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HomeMy WebLinkAboutInclusionary Housing Program / Affordable Housing Program - �vUr�t 2 0&cc c o/2 5 N l IIJCL I)S 10AMI �/G05IA)6� i OG 'ZAN 4L S14X,Lt--- &6 O/V"J / C�ko��� -7-0�1- OoNIUIP-:7 IWJ -1- 00 IUO-7- JWD C-hlU NO �� l�`� 7v VAX eF/2 �f/� ZIA �J. /Vo ,tl&/ kr �--7 �4s C- 1A) 1VG i OS-/ 0 1= �Z ec3) OR RP FWANCZ� , MARCH OF 26nel-,F (2 NvV(2 of r-Fo-R DA[-S/4-1 ; ON �AF� 14i )ly WL'�7- 2EVET A7-�-td-Z�7 7-11'�L- cF- OF o oR lSko2 E�4/'- 0 2 -2o �uivr»y M I I( 1 01 d (> 0 Box 190 Paul D Alessandro Asmstint C ity Attoincy ��ounir �a� 2000 M tin StrECt Scott Field Assistlnt City Attorney Neal Moore Sr Deputy City Attorney Flanhn ton Beech Cnl►forn►� 92648 Leome Ntulvdull Sr Deputy City Attorney lennrfer NI C1 lth Iciephone (711) 536 5)5) John Fop Sr Deputy ON Attorney Clt� Attonie% 1 icsitnil (714)371 1590 Daniel K Ohl Deputy City Attorney Sarah Sutton Deputy City Attorney Mike Vighotta Deputy City Attorney July 19 2010 Mr Robcit Johnson 18862 Cook% rtet I lnc I1>intlugron FCC rCl C � 92641 Re A,cc et al i CM of Mintui'ton Beach, e/al , Request to Refin >tnee your Property De it RobLi t It is my understanding th-it you rtc seeking to iefmance your home Because the Resale Restrictions m favor of the City h-ive been recorded against your unit, your lender is insisting that the City agree to subordinate the Resale Restrictions to any new loan that it makes on your property ( Suboidmation means that the city has agreed that if the new forecloses on your property the lender would t-ike thL unit free and clear of the Resale Restrictions ) As the City has consistently done. with ill other homeowners in Cape Ann who seek either to sLll or refinance their homes the City requires that the enclosed Notice of Affordability Restrictions on Tiansfer of Property be iecoided against your property as a condition of subordination Zhe purpose of the Notice is to confirm your knowledge that your home is subject to the Resale Restrictions In response to your lawsuit the Notice includes a paragraph explaining the impact that the use of interest rates on the resale price formula In the lawsuit, the Plaintiffs (like yourself) complained that they never understood the fact that when interest rates increase, the resale price decreases and when interest rates fall the resale price rises Consequently, the Notice of Affordability Restrictions now explains that fact When the other pl untifts in the lawsuit dismissed their claims against the City with very few Lxceptrons they Lath signed Notices of Affordability Restrictions identical to the on enclosed However Robert you are still suing the City and you are asking the Superior Court to terminate or modify in some way the Resale Restrictions Consequently I am writing this letter to explain th it if you proceed with the refinancing and sign the Notice of Affordability Restrictions, I will argue to Judge Colaw th it you have effectively dismissed your case by acknowledging in the Notice the Affordability Restrictions apply to your unit Accordingly if you still -,ish to tefln ince your home I strongly suggest that you consult with -in ittorncy and obt3rn legal -ids icc is to what impact executing the Notice of Affordability 19916 MI Rob"It lohntion iuly 19 2010 1' 1(c 2 Restnction5 Nvill h rvc on the pcndin- 1 ivo mt In the meanwhile until you notify nie that you agicc to sign the Notice the ( itv will not process refinancing Fin illy if you choose not to rchii lncc plc isc, let me know so that 1 can arrange to refund you the $250 application fcc v ou p iid to piocc�s the refinancing Smccrcly SC 01 1 1 ILLD Assistant C itN nttoriicy S1/tv c Bonmc Levesquc John 1 ujii Denise B izant 49916 t 7,1 77 7 C. t 1,r :-.h 1 i � '.t � � f��a I -•J R� :ne �e'. � 1��,4�"�.r 3*+.� } C ,.;i /r �,j , _. 3 Your Property subject'♦ ec o an AffordalSility Covenant I! -:1 •[1: ,o i. _ PMperty May ,., be sold to, at what price, and ft terms and conditions of any financingfrefinancing The Aftrdat"lity Covenant fimift ft maximum sales price to less than ds taw market value On the open market, and potentially less ftn the amount of any outstwx"loans on the ftpGrty The maximum sales pnoe also decreases as prending interest rates mcresse In addition if you have boffowed money ftm the City or Redevelopinent Agency, then Me r.. •, ar f deed on your .' •.♦-peer in an amount that exceeds the ► tire'.: ♦.ing balance tnggws payment of ft equity sham under the Uy or Agency Loan Most lenders*#AN not loan money to purcMse or reffnance a hme unless the pn3pe*vAll be ftw of ft Afk"sbky Covenant if the IerKW fomdoses The City YAR agree to place ft Aftrdatmlfty Cvvenant in seomW position to the lender(that is,to asuborcrinate") subpct to certain conditioris The fn*stop in obtwnmg ft Citys subordinaWn a completing this -Subfnftb fee �• 4 IMP n�MWO.f • 1 1 � � i �P tl`R � � 1�5� , l •::1 6 r= } t I • �► IM E 'Inclusionary Housing Program Application r Subordination City of Huntington Beach Department of Economic Development ECEIVEE 2000 Main Street, 5' Floor Huntington Beach, California 92648 (714) 536-5901 Phone PEAR 2 5 2004 (714) 375-5087 FAX DEPAF°rVENT( i9€ DL%/ELOis 7B7oVame(s) Property Address -N- s 5 nsaw--\ k 6 8(0 2 G t WoAe- - o,lne "�Sohr\��- Flew Loan(s) Name of�^Lender Loan Amount Loan 1 L.0 \r\ L\�V� r Nv,\aAci0.\ ����CPS $__�j�� 0D Loan 2 (please write name of lender as it should appear on the subordination agreement) Loan(s)to be Paid Off t Name of Lender Payoff Amount Loan *1 13 Ntk�0 $32 I o Loan 2 W \(-, Ac)y\\ \ A\\qa?-.)av\V\ $ _2 LA 4 S S(0 Proposed Debt to Value Ratio(90°/m max allowed for 1 senior Anticipated Date of Escrow Closing lien 80%max allowed for 2 senior liens) -12). 5tS LA - S -O`A Proposed Debt to Income Ratio If necessary questions regarding this application should be addressed to L4 LI*t_{ -1 O Vic , sS 0 BSc cow °t°-t9 S So q-t(D Lender/Broker Contact Information Escrow Contact Information Name VX6,ve-Y1 1JV2��O1(� --� nn Name (Y\\c\AeA�C. Company Loc � CLL.0 �4�� �� VZC l Company 1 Y1'S Address 3� �O�.J�c�Q�,l , 5%-K1k0- 20� Address 23�b� Lo`*,p C2u�Q11 Phone C�411_ 360 Phone 'l yvk 32© c-,o Fax " `-i- b Lt 3- N s Fax q yq S 8-A- 9(0 S 1 Loan#- (ny 3$p0 b G p Escrow# ©� Page 1 of 2 e e Please attach the following required documents Homeowner Occupancy Certification (City Form) Title Report [ Clean Copy of Property Legal Description Estimated Escrow Settlement Statement $250 Subordination Fee Payable to the City of Huntington Beach YN (please note that payment is required at time of application) For refinances with cash-out to the borrower(s), please attach the following Appraisal �] Loan Underwriting Analysis o ®® e P Applications should be sent to Attn Steve Holtz, Assistant Project Manager City of Huntington Beach Economic Development Department 2000 Main Street, 5"' Floor Huntington Beach, California 92648 PLEASE NOTE THAT FAXES MILL NOT BE ACCEPTED Completed Subordination Agreements will be released ONLY to escrow companies licensed to do business in California Please allow 10 business days for the City to review your application Upon approval of your request,the City will prepare a subordination agreement Please indicate how the completed agreement should be delivered to escrow ❑ Call escrow company for pickup by courier ❑ Mail to escrow company via Airborne Express account number Use enclosed, pre addressed postage-paid envelope Page 2 of 2 Recording Requested By Redevelopment Agency of the City of Huntington Beach 2000 Main Street Huntington Beach, California 92648 Attention Economic Development Dept /Housing Div SPACt AI30VF THIS LINE FOR RECORDER S USE NOTICE OF AFFORDABILITY RESTRICTIONS ON TRANSFER OF PROPERTY (Cape Ann) NOTICE IS HEREBY GIVEN by Bonnie Levesque, a single woman, and owner as a joint tenant with Robert Johnson, a single man, of the property located at 18862 Coolwater Lane, Huntington Beach, CA 92648, Huntington Beach, California 92648 and more particularly described in Exhibit "A" attached hereto (the "Property"), that I A "Declaration of Conditions, Covenants and Restrictions for Property" was recorded on March 23, 1999, as Instrument No 19990214033 in the Office of the County Recorder of the County of Orange, California (the "Resale Restrictions") Among other things, the Resale Restrictions limit the price that the Property may be sold at an "Affordable Sale Price" for a "Moderate Income Household" as those terms are defined in the Resale Restrictions, and further defined in the current Affordable Regulations of the City of Huntington Beach 2 In summary, the term "Affordable Sale Price" means that purchase price which would result in monthly housing payments which do not exceed Thirty-Five Percent (35%) of One Hundred Twenty Percent (120%) of the current Orange County monthly median income for a household equal to the number of bedrooms in the unit plus one (1) person In determining monthly housing payments, the City will assume principal Page 1 of 2 49922 doc and interest payments on a conventional home mortgage after paying a ten percent (10%) downpayment The mortgage interest rate will be the prevailing Fannie Mae thuty (30) year mortgage rate, or a City-selected equivalent Monthly housing costs will also include homeowner's association dues, utilities, homeowner's insurance, maintenance costs and property taxes The effect of relying on prevailing interest sates to determine the Affordable Housing Cost is to make the resale price of the Property sensitive to mteiest rates For example, if interest rates rise, the resale price will fall, and if interest rates fall, the resale price will rise This could result m the Affordable Housing Cost decreasing below the original purchase price 3 The Resale Restrictions imposed on the Property will expire on March 29, 2029 Dated Bonnie Levesque Dated Robert Johnson Page 2 of 2 49922 dog 1 Robert Johnson 2009 DEC 14. P IN, : 53 2 In Pro Per r i 3 18862 Coolwater Ln. 4 Huntington Beach,Ca.92648 5 H. (714)596-2543 C. (714)362-6051 6 7 SUPERIOR COURT OF CALIFORNIA 8 IN AND FOR THE COUNTY OF ORANGE CIVIL COMPLEX CENTER 9 BARBARA L.AGEE,el al., ) CASE NO.06CC00125 10 Plaintiffs, ) Judge Thierry Patrick Colaw 11 v. ) Dept.CX-104 12 CITY OF HUNTINGTON BEACH,et,al., ) Complained filed June 23,2006 13 Defendants ) 14 ) Date: Dec.07,2009 15 To: All parties and to their attorneys of record: 16 Please take notice of Filling Declaration in Support of Order to allow Robert Johnson(plaintiff)to not have to 17 electronically file(E-File) court papers and documents. 18 19 YOUR HONOR: 20 We have a computer at our condo and it is Bonnies son. He moved out and it is not working. I have no reason 21 to learn to use the computer except for this case. Please allow me to be excused from e-filling,so I have one less 22 thing to do before the trial. 23 Thank you. 24 25 26 27 28 1 Robert Johnson 2609 D 14 : 5 In Pro Per 2 i 3 18862 Coolwater Ln 4 Huntington Beach,Ca.92648 5 H.(714)596-2543 C.(714)362-6051 6 7 SUPERIOR COURT OF CALIFORNIA 8 IN AND FOR THE COUNTY OF ORANGE CIVIL COMPLEX CENTER 9 BARBARA L.AGEE,el at., ) CASE NO.06CCO0125 10 Plaintiffs, ) Judge Thierry Patrick Colaw 11 v. ) Dept.CX-104 12 CITY OF HUNTINGTON BEACH,et,at., ) Complained filed June 23,2006 13 Defendants ) 14 ) Date: Dec.07,2009 15 Your Honor: 16 I. I would like to file a motion to reopen discovery. 17 II. The specified grounds to reopen discovery are as follows: 18 1) According to our lawyers our case with the city was in its early stages when our council decided to 19 withdraw. 20 2) New evidence that has come up that I would like to present to the court. 21 22 23 24 25 26 27 28 9 PrOgr • - : Incusionary Housing -7 Proposed Huntington Beach City Council Study Session January 20, 2009 'e Study Session Focus What are the major components of the City's Inclusionary Housing Program? • What significant changes are proposed for the program? 77-7--7 I., January 20,2009 Keyser Marston Associates Page 2 i - �� - Aco Inclusionary Housing Program Background • The State adopts Regional Housing Needs Assessment (RHNA) goals for the City. • The Housing Element of the General Plan must show how the RHNA goals can be met. -- • One tool is an inclusionary housing policy. January 20,2009 Keyser Marston Associates Page 3 Inclusionary Housing Program Background ;_. • Inclusionary housing requirements imposed by the �r City beginning in early 1990's. • The requirements are imposed on projects with F- three or more units. • Goal is to fulfill both RHNA and redevelopment _ agency production requirements. _. • Formal Policies & Procedures adopted 2004. January 20,2009 Keyser Marston Associates Page 4 • 2 Goals for Program Modifications • Clarify the program requirements. • Simplify the process for developers and occupants. -= • Modify terms to reflect current issues and best practices. January 20,2009 Keyser Marston Associates Page 5 • Inclusionary Housing: Points in Time 4 l • A developer builds the project. • A home buyer purchases a home. • The home owner lives in the home. • The home owner sells the home. --- January 20,2009 Keyser Marston Associates Page 6 3 • A Developer Builds the Project - — January 20,2009 Keyser Marston Associates Page 7 • i 3 Affordable Housing Percentage • Current Requirement: Base affordable housing requirement is 10% of units. __== • Proposed Requirement: Increase m _ requirement to 15% of units for projects located in a redevelopment project area. January 20,2009 Keyser Marston Associates Page 8 i 4 • Off-Site Fulfillment • Current Requirement: Developers have - = option to provide units off site in new or existing units. • Proposed Requirement: Restrict off-site development to net new units or "substantial rehabilitation" of existing units. January 20,2009 Keyser Marston Associates Page 9 __ s In-Lieu Fee Payment • Current Requirement: In-lieu fee can be paid for projects with three to nine units. • Proposed Requirements: e . Increase threshold project size to 30 units. ■ Allow fee for fractional unit requirement. January 20,2009 Keyser Marston Associates Page 10 5 • In-Lieu Fee Schedule • Current Requirement: City Council has approved fee schedule for three to nine units. ___ • Proposed Requirement: City Council may approve a fee schedule for 10 to 30 unit projects. --_ _- January 20,2009 Keyser Marston Associates Page 11 Income & Affordability Standards • Current Requirements: . Rental: very-low and low income . Ownership: low, median and moderate income • Proposed Requirements: . Rental: Base requirement is low income; = moderate income allowed for on-site units . Ownership: moderate income -_- _- January 20,2009 Keyser Marston Associates Page 12 6 Income & Affordability Covenants • Current Requirement: Base requirement is 60 years; there are some exceptions for older proj ects. • Proposed Requirement: . Rental: 55 years . Ownership: 45 years January 20,2009 Keyser Marston Associates Page 13 • Other Proposed Changes that Impact Developers • On a one-year trial basis, in-lieu fees can be paid at w = project completion. • Affordable unit bedroom mix must be proportionate to the market rate mix, but the smallest plans in less _ desirable locations can be used. • The Planning Director can make minor modifications to the affordable housing mix approved as part of the project entitlements. January 20,2009 Keyser Marston Associates Page 14 7 y � A Home Buyer Purchases a Home January 20,2009 Keyser Marston Associates Page 15 Household Income -_ - Measurement _.--== • No change is proposed to the methodology: . The income standards are defined in the California Health and Safety Code. . The home buyer's assets prior to the purchase __- - cannot exceed 50% of the home's value. Retirement funds are not included in the formula. — January 20,2009 Keyser Marston Associates Page 16 8 r Affordable Sales Price Calculation • Units must be sold at affordable housing cost for City to get RHNA credit and for Agency to get _=== inclusionary housing production credit. • Affordable housing cost is defined to include all _= housing related expenses. -- • Affordable housing cost is based on a defined =_ .. formula, not based on the actual home buyer. January 20,2009 Keyser Marston.Associates Page 17 Affordable Sales Price Calculation • Housing related expenses include: . Mortgage debt service ------------ . Property taxes Property insurance . Utilities . Maintenance . Home owners association dues -- January 20,2009 Keyser Marston Associates Page 18 9 Affordable Sales Price Calculation _. • The interest rate applied to the mortgage is a key affordable housing cost component. T - ■ Current Requirement: The interest rate used in == the calculation is set daily. Proposed Requirement: The interest rate will be set quarterly at the average rate. - January 20,2009 Keyser Marston Associates Page 19 Affordable Sales Price Calculation _____' • No change is proposed to the methodology. - . Methodology is defined by California Health and _ = Safety Code Section 50052.5. . Actual mortgage debt service & home buyer -- down payment will vary from unit-to-unit. January 20,2009 Keyser Marston Associates Page 20 10 i Affordable Sales Price: Sample Calculation (3-Bdrms) Housing Expenses Monthly Annually -may HOA $150 $100 Utilities 143 1,716 Insurance 75 900 Maintenance 50 600 Property Tax 326 3,910 _. Total Expenses $744 $8,926 January 20,2009 Keyser Marston Associates Page 21 Affordable Sales Price: Sample Calculation (3-Bdrms) Median Income (4 Persons) $845100 -= % of Median Income 110% Applicable Household Income $92,510 =- Income Allotted to Housing 35% =e=- : Income Available for Housing $32,380 January 20,2009 Keyser Marston Associates Page 22 • 11 _ Affordable Sales Price: Sample Calculation (3-Bdrms) ----= Income Available for Housing $32,380 -« Total Expenses 89930 Available for Debt Service $239450 Applicable Interest Rate 6% - Supportable Mortgage $3251,900 January 20,2009 Keyser Marston Associates Page 23 • Affordable Sales Price: Sample Calculation (3-Bdrms) Supportable Mortgage $325,900 As % of Affordable Price 90% -- Affordable Sales Price $3621,100 n Benchmark Down Payment 10% - - January,20,2009 Keyser Marston Associates Page 24 12 Actual Home Buyer Down Payment • No change is proposed to the methodology. . The actual home buyer down payment must equal at least 5% of the purchase price and no more than 50% of the purchase price. . The actual down payment amount has no impact on the affordable sales price. It will impact the required mortgage amount. January 20,2009 Keyser Marston Associates Page 25 Other Proposed Changes that Impact Home Buyers _= • The Affordable Sales Prices for units will be published by the Agency each quarter. • Home buyers may purchase durable goods from the seller at a cost of no more than $500 per item. • For disclosure purposes, each home buyer will receive a copy of the Policies & Procedures manual. _ January 20,2009 Keyser Marston Associates Page 26 13 • The Home Owner Lives in the Home r7-777-7-7 - January 20,2009 Keyser Marston Associates Page 27 Owner Occupancy Requirements ---- - - , • Current Requirement: Participants must occupy the home as their primary residence. • Proposed Requirements: Hardship provision is added: . Defined as temporary job relocation, family illness or -N-= medical necessity. -- Allows for unit to be rented for one year at affordable rent for same income level as covenant. --- January 20,2009 Keyser Marston Associates Page 28 14 _ = Refinancing