Article 2 — Density Bonuses, Concessions and Other Incentives for

Lower and Very Low-Income Households and for Senior Housing.

The California Legislature has determined that the provision of housing for lower and very low income individuals and senior citizens is of primary importance in the state and must be encouraged at the local level. It is the purpose of this chapter to specify how compliance with Government Code Section 65915 et seq. ("state density bonus law") will be implemented, as required by Government Code Section 65915, subdivision (a). In enacting this chapter, the City of Visalia's intent is to facilitate the development of affordable housing, to implement the goals, policies, and actions of the housing element of the city's general plan and provide a framework as it relates to implementing affordable housing density bonuses and offering concessions/incentives for eligible housing developments. (Ord. 2021-08, 2021)

The definitions found in state density bonus law shall apply to the terms contained in this chapter. (Ord. 2021-08, 2021)

A. A housing development as defined in state density bonus law shall be eligible for a density bonus and other regulatory incentives that are provided by state density bonus law when the applicant seeks and agrees to provide very low, low or moderate income housing units, or units intended to serve seniors, transitional foster youth, disabled veterans, homeless persons, and lower income students in the threshold amounts specified in state density bonus law. A housing development includes only the residential component of a mixed-use project. A commercial development, as that term is defined in Section 17.32.220, shall be eligible for a commercial development bonus as provided in Section 17.32.220.

B. The granting of a density bonus, incentive or concession, pursuant to this chapter, shall not be interpreted, in and of itself, to require a general plan amendment, development code amendment, zone change, other discretionary approval, or the waiver of a city ordinance or provisions of a city ordinance unrelated to development standards. (Ord. 2021-08, 2021)

A. Any applicant requesting a density bonus and any incentive(s), waiver(s), parking reductions, or commercial development bonus provided by state density bonus law shall submit a density bonus report as described below concurrently with the filing of the planning application for the first discretionary permit required for the housing development, commercial development, or mixed-use development. The requests contained in the density bonus report shall be processed concurrently with the planning application. The applicant shall be informed whether the application is complete consistent with California Government Code Section 65943.

• B. The density bonus report shall include the following minimum information:

1. Requested Density Bonus.

a. Summary table showing the maximum number of dwelling units permitted by the zoning and general plan excluding any density bonus units, proposed affordable units by income level, proposed bonus percentage, number of density bonus units proposed, total number of dwelling units proposed on the site, and resulting density in units per acre.

b. A tentative map and/or preliminary site plan, drawn to scale, showing the number and location of all proposed units, designating the location of proposed affordable units and density bonus units.

• c. The zoning and general plan designations and assessor's parcel number(s) of the housing development site.

• d. Calculation of the maximum number of dwelling units permitted by the city's zoning regulations and general plan for the housing development, excluding any density bonus units.

e. A description of all dwelling units existing on the site in the five (5)-year period preceding the date of submittal of the application and identification of any units rented in the five (5)-year period. If dwelling units on the site are currently rented, income and household size of all residents of currently occupied units, if known. If any dwelling units on the site were rented in the five (5)-year period but are not currently rented, the income and household size of residents occupying dwelling units when the site contained the maximum number of dwelling units, if known.

f. Description of any recorded covenant, ordinance, or law applicable to the site that restricted rents to levels affordable to very low or lower income households in the five (5)-year period preceding the date of submittal of the application. g. If a density bonus is requested for a land donation, the location of the land to be dedicated, proof of site control, and reasonable documentation that each of the requirements included in California Government Code Section 65915, subdivision (g) can be met.

2. Requested Concession(s) or Incentive(s). In the event an application proposes concessions or incentives for a housing development pursuant to state density bonus law, the density bonus report shall include the following minimum information for each incentive requested, shown on a site plan if appropriate:

a. The city's usual development standard and the requested development standard or regulatory incentive.

b. Except where mixed-use zoning is proposed as a concession or incentive, reasonable documentation to show that any requested incentive will result in identifiable and actual cost reductions to provide for affordable housing costs or rents.

c. If approval of mixed-use zoning is proposed, reasonable documentation that nonresidential land uses will reduce the cost of the housing development, that the nonresidential land uses are compatible with the housing development and the existing or planned development in the area where the proposed housing development will be located, and that mixed-use zoning will provide for affordable housing costs or rents.

