(A) The occupancy and continuing availability of inclusionary units shall be provided for in the following manner:
(1) The number and type of rental inclusionary units and for-sale inclusionary units shall be determined for each application or approval under the standards of this chapter and set forth in the affordable housing agreement or development agreement as approved by the Board. On-site and off-site for-sale and/or rental inclusionary units shall be sold/rented only to eligible households and only to extremely low, very low, low, or moderate-income households, as applicable, at prices affordable to such households and pursuant to further requirements of resale restrictions, a promissory note, second deed of trust naming the county as beneficiary, deed restrictions and/or other documents pursuant to this chapter.
(2) Where the number of required moderate-income units is not a whole number, the fractional units required shall be added to the number of low-income inclusionary units required. If the resultant number of low-income units is not a whole number, the fractional units required shall be added to the number of very low-income inclusionary units required. Where (after any addition of fractional units under the preceding sentences) the number of very low-income inclusionary units required is not a whole number, the applicant shall include the next higher whole number of very low-income and inclusionary units or may apply to pay a fractional unit in-lieu fee in the amount provided in § 21.03.008.
(B) The initial maximum sale price of the inclusionary unit to the first purchaser shall be determined by the Director, pursuant to a method set forth in the Administrative Manual. Similar restrictions shall be required of subsequent owners at the time they acquire the unit. The initial maximum rental price of the rental inclusionary unit shall be determined by the Cal. Health and Safety Code related to Section 8 Rental Housing Assistance or by the Director pursuant to a method set forth in the Administrative Manual, or as established by ordinance.
(C) Resale value for an inclusionary for-sale unit. The maximum resale price shall be determined under the approved documents, consistent with the Administrative Manual and the following:
(1) The maximum permitted resale price of an inclusionary unit shall not be increased above the purchase price within one year of purchase.
(2) The maximum permitted resale price shall be the initial sale price of the inclusionary unit, increased at the same rate as the median income has increased, with the following modifications.
(3) Where an owner has lawfully added a bedroom to a for-sale inclusionary unit, the maximum resale price of the unit shall be calculated based on an assumed household size corresponding to the total number of bedrooms, including the added bedroom.
(4) The Administrative Manual and/or approved documents may provide for a ceiling which limits the resale price increases resulting from the modifications in divisions (C) and (D).
(D) Transfer. Transfer of a for-sale inclusionary unit to a child or stepchild upon the death of one or more of the prior owners shall be permitted without payment of any amount otherwise due to the county based on the sales price or appreciation of the unit, and without regard to any otherwise applicable preferences or waiting list priority for successor owners, if, but only if, the household of the child or stepchild would be eligible to purchase the unit and will occupy the unit. A child or stepchild, whether or not his or her household is income eligible or will occupy the unit and regardless of any otherwise applicable preferences or waiting list priority, shall be entitled to own and/or occupy a for-sale inclusionary unit after the death of the prior parent owner, for a period not to exceed one year, without regard to otherwise applicable resale requirements of this chapter but subject to any applicable provisions of the Administrative Manual or county documents regulating the project. Not later than the expiration of the one-year period, the unit shall be transferred to the child or stepchild (if the household is eligible and wishes to keep the unit) or shall be offered for sale in conformance with this chapter, with appropriate restrictions recorded against the unit under this chapter for the county’s benefit.
(E) Refinancing. For-sale inclusionary units may be refinanced, to the extent provided in the Administrative Manual. A separate notice of that restriction shall be recorded to prevent lenders from bypassing this requirement.
(F) Terms of affordability.
(1) New and existing for-sale inclusionary units. New and existing for-sale inclusionary units, affordability and occupancy restrictions shall remain in effect for 30 years and shall apply to any replacement structure or structures constructed if a structure containing an inclusionary unit or units is demolished or destroyed. If demolition or destruction of a structure containing inclusionary units occurs 30 years or more after recording of the restrictions and said demolition or destruction was unintentional, restrictions on the units in the structure shall terminate on demolition or destruction. Where a for-sale inclusionary unit is transferred and the new owner is required to enter into new regulatory documents under this chapter, the new regulatory documents will provide for an affordability period of 30 years.
(2) New and existing rental inclusionary units. New and existing inclusionary rental units, affordability and occupancy restrictions shall remain in effect for a minimum of 55 years and shall apply to any replacement structure or structures constructed if a structure containing an inclusionary unit or units is demolished or destroyed. If demolition or destruction of a structure containing inclusionary units occurs 55 or more after recording of the restrictions and said demolition or destruction was unintentional, restrictions on the units in the structure shall terminate on demolition or destruction.
(G) Maintenance. Regulatory agreements and recorded restrictions on resale shall include maintenance and insurance requirements for affordable units.
(H) Approval and recording of documents.
(1) The Director, in consultation with County Counsel, shall establish the form and content of agreements and restrictions authorized under this chapter. Regulatory agreements and resale restriction documents may provide for specific affordability and/or occupancy requirements for particular affordable units, consistent with this chapter and with the terms of the project’s affordable housing agreement. Restrictions on resale are required and shall be recorded against title to the affordable units and shall prohibit or limit leasing of inclusionary units.
(2) These documents shall be executed by the record owners of affected property, approved as to form by County Counsel and recorded in the official records of the county.
(I) Occupancy. Initial and subsequent occupancy of inclusionary units shall be in accord with conditions and requirements stated in the Administrative Manual.
(J) Marketing/selection of participants. The Administrative Manual shall set forth marketing and selection policies and/or procedures for inclusionary for-sale and rental units and identify county staff responsible for supervising marketing. If the county maintains an eligible list(s), it may select households first from an eligibility list for newly available affordable units prior to other applicants.
(K) Changes in a renter’s income. If the monitoring process conducted by county staff reveals that the income of the household occupying the inclusionary rental unit exceeds the maximum amount of income for the restricted unit for the specific household size, the renter-household can remain in the home for an additional year.
(L) Administrative Manual. The Board of Supervisors shall adopt and may from time to time amend an Administrative Manual, approved as to form by County Counsel, to establish guidelines to interpret and implement this chapter, including without limitation income and maximum asset guidelines for inclusionary units and units assisted by in-lieu fee proceeds. All mandatory provisions of the manual, when adopted, shall bind applicants and other private parties subject to this chapter. Maximum permitted sales prices shall be governed by the administrative manual. The Board of Supervisors shall conduct a duly noticed public hearing prior to the adoption or any amendment of the Administrative Manual.
(Ord. 951, § 1(part), 2016; Ord. 1,014, § 10, 2020; Ord. 1052, § 2, 2023)