Restrictions • No change is proposed to the methodology: _ ■ Homes can be refinanced for better interest rate or repayment terms. =- ■ Maximum loan set at lesser of affordable housing cost or 95% of market value. ■ No cash out allowed if the affordability restrictions are subordinate to the financing. =_ January 20,2009 Keyser Marston Associates Page 29 • f Inheritance • Current Requirements: — - ■ Transfer to spouse allowed in all cases,and transfer to other family v members allowed if they meet the household income restrictions. ■ New owner must occupy the home as their primary residence. Proposed Requirements: ■ Transfer allowed in all instances. T ■ New owner may rent the unit for one year at same income level as -- -- affordability restriction. -=A ■ Resale is subject to the original income&affordability restrictions. January 20,2009 Keyser Marston Associates Page 30 15 V77--1 New Monitoring &ri 5 Enforcement Documents M • Recorded Notice of the Affordability Covenant. • Promissory Note equal to the difference between the original market price & Affordable Sales Price. • Deed of Trust securing the obligations. • Special disclosure stating that home buyer has received the Policies & Procedures manual, and has rr had the opportunity to ask questions about the terms and policies. January 20,2009 Keyser Marston Associates Page 31 F < w New Enforcement Measures • Civil citations with monetary penalties for violations of affordable housing restrictions. • Ongoing maintenance of a covenant database. • Annual review of County Assessor's records for title changes and homeowner exemption claims. January 20,2009 Keyser Marston Associates Page 32 16 New Enforcement Measures • Annual notice to program participants to verify owner occupancy. • Quarterly Affordable Sales Price calculation distributed to program participants. Workshops with home owners and real estate brokers at the large inclusionary projects. January 20,2009 Keyser Marston Associates Page 33 e The Home Owner Sells Home January 20,2009 Keyser Marston Associates Page 34 17 { Treatment of Capital Improvements • No change is proposed to the methodology. Capital improvements are allowed without limitation. . Resale price is capped at lesser of the then current Affordable Sales Price and market rate sales price. . Allowable sales price may be less than home owners original purchase price plus investments in capital improvements. January 26,2009 Keyser Marston Associates Page 35 Duration of Income & t Affordability Restrictions • Current Requirement: The restriction period restarts to Year 1 each time the unit resells. • Proposed Requirement: The restriction period will be fixed at the original term. For example, an ownership covenant will expire 45 years following its original execution. January 20,2009 Keyser Marston Associates Page 36 18 t Equity Share Upon Resale • No change is proposed to the methodology. . Inclusionary units are counted towards the City's RHNA requirements and the Agency's affordable housing production requirements. . Both the City and Agency requirements can only be fulfilled with units subject to long-term - affordability. January 20,2009 Keyser Marston Associates Page 37 77 a E Equity Share Upon Resale � . If equity share on resale is allowed, the unit will be resold at the market rate price. . The City and Agency will lose an affordable unit credit. == m Lenders limit the amount of appreciation that can be captured by the City/Agency. The funds are = insufficient to replace the lost unit. January 20,2009 Keyser Marston Associates Page 38 19 Equity Share Upon Resale ■ Inclusionary program is intended to create affordable home ownership opportunities. Home owner was able to purchase the home at a discounted price. ■ With equity sharing, home owner has the potential to achieve a windfall profit upon resale. January 20,2009 Keyser Marston Associates Page 39 20 1/19/2009 RECEIVED FROM COUNCI MEETING AS PUBLIC COR OF 9 • ITY CLERK OFFICE N L.FLYNN,CMCLEW Cape Ann ments Other Develoo. � F3 r i • 1 1/19/2009 - , Y� Introduction • The Cape Ann homeowners have been seeking to change unfair and arbitrary policies, procedures, and management of Huntington Beach's Inclusionary Housing program for the past a lh years. • During that time,we have offered many times to sit down with staff and discuss the problems with the program. We have many creative ideas on how things can be fixed. But the city attorneys have informed us that the City will never, ever change the program. We hope that through this Study Session the City Council is now considering addressing the many problems that have come to light. ZN R ntroduction, con't •At the October 6, 20o8 City Council meeting, then Mayor Debbie Cook said she didn't think she was alone in "not understanding . . . Cape Ann." •At that point we we realized that perhaps the City Council was not being properly apprised of the problems that exist with the program (despite the on-going litigation). i 1 1/19/2009 • 41 ---- y , r Introduction, cont. • Since then, Cape Ann owners have presented comments at City Council meetings in an effort to raise the City Council's awareness of the flaws and inequities in the current affordable housing program • Those comments have conveyed many personal stories; tonight, however, we would like to list some of the problems with the program. In addition, our attorneys have prepared a letter detailing some of our concerns. :. ��� Introduction, cont. • Many of the possible solutions we propose to the problems that plague this program were found through researching other affordable housing programs in the state of California. This proves that these solutions do work and can be implemented. • 2 1/19/2009 ntroduction, cont. • We had difficulty commenting on this because it was unclear from Staff's written presentation whether the proposed changes would apply to the residents of Cape Ann, or if the changes are only applicable to homes that fall under the new program as outlined in Ordinance No. 3764. • You as City Council members may not even be aware that there are two different affordable housing programs currently in place. The program that existed prior to the adoption of Ordinance No. 3764 (and continues to exist) and the program created by the Ordinance. • • 3 1/19/2009 • The Problems • • 1 1/19/2009 41 1. Pricing and the Resale Formula • The formula that is used to compute the price that each unit can be resold has no connection to the real estate market • It is governed by daily changes in mortgage interest rates, meaning the condo price acts like a bond rather than normal real estate. • The resale pricing procedures do not allow owners to recoup ANY monies spent upgrades, repairs, or lot premiums. • Unlike other programs, the City's program does not place a floor on the price, so the value can actually drop below what the owner paid for it even if the real esatte market is booming. 1 1/19/2009 2. Inability to Leave the Home to Heirs • The current program does not allow current owners to leave the home to heirs in the event of the owner's death unless the heirs qualify under the program. s 3. The Affordability Period • Page 1 paragraph 1 of the CC&R Resale Restrictions (Attachment`A") that are recorded on Cape Ann homes state that the Affordability Period runs for "thirty(30) years from date the first certificate of occupancy is issued for a condominium unit in the Property (he `Expiration Date').." • Since the certificate of occupancy for the first home in Cape Ann was issued in 1999, the affordability period should expire in zoz9 for all Cape Ann homes. • 2 1/19/2009 3. cont. • However, according to the information posted on the City's website (http://www ci.huntingto on- beach.ca.us/files/users/economic developmen t/affordable housing_list.pdf), the affordability period for many of the units expire as late as zo36. This is in direct conflict with the information in the CC&Rs that were recorded. IN - � 1" 3. cont. • In addition, the expiration of the affordability, period as published on the City's website in 2oo8 (Attachment "B") differs from those in 2009 (Attachment "C") . This is true even regarding homes where there has been no sale or other change of title between 2oo8 and 2009. • 3 1/19/2009 IM ,s SQ s 3. cont. • According page 36 of the presentation given by City staff tonight, "The restriction period starts Year i each time the unit resells' Again, this is in direct conflict with the information in the CC&Rs that were recorded on the properties. -i,. - ,'i f F yY 77, nability to Recover os s of Improvements or Repairs • The current pricing formula does not allow for a seller to recoup any monies spent on repairing or improving the property. • 4 1/19/2009 4. cont. • At Cape Ann, individual homeowners, not homeowners associations, bear the cost of things such as exterior painting, plumbing, electrical, and roof repair/replacement. These things can cost thousands of dollars, none of which are recoupable upon the sale of the home. What incentive do people have to maintain the outward appearance of their homes when the shabby looking home that needs paint and a new roof is priced the same as the newly-painted, newly- roofed home? 21, 4. cont. • Upgrades such as granite countertops, hardwood flooring, upgraded fixtures, etc. also cannot be recouped in the City's resale pricing formula. • This leaves homeowners no incentive to maintain or improve the interior of their homes. • 5 1/19/2009 s ack of Informationor- wners and Potential Buyers • The City states on it's website "DO NOT CONTACT CITY OF HUNTINGTON BEACH FOR QUESTIONS!! CONTACT AGENT OR OWNER." (http://www.ci.huntington- beach.ca.us/files/users/economic development/sa les.pdf). (Attachment"D"). • The City has never held any seminars, classes or workshops on affordable housing for potential buyers. • 5. •The City does not provide new affordable home buyers with any written policies or procedures, such as the ones adopted by the Council in April 2004. In fact, these policies and procedures were never provided to current affordable homeowners when they were first adopted by the Council'4-5 years after the Cape Ann homes were built. 6 1/19/2009 6. Inability to Rent • The program does not allow homeowners to rent for any amount of time for any reason. • This includes situations where : • a homeowner is transferred in his/her job for a definite amount of time (i.e. 1-a years) • Selling at the current price would result in the homeowner taking a loss on the property • The homeowner could rent to an individual who qualifies for affordable housing under the City's rental program. • The homeowner has some other hardship such as health problems. • • 7 1/19/2009 • e- Possible Solutions • Ideas to help fix the program and make it fair to all • 1 1/19/2009 . Allow sellers to recoup capital improvements and repairs in addition to the formula price of the unit. With the age of the units fast approaching io years, certain capital improvements and repairs are becoming more and more necessary. This is especially true of the detached condominiums whose HOAs do not cover things such as plumbing, roofs, painting, etc. OEM 14, • The City of San Francisco's Residential Inclusionary Affordable Housing Program permits owners to recoup for eligible capital improvements at a rate of either i00% or 5o%. • Home buyers are provided a list of items that will qualify as eligible capital improvements and the information is also readily available on the program's website. Specific information can be found at: www sfgov or /sg ite/uploadedfiles/moh/programs/FirstT imeBuyer/CP%zopolicy%zooverview%zofor%aothe%ao website%2o7.2o.o7.pdf) (Attachment"E"). • 1 1/19/2009 • _.,_:, • The County of Monterey's program adds io%of the original sales price to the calculated resale price of the home if the home is in"decent.condition" upon resale. (See p. 18&z3 of www.co.montergy.ca.us/housing/pdfs/inclusiongry housing,pdf) (Attachment"F") • y ON y k- uM1E £- . Allow homes to pass to heirs without requiring the heir to qualify for the program and without restarting the affordability period upon transfer of title. 2 1/19/2009 3. Allow sellers to add 5% to the calculated price of the home if a real estate agent is used to sell the home. • This would encourage owners to use a real estate agent in the sale of their home, rather than attempting to sell by owner. With a complicated program such as this, it is not fair to ask untrained homeowners to take on the responsibility and liability of informing potential buyers about the program. • •San Francisco's program adds 5% of the calculated resale price (formula price + capital improvements) if the unit is listed on the Multiple Listing Service and a real estate agent is used by the seller. (Seep. 23 of Attachment "G"). 3 1/19/2009 • Monterey's program circumvents the need for a real estate agent by having its Office of Housing and Redevelopment maintain a list of eligible buyers for affordable homes. • The County compiles a list of interested potential applicants who are pre-qualified under the program's requirements. • When a home in the program is going to be put up for sale, the County can exercise its right to purchase the home. If it doesn't exercise this right, a list of pre- qualified buyers is given to the seller. The seller is then assured that any buyer will qualify under the County's eligibility guidelines/requirements. • See pgs. 11-13 of Attachment"F" III III PUIP1. 4. Adhere to the recorded resale restriction CC&Rs that state that the affordability period expires 30 years from the date of the first certificate of occupancy. 4 1/19/2009 � WX • Other programs, like County of Monterey, that have changed the duration of the affordability program have done so ONLY to homes sold AFTER the change was implemented. Those homes purchased BEFORE changes were made still adhered to the original affordability period length. • Seep. 22 of Attachment"F" (County of Monterey Inclusionary Housing Program Administrative Manual). • Seep. 20 of Attachment "G" (City&County of San Francisco Residential Inclusionary Affordable Housing Program Monitoring and Procedures Manual). • 2 oti y current owners o any and all changes to the program. • As stated earlier in this presentation, current owners never received a copy of the policies and procedures that were adopted by this Council in 2004. • Since then, many changes have been made to the way in which this program is administered. For example, it is now required that a 3o-year fixed rate loan be obtained to purchase an affordable home. When asked where this information was written, the response was simply that it wasn't written anywhere...it was just what they do now. This is unacceptable. 5 1/19/2009 • Wz • Also as stated earlier in this presentation, the affordability expiration dates for many homes were changed from the information posted on the City's website in 2oo8 and that which is posted currently. However, homeowners were never notified by the City that the expiration date for their property was changed. • This is the first time that the City has ever directly contacted each affordable housing homeowner to give notice that Council would be discussing the affordable housing program. This type of notice should be the rule, not the exception. • C: ;. . .., `. D *. � da.1��M ..T's."^v"•n 6. Allow homeowners to rent the homes for a period of time under certain circumstances. • Circumstances under which rental would be allowed could include things such as: • Job transfer • Medical problems • Hardships • Familial situations • 6 1/19/2009 aq • Monterey's program permits rental for short periods of time (generally up to one year) if there is an emergency or hardship situation. The rental must o a qualified tenant at the same affordability level as the ownership. (See P. as of Attachment"F"). • San Francisco's program permits rental in situations where the owner is forced to temporarily relocated due to employment, or for other reasons deemed acceptable by the Mayor's Office of Housing. The tenant must satisfy certain requirements of the program. (See pgs. 21-22 of Attachment"G"). • 7. The City should hold workshops and information sessions for potential buyers. • These workshops should explain, in detail, how the program works so that buyers are aware of all of the aspects of the program and its implications on the ownership of their homes. S 7 1/19/2009 8. Do NOT retroactively apply program changes to existing homeowners without the knowledge and consent of the owner. • When San Francisco adopted new policies and procedures for its program, current owners were not bound by the changes. An owner could, however, elect to.adopt the new policies and procedures if they were more advantageous to the individual owner. (See P. 2 of Attachment "H"). • Similarly, Monterey's program has different rules and regulations for units purchased prior to May 23, 2003 and those purchased on or after that date. (See P. 18 of Attachment"F"). • 8 1/19/2009 9. Have safeguard in place to prevent an owner from having to sell at a price below that which he paid for the home. • In San Francisco's program, if the calculated price is below that which was originally paid for the unit, the owner may elect to sell the unit for the original sales price (plus capital improvements plus real estate fees). (See P. a of Attachment"H"). • PRIME" This is just a brief overview of the Affordable Housing Program's problems and possible solutions to those problems. We welcome the opportunity to sit down and discuss further the issues raised in this presentation. THANK YOU. 9 _ b k4Ie% • Recorded in the County of Orange,California Gary L.Granmflile,Clerk/Recorder RECORDM REQUESTED BY: 'IIQ 11� D1�11� No Fee ARST AMERICAN TrrLE CO. 19990214033 3:59pm 03/23/99 Ate rtM RBCORDFD MAIL TO:0051 J81236311 12 City of Huntington Beach D02 13 6.00 36.00 0.00 0.00 0.00 0.00 2000 Main Street ) Huntington Beach, CA 92648 ) Attn: City Clerk > EA Uo5 R-7 6 rn P.S C (Space above for Recorder's use This document is exempt from recording fees pursuant to Government Code Section 27393. DECLARATION OF CONDITIONS, COVENANTS AND RESTRICTIONS FOR PROPERTY (RESALE RESTRICTIONS) THIS DECLARATION OF CONDITIONS, COVENANTS AND RESTRICTIONS FOR PROPERTY (the "Declaration") is made as of �/,t!