3. Requested Waiver(s). In the event an application proposes waivers of development standards for a housing development pursuant to state density bonus law, the density bonus report shall include the following minimum information for each waiver requested on each lot, shown on a site plan if appropriate:

a. The city's usual development standard and the requested development standard.

b. Reasonable documentation that the development standards for which a waiver is requested will have the effect of physically precluding the construction of a development at the densities or with the concessions or incentives permitted by California Government Code Section 65915.

4. Requested Parking Reduction. In the event an application proposes a parking reduction for a housing development pursuant to California Government Code Section 65915, subdivision (p), a table showing parking required by the zoning regulations, parking proposed under Section 65915, subdivision (p), and reasonable documentation that the project is eligible for the requested parking reduction.

5. Child Care Facility. If a density bonus or incentive is requested for a child care facility in a housing development, reasonable documentation that all of the requirements included in California Government Code Section 65915, subdivision (h) can be met.

6. Condominium Conversion. If a density bonus or incentive is requested for a condominium conversion, reasonable documentation that all of the requirements included in California Government Code Section 65915.5 can be met.

7. Commercial Development Bonus. If a commercial development bonus is requested for a commercial development, the application shall include the proposed partnered housing agreement and the proposed commercial development bonus, as defined in Section 17.32.220, and reasonable documentation that each of the standards included in Subsection 17.32.220(C) has been met.

8. Fee. Payment of any fee in an amount set by resolution of the city council for staff time necessary to determine compliance of the density bonus plan with state density bonus law.

(Ord. 2021-08, 2021)

All calculations are rounded up for any fractional numeric value in determining the total number of units to be granted, including base density and bonus density as well as the resulting number of affordable units needed for a given density bonus project.

A. If a housing development qualifies for a density bonus under more than one (1) income category, or additionally as a senior citizen housing development as defined in state density bonus law, or as housing intended to serve transitional foster youth, disabled veterans, homeless persons, or lower income students, the applicant shall identify the categories under which the density bonus would be associated and granted. Density bonuses from more than one (1) category can be combined up to the maximum allowed under state density bonus law.

B. The density bonus units shall not be included in determining the number of affordable units required to qualify a housing development for a density bonus pursuant to state density bonus law.

C. The applicant may elect to accept a lesser percentage of density bonus than the housing development is entitled to, or no density bonus, but no reduction will be permitted in the percentages of required affordable units contained in California Government Code Section 65915, subdivisions (b), (c), and (f). Regardless of the number of affordable units, no housing development shall be entitled to a density bonus of more than what is authorized under state density bonus law.

(Ord. 2021-08, 2021)

A. Incentives include incentives and concessions as defined in state density bonus law. The number of incentives that may be requested shall be based upon the number the applicant is entitled to pursuant to state density bonus law.

B. Nothing in this chapter requires the provision of direct financial incentives for the housing development, including, but not limited to, the provision of financial subsidies, publicly owned land, fee waivers, or waiver of dedication requirements. The city, at its sole discretion, may choose to provide such direct financial incentives. (Ord. 2021-08, 2021)

All requests for density bonuses, incentives, parking reductions, waivers, or commercial development bonuses shall be considered and acted upon by the approval body with authority to approve the development within the timelines prescribed by California Government Code Section 65950 et seq., with right of appeal to the city council.

A. Eligibility for Density Bonus, Incentive(s), Parking Reduction, and/or Waiver(s) for a Housing Development. To ensure that an application for a housing development conforms with the provisions of state density bonus law, the staff report presented to the decision-making body shall state, or the city planner shall make a determination if it is within their authority to approve the development, whether the application conforms to the following requirements of state law as applicable:

1. The housing development provides the affordable units or senior housing required by state density bonus law to be eligible for the density bonus and any incentives, parking reduction, or waivers requested, including the replacement of units rented or formerly rented to very low and low income households as required by California Government Code Section 65915, subdivision (c)(3).

2. Any requested incentive will result in identifiable and actual cost reductions to provide for affordable housing costs or rents; except that, if a mixed-use development is requested, the application must instead meet all of the requirements of California Government Code Section 65915, subdivision (k)(2).

