Development.

(E) “Low-income household” means a person or persons living together as a household unit whose combined incomes do not exceed eighty percent (80%) of the median income for San Benito County for an equivalent size household.

(F) “Reserved unit” means a residential dwelling unit deed restricted for occupancy by a very low- or low-income household pursuant to the requirement of this Chapter.

(G) “Residential project” means any new construction of dwelling units or condominium conversion.

(H) “Very low-income household” means a person or persons living together as a household unit whose combined income does not exceed fifty percent (50%) of the median income for San Benito County for an equivalent sized household.

Article 4. Unit Reservation

(A) Reservation of For-Sale Units.

(1) No for-sale residential project of six (6) or more units subject to this Chapter shall be approved in any area of the City unless at least one (1) such housing unit is reserved for sale to very low- or low-income households or reserved as rental units for very low- or lowincome households for each five (5) units of market-rate housing.

(2) Calculation of Reservation Requirement. The calculation of the number of housing units to be reserved shall be made utilizing the total number of housing units in the residential project prior to including any increase in the allowable number of such housing units authorized by any density bonus granted pursuant to Government Code Section 65915 et seq. If the calculation of the number of housing units to be reserved results in a fraction of a whole number, the developer may either reserve one (1) additional housing unit or pay a partial in-lieu fee equal to the remaining fraction. The amount of the in-lieu fee shall be determined according to SJBMC 1109-505.

(3) Timing for Construction of Reserved Units. The reserved units shall be constructed either prior to or simultaneously with the nonreserved units within the development. If the development is being constructed in phases, the percentage of reserved units to be constructed in each phase shall be equivalent to one (1) reserved unit for every five (5) market rate units being constructed in that phase.

(4) Sales Price. The initial sales price and the resale sales price of reserved units shall be limited to ensure that the price is and remains affordable to very low- or low-income households as defined in SJBMC 11-09-300.

(5) Sales Restriction. Reserved units shall be sold or resold only to eligible very low- or low-income households. A deed restriction, covenant, and/or other instrument enforceable by the City and approved by the City Attorney limiting the resale of such units to eligible very low- or low-income households shall be recorded against the title of all reserved units. The duration of such resale restrictions shall be a minimum of fifty-five (55) years.

(6) Rental Restriction. The requirements in subsection (B) of this Section shall apply if rental housing is provided as the reserved units.

(B) Reservation of Rental Unit.

(1) No rental residential project subject to this Chapter (including time extensions) shall be permitted unless at least one (1) affordable unit is reserved for very low- or low-income households for each five (5) units of market-rate housing.

(2) Calculation of Reservation Requirement. The provisions of this subsection shall apply to the calculation of the number of housing units to be reserved in any rental housing development.

(3) Design and Construction of Reserved Units. The design and exterior appearance of the reserved units shall be compatible with and substantially the same as the nonreserved units within the development and shall contain proportionately the same or a larger number of bedrooms and square footage per reserved unit as the nonreserved units.

(4) Rental Restriction. The rent to be charged for a reserved housing unit shall be so limited as to be affordable to very low- or lowincome households.

(5) Deed Restriction. A deed of restriction, covenant, and/or other instrument enforceable by the City and approved by the City Attorney shall be recorded against the title of the property within which the reserved units are located limiting the rental of the reserved units as described in subsection (B)(4) of this section. This rent restriction shall be in effect for a minimum of fifty-five (55) years. Additionally, the property shall be so restricted as to prohibit the conversion of the restricted units for the term of the rent restriction to a condominium, stock cooperative, community apartment, or such other form of ownership which would eliminate the restricted units as rental units.