� , 1999, by and between WL HOMES LLC, a Delaware limited/liability company (the "Covenantor") , and THE CITY OF HUNTINGTON BEACH, a California municipal corporation (the "City" or *Covenantee") . - RECITALS A. Covenantor has received zoning approval from the City for the construction of one hundred forty-six (146) detached condominium units located, on the northern and eastern corners of Promenade Parkway and Seagate Drive in the City of Huntington Y Y J Beach, as described in the "Legal Description of the Property" which is attached hereto as Exhibit "A" and incorporated herein by this reference (the "Property") . B. City has, as a condition of such approval, required Covenantor to subject each of the condominium units constructed on the Property to certain Covenants, conditions, and restrictions. s The execution and recordation of this Declaration is intended to All fully satisfy that condition. - NOW, THEREFORE, the parties hereto agree and covenant as follows: 1. Affordability Covenants. Covenantor agrees for itself and its successors and assigns, and every successor to Covenantor's interest in the Property, or any part thereof, that for thirty (30) years from the date the first certificate of occupancy is issued for a condominium unit in the Property (the "Expiration Date") : EVERY PACE OF THIS DOCUt+TFM SHALL BE AFFIXED WITH THE. SEAL OF ISM CITY OF Thisr�e� H[)t1TINGrCN BEAM. offletell d > 'bfi� 3s of Hundngton Biwm 4 as concern- NIE BROCKWAY CITY OF HUN71NGTON REACH Fated under Gov-; runent C 3ode a Brockway, Clerk n=_ Sec.e103 and should be recorded free at charge. �' � c ty CI puty (a) The Property shall only be owned and occupied by 6 Covenantor or by "Moderate Income Households . " Moderate Income .Households shall mean persons or families earning not more than One Hundred Twenty Percent (120U or less of the Orange County median income, adjusted for appropriate family size, as published by the United States Department of Housing & Urban Development or established by the State of California, pursuant to Health and Safety Code Section 50093 , or a successor statute. (b) The Property shall only be sold at an "Affordable Housing Cost" to Moderate Income Households . Affordable Housing Cost shall mean the permitted gross sales prices of the condominium units as set forth in the Affordable Housing Price/Income Guidelines or successor guidelines published, from time to time, by the City for such purpose. (c) The covenant contained in this Section 1 shall run with the Property and shall automatically terminate and be of no further force or effect upon the Expiration Date. 2. Transfer of Property. No transfer of the Property shall occur until the City determines (a) that the proposed purchaser intends to occupy the Property as the proposed purchaser' s principal residence, (b) that the proposed purchaser is a Moderate Income Household, and (c) that the proposed transfer occurs at an Affordable Housing Cost . In the event that Covenantor (including successors and assigns) desires to sell the Property, Covenantor shall send written notice thereof to the City at the following sa address: City of Huntington Beach 2000 Main Street Huntington Beach, CA 92648 Attention: Director of Economic Development Within seven (7) days of receiving such notice, the City shall send Covenantor transfer application forms prepared by the City. Such forms shall contain a certification of the proposed p:urchaser's intent with respect to his/her/its residency of the Property and his/her/its gross income, and an affidavit of the proposed purchaser disclosing and certifying the amount of the proposed purchase price . The City shall not be obligated to approve a transfer unless and until the proposed purchaser has submitted to the City such information and completed such forms. In the interest of expediting the close of escrow for such proposed transactions, the City shall reasonably approve or disapprove such submissions as soon as practicable after submission of such forms, and in no event later than fourteen (14) days after submission of a completed form_ If the City fails to approve or disapprove a submission within such fourteen (14) day period, the City shall be deemed to have approved such transfer in accordance with the foregoing. Prior to conveyance of the Property, each approved 16314.181-3331.F07 012199 -2- purchaser shall also submit to the City an executed disclosure statement which certifies that the purchaser is aware that the . purchaser buying the Property may only sell the unit at an Affordable Housing Cost to a Moderate Income Household, that the maximum permitted sales price may be less than fair market value and that the unit must be owner-occupied at all times and cannot be rented or leased, except as approved by the City in the case of hardship. Covenantor shall cooperate with the City in providing such forms to proposed purchasers and in assisting proposed purchasers to prepare such forms and to provide any required information to the City in connection with only the Covenantor' s sale of the Property, provided that the Covenantor shall not be obligated to incur any out-of-pocket costs in connection therewith, other than employee time dedicated to providing such assistance. THE COVENANTOR AND EACH SUCCESSOR, HEIR, OR ASSIGN OF COVENANTOR UNDERSTANDS THAT THE DETERMINATION OF THE AFFORDABLE HOUSING COST CAN BE MADE ONLY AT THE TIME OF THE PROPOSED TRANSFER, TAKING INTO CONSIDERATION INTEREST RATES, THE TERMS OF SALE OFFERED TO AND THE ECONOMIC CIRCUMSTANCES OF THE PROPOSED PURCHASER AND OTHER. FACTORS THAT CANNOT BE ACCURATELY PREDICTED, AND THAT THE TRANSFER PRICE PERMITTED HEREUNDER MAY BE LESS THAN THE FAIR MARKET VALUE OF THE PROPERTY AND MAY NOT INCREASE OR DECREASE IN THE SAME MANNER AS OTHER SIMILAR REAL PROPERTY WHICH IS NOT ENCUMBERED BY THIS RESTRICTION. COVENANTOR AND EACH SUCCESSOR, HEIR, OR ASSIGN OF COVENANTOR FURTHER ACKNOWLEDGES THAT AT ALL TIMES IN SETTLING THE TRANSFER PRICE, THE PRIMARY OBJECTIVE OF THE CITY AND THIS DECLARATION IS TO PROVIDE HOUSING TO MODERATE INCOME HOUSEHOLDS AT AN AFFORDABLE HOUSING COST. Co nantor' s Initia s The covenant contained in this Section 2- shall run with the Property and shall automatically terminate and be of no further force or effect upon the Expiration Date . 3 . Non-Discrimination Covenants. Covenantor covenants by and for itself, its successors and assigns, and all persons claiming under or through them that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the Property, nor shall Covenantor itself or any person claiming under or through it, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the Property. Covenantor and its successors and assigns shall refrain from restricting the rental or lease (if permitted by Covenantor 18324.181-3332.FQ4 012199 -3 and Covenantee) or sale of the Property on the basis of race, color, religion, sex, marital status, national origin, or ancestry of any person. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clause: (a) In deeds: "The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators .and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group o£ persons on account of race, color, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land. " (b) In leases: "The Lessee herein covenants by and for himself and herself, his or her heirs, executors, administrators and assigns, and all persons claiming under or through him or her, that this lease is made and accepted upon and subject to the following conditions: "There shall be no discrimination against or segregation of any person or group of persons on account of race, color, religion, sex, marital status, ancestry or national origin in the leasing, subleasing, use, occupancy, tenure or enjoyment of the premises herein leased nor shall the lessee himself or herself, or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy of tenants, lessees, sublessees, subtenants,- or vendees in the premises herein leased. " (c) In contracts: "There shall be no discrimination against or segregation of, any person, or group of persons on account of race, color, religion, sex, marital status, ancestry or national origin, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the premises, nor shall the transferor himself or herself or any person claiming under or through him or her, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use of occupancy of tenants, lessees, subtenants, sublessee or vendee of the p=emises . " Nothing in this Section 3 shall be construed to authorize the rental or lease of the Property or any condominium unit thereon, if such rental or lease is not otherwise permitted or approved in accordance with the terms and provisions of this 18324.191-3332.FQI 012199 -4 Declaration, The covenants in this Section 3 shall run with the Property. 4. Covenants Do Not Impair Lien. No violation or breach of the covenants, conditions, restrictions, provisions or limitations contained in this Declaration shall defeat or render invalid or in any way impair the lien or charge of any mortgage or deed of trust or security interest. 5. Covenants For Benefit of City. All covenants without regard to technical classification or designation shall be binding for the benefit of the Covenantee and such covenants shall run in favor of the Covenantee for the entire period during which time such covenants shall be in force and effect, without regard to whether the Covenantee is or remains an owner of any . land -or interest therein to which such covenants relate. The Covenantee, in the event of any breach of any such covenants, shall have the right to exercise all the rights and remedies and to maintain any such action at law or suits in equity or other proper legal proceedings to enforce and to cure such breach to which it or any other beneficiaries of these covenants may be entitled during the term specified for such covenants, except the covenants against discrimination which may be enforced at law or in equity at any time in perpetuity. 6. Subordination. Notwithstanding any other provision hereof, the provisions of this Declaration shall be subordinate to the lien of the First Lender's Deed of Trust and shall not impair. the rights of the First Lender, or such lender's assignee or successor in interest, to exercise its remedies under the First Lender's Deed of Trust in the event of default under the First Lender' s Deed of Trust by the borrower. Such remedies under the First Lender's Deed of Trust include the right of foreclosure or acceptance of a deed or assignment in lieu of foreclosure. After such foreclosure or acceptance of a deed in lieu of foreclosure, the covenants of this Declaration shall be forever terminated and shall have no further effect as to the Unit foreclosed on or any transferee thereafter; provided, however, if the holder of such First Lender' s Deed of Trust acquired title to the Property pursuant to a deed or assignment in lieu of foreclosure, this Declaration shall automatically terminate upon such acquisition of title, provided that (i) the City and Covenantor have been given written notice of default under such First Lender' s Deed of Trust, and (ii) the City or Covenantor shall not have cured or commenced to cure the default within such 30-day period and given its firm commitment to complete the cure in form and substance acceptable to the First Lender. This Declaration shall not diminish or affect the rights of the United States Department of Housing and Urban Development ("HUD") , FNMA, or the Veterans Administration ("VA") , as and if applicable, under the First Lender' s • Deed of Trust. 18321.181-3332.FOd 012199 -5- Notwithstanding any provision in this Declaration to the contrary, all of the provisions of this Declaration shall terminate and have no further force and effect upon the occurrence of one of the following events: (i) Title is acquired by HUD, VA, FNMA or another party upon foreclosure of a deed of trust insured by HUD or guaranteed by VA; (ii) Title is acquired by HUD, VA, FNMA or another party by a deed in lieu of foreclosure of a deed of trust insured by HUD. or guaranteed by VA; or (iii) a deed of trust insured by- HUD is assigned to HUD. 7. Deed of Trust. Each Unit in the Property shall be encumbered by a recorded deed of trust naming as beneficiary both the Covenantor and Covenantee. The deed of trust (a sample form is attached hereto as Exhibit "B") shall secure the obligation of each owner of a Unit to reimburse either the Covenantor or Covenantee, as appropriate, for any costs paid for from that certain WL Homes Tru t Account, defined in the Reimbursement Agreement, dated k-CloRut�'�-�1 �p , 1999, between WL Homes LLC and the City, to cure a def ult by such owner under a purchase money loan for the unit and/or deed of trust securing same. 8. Counterparts. This Agreement may be executed in a number of counterparts, each of which shall be an original, but all of which shall constitute one and the same document. (Signatures and Jurats to follow] 19324.161-3332.FQ4 012199 -6 IN WITNESS WHEREOF, the Covenantee and Covenantor have caused this instrument to be executed on their behalf by their respective officers hereunto duly authorized as of the date set forth above. COVENANTOR: COVENANTEE: WL HOMES LLC, CITY OF HUNTINGTON BEACH a Delaware limited liability a California municipal company corporation dba JOHN LAING HOMES (CALIFORNIA) r. � I ) By: By: L. ti EDGCrJMB Mayor Divisional President Orange County, California ATTEST: l By: Connie Brockway _ MAR�I4NNE BRQ�TtJE City Clerk —o- Deputy City Clerk APPROVED AS TO FORM: Cite!2orney REVIEWED AND APPROVED: City Administrator INITIATED AND APPROVED: Pla ning D ect r 18324.181-3332.FCM 012199 -7- STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE ) On 3-A4. 22riD 1999, before me, the undersigned, a Notary Public in and for said State, personally appeared L. J. EDGCOMB and MARIANNE BROWNE personally known to me { to be the person whose name is subscribed to the within instrument and acknowledged to me that he/she executed the same in his/her authorized capacity, and that by his/her signature on the instrument the persons or the entities upon behalf of which the person acted executed the instrument. WITNESS my hand and official seal . comn b*n#109920 -� MWC ry FUh —carMw1lb signature of Notary Public C0 =" (SEAL) STATE OF CALIFORNIA ) ss. COUNTY OF ORANGE ) On 1999, before me, the undersigned, a Notary Public in and for said State, personally appeared , personally known to me (or proved to me on the basis of satisfactory evidence) to be the person, whose name is subscribed to the within instrument and acknowledged to me that he/she executed the same in his/her authorized capacity, and that by his/her signature on the instrument the persons or the entities upon behalf of which the person acted executed the instrument. WITNESS my hand and official seal . Signature of Notary Public (SEAL) 18324.181-3332.FQ4 012199 -8 .__....... .__ hl. CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT ' - _ - cr�c e c�c cscc c< cs�src�e rc�c c ec ,L�cr ��,r •' State of ---�`3~ County of On � - c before me, J r 1 Date Name and Us of Officer te.9.,'Jane e.Notary Public') personally appeared -� �n^e '�i - Nam(s)or Signer(s) ❑personally known to me-OR-O proved to me on the basis of satisfactory evidence to be the personQ who nam s ar subscribed to the wi0in instrument ?� and acknow ed me that-he/ heexecuted the , same i /their uthorized capacl es and that by hei ignature(s)on the instrument the persod, or the ntity upon behalf of which the persq!9 acted, executed the instrument. ` EIIZAB-TH EHRING ] + Cornrn;ssion tt 1150021 WITNESS my hand and official seal, R:,, Notary PU011C-Cal+lo(tua Z ' ONonge County [ My com-n.5 pies Aug29.2001 r signature of Nota Pli_ �S OPTIONAL — `'l Though the information below is not required by taw,it may prove valuable to persons relying on the document and could prevent � fraudulent removal and reattachment of this form to another document. Description of Attache ocument ?� • Title or Type of Document: Document Date: zlc Number of Pages: Signer's)-Other Than Named Above: ��' °'� _ 7ZZL " Capacit otes) laicned by Sign r S Signer's Name: Signer's Name: 0 Individual ❑ Individual Corporate Officer Corporate C 4 cer f Tttlef6j Title(: / Z L 0 Partner--Cl Linged 0 General ❑ Partner—❑ Lifnited EYGeneral O Attomey-in-Fact ❑ Attomey-in-Fact ❑,Trustee _ ❑ Trustee D Guardian or Conservator ❑ Guardian or Conservator ❑ Other: Top of thumb here ❑ Other: Top of thumb here Signer Is Representing: Si ner Is Representing: BII 0 1996 National Notary Association-&M Remmet Ave.,P.O.Sox 7184•Canoga Park,CA 91309-7184 i rod.No.5907 Reorder.CaN ToN-Fee 1-00"76-=7 EXHIBIT "A" PROPERTY The Property shall mean and refer to that certain real property located in the City of Huntington Beach, County of Orange, State of California, more particularly described as : All of Tract 15531, as shown on a Map recorded in Book 771, Pages 26 to 32, inclusive, of Miscellaneous Maps, Records of Orange County, California. 18324.181-3332.FCM 012199 -9- • City ®f Huntington Beach AFFORDABLE HOUSIJVG LIST HUN'nNGTON BEACH This list is intended to comply with California State Assembly Bill 987. THIS IS NOT A LIST OF "FOR SALE" PROPERTIES. Please DO NOT contact owners of these properties. For a list of units for sale, visit Programs. However, this list reflects multifamily affordable housing units in Huntington Beach that are "Deed Restricted"(Affordable through governmental fmancing or other assistance). Updated January 16,2008 W71 937-84-020 17201 Ash Street A ASH STREET 3 2002 MEDIAN 2062 937-84-021 17201 Ash Street B ASH STREET 3 2002 MEDIAN 2062 937-84-022 17201 Ash Street C ASH STREET 3 2002 MEDIAN 2062 937-84-023 17201 Ash Street D ASH STREET 3 2002 MEDIAN 2062 937-84-024 17201 Ash Street E ASH STREET 3 2002 MEDIAN 2062 937-84-025 17201 Ash Street F ASH STREET 3 2002 MEDIAN 2062 930-79-461 409 Utica Avenue A-1 BRISAS DEL MAR 2 1993 LOW 2032 930-79-462 409 Utica Avenue A-2 BRISAS DEL MAR 3 1993 MODERATE 2024 930-79-463 409 Utica Avenue A-3 BRISAS DEL MAR 3 1993 MODERATE 2025 930-79-464 409 Utica Avenue A-4 BRISAS DEL MAR 3 1993 MODERATE 2024 930-79-465 409 Utica Avenue A-5 BRISAS DEL MAR 2 1993 MODERATE 2035 930-79-466 409 Utica Avenue 7-6 BRISAS DEL MAR 2 1993 MODERATE 2033 930-79-467 409 Utica Avenue A-7 BRISAS DEL MAR 2 1993 LOW 2024 930-79-468 409 Utica Avenue A-8 BRISAS DEL MAR 2 1993 MODERATE 2024 930-79-469 409 Utica Avenue -A-9 BRISAS DEL MAR 1 1993 LOW 2023 930-79-470 409 Utica Avenue A-1 0 BRISAS DEL MAR 2 1993 MODERATE 2032 930-79-471 409 Utica Avenue A-1 1 BRISAS DEL MAR 1 1993 MODERATE 2033 930-79-472 409 Utica Avenue B-1 2 BRISAS DEL MAR 2 1993 LOW 2036 930-79-473 409 Utica Avenue B-1 3 BRISAS DEL MAR 3 1993 MODERATE 2030 930-79-474 409 Utica Avenue B-1 4 BRISAS DEL MAR 3 1993 MODERATE 2030 930-79-475 409 Utica Avenue B-1 5 BRISAS DEL MAR 3 1993 MODERATE 2024 930-79-476 409 Utica Avenue B-16 BRISAS DEL MAR 2 1993 MODERATE 2030 .930-79-477 409 Utica Avenue B-1 7 BRISAS DEL MAR 2 1993 MODERATE 2031 930-79-4 8 409 jUtica Avenue B-1-8 —BRISAS DE AR 2 1993 MODERATE 2 930-79-479 409 Utica Avenue B-19 BRISAS DEL MAR 2 1993 MODERATE 2030 930-79-480 409 Utica Avenue B-20 BRISAS DEL MAR 1 1993 MODERATE 2024 930-79-481 409 Utica Avenue B-21 BRISAS DEL MAR 2 1993 LOW 2033 930-79-482 409 Utica Avenue B-22 BRISAS DEL MAR 1 1993 MODERATE 2024 930-79-483 409 Utica Avenue C-23 BRISAS DEL MAR 2 1993 LOW 2032 930-79-484 409 Utica Avenue C-24 BRISAS DEL MAR 1993 MODERATE 2024 930-79-485 409 Utica Avenue C-25 BRISAS DEL MAR 3 1993 MODERATE 2030 930-79-486 409 Utica Avenue C-26 BRISAS DEL MAR 3 1993 MODERATE 2026 930-79-487 409 Utica Avenue C-27 BRISAS DEL MAR 2 1993 MODERATE 2024 930-79-488 409 Utica Avenue C-28 BRISAS DEL MAR 2 1993 MODERATE 2036 930-79-489 409 Utica Avenue C-29 BRISAS DEL MAR 3 1993 MODERATE 2032 930-79-490 409 Utica Avenue C-30 BRISAS DEL MAR 1 1993 MODERATE 2024 930-79-491 409 Utica Avenue C-31 BRISAS DEL MAR 3 1993 MODERATE 2034 930-79-492 409 Utica Avenue C-32 BRISAS DEL MAR 1 1993 LOW 2035 930-79-493 409 Utica Avenue D-33 BRISAS DEL MAR 2 1993 MODERATE 2032 930-79-494 409 Utica Avenue D-34 BRISAS DEL MAR 2 1993 MODERATE 2031 930-79-495 409 Utica Avenue D-35 BRISAS DEL MAR 2 1993 MODERATE 2036 930-79-496 409 Utica Avenue D-36 BRISAS DEL MAR 2 1993 MODERATE 2024 930-79-497 409 Utica Avenue D-37 BRISAS DEL MAR 2 1993 MODERATE 2033 930-79-498 409 Utica Avenue D-38 BRISAS DEL MAR 3 1993 MODERATE 2034 930-79-499 409 Utica Avenue D-39 BRISAS DEL MAR 3 1993 LOW 2028 930-79-500 409 Utica Avenue