3. The development standards for which a waiver is requested would have the effect of physically precluding the construction of a development at the densities or with the concessions or incentives permitted by California Government Code Section 65915.

4. The housing development is eligible for any requested parking reductions under California Government Code Section 65915, subdivision (p).

5. If the density bonus is based all or in part on donation of land, all of the requirements included in California Government Code Section 65915, subdivision (g) have been met.

6. If the density bonus or incentive is based all or in part on the inclusion of a child care facility, all of the requirements included in California Government Code Section 65915, subdivision (h) have been met.

7. If the density bonus or incentive is based all or in part on the inclusion of affordable units as part of a condominium conversion, all of the requirements included in California Government Code Section 65915.5 have been met.

B. If a commercial development bonus is requested for a commercial development, the decision-making body shall make a finding, or the city planner shall make a finding if it is within their authority to approve the development, that the development complies with all of the requirements of Subsection 17.32.220(C), that the city has approved the partnered housing agreement, and that the commercial development bonus has been mutually agreed upon by the city and the commercial developer.

ion-making body shall make a finding, or the city planner shall make a finding if it is within their authority to approve the development, that the development complies with all of the requirements of Subsection 17.32.220(C), that the city has approved the partnered housing agreement, and that the commercial development bonus has been mutually agreed upon by the city and the commercial developer.

C. The decision-making body, or the city planner if it is within their authority to approve the development, shall grant an incentive requested by the applicant unless it makes a written finding, based upon substantial evidence, of any of the following:

1. The proposed incentive does not result in identifiable and actual cost reductions to provide for affordable housing costs, as defined in California Health and Safety Code Section 50052.5, or for affordable rents, as defined in California Health and Safety Code Section 50053;

2. The proposed incentive would be contrary to state or federal law; or

3. The proposed incentive would have a specific, adverse impact upon public health or safety or the physical environment or on any real property that is listed in the California Register of Historic Resources, and there is no feasible method to satisfactorily mitigate or avoid the specific adverse impact without rendering the housing development unaffordable to low and moderate income households. For the purpose of this subsection, specific adverse impact means a significant, quantifiable, direct, and unavoidable impact, based on objective, identified, written public health or safety standards, policies, or conditions as they existed on the date that the application for the housing development was deemed complete.

D. The decision-making body, or the city planner if it is within their authority to approve the development, shall grant the waiver of development standards requested by the applicant unless it makes a written finding, based upon substantial evidence, of any of the following:

1. The proposed waiver would be contrary to state or federal law; or

2. The proposed waiver would have an adverse impact on any real property listed in the California Register of Historic Resources; or

3. The proposed waiver would have a specific, adverse impact upon public health or safety or the physical environment, and there is no feasible method to satisfactorily mitigate or avoid the specific adverse impact without rendering the housing development unaffordable to low and moderate income households. For the purpose of this subsection, specific adverse impact means a significant, quantifiable, direct, and unavoidable impact, based on objective, identified, written public health or safety standards, policies, or conditions as they existed on the date that the application for the housing development was deemed complete.

E. If any density bonus, incentive, parking reduction, waiver, or commercial development bonus is approved pursuant to this chapter, the applicant shall enter into an affordable housing agreement or senior housing agreement with the city pursuant to Section 17.32.205.

(Ord. 2021-08, 2021)

A. Affordable Housing Agreement. Except where a density bonus, incentive, waiver, parking reduction, or commercial development bonus is provided for a market rate senior housing development, the applicant shall enter into an affordable housing agreement with the city, in a form approved by the city attorney, to be executed by the city manager, to ensure that the requirements of this chapter are satisfied. The affordable housing agreement shall guarantee the affordability of the affordable units for a minimum of fifty-five (55) years or a longer period of time if required by the construction or mortgage financing assistance program, mortgage insurance program, or rental subsidy program; shall identify the type, size and location of each affordable unit; and shall specify phasing of the affordable units in relation to the market rate units.

B. Senior Housing Agreement. Where a density bonus, waiver, or parking reduction is provided for a market rate senior housing development, the applicant shall enter into a restrictive covenant with the city, running with the land, in a form approved by the city attorney, to be executed by the city manager, to require that the housing development be operated as "housing for older persons" consistent with state and federal fair housing laws.

