SEC. 16-410S.  AFFORDABLE HOUSING AGREEMENT AND EQUITY SHARING AGREEMENT.
   (A)   General requirements - No density bonus pursuant to section 16-410C shall be effective unless and until the affordable housing developer, or its designee approved in writing by the director, enters into an affordable housing agreement and, if applicable, an equity sharing agreement, with the city or its designee pursuant to and in compliance with this section. (Cal. Gov’t Code, Section 65915(c)) The agreements shall be in the form provided by the city which shall contain terms and conditions mandated by, or necessary to implement, State law and this article. The director may designate a qualified administrator or entity to administer the provisions of this section on behalf of the city. The affordable housing agreement shall be recorded prior to, or concurrently with, final map recordation or, where the qualified housing development does not include a map, prior to issuance of a building permit for any structure on the site. The director is hereby authorized to enter into the agreements authorized by this section on behalf of the city upon approval of the agreements by city attorney for legal form and sufficiency.
   (B)   Low or very low income minimum affordable housing component or senior citizen housing development -
      (1)   The affordable housing developer of a qualified housing development based upon the inclusion of low income and/or very low income affordable units for rent must enter into an agreement with the city to maintain the continued affordability of the affordable units for 55 years, or a longer period if required by the construction or mortgage financing assistance program, mortgage insurance program, or rental subsidy program, as follows (Cal. Gov’t Code, Section 65915(c)(1)). The agreement shall establish specific compliance standards and specific remedies available to the city if such compliance standards are not met. The agreement shall among other things, specify the number of lower-income affordable units by number of bedrooms; standards for qualifying household incomes or other qualifying criteria based upon the specific project; standards for maximum rents; the person responsible for certifying tenant incomes; procedures by which vacancies will be filled: required annual report and monitoring fees: restrictions imposed on lower-income affordable units on sale or transfer; and methods of enforcing such restrictions.
      (2)   Rental units - Rents for the low income and very low income affordable units that qualified the housing development for the density bonus pursuant to section 16-4I0C shall be set and maintained at an affordable rent. (Cal. Gov’t Code, Section 65915(c)(1))
      (3)   For-sale units - Owner-occupied low income and very low income affordable units that qualified the housing development for the density bonus pursuant to section 16-410C shall be available at an affordable housing cost. (Cal. Gov’t Code, Section 65915(c)(1)) For-sale very low, low and moderate units shall not have a term of affordability but shall be subject to an equity sharing agreement that meets the requirements of Cal. Gov’t Code, Section 65915(c)(2) unless the equity sharing agreement is in conflict with the requirements of another public funding source or law) (Cal. Gov’t Code, Section 65915(c)(2)).
      (4)   To qualify as a senior unit, at least 35 senior citizen housing development units are maintained and available for rent or sale to senior citizens as defined in Cal. Civil Code, Section 51.3.
   (C)   Moderate income minimum affordable housing component -
      (1)   The affordable housing developer of a qualified housing development based upon the inclusion of moderate income affordable units in a common interest development must enter into an agreement with the city ensuring that:
         (a)   The initial occupants of the moderate income affordable units that are directly related to the receipt of the density bonus are persons and families of a moderate income household.
         (b)   The units are offered at an affordable housing cost. (Cal. Gov’t Code, Section 65915(c)(2))
      (2)   The affordable housing developer of qualified housing development based upon a moderate income minimum affordable component shall enter into an equity sharing agreement for a common interest development with the city. (Cal. Gov’t Code, Section § 65915(c)(2)) The city shall enforce the equity sharing agreement unless it is in conflict with the requirements of another public funding source or law. (Cal. Gov’t Code, Section 65915(c)(2)) The equity sharing agreement shall include at a minimum the following provisions:
         (a)   Upon resale, the seller of the unit shall retain the value of improvements, the down payment, and the seller's proportionate share of appreciation. The city shall recapture any initial subsidy, as defined in division (C)(2)(b) below, and its proportionate share of appreciation, as defined in division (C)(2)(c) below, which amount shall be used within five years for any of the purposes described in Cal. Health and Safety Code, Section 33334.2(e) that promote home ownership. (Cal. Gov’t Code, Section 65915(c)(2)(A))
         (b)   The city's initial subsidy shall be equal to the fair market value of the unit 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 the resale shall be used as the initial market value. (Cal. Gov’t Code, Section 65915(c)(2)(B))
         (c)   The city's proportionate share of appreciation shall be equal to the ratio of the city's initial subsidy to the fair market value of the unit at the time of initial sale. (Cal. Gov’t Code, Section 65915(c)(2)(C))
   (D)   Minimum affordable housing component and child care facility - If an additional density bonus or incentive is granted because a child care facility is included in the qualified housing development, the affordable housing agreement shall also include the affordable housing developer's obligations pursuant to section 16-410I(A)(3) for maintaining a child care facility, if not otherwise addressed through conditions of approval.
(Ord. No. 2912)