D-40 BRISAS DEL MAR 3 1993 MODERATE 2032 930-46-501 409 Utica Avenue D-41 BRISAS DEL MAR 2 1993 MODERATE 2028 930-79-502 409 Utica Avenue D-42 BRISAS DEL MAR 2 1993 MODERATE 2034 930-79-503 409 Utica Avenue D-43 BRISAS DEL MAR 1 1993 LOW 2028 930-79-504 409 Utica Avenue D-44 BRISAS DEL MAR 1 1993 MODERATE 2024 933-87-424 18861 Breezy Lane CAPE ANN 4 2000 MODERATE 2032 933-87-477 18862 Breezy Lane CAPE ANN 4 2000 MODERATE 2030 933-87-425 18865 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-478 18866 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-479 18870 -Breezy Lane CAPE ANN 4 2000 MODERATE 2030 933-87-426 18873 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-427 18877 lBreezy Lane CAPE ANN 3 2000 MODERATE 2032 "Elm Immi 933-87-428 18881 Breezy Lane CAPE ANN 4 2000 MODERATE 2030 933-87-429 18887 Breezy Lane CAPE ANN 4 2000 MODERATE 2030 933-87-430 18891 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-431 18895 Breezy Lane CAPE ANN 4 2000 MODERATE 2032 933-87-334 18899 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-335 18903 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-336 18907 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-337 18911 Breezy Lane CAPE ANN 3 2000 MODERATE 2031 933-87-338 18915 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-367 18916 Breezy Lane CAPE ANN 4 2000 MODERATE 2034 933-87-339 18919 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-368 18920 Breezy Lane CAPE ANN 3 2000 MODERATE 2033 933-87-340 18923 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-369 18924 Breezy Lane CAPE ANN 3 2000 MODERATE 2033 933-87-341 18927 Breezy Lane CAPE ANN 3 2000 MODERATE 2033 933-87-370 18928 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-371 18930 Breezy Lane CAPE ANN 4 2000 MODERATE 2030 933-87-342 18931 Breezy Lane CAPE ANN 4 2000 MODERATE 2031 933-87-343 18935 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-344 18939 Breezy Lane CAPE ANN 3 2000 MODERATE 2033 933-87-345 18943 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-346 18947 Breezy Lane CAPE ANN 4 2000 MODERATE 2033 933-87-347 18951 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-348 18955 Breezy Lane CAPE ANN 3 2000 MODERATE 2031 933-87-349 18959 Breezy Lane CAPE ANN 3 2000 MODERATE 2033 933-87-350 18961 Breezy Lane CAPE ANN 4 2000 MODERATE 2030 933-87-351 18965 Breezy Lane CAPE ANN 3 2000 MODERATE 2033 933-87-352 18969 Breezy Lane CAPE ANN 3 2000 MODERATE 2032 933-87-353 18971 Breezy Lane CAPE ANN 3 2000 MODERATE 2032 933-87-354 18975 Breezy Lane CAPE ANN 4 2000 MODERATE 2030 933-87-355 18979 Breezy Lane CAPE ANN 3 2000 MODERATE 2030 933-87-356 18983 Breezy Lane CAPE ANN 3 2000 MODERATE 2035 933-87- 7 18987 Breezy Lane CAPE ANN 3 2000 1 MODERATE 2 +u t 933-87-469 18809 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-468 18813 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-467 18817 Coolwater Lane CAPE ANN 4 2000 MODERATE 2030 933-87-454 18821 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-453 18825 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-452 18829 Coolwater Lane CAPE ANN 4 2000 MODERATE 2030 933-87-459 18830 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-460 18834 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-461 18838 Coolwater Lane CAPE ANN 4 2000 MODERATE 2033 933-87-449 18842 Coolwater Lane CAPE ANN 3 2000 MODERATE 2033 933-87-450 18846 Coolwater Lane CAPE ANN 3 2000 MODERATE 2035 933-87-451 18850 Coolwater Lane CAPE ANN 4 2000 MODERATE 2034 933-87-446 18854 Coolwater Lane CAPE ANN 4 2000 MODERATE 2030 933-87-438 18857 Coolwater Lane CAPE ANN 4 2000 MODERATE 2030 933-87-447 18858 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-448 18862 Coolwater Lane CAPE ANN 3 2000 MODERATE 2034 933-87-439 18863 Coolwater Lane CAPE ANN 3 2000 MODERATE 2033 933-87-435 18866 Coolwater Lane CAPE ANN 4 2000 MODERATE 2030 933-87-440 18867 Coolwater Lane CAPE ANN 3 2000 MODERATE 2033 933-87-436 18868 Coolwater Lane CAPE ANN 3 2000 MODERATE 2032 933-87-437 18870 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-432 18874 Coolwater Lane CAPE ANN 4 2000 MODERATE 2030 933-87-441 18875 Coolwater Lane CAPE ANN 4 2000 MODERATE 2030 933-87-433 18876 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-434 18878 Coolwater Lane CAPE ANN 3 2000 MODERATE 2034 933-87-413 18882 Coolwater Lane CAPE ANN 4 2000 MODERATE 2030 933-87-414 18886 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-416 18889 Coolwater Lane CAPE ANN 4 2000 MODERATE 2030 933-87-415 18890 Coolwater Lane CAPE ANN 3 2000 MODERATE 2033 933-87-417 18893 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-418 18897 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-410 18904 1Coolwater Lane CAPE ANN 4 2000 MODERATE—[- 2035 933-87-411 18908 lCoolwater Lane CAPE ANN 3 2000 MODERATE 2Q30 933-87-419 189.11 Coo.lwater Lane CAPE ANN 4 2000 MODERATE 2030 933-87-412 18912 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-407 18916 Coolwater Lane CAPE ANN 4 2000 MODERATE 2033 933-87-408 18920 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-409 18924 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 93-87-392 18925 Coolwater Lane CAPE ANN 4 2000 MODERATE 2030 933-87-404 18928 Coolwater Lane CAPE ANN 4 2000 MODERATE 2030 933-87-391 18929 Coolwater Lane CAPE ANN 3 2000 MODERATE 2032 933-87-405 18930 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-390 18933 Coolwater Lane CAPE ANN 3 2000 MODERATE 2032 933-87-406 18934 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-389 18937 Coolwater Lane CAPE ANN 3 2000 MODERATE 2034 933-87-401 18938 Coolwater Lane CAPE ANN 4 2000 MODERATE 2036 933-87-402 18942 Coolwater Lane CAPE ANN 3 2000 MODERATE 2030 933-87-403 18946 Coolwater Lane CAPE ANN .3 2000 MODERATE 2030 933-87-476 7407 Pinnacle Circle CAPE ANN 4 2000 MODERATE 2035 933-87-472 7408 Pinnacle Circle CAPE ANN 3 2000 MODERATE 2030 933-87-471 7410 Pinnacle Circle CAPE ANN 3 2000 MODERATE 2030 933-87-475 7411 Pinnacle Circle CAPE ANN 3 2000 MODERATE 2033 933-87-470 7414 Pinnacle Circle CAPE ANN 4 2000 MODERATE 2030 933-87-474 7415 Pinnacle Circle CAPE ANN 3 2000 MODERATE 2030 933-87-442 7418 Pinnacle Circle CAPE ANN 3 2000 MODERATE 2030 933-87-473 7419 Pinnacle Circle CAPE ANN 3 2000 MODERATE 2033 933-87-455 7421 Pinnacle Circle CAPE ANN 4 2000 MODERATE 2030 933-87-443 7422 Pinnacle Circle CAPE ANN 4 2000 MODERATE 2030 933-87-456 7425 Pinnacle Circle CAPE ANN 3 2000 MODERATE 2033 933-87-444 7428 Pinnacle Circle CAPE ANN 3 2000 MODERATE 2030 933-87-457 7429 Pinnacle Circle CAPE ANN 3 2000 MODERATE 2035 933-87-458 7431 Pinnacle Circle CAPE ANN 3 2000 MODERATE 2030 933-87-445 7432 Pinnacle Circle CAPE ANN 4 2000 MODERATE 2030 933-87-423 7432 Prospect Drive CAPE ANN 4 2000 MODERATE 2030 933-87-422 7436 Prospect Drive CAPE ANN 3 2000 MODERATE 2030 933-87-421 7440 jProspect Drive CAPE ANNAmh, 3 2000 MODERATE 2 933-87-420 7444 Prospect Drive CAPE ANN 4 2000 MODERATE 2030 933-87-466 7453 Shelter Cove Circle CAPE ANN 4 2000 MODERATE 2030 933-87-465 7457 Shelter Cove Circle CAPE ANN 3 2000 MODERATE 2030 933-87-464 7461 Shelter Cove Circle CAPE ANN 3 2000 MODERATE 2030 933-87-463 7465 Shelter Cove Circle CAPE ANN 3 2000 MODERATE 2030 933-87-462 7469 Shelter Cove Circle CAPE ANN 4 2000 MODERATE 2033 933-87-361 7402 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2032 933-87-360 7404 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-359 7406 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-358 7408 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-375 7412 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2036 933-87-374 7414 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2032 933-87-373 7416 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-372 7418 Upper Bay Drive CAPE ANN 4 2000 MODERATE 2031 933-87-362 7419 Upper Bay Drive CAPE ANN 4 2000 MODERATE 2032 933-87-363 7421 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-379 7422 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2032 933-87-364 7423 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-378 7424 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2033 933-87-365 7425 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2035 933-87-377 7426 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-366 7427 Upper Bay Drive CAPE ANN 4 2000 MODERATE 2030 933-87-376 7428 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-393 7431 Upper Bay Drive CAPE ANN 4 2000 MODERATE 2030 933-87-383 7432 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2035 933-87-394 7433 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2033 933-87-382 7434 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-395 7435 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-381 7436 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-396 7437 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 993-87-380 7438 Upper Bay Drive CAPE ANN 4 2000 MODERATE 2033 933-87-388 7442 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-387 1 7444 jUpper Bay Drive I CAPE ANN 3 1 2000 MODERATE 2033 v 933-87-384 7448 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2031 933-87-385 7450 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-386 7452 Upper Bay Drive CAPE ANN 4 2000 MODERATE 2030 933-87-398 7456 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-397 7458 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-400 7462 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 933-87-399 7464 Upper Bay Drive CAPE ANN 3 2000 MODERATE 2030 025-121-44 2340 Delaware DELAWARE 3 2003 LOW 2032 933-875-59 19028 Delaware DELAWARE 3 2003 MEDIAN 2036 159-472-48 18751 Park Brook Lane GREYSTONE KEYS 3 1993 MODERATE 159-472-47 18755 Park Brook Lane GREYSTONE KEYS 3 1993 MODERATE 2031 159-472-06 7615 Park Field Circle GREYSTONE KEYS 3 1993 MODERATE 2035 159-472-05 7621 Park Field Circle GREYSTONE KEYS 3 1993 MODERATE 2027 159-472-37 7661 Park Field Circle GREYSTONE KEYS 3 1993 MODERATE 2035 159-472-36 7665 Park Field Circle GREYSTONE KEYS 3 1993 MODERATE 2028 159-474-15 7641 Park Forest Drive GREYSTONE KEYS 3 1993 MODERATE 2028 159-474-47 18602 Park Glen Lane GREYSTONE KEYS 3 1993 MODERATE 2028 159-474-59 18615 Park Glen Lane GREYSTONE KEYS 3 1993 MODERATE 2032 159-472-13 18771 Park Haven Lane GREYSTONE KEYS 3 1993 MODERATE 2027 159-472-14 18775 Park Haven Lane GREYSTONE KEYS 3 1993 MODERATE 2027 159-474-27 18596 Park Meadow Lane GREYSTONE KEYS 3 1993 MODERATE 2033 159-474-28 18602 Park Meadow Lane GREYSTONE KEYS 3 1993 MODERATE 2028 159-474-96 18616 Park Meadow Lane GREYSTONE KEYS 3 1993 MODERATE 2032 159-474-32 186.22 Park Meadow Lane GREYSTONE KEYS 3 1993 MODERATE 2028 159-474-35 18636 Park Meadow Lane GREYSTQNE KEYS 3 1993 MODERATE 2028 159-474-36 18642 Park Meadow Lane GREYSTONE KEYS 3 1993 MODERATE 2028 159-472-19 7632 Park Path Drive GREYSTONE KEYS 4 1993 MODERATE 2033 159-472-20 7636 Park Path Drive GREYSTONE KEYS 3 1993 MODERATE 2031 159-474-65 18612 Park Ridge Lane GREYSTONE KEYS 3 1993 MODERATE 2028 159-474-66 18616 Park Ridge Lane GREYSTONE KEYS 3 1993 MODERATE 2028 159-473-02 18641 Park Ride Lane GREYSTONE KEYS 3 1993 MODERATE 2027 937-402-90 19172 Holly Street B HOLLY STREET 2 2002 MODERATE 2032 937-402-91 19172 Holly Street C HOLLY ST ET 2 2002 MODERATE 2 d 933-875-55 18831 Huntington Street HUNTINGTON STREET 4 2002 MODERATE 2032 159-481-13 18930 Ocean Park Lane PACIFIC LANDING 1998 MODERATE 2028 159-481-23 7556 Ocean Point Drive PACIFIC LANDING 1998 MODERATE 2028 159-481-15 7565 Ocean Point Drive PACIFIC LANDING 1998 MODERATE 2028 159-481-21 7572 Ocean Point Drive PACIFIC LANDING 1998 MODERATE 2028 159-481-18 7585 Ocean Point Drive PACIFIC LANDING 1998 MODERATE 2028 933-872-56 7861 Happy Drive 101 PACIFIC PARK VILLAS 2 1996 MODERATE 2026 933-872-58 7861 Happy Drive 102 PACIFIC PARK VILLAS 1996 MODERATE 2026 933-872-59 7861 Happy Drive 202 PACIFIC PARK VILLAS 1996 MODERATE 2031 933-872-63 7871 Happy Drive 201 PACIFIC PARK VILLAS 1 1996 MODERATE 2026 933-872-60 7871 Happy Drive 102 PACIFIC PARK VILLAS 3 1996 MODERATE 2032 933-872-73 18051 Joyful Lane 102 PACIFIC PARK VILLAS 1996 MODERATE 2033 933-872-75 18051 Joyful Lane 104 PACIFIC PARK VILLAS 2 1996 MODERATE 2026 933-872-77 18051 Joyful Lane 205 PACIFIC PARK VILLAS 1996 MODERATE 2030 933-872-69 18061 Joyful Lane 101 PACIFIC PARK VILLAS 2 1996 MODERATE 2027 933-872-68 18061 Joyful Lane 102 PACIFIC PARK VILLAS 2 1996 MODERATE 2027 933-872-66 18061 Joyful Lane 104 PACIFIC PARK VILLAS 2 1996 MODERATE 2026 933-872-70 18061 Joyful Lane 201 PACIFIC PARK VILLAS 2 1996 MODERATE 2033 933-872-65 18061 Joyful Lane 205 PACIFIC PARK VILLAS 1996 MODERATE 2026 933-875-00 7501 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2030 933-875-01 7503 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2033 933-875-02 7505 Quiet Cove Circle PROMENADE 2 2000 MODERATE 2033 933-875-03 7507 Quiet Cove Circle PROMENADE 2 2000 MODERATE 2033 933-875-04 7509 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2030 933-875-05 7511 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2031 933-875-06 7513 Quiet Cove Circle PROMENADE 2 2000 MODERATE 2031 933-875-07 7515 Quiet Cove Circle PROMENADE 2 2000 MODERATE 2030 933-875-08 7517 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2030 933-875-09 7519 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2030 933-875-10 7523 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2030 933-875-11 7525 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2034 933-875-12 1 7527 Quiet Cove Circle 1PROMENADE 2 2000 MODERATE 2035 933-875-13 1 529 Quiet Cove Circle 1PROMENADE 2 2000 MODERATE 2030 933-875-14 7531 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2032 933-875-15 7533 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2033 933-875-16 7535 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2036 933-875-17 7537 Quiet Cove Circle PROMENADE 2 2000 MODERATE 2034 933-875-18 7539 Quiet Cove Circle PROMENADE 2 2000 MODERATE 2030 933-875-19 7541 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2032 933-875-20 7543 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2030 933-875-21 7547 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2030 933-875-22 7549 Quiet Cove Circle PROMENADE 2 2000 MODERATE 2030 933-875-23 7551 Quiet Cove Circle PROMENADE 2 2000 MODERATE 2030 933-875-24 7553 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2030 933-875-25 7555 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2030 933-875-26 7557 Quiet Cove Circle PROMENADE 2 2000 MODERATE 2030 933-875-27 7559 Quiet Cove Circle PROMENADE 2 2000 MODERATE 2030 933-875-28 7561 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2030 933-875-29 7563 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2033 933-875-30 7567 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2030 933-875-31 7569 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2032 933-875-32 7571 Quiet Cove Circle PROMENADE 2 2000 MODERATE 2030 933-875-33 7573 Quiet Cove Circle PROMENADE 2 2000 MODERATE 2030 933-875-34 7575 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2032 933-875-35 7577 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2030 933-875-36 7579 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2030 933-875-37 7581 Quiet Cove Circle PROMENADE 3 2000 MODERATE 2031 933-872-88 7510 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-872-89 7512 Shady Glen Circle PROMENADE 3 2000 MODERATE 2033 933-872-90 7514 Shady Glen Circle PROMENADE 2 2000 MODERATE 2030 933-873-29 7515 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-872-91 7516 Shady Glen Circle PROMENADE 2 2000 MODERATE 2034 933-873-28 7517 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-872-92 7518 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-873-27 7519 Shady Glen Circle PROMENADE 2 2000 MODERATE 2036 933-872-93 7520 Shady Glen Circle 1PROMENAUL 3 2000 MODERATE 2 ' gli 933-873-26 7521 Shady Glen Circle PROMENADE 2 2000 MODERATE 2036 933-872-94 7522 Shady Glen Circle PROMENADE 3 2000 MODERATE 2035 933-873-25 7523 Shady Glen Circle PROMENADE 3 2000 MODERATE 2032 933-872-95 7524 Shady Glen Circle PROMENADE 2 2000 MODERATE 2035 933-873-24 7525 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-872-96 7526 Shady Glen Circle PROMENADE 2 2000 MODERATE 2032 933-872-97 7528 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-873-23 7529 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-872-98 7530 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-873-22 7531 Shady Glen Circle PROMENADE 3 2000 MODERATE 2033 933-873-21 7533 Shady Glen Circle PROMENADE 2 2000 MODERATE 2030 933-872-99 7534 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-873-20 7535 Shady Glen Circle PROMENADE 2 2000 MODERATE 2030 933-873-00 7536 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-873-19 7537 Shady Glen Circle PROMENADE 3 2000 MODERATE 2033 933-873-01 7538 Shady Glen Circle PROMENADE 2 2000 MODERATE 2030 933-873-18 7539 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-873-02 7540 Shady Glen Circle PROMENADE 2 2000 MODERATE 2030 933-873-17 7541 Shady Glen Circle PROMENADE 2 2000 MODERATE 2030 933-873-03 7542 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-873-16 7543 Shady Glen Circle PROMENADE 2 2000 MODERATE 2033 933-873-04 7544 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-873-15 7545 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-873-05 7546 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-873-14 7547 Shady Glen Circle PROMENADE 3 2000 MODERATE 2033 933-873-06 7548 Shady Glen Circle PROMENADE 2 2000 MODERATE 2030 933-873-07 7550 Shady Glen Circle PROMENADE 2 2000 MODERATE 2030 933-873-13 7551 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-873-08 7552 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-873-12 7553 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-873-09 7554 Shady Glen Circle PROMENADE 3 2000 MODERATE 2030 933-873-11 7555 Shady Glen Circle PROMENADE 3 2000 MODERATE 2035 933-873-10 7557 Shady Glen Circle I IPROMENADE 3 2000 MODERATE 2030 SEMI= 935-760-78 7333 Bret Court SEACLIFF PALMS 2 2005 MODERATE 2035 935-760-79 7341 Bret Court SEACLIFF PALMS 2 2005 MODERATE 2035 935-760-80 7349 Bret Court SEACLIFF PALMS 2 2005 MODERATE 2035 111-441-31 7015 Cannon Court TIDES 3 2004 MODERATE 2035 111-441-39 7060 Coos Court TIDES 3 2004 MODERATE 2034 111-441-07 7059 Depoe Court TIDES 3 2004 MODERATE 2037 111-441-01 7089 Depoe Court TIDES 3 2004 MODERATE 2034 111-441-13 7017 Nestucca Court TIDES 3 2004 MODERATE 2034 111-441-08 7051 Nestucca Court TIDES 3 2004 MODERATE 2034 111-441-54 7018 Reedsport Court TIDES 3 2004 MODERATE 2034 111-441-58 7040 Reedsport Court TIDES 3 2004 MODERATE 2034 111-441-85 7093 Rincon Court TIDES 3 2004 MODERATE 2034 1 11-441-24 7089 Rockaway Court TIDES 3 2004 MODERATE 2034 111-441-36 7054 Toledo Court TIDES 3 2004 MODERATE 2034 111-441-44 7095 Trestles Court TIDES 3 2004 MODERATE 2034 No Data 19115 Alexa Lane TUSCANY 3 2007 MODERATE 2037 No Data 19135 Alexa Lane TUSCANY 3 2007 MODERATE 2037 No Data 19153 Alexa Lane TUSCANY 3 2007 MODERATE 2037 No Data 7254 Lisamarie Court TUSCANY 3 2007 MODERATE 2037 No Data 7265 Lisamarie Court TUSCANY 3 2007 MODERATE 2037 No Data 19079 Eric Court VILLAS AT SEACLIFF 2 2008 MODERATE 2038 No Data 19083 Eric Court VILLAS AT SEACLIFF 3 2008 MODERATE 2038 No Data 7224 Rosemarie Drive VILLAS AT SEACLIFF 2 2008 MODERATE 2038 No Data 7234 lRosemarie Drive IVILLAS AT SEACLIFF 2 2008 MODERATE 2038 LEFT BIANK City of Huntington