C. The executed affordable housing agreement or senior housing agreement shall be recorded against the housing development prior to final or parcel map approval, or, where a map is not being processed, prior to issuance of building permits for the housing development. The affordable housing agreement or senior housing agreement shall be binding on all future owners and successors in interest.

• D. The affordable housing agreement shall include, but not be limited to, the following:

1. The number of density bonus dwelling units granted;

2. The number and type of affordable dwelling units

3. The unit size(s) (square footage) of target dwelling units and the number of bedrooms per target dwelling unit;

4. The proposed location of the affordable dwelling units;

5. Schedule for production of affordable dwelling units;

6. Incentives or concessions or waivers provided by the city;

7. Where applicable, tenure and conditions governing the initial sale of the affordable units;

8. Where applicable, tenure and conditions establishing rules and procedures for qualifying tenants, setting rental rates, filling vacancies, and operating and maintaining units for affordable rental dwelling units

9. Marketing plan; publication and notification of availability of affordable units;

10. Compliance with federal and state laws;

11. Prohibition against discrimination;

12. Indemnification;

13. City's right to inspect units and documents;

14. Remedies;

15. Attorney(s) fees provision.

• (Ord. 2021-08, 2021)

A. The city may not issue building permits for more than fifty percent (50%) of the market rate units until it has issued building permits for all of the affordable units, and the city may not approve any final inspections or certificates of occupancy for more than fifty percent (50%) of the market rate units until it has issued final inspections or certificates of occupancy for all of the affordable units.

B. Affordable units shall be comparable in exterior appearance and overall quality of construction to market rate units in the same housing development. Interior finishes and amenities may differ from those provided in the market rate units, but neither the workmanship nor the products may be of substandard or inferior quality as determined by the city.

C. The number of bedrooms of the affordable units shall at least equal the minimum number of bedrooms of the market rate units.

(Ord. 2021-08, 2021)

• A. The following definitions shall apply to commercial density bonus:

1. "Commercial development" means a development project for nonresidential uses.

2. "Commercial development bonus" means a modification of development standards mutually agreed upon by the city and a commercial developer and provided to a commercial development eligible for such a bonus under Subsection 17.32.220(C). Examples of a commercial development bonus include an increase in floor area ratio, increased building height, or reduced parking.

3. "Partnered housing agreement" means an agreement approved by the city between a commercial developer and a housing developer identifying how the commercial development will provide housing available at affordable ownership cost or affordable rent consistent with Subsection 17.32.220(C). A partnered housing agreement may consist of the formation of a partnership, limited liability company, corporation, or other entity recognized by the state in which the commercial developer and the housing developer are each partners, members, shareholders, or other participants, or a contract between the commercial developer and the housing developer for the development of both the commercial development and the housing development.

B. When an applicant proposes to construct a commercial development and has entered into a partnered housing agreement approved by the city, the city shall grant a commercial development bonus mutually agreed upon by the developer and the city. The commercial development bonus shall not include a reduction or waiver of fees imposed on the commercial development to provide for affordable housing.

C. The requirements for commercial development bonus are as follows, which also be described in the partnered housing agreement:

1. The housing development shall be located either: (A) on the site of the commercial development; or (B) on a site within the city that is within one-half mile of a major transit stop and is located in close proximity to public amenities, including schools and employment centers.

2. At least thirty percent (30%) of the total units in the housing development shall be made available at affordable ownership cost or affordable rent for low-income households, or at least fifteen percent (15%) of the total units in the housing development shall be made available at affordable ownership cost or affordable rent for very low-income households.

3. The commercial developer must agree either to directly build the affordable units; donate a site consistent with Subsection 17.32.220(C)(1) above for the affordable units; or make a cash payment to the housing developer for the affordable units.

D. Any approved partnered housing agreement shall be described in the city's housing element annual report as required by California Government Code Section 65915.7, subdivision (k). (Ord. 2021-08, 2021)

If any portion of this chapter conflicts with state density bonus law or other applicable state law, state law shall supersede this chapter. Any ambiguities in this chapter shall be interpreted to be consistent with state density bonus law. (Ord. 2021-08, 2021)