Beach AFFORDABLE HOUSING LIST HUN71NGrON BEACH This list is intended to comply with California State Assembly Bill 987. THIS IS NOT A LIST OF"FOR SALE" PROPERTIES. Please DO NOT contact owners of these properties. For a list of units for sale,visit http://www.surfcity-hb.org/Residents/housing/ownership. However,this list reflects multi-family affordable housing units in Huntington Beach that are"Deed Restricted" (Affordable through governmental financing or other assistance). Updated January 5,2009 937-84-020 17201 Ash Street A ASH STREET MEDIAN 3 2062 2002 937-84-021 17201 Ash Street B ASH STREET MEDIAN 3 2062 2002 937-84-022 17201 Ash Street C ASH STREET MEDIAN 3 2062 2002 937-84-023 17201 Ash Street D ASH STREET MEDIAN 3 2062 2002 937-84-024 17201 Ash Street E ASH STREET MEDIAN 31 2062 2002 937-84-025 17201 Ash Street F ASH STREET MEDIAN 3 2062 2002 930-79-461 409 Utica Avenue A-1 BRISAS DEL MAR LOW 2 2024 1993 930-79-462 409 Utica Avenue A-2 BRISAS DEL MAR MODERATE 3 2024 1993 930-79-463 409 Utica Avenue A-3 BRISAS DEL MAR MODERATE 3 2024 1993 930-79-464 409 Utica Avenue A-4 IBRISAS DEL MAR MODERATE 31 2025 1993 930-79-465 409 Utica Avenue A-5 BRISAS DEL MAR MODERATE 21 2033 1993 930-79-466 409 Utica Avenue A-6 BRISAS DEL MAR MODERATE 2 2024 1993 930-79-467 409 Utica Avenue A-7 BRISAS DEL MAR LOW 2 2024 1993 930-79-468 409 Utica Avenue A-8 BRISAS DEL MAR MODERATE 2 2023 1993 930-79-469 409 Utica Avenue A-9 BRISAS DEL MAR LOW 1 2032 1993 930-79-470 409 Utica Avenue A-10 BRISAS DEL MAR MODERATE 2 2033 1993 930-79-471 409 Utica Avenue A-11 BRISAS DEL MAR MODERATE 1 2036 1993 930-79-472 409 Utica Avenue B-12 BRISAS DEL MAR LOW 2 2029 1993 930-79-473 409 Utica Avenue B-13 BRISAS DEL MAR MODERATE 3 2029 1993 930-79-474 409 Utica Avenue B-14 BRISAS DEL MAR MODERATE 3 2024 1993 930-79-475 409 Utica Avenue B-15 BRISAS DEL MAR MODERATE 3 2030 1993 930-79-476 409 Utica Avenue B-16 BRISAS DEL MAR MODERATE 2 2031 1993 930-79-477 409 Utica Avenue 1-18 -17 BRISAS DEL MAR MODERATE 2 2035 1993 930-79-478 409 Utica Avenue BRISAS DEL MAR MODERATE 2 2029 1993 930-79-479 409 Utica Avenue B-19 BRISAS DEL MAR MODERATE 21 2024 1993 930-79-480 409 Utica Avenue B-20 BRISAS DEL MAR MODERATE 1 2038 1993 930-79-481 409 Utica Avenue B-21 BRISAS DEL MAR LOW 2 2024 1993 930-79-482 409 Utica Avenue B-22 BRISAS DEL MAR MODERATE 1 2032 1993 930-79-483 409 Utica Avenue C-23 BRISAS DEL MAR LOW 2 2024 1993 930-79-484 409 Utica Avenue C-24 BRISAS DEL MAR MODERATE 1993 930-79-485 409 Utica Avenue C-25 BRISAS DEL MAR MODERATE 3 2026 1993 930-79-486 409 Utica Avenue C-26 BRISAS DEL MAR MODERATE 3 2024 1993 930-79-487 409 Utica Avenue C-27 BRISAS DEL MAR MODERATE 2 2036 1993 930-79-488 409 Utica Avenue C-28 BRISAS DEL MAR MODERATE 2 2032 1993 930-79-489 409 Utica Avenue C-29 BRISAS DEL MAR MODERATE 31 2024 1993 930-79-490 409 Utica Avenue C-30 BRISAS DEL MAR MODERATE 1 2034 1993 930-79-491 409 Utica Avenue C-31 BRISAS DEL MAR MODERATE 3 2035 1993 930-79-492 409 Utica Avenue C-32 BRISAS DEL MAR LOW 1 2032 1993 930-79-493 409 Utica Avenue D-33 BRISAS DEL MAR MODERATE 2 2031 1993 930-79-494 409 Utica Avenue D-34 BRISAS DEL MAR MODERATE 2 2036 1993 930-79-495 409 Utica Avenue D-35 BRISAS DEL MAR MODERATE 2 2024 1993 930-79-496 409 Utica Avenue D-36 BRISAS DEL MAR MODERATE 2 2033 1993 930-79-497 409 Utica Avenue D-37 BRISAS DEL MAR MODERATE 2 2034 1993 930-79-498 409 Utica Avenue D-38 BRISAS DEL MAR MODERATE 3 2028 1993 930-79-499 409 Utica Avenue D-39 BRISAS DEL MAR LOW 3 2032 1993 930-79-500 409 Utica Avenue D-40 BRISAS DEL MAR MODERATE 3 2028 1993 930-46-501 409 Utica Avenue D-41 BRISAS DEL MAR MODERATE 2 2034 1993 930-79-502 409 Utica Avenue D-42 BRISAS DEL MAR MODERATE 2 2028 1993 930-79-503 409 Utica Avenue D-43 BRISAS DEL MAR LOW 1 2024 1993 930-79-504 409 Utica Avenue D-44 BRISAS DEL MAR MODERATE 1 2032 1993 933-87-424 18861 Breezy Lane CAPE ANN MODERATE 4 2030 2000 933-87-477 18862 Breezy Lane CAPE ANN MODERATE 4 2030 2000 933-87-425 18865 Breezy Lane CAPE ANN MODERATE 3 2030 2000 933-87-478 18866 Breezy Lane CAPE ANN MODERATE 31 2030 2000 933-87-479 18870 Breezy Lane CAPE ANN MODERATE 4 2030 2000 933-87-426 18873 Breezv Lane CAPE ANN MODERATE 3 2032 2000 933-87-427 18877 lBreezy Lane ICAPE ANN I MODERATE 3 20301 2000 • • • 933-87-428 18881 Breezy Lane CAPE ANN MODERATE 4 2030 2000 933-87-429 18887 Breezy Lane CAPE ANN MODERATE 4 2030 2000 933-87-430 18891 Breezy Lane CAPE ANN MODERATE 3 2032 2000 933-87-431 18895 Breezy Lane CAPE ANN MODERATE 4 2030 2000 933-87-334 18899 Breezy Lane CAPE ANN MODERATE 31 2029 2000 933-87-335 18903 Breezy Lane CAPE ANN MODERATE 31 2038 2000 933-87-336 18907 Breezy Lane CAPE ANN MODERATE 31 2031 2000 933-87-337 18911 Breezy Lane CAPE ANN MODERATE 3 2029 2000 933-87-338 18915 Breezy Lane CAPE ANN MODERATE 3 2034 2000 933-87-367 18916 Breezy Lane CAPE ANN MODERATE 4 2029 2000 933-87-339 18919 Breezy Lane CAPE ANN MODERATE 3 2033 2000 933-87-368 18920 Breezy Lane CAPE ANN MODERATE 31 2030 2000 933-87-340 18923 Breezy Lane CAPE ANN MODERATE 3 2033 2000 933-87-369 18924 Breezy Lane CAPE ANN MODERATE 3 2033 2000 933-87-341 18927 Breezy Lane CAPE ANN MODERATE 3 2029 2000 933-87-370 18928 Breezy Lane CAPE ANN MODERATE 3 2029 2000 933-87-371 18930 Breezy Lane CAPE ANN MODERATE 41 2038 2000 933-87-342 18931 Breezy Lane CAPE ANN MODERATE 4 2029 2000 933-87-343 18935 Breezy Lane CAPE ANN MODERATE 3 2033 2000 933-87-344 18939 Breezy Lane CAPE ANN MODERATE 3 2029 2000 933-87-345 18943 Breezy Lane CAPE ANN MODERATE 3 2033 2000 933-87-346 18947 Breezy Lane CAPE ANN MODERATE 41 2029 2000 933-87-347 18951 Breezy Lane CAPE ANN MODERATE 3 2031 2000 933-87-348 18955 Breezy Lane CAPE ANN MODERATE 3 2033 2000 933-87-349 18959 Breezy Lane CAPE ANN MODERATE 3 2029 2000 933-87-350 18961 Breezy Lane CAPE ANN MODERATE 4 2033 2000 933-87-351 18965 Breezy Lane CAPE ANN MODERATE 31 2032 2000 933-87-352 18969 Breezy Lane CAPE ANN MODERATE 3 2032 2000 933-87-353 18971 Breezy Lane CAPE ANN MODERATE 3 2029 2000 933-87-354 18975 Breezy Lane CAPE ANN MODERATE 4 2029 2000 933-87-355 18979 Breezy Lane CAPE ANN MODERATE 3 2035 2000 933-87-356 1 18983 lBreezy Lane CAPE ANN MODERATE 1 31 2029 2000 933-87-357 1 18987 lBreezy Lane ICAPE ANN MODERATE 1 31 2029 2000 • • • 933-87-469 18809 Coolwater Lane CAPE ANN MODERATE 31 2030 2000 933-87-468 18813 Coolwater Lane CAPE ANN MODERATE 3 2030 2000 933-87-467 18817 Coolwater Lane CAPE ANN MODERATE 4 2030 2000 933-87-454 18821 Coolwater Lane CAPE ANN MODERATE 3 2030 2000 933-87-453 18825 Coolwater Lane CAPE ANN MODERATE 3 2030 2000 933-87-452 18829 Coolwater Lane CAPE ANN MODERATE 41 2030 2000 933-87-459 18830 Coolwater Lane CAPE ANN MODERATE 3 2030 2000 933-87-460 18834 Coolwater Lane CAPE ANN MODERATE 3 2033 2000 933-87-461 18838 Coolwater Lane CAPE ANN MODERATE 4 2033 2000 933-87-449 18842 Coolwater Lane CAPE ANN MODERATE 3 2035 2000 933-87-450 18846 Coolwater Lane CAPE ANN MODERATE 31 2034 2000 933-87-451 18850 Coolwater Lane CAPE ANN MODERATE 4 2030 2000 933-87-446 18854 Coolwater Lane CAPE ANN MODERATE 4 2030 2000 933-87-438 18857 Coolwater Lane CAPE ANN MODERATE 4 2035 2000 933-87-447 18858 Coolwater Lane CAPE ANN MODERATE 3 2037 2000 933-87-448 18862 Coolwater Lane CAPE ANN MODERATE 31 2033 2000 933-87-439 18863 Coolwater Lane CAPE ANN MODERATE 3 2030 2000 933-87-435 18866 Coolwater Lane CAPE ANN MODERATE 4 2033 2000 933-87-440 18867 Coolwater Lane CAPE ANN MODERATE 3 2038 2000 933-87-436 18868 Coolwater Lane CAPE ANN MODERATE 3 2029 2000 933-87-437 18870 Coolwater Lane CAPE ANN MODERATE 31 2030 2000 933-87-432 18874 Coolwater Lane CAPE ANN MODERATE 4 2030 2000 933-87-441 18875 Coolwater Lane CAPE ANN MODERATE 4 2030 2000 933-87-433 18876 Coolwater Lane CAPE ANN MODERATE 3 2034 2000 933-87-434 18878 Coolwater Lane CAPE ANN MODERATE 3 2030 2000 933-87-413 18882 Coolwater Lane CAPE ANN MODERATE 41 2029 2000 933-87-414 18886 Coolwater Lane CAPE ANN MODERATE 31 2029 2000 933-87-416 18889 Coolwater Lane CAPE ANN MODERATE 41 2038 2000 933-87-415 18890 Coolwater Lane CAPE ANN MODERATE 31 2038 2000 933-87-417 18893 Coolwater Lane CAPE ANN MODERATE 31 2029 2000 933-87-418 18897 Coolwater Lane CAPE ANN MODERATE 3 2035 2000 933-87-410 18904 Coolwater Lane CAPE ANN MODERATE 4 2029 2000 933-87-411 18908 Coolwater Lane CAPE ANN MODERATE 3 2029 2000 • • • 933-87-419 18911 Coolwater Lane CAPE ANN MODERATE 4 2029 2000 933-87-412 18912 Coolwater Lane CAPE ANN MODERATE 3 2033 2000 933-87-407 18916 Coolwater Lane CAPE ANN MODERATE 4 2029 2000 933-87-408 18920 Coolwater Lane CAPE ANN MODERATE 3 2033 2000 933-87-409 18924 Coolwater Lane CAPE ANN MODERATE 31 2036 2000 933-87-392 18925 Coolwater Lane CAPE ANN MODERATE 4 2038 2000 933-87-404 18928 Coolwater Lane CAPE ANN MODERATE 4 2032 2000 933-87-391 18929 Coolwater Lane CAPE ANN MODERATE 3 2029 2000 933-87-405 18930 Coolwater Lane CAPE ANN MODERATE 3 2032 2000 933-87-390 18933 Coolwater Lane CAPE ANN MODERATE 31 2029 2000 933-87-406 18934 Coolwater Lane CAPE ANN MODERATE 3 2034 2000 933-87-389 18937 Coolwater Lane CAPE ANN MODERATE 3 2026 2000 933-87-401 18938 Coolwater Lane CAPE ANN MODERATE 4 2029 2000 933-87-402 18942 Coolwater Lane CAPE ANN MODERATE 3 2029 2000 933-87-403 18946 Coolwater Lane CAPE ANN MODERATE 31 2035 2000 933-87-476 7407 Pinnacle Circle CAPE ANN MODERATE 4 2030 2000 933-87-472 7408 Pinnacle Circle CAPE ANN MODERATE 3 2030 2000 933-87-471 7410 Pinnacle Circle CAPE ANN MODERATE 3 2033 2000 933-87-475 7411 Pinnacle Circle CAPE ANN MODERATE 3 2030 2000 933-87-470 7414 Pinnacle Circle CAPE ANN MODERATE 4 2030 2000 933-87-474 7415 Pinnacle Circle CAPE ANN MODERATE 31 2030 2000 933-87-442 7418 Pinnacle Circle CAPE ANN MODERATE 3 2033 2000 933-87-473 7419 Pinnacle Circle CAPE ANN MODERATE 3 2030 2000 933-87-455 7421 Pinnacle Circle CAPE ANN MODERATE 4 2030 2000 933-87-443 7422 Pinnacle Circle CAPE ANN MODERATE 4 2033 2000 933-87-456 7425 Pinnacle Circle CAPE ANN MODERATE 3 2030 2000 933-87-444 7428 Pinnacle Circle CAPE ANN MODERATE 3 2035 2000 933-87-457 7429 Pinnacle Circle CAPE ANN MODERATE 3 2030 2000 933-87-458 7431 Pinnacle Circle CAPE ANN MODERATE 3 2031 2000 933-87-445 7432 Pinnacle Circle CAPE ANN MODERATE 41 2030 2000 933-87-423 7432 Prospect Drive CAPE ANN MODERATE 4 2029 2000 933-87-422 7436 Prospect Drive ICAPE ANN MODERATE 3 2029 2000 933-87-421 7440 lProspect Drive ICAPE ANN MODERATE 3 2029 2000 933-87-420 7444 Prospect Drive CAPE ANN MODERATE 4 2029 2000 933-87-466 7453 Shelter Cove Circle CAPE ANN MODERATE 4 2030 2000 933-87-465 7457 Shelter Cove Circle CAPE ANN MODERATE 3 2030 2000 933-87-464 7461 Shelter Cove Circle CAPE ANN MODERATE 3 2030 2000 933-87-463 7465 Shelter Cove Circle CAPE ANN MODERATE 3 2033 2000 933-87-462 7469 Shelter Cove Circle CAPE ANN MODERATE 4 2032 2000 933-87-361 7402 Upper Bay Drive CAPE ANN MODERATE 3 2029 2000 933-87-360 7404 Upper Bay Drive CAPE ANN MODERATE 3 2038 2000 933-87-359 7406 Upper Bay Drive CAPE ANN MODERATE 3 2029 2000 933-87-358 7408 Upper Bay Drive CAPE ANN MODERATE 31 2036 2000 933-87-375 7412 Upper Bay Drive CAPE ANN MODERATE 31 2032 2000 933-87-374 7414 Upper Bay Drive CAPE ANN MODERATE 3 2038 2000 933-87-373 7416 Upper Bay Drive CAPE ANN MODERATE 3 2031 2000 933-87-372 7418 Upper Bay Drive CAPE ANN MODERATE 4 2032 2000 933-87-362 7419 Upper Bay Drive CAPE ANN MODERATE 4 2029 2000 933-87-363 7421 Upper Bay Drive CAPE ANN MODERATE 31 2032 2000 933-87-379 7422 Upper Bay Drive CAPE ANN MODERATE 3 2029 2000 933-87-364 7423 Upper Bay Drive CAPE ANN MODERATE 3 2033 2000 933-87-378 7424 U er Bay Drive CAPE ANN MODERATE 3 2035 2000 933-87-365 7425 Upper Bay Drive CAPE ANN MODERATE 3 2029 2000 933-87-377 7426 Upper Bay Drive CAPE ANN MODERATE 31 2029 2000 933-87-366 7427 Upper Bay Drive CAPE ANN MODERATE 41 2029 2000 933-87-376 7428 _Upper Bay Drive CAPE ANN MODERATE 3 2029 2000 933-87-393 7431 Upper Bay Drive CAPE ANN MODERATE 4 2035 2000 933-87-383 7432 _Upper Bay Drive CAPE ANN MODERATE 3 2003 2000 933-87-394 7433 Upper Bay Drive CAPE ANN MODERATE 3 2029 2000 933-87-382 7434 Upper Bay Drive CAPE ANN MODERATE 31 2029 2000 933-87-395 7435 Upper Bay Drive CAPE ANN MODERATE 3 2029 2000 933-87-381 7436 Upper Bay Drive CAPE ANN MODERATE 3 2029 2000 933-87-396 7437 Upper Bay Drive CAPE ANN MODERATE 3 2032 2000 993-87-380 7438 Upper Bay Drive ICAPE ANN MODERATE 4 2029 2000 933-87-388 7442 jUpper Bay Drive CAPE ANN MODERATE 3 2033 2000 933-87-387 7444 jUpper Bay Drive ICAPE ANN MODERATE 31 20311 2000 933-87-384 7448 Upper Bay Drive CAPE ANN MODERATE 3 2029 2000 933-87-385 7450 Upper Bay Drive CAPE ANN MODERATE 3 2030 2000 933-87-386 7452 Upper Bay Drive CAPE ANN MODERATE 4 2029 2000 933-87-398 7456 Upper Bay Drive CAPE ANN MODERATE 3 2029 2000 933-87-397 7458 _Upper Bay Drive CAPE ANN MODERATE 31 2038 2000 933-87-400 7462 Upper Bay Drive CAPE ANN MODERATE 3 2029 2000 933-87-399 7464 Upper Bay Drive CAPE ANN MODERATE 3 2032 2000 025-12-144 2340 Delaware DELAWARE LOW 3 2036 2003 933-87-559 19028 Delaware DELAWARE MEDIAN 3 2036 2003 159-47-248 18751 Park Brook Lane GREYSTONE KEYS MODERATE 31 2031 1993 159-47-247 18755 Park Brook Lane GREYSTONE KEYS MODERATE 3 2031 1993 159-47-206 7615 Park Field Circle GREYSTONE KEYS MODERATE 3 2035 1993 159-47-205 7621 Park Field Circle GREYSTONE KEYS MODERATE 3 2027 1993 159-47-237 7661 Park Field Circle GREYSTONE KEYS MODERATE 3 2035 1993 159-47-236 7665 Park Field Circle GREYSTONE KEYS MODERATE 3 2028 1993 159-47-415 7641 Park Forest Drive GREYSTONE KEYS MODERATE 31 2028 1993 159-47-447 18602 Park Glen Lane GREYSTONE KEYS MODERATE 3 2028 1993 159-47-459 18615 Park Glen Lane GREYSTONE KEYS MODERATE 3 2038 1993 159-47-213 18771 Park Haven Lane GREYSTONE KEYS MODERATE 3 2028 1993 159-47-214 18775 Park Haven Lane GREYSTONE KEYS MODERATE 3 2027 1993 159-47-427 18596 Park Meadow Lane GREYSTONE KEYS MODERATE 3 2033 1993 159-47-428 18602 Park Meadow Lane GREYSTONE KEYS MODERATE 3 2028 1993 159-47-496 18616 Park Meadow Lane GREYSTONE KEYS MODERATE 3 2032 1993 159-47-432 18622 Park Meadow Lane GREYSTONE KEYS MODERATE 3 2028 1993 159-47-435 18636 Park Meadow Lane GREYSTONE KEYS MODERATE 3 2028 1993 159-47-436 18642 Park Meadow Lane GREYSTONE KEYS MODERATE 3 2028 1993 159-47-219 7632 Park Path Drive GREYSTONE KEYS MODERATE 41 2033 1993 159-47-220 7636 Park Path Drive GREYSTONE KEYS MODERATE 3 2031 1993 159-47-465 18612 Park Ridge Lane GREYSTONE KEYS MODERATE 3 2028 1993 159-47-466 18616 Park Ridge Lane GREYSTONE KEYS MODERATE 3 2028 1993 159-47-302 18641 Park Rid e Lane GREYSTONE KEYS MODERATE 3 2027 1993 18615 IPark Meadow Lane IGREYSTONE KEYS MODERATE 937-40-290 19172 lHolly Street B HOLLY STREET MODERATE 2 20321 2002 • • 937-40-291 19172 Holly Street C HOLLY STREET MODERATE 2 2032 2002 HUNTINGTON 933-87-555 18831 Huntington Street STREET MODERATE 4 2032 2002 159-48-113 18930 Ocean Park Lane PACIFIC LANDING MODERATE 2028 1998 159-48-123 7556 Ocean Point Drive PACIFIC LANDING MODERATE 2028 1998 159-48-115 7565 Ocean Point Drive PACIFIC LANDING MODERATE 2028 1998 159-48-121 7572 Ocean Point Drive PACIFIC LANDING MODERATE 4 2038 1998 159-48-118 7585 Ocean Point Drive PACIFIC LANDING MODERATE 2028 1998 933-87-256 7861 Happy Drive 101 PACIFIC PARK VILLAS MODERATE 2 2026 1996 933-87-258 7861 _Happy Drive 102 PACIFIC PARK VILLAS MODERATE 2026 1996 933-87-259 7861 _Happy Drive 202 PACIFIC PARK VILLAS MODERATE 2031 1996 933-87-263 7871 Happy Drive 201 PACIFIC PARK VILLAS MODERATE 1 2026 1996 933-87-260 7871 _Happy Drive 102 PACIFIC PARK VILLAS MODERATE 3 2032 1996 933-87-273 18051 Joyful Lane 102 PACIFIC PARK VILLAS MODERATE 2033 1996 933-87-275 18051 Joyful Lane 104 PACIFIC PARK VILLAS MODERATE 2 2026 1996 933-87-277 18051 _Joyful Lane 205 PACIFIC PARK VILLAS MODERATE 2029 1996 933-87-269 18061 Joyful Lane 101 PACIFIC PARK VILLAS MODERATE 2 2027 1996 933-87-268 18061 Joyful Lane 102 PACIFIC PARK VILLAS MODERATE 2 2027 1996 933-87-266 18061 Joyful Lane 104 PACIFIC PARK VILLAS MODERATE 2 2025 1996 933-87-270 18061 Joyful Lane 201 PACIFIC PARK VILLAS MODERATE 21 2038 1996 933-87-265 18061 Joyful Lane 205 PACIFIC PARK VILLAS MODERATE 2026 1996 933-87-500 7501 Quiet Cove Circle PROMENADE MODERATE - 110% 3 2029 2000 933-87-501 7503 Quiet Cove Circle PROMENADE MODERATE - 120% 3 2033 2000 933-87-502 7505 Quiet Cove Circle PROMENADE MODERATE - 120% 2 2033 2000 933-87-503 7507 Quiet Cove Circle PROMENADE MODERATE - 120% 21 2038 2000 933-87-504 7509 Quiet Cove Circle PROMENADE MODERATE - 110% 31 2029 2000 933-87-505 7511 Quiet Cove Circle PROMENADE MODERATE - 120% 31 2031 2000 933-87-506 7513 Quiet Cove Circle PROMENADE MODERATE - 120% 21 2031 2000 933-87-507 7515 Quiet Cove Circle PROMENADE MODERATE - 110% 21 2029 2000 933-87-508 7517 Quiet Cove Circle PROMENADE MODERATE - 110% 3 2030 2000 933-87-509 7519 Quiet Cove Circle PROMENADE MODERATE - 110% 3 2029 2000 933-87-510 7523 Quiet Cove Circle 1PROMENAIDE MODERATE - 110% 3 2029 2000 933-87-511 1 7525 lQuiet Cove Circle I 1PROMENAIDE IMODERATE - 120% 3 20341 2000 • • • 933-87-512 7527 Quiet Cove Circle PROMENADE MODERATE - 110% 2 2035 2000 933-87-513 7529 Quiet Cove Circle PROMENADE MODERATE - 110% 2 2029 2000 933-87-514 7531 Quiet Cove Circle PROMENADE MODERATE - 110% 3 2032 2000 933-87-515 7533 Quiet Cove Circle PROMENADE MODERATE - 120% 3 2033 2000 933-87-516 7535 Quiet Cove Circle PROMENADE MODERATE - 120% 31 2036 2000 933-87-517 7537 Quiet Cove Circle PROMENADE MODERATE - 110% 21 2034 2000 933-87-518 7539 Quiet Cove Circle PROMENADE MODERATE - 110% 2 2029 2000 933-87-519 7541 Quiet Cove Circle PROMENADE MODERATE - 120% 3 2032 2000 933-87-520 7543 Quiet Cove Circle PROMENADE MODERATE - 110% 3 2038 2000 933-87-521 7547 Quiet Cove Circle PROMENADE MODERATE - 110% 3 2029 2000 933-87-522 7549 Quiet Cove Circle PROMENADE MODERATE - 110% 2 2029 2000 933-87-523 7551 Quiet Cove Circle PROMENADE MODERATE - 110% 2 2029 2000 933-87-524 7553 Quiet Cove Circle PROMENADE MODERATE - 110% 3 2030 2000 933-87-525 7555 Quiet Cove Circle PROMENADE MODERATE - 110% 3 2029 2000 933-87-526 7557 Quiet Cove Circle PROMENADE MODERATE - 110% 21 2029 2000 933-87-527 7559 Quiet Cove Circle PROMENADE MODERATE - 120% 21 2030 2000 933-87-528 7561 Quiet Cove Circle PROMENADE MODERATE - 110% 3 2029 2000 933-87-529 7563 Quiet Cove Circle PROMENADE MODERATE - 120% 3 2030 2000 933-87-530 7567 Quiet Cove Circle PROMENADE MODERATE - 110% 3 2029 2000 933-87-531 7569 Quiet Cove Circle PROMENADE MODERATE - 110% 3 2032 2000 933-87-532 7571 Quiet Cove Circle PROMENADE MODERATE - 110% 21 2029 2000 933-87-533 7573 Quiet Cove Circle PROMENADE MODERATE - 110% 2 2029 2000 933-87-534 7575 Quiet Cove Circle IPROMENADE MODERATE - 120% 3 2032 2000 933-87-535 7577 Quiet Cove Circle IPROMENADE MODERATE - 110% 3 2029 2000 933-87-536 7579 Quiet Cove Circle PROMENADE MODERATE - 110% 3 2029 2000 933-87-537 7581 Quiet Cove Circle PROMENADE MODERATE - 120% 3 2031 2000 933-87-288 7510 _Shady Glen Circle PROMENADE MODERATE - 120% 3 2029 2000 933-87-289 7512 _Shady Glen Circle PROMENADE MODERATE - 110% 3 2033 2000 933-87-290 7514 _Shady Glen Circle PROMENADE MODERATE - 120% 2 2029 2000 933-87-329 7515 Shady Glen Circle PROMENADE MODERATE - 120% 31 2029 2000 933-87-291 7516 _Shady Glen Circle PROMENADE MODERATE - 110% 2 2034 2000 933-87-328 7517 _Shady Glen Circle PROMENADE MODERATE - 120% 3 2029 2000 933-87-292 7518 _Shady Glen Circle PROMENADE MODERATE - 110% 3 2029 2000 • • • 933-87-327 7519 Shady Glen Circle PROMENADE MODERATE - 120% 21 2036 2000 933-87-293 7520 _Shady Glen Circle PROMENADE MODERATE - 120% 31 2037 2000 933-87-326 7521 _Shady Glen Circle PROMENADE MODERATE - 110% 21 2036 2000 933-87-294 7522 _Shady Glen Circle PROMENADE MODERATE - 110% 31 2038 2000 933-87-325 7523 Shady Glen Circle PROMENADE MODERATE - 120% 31 2032 2000 933-87-295 7524 _Shady Glen Circle PROMENADE MODERATE - 110% 21 2035 2000 933-87-324 7525 _Shady Glen Circle PROMENADE MODERATE - 110% 31 2029 2000 933-87-296 7526 _Shady Glen Circle PROMENADE MODERATE - 110% 21 2032 2000 933-87-297 7528 Shady Glen Circle PROMENADE MODERATE - 110% 31 2029 2000 933-87-323 7529 _Shady Glen Circle PROMENADE MODERATE - 110% 31 2029 2000 933-87-298 7530 _Shady Glen Circle PROMENADE MODERATE - 110% 31 2032 2000 933-87-322 7531 _Shady Glen Circle PROMENADE MODERATE - 120% 31 2033 2000 933-87-321 7533 Shady Glen Circle PROMENADE MODERATE - 110% 21 2030 2000 933-87-299 7534 _Shady Glen Circle PROMENADE MODERATE - 110% 31 2029 2000 933-87-320 7535 Shady Glen Circle PROMENADE MODERATE - 110% 21 2029 2000 933-87-300 7536 Shady Glen Circle PROMENADE MODERATE - 110% 31 2029 2000 933-87-319 7537 Shady Glen Circle PROMENADE MODERATE - 120% 31 2033 2000 933-87-301 7538 _Shady Glen Circle PROMENADE MODERATE - 110% 21 2029 2000 933-87-318 7539 Shady Glen Circle PROMENADE MODERATE - 110% 31 2029 2000 933-87-302 7540 Shady Glen Circle PROMENADE MODERATE - 110% 21 2029 2000 933-87-317 7541 Shady Glen Circle PROMENADE MODERATE - 110% 21 2038 2000 933-87-303 7542 _Shady Glen Circle PROMENADE MODERATE - 120% 31 2029 2000 933-87-316 7543 Shady Glen Circle PROMENADE MODERATE - 110% 21 2033 2000 933-87-304 7544 Shady Glen Circle PROMENADE MODERATE - 110% 31 2029 2000 933-87-315 7545 Shady Glen Circle PROMENADE MODERATE - 110% 31 2029 2000 933-87-305 7546 _Shady Glen Circle PROMENADE MODERATE - 110% 31 2029 2000 933-87-314 7547 _Shady Glen Circle PROMENADE MODERATE - 110% 3 2038 2000 933-87-306 7548 Shady Glen Circle PROMENADE MODERATE - 110% 2 2029 2000 933-87-307 7550 _Shady Glen Circle PROMENADE MODERATE - 110% 2 2029 2000 933-87-313 7551 Shady Glen Circle PROMENADE MODERATE - 110% 3 2029 200.0 933-87-308 7552 Shady Glen Circle PROMENADE MODERATE - 120% 31 2029 2000 933-87-312 7553 Shady Glen Circle PROMENADE MODERATE - 120% 31 2029 2000 933-87-309 7554 _Shady Glen Circle PROMENADE IMODERATE - 120% 31 2029 2000 • • • 933-87-311 7555 _Shady Glen Circle PROMENADE MODERATE - 110% 3 2035 2000 933-87-310 7557 _Shady Glen Circle PROMENADE MODERATE - 110% 3 2029 2000 935-76-078 7333 Bret Court SEACLIFF PALMS MODERATE 2 2035 2005 935-76-079 7341 Bret Court SEACLIFF PALMS MODERATE 2 2038 2005 935-76-080 7349 Bret Court SEACLIFF PALMS MODERATE 2 2035 2005 111-44-131 7015 Cannon Court TIDES MODERATE 3 2032 2004 111-44-139 7060 Coos Court TIDES MODERATE 3 2032 2004 111-44-107 7059 De oe Court TIDES MODERATE 3 2037 2004 111-44-101 7089 De oe Court TIDES MODERATE 31 2032 2004 111-44-113 7017 Nestucca Court TIDES MODERATE 3 2032 2004 111-44-108 7051 Nestucca Court TIDES MODERATE 3 2032 2004 111-44-154 7018 Reeds port Court TIDES MODERATE 3 2032 2004 111-44-158 7040 Reeds port Court TIDES MODERATE 3 2032 2004 111-44-185 7093 Rincon Court TIDES MODERATE 3 2034 2004 111-44-124 7089 Rockaway Court TIDES MODERATE 3 2032 2004 111-44-136 7054 Toledo Court TIDES MODERATE 3 2032 2004 111-44-144 7095 Trestles Court TIDES MODERATE 3 2032 2004 935-760-84 19115 Alexa Lane TUSCANY MODERATE 3 2037 2007 935-760-88 19135 Alexa Lane TUSCANY MODERATE 3 2037 2007 935-760-92 19153 Alexa Lane TUSCANY MODERATE 3 2037 2007 935-761-04 7254 Lisamarie Court TUSCANY MODERATE 3 2037 2007 935-761-09 7265 Lisamarie Court TUSCANY MODERATE 3 2037 2007 111-150-51 19075 Eric Court VILLAS AT SEACLIFF MODERATE 2 2038 2008 111-150-51 19083 Eric Court VILLAS AT SEACLIFF MODERATE 3 2038 2008 111-150-51 7224 Rosemarie Drive IVILLAS AT SEACLIFF MODERATE 1 21 2038 2008 ILEIF City un of Huntington Beach ® • Affordable Housing Programs Homes for Sale Bnsas Del Mar Address Bedrooms Income Level Max Price Realtor Phone Number Email 409 Utica,C-27 2 Moderate $ 313,219 Patrick Bartolic,Remax Real Estate Srvs 949-463-6329 Tbart4re(a)aol.com DO NOT CONTACT CITY OF HUNTINGTON BEACH FOR QUESTIONS!! CONTACT AGENT OR OWNER. Cape Ann: Address Bedrooms Income Level Max Price Realtor Phone Number Email 18862 Coolwater Lane 3 Moderate $ 422,561 For Sale by Owner 714-596-2543 7456 Upper Bay Drive 3 Moderate $ 394,606 For Sale by Owner 714-375-0473 18947 Breezy Lane 4 Moderate $ 492,281 For Sale by Owner 714-309-7366 18874 Coolwater 4 Moderate $ 492,281 For Sale by Owner 714-596-3972 melendez(a.aol.com 18929 Coolwater 3 Moderate $ 447,514 Van Nguyen,Realty Home 714-785-7604 18881 Breezy Lane 4 Moderate $ 511,146 For Sale by Owner 714-841-1659 John 18881Paol.com 18850 Coolwater Lane 4 Moderate $ 511,146 Donna Horn,Star Real Estate 714-746-1670 www.donnahorn.com 18866 Breezy Lane 3 Moderate $ 448,411 Donna Horn,Star Real Estate 714-746-1670 di.hom(5)verizon.net 18834 Coolwater Lane 3 Moderate $ 453,676 Roy Slater,Hathaway Real Estate Srvs 949-273-5573,x101 rslaterphresc.com 18951 Breezy Lane 3 Moderate $ 469,074 Margaret Van Herk,Star Real Estate 714-969-1516 mvh4re(a),verizon.ent DO NOT CONTACT CITY OF HUNTINGTON BEACH FOR QUESTIONS!! CONTACT AGENT OR OWNER. "_ram^,v^a �.� w•-.� Address Bedrooms Income Level Max Price Realtor Phone Number Email (none currently available) Greystone Keys._, Address Bedrooms Income Level Max Price Realtor Phone Number Email (none currently available) Pacific Park Villas: Address Bedrooms Income Level Max Price Realtor Phone Number Email (none currently available) Prottt`raradeR r��,I Address Bedrooms Income Level Max Price Realtor Phone Number Email (none currently available) DO NOT CONTACT CITY OF HUNTINGTON BEACH FOR QUESTIONS!! CONTACT AGENT OR OWNER. The Ttdes,,�, Address Bedrooms Income Level Max Price Realtor Phone Number Email (none currently available) Asir Street Condos: Address Bedrooms Income Level Max Price Realtor Phone Number Email DO NOT CONTACT CITY OF HUNTINGTON BEACH FOR QUESTIONS!! CONTACT AGENT OR OWNER. Information in this report is subject to change without notice_ Updated reports can be found at www.hbbiz.com\Housing\Ownership\lnrluslonaryHousing City of Huntington Beach,Economic Development Department 2000 Main Street,Huntington Beach.CA 92648 (714)536-5470 Updated 111612009 LEFT www- or-9 Is t�/u�1 c �c f� ►�s j► o l�/�j-vc�; � � s /ritsf iira � �v yer�c P`% zo P Inc`/ `% 2oovervl �v `/c2 Fc,> %? 20 � "l� zct,ve ite102� 7. �0 7. ���.{, • Mayor's Office of Housing Capital Improvements Policy The following policy applies to all BMR units and is excerpted from Section 2 (E) of the City and County of San Francisco Inclusionary Affordable Housing Program Monitoring and Procedures Manual 2007. The "Procedures Manual" is a formal overview of the rules and regulations of the BMR program. A. Capital Improvements for BMR Ownership Units 1. BMR units may begin claiming capital improvements made 10 years after the unit was originally occupied. Once the building becomes eligible for capital improvements credit, homeowners may begin submitting documentation of completed work. 2. MOH will review all capital improvements claims and categorize them into three distinct categories: Eligible Capital Improvements, Eligible Replacement and Repair and Ineligible Costs. Each category is defined below. a. Eligible Capital Improvements include major • structural system upgrades, special assessments, new additions to the unit and improvements related to increasing the health, safety and energy efficiency of the property. Improvements that meet these criteria will be given 100% credit. b. Eligible Replacement and Repair includes in-kind replacement of existing amenities, repairs and general maintenance that keeps the property in good working condition. Costs that meet these criteria will be given 50% credit. c. Ineligible costs include cosmetic enhancements, installations with limited useful life spans and non- permanent fixtures. Homeowners may undertake these projects at their discretion, however they will not be given capital improvements credit. 3. Procedure for Submitting Capital Improvements a. Homeowners must submit capital improvements to MOH for review within 6-months of the completion of the project. In order to document the improvements, each homeowner must submit: i. List of Capital Improvements with Description ii. Receipt/Invoice for Each Eligible Improvement iii. Proof of Payment, such as a cancelled check, bank account statement or credit card bill iv. A Copy of Site or Building Permits, if required v. Contractor's License Number for Projects Exceeding $500 b. Upon receipt of a complete capital improvements claim, MOH staff will arrange a site visit to inspect the completed project. Once the improvements have been verified, MOH will send a written response to approve or deny the submitted capital improvements within 60 days of original receipt. This information will be placed in the property file at MOH for use when the property is being sold. 4. Special Assessments Homeowner's Association initiated special assessments are • considered capital improvements and will be added to the resale price of the home. In order to receive credit for special assessments, homeowners must submit the following documentation within 6-months of payment: a. Invoice for Special assessment b. Proof of Payment, such as a cancelled check, bank account statement or credit card bill 5. Capital Improvements Cap In order to maintain the affordability of the BMR unit for subsequent buyers, MOH will approve all eligible capital improvements, eligible replacement and repair, and special assessments when submitted. At the time of sale, MOH will cap all eligible capital improvements and eligible replacement and repair at 7% of the resale price. 6. List of Approved Capital Improvements • • a. Eligible Capital Improvements include major structural system upgrades, new additions to the unit and improvements related to increasing the health, safety and energy efficiency of the property. Improvements that meet these criteria will be given 100% credit. i. Major Electrical Wiring System Upgrade ii. Major Plumbing System Upgrade iii. Room Additions iv. Installation of Additional Closets and Walls v. Alarm System vi. Smoke Detectors vii. Removal of Toxic Substances, such as: (a) Asbestos (b) Lead (c) Mold/Mildew (d) Insulation (e) Upgrade to Double Paned Windows (f) Fireplace Glass Screen viii. Upgrade to Energy Star Built-In Appliances, as follows: (a) Furnace (b) Water Heater (c) Stove/Range (d) Dishwasher (e) Microwave Hood b. Eligible Replacement and Repair includes in-kind replacement of existing amenities, repairs and general maintenance that keeps the property in good working condition. Costs that meet these criteria will be given 50% credit for repairs. i. Electrical Maintenance and Repair, such as: (a) Switches (b) Outlets ii. Plumbing Maintenance and Repair, such as: (a) Faucets (b) Supply Line (c) Sinks iii. Flooring iv. Countertops v. Cabinets vi. Bathroom Tile vii. Bathroom Vanity viii. Replacement of Built-In Appliances, as follows: • (a) Furnace (b) Water Heater (c) Stove/Range (d) Dishwasher (e) Microwave Hood (f) Garbage Disposal ix. Window Sash x. Fireplace Maintenance or In-kind Replacement (Gas) xi. Heating System xii. Lighting System (Recessed) c. Ineligible costs include cosmetic enhancements, installations with limited useful life spans and non- permanent fixtures. Homeowners may undertake these projects at their discretion, however they will not be given capital improvements credit. i. Cosmetic Enhancements, such as: (a) Fireplace Tile and Mantel (b) Decorative Wall Coverings or Hangings (c) Window Treatments (Blinds, Shutters, Curtains, etc.) (d) Installed Mirrors (e) Shelving e (f) Refinishing of Existing Surfaces it Non-Permanent Fixtures, such as: (a) Track Lighting (b) Door Knobs, Handles and Locks (c) Portable Appliances (Refrigerator, Microwave, Stove/Oven, etc.) iii. Installations with Limited Useful Life Spans, such as: (a) Carpet (b) Painting of Existing Surfaces (c) Window Glass (d) Light Bulbs • DMINISTRATIVEMAN IA 4F L 1 _ 4 ........ ............... COUNTY OF MONTEREY INCLUSIONARY HOUSING PROGRAM MAY 2003 APPENDIX MATERIALS UPDATED MARCH 2O04 �' -' County of Monterey Environmental Resource Policy Office of Housing and Redevelopment • Administrative Manual May 2003 LEFT j:AN Administrative Manual May 2003 • • Administrative Manual Prepared by: MELANIE SHAFFER FREITAS FREITAS + FREITAS, ENGINEERING AND PLANNING CONSULTANTS, INC. 311 LAURENT STREET, SANTA CRUZ CALIFORNIA (831) 471-9942 • Administrative Manual May 2003 Table of Contents 0 Paze# EXECUTIVESUMMARY.............................................................................................. 1 I. OPTIONS TO COMPLY WITH INCLUSIONARY ORDINANCE.......................2 1. ON-SITE OPTION..........................................................................................................2 A. inclusionary %Requirement................................................................................. 2 B. Levels of Affordability........................................................................................... 2 C. Design, Size and Location of Units....................................................................... 4 D. Timing of inclusionary units................................................................................. 4 2. OFF-SITE OPTION......................................................................................................... 5 A. Inclusionary % Requirement................................................................................. 5 B. Design, Size and Location of Units....................................................................... S C. Timing of inclusionary units.................................................................................. 5 D. Approval Process.................................................................................................. 6 3. PAYMENT OF IN-LIEU FEES..........................................................................................6 A. Projects Eligible for Payment of In-Lieu Fees...................................................... 6 B. In-Lieu Fee Calculation........................................................................................ 7 C. Calculation and Payment of In-Lieu Fee (Timing)............................................... 8 II. MARKETING AND SELECTION PROCEDURES............................................. 10 1. MARKETING RESPONSIBILITIES.................................................................................. 10 A. Housing and Redevelopment Office.................................................................... 10 • B. Property Owner/Developer................................................................................. 10 2. SELECTION OF INCLUSIONARY OCCUPANTS............................................................... 1 1 A. Rental Units......................................................................................................... I B. Homeowner Units................................................................................................ II III. HOMEOWNER INCLUSIONARY UNIT REQUIREMENTS .......................... 16 1. ELIGIBILITY CRITERIA ............................................................................................... 16 A. Income................................................................................................................. 16 B. Assets................................................................................................................... 16 C. Live/Work in Monterey County........................................................................... 16 2. ESTABLISHMENT OF INITIAL SALES AND RESALE PRICES........................................... 16 A. Initial Sales Price................................................................................................ 16 B. Maximum Restricted Resale Value/Price for Inclusionary units (For Units With Agreements Dated on or After May 23, 2003)...................................................... 18 C. Determination of Maximum Affordability Standards.......................................... 20 3. HOMEOWNER INCLUSIONARY UNIT REQUIREMENTS ..................................................22 A. Occupancy Requirements.................................................................................... 22 B. Affordability Periods........................................................................................... 22 C. Maintenance and Insurance................................................................................ 23 D. Refinancing of First Mortgage/Securing a new Second Mortgage..................... 23 E. Title Changes and Property Inheritance............................................................. 23 F. Default and Foreclosure...................................................................................... 23 • Administrative Manual May 2003 • IV. RENTAL INCLUSIONARY UNIT REQUIREMENTS......................................24 1. ELIGIBILITY CRITERIA................................................................................................24 A. Income................................................................................................................. 24 B. Assets................................................................................................................... 24 C. Live/Work in Monterey County........................................................................... 24 2. RENT SCHEDULES......................................................................................................24 A. Initial Rents......................................................................................................... 24 B. Annual Rent Changes.......................................................................................... 25 3. RENTAL INCLUSIONARY UNIT REQUIREMENTS...........................................................25 A. Household Size and Occupancy.......................................................................... 25 B. Lease Requirements............................................................................................. 25 C. Changes in Household Size or Income During Tenancy..................................... 25 V. MONITORING AND COMPLIANCE PROCEDURES.......................................26 1. PROJECT MONITORING AND COMPLIANCE.................................................................26 A. Monitoring Procedures:Rental Properties......................................................... 26 B. Monitoring Procedures:For Sale Units.............................................................. 28 2. PROGRAM MONITORING ............................................................................................29 A. Annual Report...................................................................................................... 29 B. Five Year Report.................................................................................................. 29 VI. OTHER......................................................................................................................30 • 1. EXEMPTIONS TO ORDINANCE..................................................................................... 30 2. POLICIES FOR AMENDMENTS TO AGREEMENTS.......................................................... 30 3. AFFORDABILITY PERIOD REQUIREMENTS FOR EXISTING INCLUSIONARY UNITS......... 30 VII. APPENDICES........................................................................................................31 APPENDIX A. HOMEOWNER FACT S1-1E1 "I........................................................................ 3 1 APPENDIX B. DEVELOPER FACT SI-IEE7.......................................................................... 33 APPENDIX C. DEVELOPER PROCEDURES........................................................................ 35 APPENDIX D. INCOME AND ASSET DEFINITIONS............................................................ 36 1. Income.................................................................................................................. 36 2. Definition of Income............................................................................................ 36 3. Assets.................................................................................................................... 36 APPENDIX E. INCOME LIMITS(UPDATE ANNUALLY).....................................................38 APPENDIX F. INITIAL SALES PRICE, REFINANCING AND RESALE STAFF PROCEDURES... 38 1. Criteria for.Determining Initial Sales Price........................................................ 38 2. Criteria for Determining Resale/Refinancing Values.......................................... 41 3. Criteria for determining Maximum Affordability Standard.................................. 46 APPENDIX G. IN LIEU FEE AND IN-LIEU FEE PAYMENT PROCESS ..................................48 APPENDIX H. UTILITY ALLOWANCE TABLES................................................................. 51 EXECUTIVE SUMMARY This Administrative Manual describes the day-to-day procedures for the implementation of the County of Monterey's Inclusionary Housing Ordinance (Chapter 18.40). In the event of a discrepancy between the Administrative Manual and the Inclusionary Housing Ordinance, the Ianguage of the Ordinance will take precedence. As identified in the Ordinance, the goals and objectives for the Inclusionary Housing Program include: • Achieving a balanced community with housing available for persons of all economic levels; • Encouraging a housing supply that provides housing opportunities throughout the County for a mix of households, including very low, low and moderate income households; • Providing a priority for occupancy of inclusionary units for households with a household member(s) who live or work in Monterey County; • Ensuring long-term affordability of the inclusionary units by requiring affordability restrictions and resale controls; and, • Encouraging the participation of the private and non-profit development communities to provide inclusionary units. • The Inclusionary Housing Program provides an opportunity for very low, low and moderate income households to purchase and/or rent affordable housing units throughout Monterey County. Policies and procedures in this Manual provide for the following: • New residential developments in the County shall include at least 20% of the units to be affordable to very low, low and/or moderate-income households. • The inclusionary units provided shall be sold or rented at affordable costs and the units, generally, shall remain permanently affordable. • Inclusionary units are considered an important and valuable resource for all County residents and, as such, shall be monitored regularly to ensure that they remain decent, safe and affordable housing units. • Creative implementation of the inclusionary requirements shall be encouraged, including the development of mixed-use housing and employee housing. 1 • Administrative Manual May 2003 • I. Options To Comply with Inclusionary Ordinance The County of Monterey has adopted an Inclusionary Housing Ordinance (Monterey County Code, Chapter 18.40). This Ordinance requires that 20% of the units/lots in new residential developments be affordable to very low, low and moderate-income households. The Ordinance is applicable to developments of three or more residential units/lots (farm worker housing and mobile home parks are exempt from the inclusionary requirements). Requirements of the Ordinance can be met through one of three options: 1. On-site Option 2. Off-site Option 3. Payment of In-Lieu Fees Developments of 3 or 4 units/lots are expected to meet their inclusionary obligations through the payment of In-Lieu Fees, although the developer/owner can choose to build an inclusionary housing unit instead of payment of In-Lieu Fees if they so desire. Developments of 5 or more units/lots are expected to meet their inclusionary obligation through the development of inclusionary housing units. 1. ON-SITE OPTION A. INCLUSIONARY% REQUIREMENT For developments of 5 or more residential units/lots, at least 20% of the units • must be set aside for inclusionary housing. The inclusionary units must be developed on the same site as the market rate units. Exceptions: In certain unusual and infrequent situations, an exception to the mandatory on-site requirement is available. These exceptions would result in provision of units off-site (see 42 "Off-Site Option") or payment of In-Lieu Fees (see 43 "Payment of In-Lieu Fees.") B. LEVELS OF AFFORDABILITY The intent of the Inclusionary Housing Ordinance is to provide a range of inclusionary units affordable to different household income levels. Inclusionary units shall be affordable to very low, low and moderate-income households. For developments of 5 or more units, at least 20%of the units must be set aside for inclusionary housing. The 20% requirement is broken down further by a requirement that 8% of all units be affordable to moderate income households, 6%to low income households, and 6% to very low income households Exceptions: In certain situations a deviation from the percentage requirements for income levels may be approved by the Appropriate Authority. The approval of the deviation must be supported by specific findings that document why the exception should be granted and how the objectives of the Inclusionary Program can still be met. The approval shall require a noticed public hearing. 2 Administrative Manual May 2003 Inclusionary Household Affordability Requirements SIZE OF INCLUSIONARY 20% REQUIREMENT DISTRIBUTED BY HOUSEHOLD INCOME LEVEL DEVELOPMENT REQUIREMENT Moderate Low Income Very Low Income Income 1-2 Units/Lots No Inclusionary Requirement 3 -4 Units/Lots Payment of In-Lieu N.A. N.A. N.A. Fee 5 Units/Lots Provide 20% 1 unit inclusionary units 6 -7 Provide 20% 1 unit+ payment Units/Lots inclusionary units of In-Lieu Fee for any fractional difference 8 Units/Lots Provide 20% 1 unit+ payment inclusionary units of In-Lieu Fee for • any fractional difference 9 Units/Lots Provide 20% 1 unit+ payment inclusionary units of In-Lieu Fee for any fractional difference 10 - 14 Provide 20% 1 unit+ payment 1 unit Units/Lots indusionary units of In-Lieu Fee for any fractional difference 15—16 Units/ Provide 20% 2 units+ payment 1 unit Lots Inclusionary of In-Lieu Fee for any fractional Units difference 17 or More Provide 20% 8% of all units 6% of all units 6% of all units Units/Lots Inclusionary (1 unit minimum) (1 unit minimum) (1 unit + payment of In- minimum) Units Lieu Fee for any fractional difference 3 • Administrative Manual May 2003 • The table on the previous page outlines the inclusionary obligation according to the method of"rounding up"the fractional requirement. According to the size of the proposed development, the 8%/60/o/6%inclusionary requirements are applied. The rounding up process for a five unit development would be as follows: the 8% moderate-income requirement is 0.40, the 6% low income requirement is 0.30 and the 6% very low income requirement is 0.30. Beginning with the very low-income figure and rounding up, the 0.30 very low-income figure is not a whole number and so the 0.30 amount would be added to the next highest income category, low income. The 0.30 would be added to the 0.30 low income and the resultant figure of 0.60 is still not a whole number. The 0.60 is added to the 0.40 moderate-income figure and a resultant whole number of 1 unit is generated. Therefore, the inclusionary requirement would be 1 moderate income unit. The same type of rounding up process would be applied to each proposed development. If a fractional amount still remains after rounding up, then the developer has the option of paying an-in lieu fee based on the fractional requirement or providing an • additional inclusionary unit. C. DESIGN, SIZE AND LOCATION OF UNITS The exterior appearance of the inclusionary units must be compatible with the market rate units. Compatibility includes the architectural style and detailing, but not necessarily the quality of materials or size of structures. The inclusionary units should be similar in number of bedrooms as the market rate units (up to four bedrooms). To the extent feasible, the inclusionary units shall be scattered throughout any development that also includes market rate units. However, inclusionary units may be clustered if it is found that such an arrangernent better meets the objectives of the program. D. TIMING OF INCLUSIONARY UNITS The inclusionary units must be developed either prior to or concurrent with the development of the market rate units. The phasing plan for the release of building permits for both the inclusionary and the market rate units shall be described in the Master inclusionary Developer Agreement. • 4 Administrative Manual May 2003 2. OFF-SITE OPTION A. INCLUSIONARY% REQUIREMENT For certain residential developments of 5 or more units/lots, the inclusionary .units may be developed on a site different (off-site) than the market rate units. To qualify for this option, the developer must demonstrate to the satisfaction of the approving body that the off-site units will provide a "greater contribution"than units provided on-site. "Greater contribution" means, at a minimum: • More inclusionary units are created off-site than would normally be required by the 20% Inclusionary Housing mandate; and • if homeowner units, all of the inclusionary units would be affordable to low income households, or • if rental units, all of the inclusionary units would be affordable to very low-income households. Units developed under the off-site option must be newly constructed units. Existing units cannot be substituted in the off-site option. Further, the off- site units must be located within the same Planning Area as the market rate units. B. DESIGN, SIZE AND LOCATION OF UNITS The exterior quality and appearance of the inclusionary units must be compatible with development in the vicinity of the'off--site location and be found to result in a positive benefit to the area. The inclusionary units shall be similar in number of bedroorns as the market rate units (up to four bedrooms), but the square footage size of the inclusionary units may be less than the market rate units. To the extent feasible,the inclusionary units shall be scattered throughout any development that also includes market rate units. However, inclusionary units may be clustered if it is found that such an arrangement better meets the objectives of the program. C. TIMING OF INCLUSIONARY UNITS The inclusionary units must be developed either prior to or concurrent with the development of the market rate units. The phasing plan for the release of 5 • Administrative Manual May 2003 • building permits Y ermits for both the inclusionary and the market rate units shall be described, in the Master Inclusionary Developer Agreement. D. APPROVAL PROCESS The provision of inclusionary units off-site will only be approved in developments that can demonstrate that they meet the "greater contribution" test specified above. The intent of the Inclusionary Housing Ordinance is to create developments that include a rnix of household income ranges and housing options, which is more possible with on-site development. Therefore, off-site inclusionary housing will only be approved for developments that provide more benefit to the community in terms of number of inclusionary units and affordability levels as specified above. The"greater contribution test must rneet be met to the satisfaction of the approving body. 3. PAYMENT OF INAIEU FEES A. PROJECTS ELIGIBLE FOR PAYMENT OF IN-LIEU FEES Proiects�3=4 Units/Eots All projects of 3-4 units/lots are eligible to pay In-Lieu Fees to meet their • Inclusionary Housing requirement. However, developers also have the option of building an inclusionary unit instead of paying the In-Lieu Fees. a. Owner-Occupied Exemptions and Applicability of Inclusionary Requirement: For developments of 3-4 units/lots, one unit may be owner-occupied and exempt from the Inclusionary Housing Requirements. Therefore, a 3 unit development with one of the units being owner-occupied would be completely exempt from the requirements of the Inclusionary Housing Ordinance because the net effect would be a 2 unit development. For a 4-unit development with one owner-occupied unit,the Inclusionary Requirement would only apply as if it were a 3-unit development. To qualify as an owner-occupied unit as specified in the paragraph above, the owner must agree to occupy the unit for at least one year following completion. One owner-occupied exemption is allowed per development and further;each developer/owner is allowed only one owner-occupied exemption every 10 years. For owner-occupied units that trigger an exemption, the owner must record a Promissory Note (for the amount of the In-Lieu Fee) secured by a Deed of Trust on the lot/unit being exempted requiring that the owner reside in the new unit for a minimum of one year from the date of the Notice of Completion. "Owner" must be an owner of record at the time the final map • 6 Administrative Manual May 2003 is recorded or use permit approved. All owners of record must sign the agreement. After the one-year period, the owner may submit a request to the Housing and Redevelopment Office to remove the deed restriction. Proof of residency for the one-year period must be provided at that time. Projects of 5 or More Units/Lots a. Payment of In-Lieu Fee for Fractional Obligations: For inclusionary obligations that result in a fractional inclusionary requirement (e.g., a 6 unit development would have an inclusionary obligation of 1.2), the developer/owner can either pay an In-Lieu Fee for the fractional difference of the inclusionary obligation or they may provide an inclusionary unit instead of paying the fee. b. Payment of In-Lieu Fee for Total Inclusionary, Obligation: Projects of 5 or more units are expected to produce inclusionary units on-site. However, in very rare and limited circumstances, a project of 5 or more units may meet its inclusionary obligation by only paying In-Lieu Fees. To qualify, the developer must conclusively demonstrate that provision of inclusionary units is infeasible because of specific characteristics of the development site, such as excessive property maintenance costs and/or limited access to services (e.g. transit, stores, etc.). B. INAIEU FEE CALCULATION The In=Lieu Fee is the difference between the cost of developing a market- rate home and the cost of providing a single-family unit affordable to a 4- person household with an income at 100% of median income. The Fees shall be based on current estimates of land and construction costs for an average single-family dwelling unit in the appropriate Planning Areas. To take into account the wide variation in land costs, two in-lieu fees are used, one for the Greater Monterey Peninsula and Coast Planning Areas and one for the remaining Planning Areas. Development costs are calculated assuming a per square foot construction cost for a 1500 square foot unit with an assumed land cost equaling 50% of total development cost for those projects located in the Greater Monterey Peninsula and Coast Planning Areas and an assumed land cost equaling 30% of total development cost for the remaining Planning Areas. The In-Lieu Fees are based on a 5-unit development. The In- Lieu Fee example provided in the table below is only an example. For current In-Lieu Fee calculations, please see Appendix G of this Manual. 7 • Administrative Manual May 2003 Example of In-Lieu Calculation: AVERAGE TOTAL DEVELOPMENT COST FOR A SINGLE-FAMILY UNIT $390,000 -AFFORDABLE SALES PRICE (4 PERSON HOUSEHOLD AT 100%OF $206,364 MEDIAN INCOME) IN-LIEU FEE FOR A 5-UNIT $183,636 DEVELOPMENT or $36,727 per unit Developments RepuirinQ a Fractional Amount of In-Lieu Fee: Developments of 3-4 units will pay a fractional amount of an In-Lieu Fee. Using the example above, a 3-unit development would pay an $110,181 In- Lieu Fee (3/5 of the $183,636 base fee). For developments with more than 5 units, the developer/owner will be required to build the required number of inclusionary units plus pay an In-Lieu Fee for any fractional amount of the inclusionary obligation. Using the In-Lieu Fee example above, a developer with an inclusionary obligation of 1.6 would be required to construct one inclusionary unit and to pay 60%of the In-Lieu Fee, or similar to the example above, 60%of$183,636 or $1 10,181. In-Lieu Fee Calculation: The Assistant County Administrative Officer for Environmental Resource Policy or his or her designee shall calculate the In-Lieu Fees on an annual basis. The Board of Supervisors shall then adopt the fees annually. C. CALCULATION AND PAYMENT OF IN-LIEU FEE (TIMING) Payment of In-Lieu Fees shall be made in full prior to the recordation of parcel or final maps, or where the development is not subject to subdivision approval, prior to issuance of the first building permit for the development. The In-Lieu Fee shall be calculated based on the In-Lieu Fee in effect at the time the application is deemed complete for a subdivision, land division or land use permit. or at the time of the first building permit issuance, if there is no subdivision. A description of the process is included in Appendix G. 8 Administrative Manual May 2003 • 9 • Administrative Manual May 2003 II. Marketing and Selection Procedures The Housing and Redevelopment Office shall have overall responsibility for the marketing of inclusionary units and the selection of households to occupy those units. However, there may be instances where it is appropriate to delegate some of those responsibilities to the development and/or real estate community. This section of the Manual discusses the overall marketing and selection procedures. 1. MARKETING RESPONSIBILITIES A. DOUSING AND REDEVELOPMENT OFFICE Staff at the Housing and Redevelopment Office shall be responsible for the general marketing of the Inclusionary Housing Program. This would include providing the following types of information: • Developer fact sheets • Homeowner fact sheets • Tenant fact sheets • Public Notices in newspaper, social service agencies, libraries, etc. regarding eligibility for occupancy and waiting list procedures • Presentations at community events or organizations • Other marketing materials as appropriate All written materials should be available in both English and Spanish, as well as in formats accessible to the visually handicapped (e.g. large print format, disc or Braille). In addition to marketing materials, important documents such as homeowner agreements and Inclusionary purchase documents shall also be available in English and Spanish as well as in formats accessible to the visually handicapped. B. PROPERTY OWNER/DEVELOPER As part of the Master Inclusionary Developer Agreement, the owner/developer may be required to submit a Management and Marketing • 10 Administrative Manual May 2003 plan for the County's approval. The Management and Marketing Plan shall g g contain at least the following elements: For rental developments • Marketing and Tenant Selection Plan, including marketing procedures, efforts to market to special needs groups, selection process and bi-lingual procedures. • Description of property management team • Copies of rental agreements/leases • Procedures for complying with fair housing laws • Selection Procedures for Tenants (including priority for households who live/work within Monterey County) • Initial rents and utility allowances (provided by staff) • Agreement to maintain adequate property insurance • Preferences may be given to employees in employer sponsored developments For homeowner developments Description of how the developer will co-ordinate occupancy of units with inclusionary homeowner selection procedures. (See next section for description of these procedures.) 2. SELECTION OF INCLUSIONARY OCCUPANTS A. RENTAL UNITS The owner/developer shall be responsible for selecting tenants upon initial occupancy and on-going vacancies. The selection procedure shall follow the marketing and selection plan submitted by the developer and approved by the County if determined to be required for the project (including any revisions required by the County as a condition of approval), and updated as needed. B. HOMEOWNER UNITS The owner/developer shall follow the procedures as listed below. a. Countywide Eli zibility List (Inclusionary Homeowners) The Housing and Redevelopment Office shall be responsible for establishing and maintaining a countywide waiting list for occupancy of homeowner inclusionary units. To create the list, the Housing and Redevelopment Office 11 Administrative Manual May 2003 • shall publish notices in newspapers circulated in the Monterey Count area Py y (in both English and Spanish), provide public notices at community gathering areas (e.g. social service agencies, libraries, etc.), and distribute information to the real estate community. Information should include: 1. Homeowner Fact Sheet (See Example in Appendix) 2. Priorities for Eligible Applicants, 3. Income Requirements, 4. When the Application Period Opens/Closes (if applicable), • Application Packet, and • Telephone/Contact for Questions From the applications submitted, the Housing and Redevelopment Office shall create a list of potential applicants. The applicants shall then be ranked by priority on the waiting list. Priority shall be given to households with members who are either: • Residents of the County of Monterey for a period of at least one year prior to application submittal and/or • Include persons who have worked within the County of Monterey • for at least 6 months prior to application submittal. b. Initial Establishment of List In order to initially establish an Eligibility Waiting List, the County shall first identify all those applicants who meet the live/work priority noted above. Through a random selection or lottery procedure, those applicants will be ranked on the waiting list. After all of the priority applicants have been ranked, the non-priority applicants shall then be ranked on the waiting list, again through a lottery procedure. The Eligibility List will thereafter contain two sets of applicants: those who meet the priority qualification and those who do not. Following the initial establishment of the list, new applicants shall be added to the bottom of each portion of the list (either priority or non-priority) as their applications are received and according to whether they meet the priority qualifications. All applicants must ultimately be income-qualified to be eligible for an inclusionary unit. e. Seleetiorz rem Eli-ibility Waiting List Each time inclusionary homeowner units become available for occupancy, the owner/developer and the Housing and Redevelopment staff shall follow these procedures: 12 Administrative Manual May 2003 • 1. At least 60 days prior to issuance of a Certificate of Occupancy for newly developed units, the owner/developer shall notify the County of the number and type of units available (i.e. bedroom size). 2. Within 10 business days of notice by the owner/developer, the Housing and Redevelopment Office shall cause to be pre-qualified the top five applicants on the list. Pre-qualify means that the information submitted by the applicant regarding income, residency, place of employment and any other relevant information has been verified. Verification shall be conducted by either the Housing and Redevelopment Office staff or a designee agency(i.e. Housing Authority of Monterey County). 3. The Housing and Redevelopment Office shall provide the developer/owner with a Referral List of at least five pre-qualified applicants. 4. Owner/developer shall directly contact the persons on the Referral List provided in the order provided. Owners who are not able to fill vacant units from the Referral List may request additional names. 5. Owner/developer shall conduct all additional screening and selection of applicants. All applicable Fair Housing Laws must be observed. S 6. Selected applicants will be responsible for securing their own financing for the proposed inclusionary unit. Within 6 weeks of being selected, applicants will be required to submit documentation that they have qualified for their permanent mortgage financing. If they have not obtained financing commitments within that time frame. the developer/owner has the option of rejecting them and requesting additional applicants from the referral list. 7. If candidates on the Referral List do not become occupants of the inclusionary units, they will be returned to the Eligibility Waiting List in the order that they originally were placed. (Except if the applicants meet any of the conditions listed under"D" below.) d. Procedures for Resale of E.xistin, Homeowner Inclusionary Units In the event that an existing inclusionary homeowner decides to sell a home during the affordability period, the owner will give the County written notice of such intent pursuant to the procedures as described in the owner's original Buyer's Occupancy and Resale Restriction Agreement. Should the County not exercise its option to purchase the property, the homeowner can then request from the Housing and Redevelopment Office at least five referrals 13 Administrative Manual May 2003 • from the Eligibility Waiting List. Additional referrals can be requested as needed to sell the unit in a timely manner. For existing homeowner inclusionary units, the Housing and Redevelopment Office shall give preference in referring applicants to those applicants who qualify for the County's First Time Homebuyer Program. At the time the existing inclusionary homeowner first notifies the County of intent to sell, the Housing and Redevelopment Office shall provide the homeowner with the maximum sales price figure for the unit. Please see Section III of this Manual for a further description of the calculation process for maximum sales prices. e. Removal from Eligibility Waiting List Applicants will be removed from the Eligibility Waiting List for: 1. Fraudulent statements on Application or verification documents; or 2. More than two refusals of offered units, unless the unit offered is located a significant distance (approximately 20 miles or more) from the place of employment of the applicant; or 3. Purchase of an inclusionary housing unit; or 4. Inability to qualify for financing to purchase a unit after two • referrals to an Owner/Developer. Appeal Process The decisions by the Housing and Redevelopment Office in establishing the Eligibility List and or maintaining the list may be appealed. All appeals must be in writing and must be received within 10 days after the Housing and Redevelopment Office has notified applicants of their standing on the List. An informal hearing on the appeal shall be conducted by the Housing Advisory Committee (HAC) with the Housing and Redevelopment Manager (or his/her designee) responsible for the final decision, based on the HAC's recommendation. The results of the appeal decision shall be communicated to the appellant in writing within 10 days of the hearing. Purging o Eligibility List The Eligibility List shall be purged every two years. A new list shall be developed based on the procedures described above. 1r. Options to Marketing/Selection Plan Submitted by Owner/Developer There may be situations where a developer has a specific target population for occupancy of the inclusionary housing units. For example, a developer of employee housing may request that potential occupants be employees of the employer/developer. The Housing and Redevelopment Office will review r 14 Administrative Manual May 2003 such alternate marketing/selection plans and, if appropriate, will approve • such plans in lieu of some or all of the procedures described above. . • 15 Administrative Manual May 2003 • III. Homeowner Inclusionary Unit Requirements 1. ELIGIBILITY CRITERIA A. INCOME Households eligible for purchase of inclusionary units shall be of very low, low and moderate income. Household income limits are determined annually by HCD/HUD and are based on household size. See Appendix E of this document for the current income limits for very low, low and moderate- income households. The definition of income is listed in Appendix D of this document. B. ASSETS There is a maximum asset test for purchasers of Inclusionary units. See Appendix D of this document for a description of maximum assets and definitions of assets. C. LIVE/WORK IN MONTEREY COUNTY Household members who live or work in Monterey County shall have priority in the purchase of inclusionary units. See Section II (Selection of • inclusionary Occupants) of this document for further information about the priority process. 2. ESTABLISHMENT OF INITIAL SALES AND RESALE PRICES A. INITIAL SALES PRICE Housing and Redevelopment staff shall provide the developer/owner with the initial sales price for an inclusionary unit. The sales price shall be developed using the following criteria: For Inclusionary units to be Occupied bv a Very Low Income Household. 1. Determine appropriate household size (number of bedrooms in unit +one person = appropriate household size) 2. Identify very low median income (usually 50% of median) for the appropriate household size (use current income limits as specified in Appendix E) 3. Determine monthly household allowance for housing payment: i. Multiply 30% of very low median income for appropriate household size 0 16 Administrative Manual May 2003 • ii. Divide amount by 12 for monthly allowance 4. Determine the maximum sales price that the monthly household allowance for housing payment can support using the following parameters: i. 7.5% fixed interest rate mortgage ii. 30 year mortgage term iii. 10%downpayment iv. estimates of property taxes, assessments, loan insurance and financing fees, allowance for property maintenance and repairs, homeowners insurance, homeowner association dues, allowance for utilities and land rent (if home is on rented land). For Inclusionary units to be Occupied bv a Low Income Household. 1. Determine appropriate household size (number of bedrooms in unit +one person = appropriate household size) 2. Identify 70% of median income for the appropriate household size (use current income limits as specified in Appendix E) • 3. Determine monthly household allowance for housing payment: i. Multiply 30% of 70% of median income for appropriate household size ii. Divide amount by 12 for monthly allowance 1. Determine the maximum sales price that the monthly household allowance for housing payment can support using the following parameters: i. 7.5% fixed interest rate mortgage ii. 30 year mortgage term iii. 10%down payment iv. estimates of property taxes, assessments, loan insurance and financing fees, allowance for property maintenance and repairs, homeowners insurance, homeowner association dues, allowance for utilities and land rent(if home is on rented land). For Inclusionary units to be Occupied b a Moderate Income Household. 1. Determine appropriate household size 17 Administrative Manual May 2003 5. If unit is not in decent condition based upon acceptable documentation, the 10%credit shall be reduced in an amount sufficient to correct deficiencies, 6. Add the additional home improvement credit amount (from steps 4 and 5)to the maximum resale value derived in step 3. Check new resale value/price to ensure that loan to value (LTV) does not exceed 100% of new resale value/price. Also check if f new resale value/price derived from steps 4-6 exceeds maximum affordability standard. If so, reduce the resale value/price to a value/price that does not exceed the maximum affordability standard. Maximum affordability standards are only used when the home improvement credit or bedroom additions are added to the maximum resale value/price. Resale Value/Price With a Bedroom Addition: Staff calculates new resale value/price allowed by: 1. Use original sales price as base figure, 2. Calculate percentage change in median income from original sales date to current date or most recent household income figures, • 3. Apply the percentage change figure for median income to original sales price, which is the maximum resale value/price with the following modifications, 4. If unit is in decent condition based upon acceptable documentation. apply home improvement credit in the amount of 10% to original sales price, 5. If unit is not in decent condition based upon acceptable documentation, the 10%credit shall be reduced in an amount sufficient to correct deficiencies, 6. Calculate value of bedroom addition by calculating the change in household size estimate. For example, a bedroom addition to an existing 3-bedroom structure (4 person household size estimate) would result in a 4-bedroom unit and a 5-person household size estimate. The value of the bedroom addition depends on the dollar difference between the median income for a 5-person household as compared to the median income for a 4-person household. Using this dollar amount, estimate the amount of new loan that can be financed with this dollar amount using a 30% for low/very low income and 35% for moderate income housing cost to income ratio. 19 • Administrative Manual May 2003 • 7. Add the additional home improvement credit amount(from steps 4 and 5) and the bedroom credit(step 6)to the adjusted resale value derived in step 3. 8.Check new resale value/price to ensure that loan to value (LTV) does not exceed 100% of new resale value/price. Also check if new resale value/price derived from steps 4-7 exceeds maximum affordability standard. If so, reduce the resale value/price to a price that does not exceed the maximum affordability standard. Maximum affordability standards are only used when the home improvement credit or bedroom additions are added to the maximum resale value/price. C. DETERMINATION OF MAXIMUM AFFORDABILITY STANDARDS (Applicable to resale of existing units with agreements dated on or after May 23,2003) For Inclusionary units to be Occupied by a Verp Low Income Household: 1. Determine appropriate household size (number of bedrooms in unit +one person = appropriate household size) • 2. Identify very low-income limit(usually 50%of median income) for the appropriate household size (use current income limits as specified in Appendix E). 3. Determine monthly household allowance for housing payment: A. Multiply 30% of 50% of median income for appropriate household size B. Divide amount by 12 for monthly allowance 4. Determine the maximum sales price that the monthly household allowance for housing payment can support using the following parameters: i. 7.5% fixed interest rate mortgage ii. 3.0 year mortgage term iii. 10% down payment iv. Estimates of property taxes, assessments, loan insurance and financing fees, allowance for property maintenance and repairs, homeowners insurance, homeowner association dues, allowance for utilities and land rent(if home is on rented land). • 20 Administrative Manual May 2003 For Inclusionary units to be Occupied by a Low Income Household: 1. Determine appropriate household size (number of bedrooms in unit +one person = appropriate household size) 2. Identify lower income limit(usually 80% of median income) for the appropriate household size (use current income limits as specified in Appendix E) 3. Determine monthly household allowance for housing payment: 4. Multiply 30%of 80%of median income for appropriate household size 5. Divide amount by 12 for monthly allowance 6. Determine the maximum sales price that the monthly household allowance for housing payment can support using the following parameters: i. 7.5% fixed interest rate mortgage ii. 30 year mortgage term iii. 10% downpayrnent iv. estimates of property taxes, assessments, loan insurance and financing fees, allowance for property maintenance and repairs, homeowners insurance, homeowner association dues, allowance for utilities and land rent (if home is on rented land). For Inclusionary units to be Occupied by a Moderate Income Household: 1. Determine appropriate household size (number of bedrooms in unit +one person =appropriate household size) 2. Identify moderate income limit(usually 120% of median income) for the appropriate household size (use current income limits as specified in Appendix E) 3. Determine monthly household allowance for housing payment: • Multiply 35%of 120%of median income for appropriate household size. • Divide amount by 12 for monthly allowance 21 • Administrative Manual May 2003 • 4. Determine the maximum sales rice that the monthly household P Y allowance for housing payment can support using the following parameters: i. 7.5% fixed interest rate mortgage ii. 30 year mortgage term iii. 10%downpayment iv. estimates of property taxes, assessments, loan insurance and financing fees, allowance for property maintenance and repairs, homeowners insurance, homeowner association dues, allowance for utilities and land rent (if home is on rented land). 3. HOMEOWNER INCLUSIONARY UNIT REQUIREMENTS A. OCCUPANCY REQUIREMENTS The inclusionary unit shall be the owner's principal place of residence. To be considered as a principal place of residency,the owner shall live in the unit for at least 10 months out of each calendar year. In emergency or hardship • situations, the County may approve that the inclusionary owner can rent or lease the inclusionary unit for a short period of time (generally a maximum of one year). All rentals or leases must be pre-approved by the County. The owner must submit a letter to the Housing and Redevelopment Office requesting permission to rent their unit, the reason for the request with appropriate documentation and length of time requested. The unit shall be rented to a qualified tenant household at the same affordability level as specified in the owner agreement. The inclusionary owner may select an income-qualified tenant. An affordable rental cost is defined as rent plus a utility allowance. Affordable rental costs shall not exceed not exceed 30% of 50%of median income (adjusted by bedroom size) for very low-income households, 30%of 60%of median income(adjusted by bedroom size) for low-income households and 30%of 110% of median income for moderate- income households (adjusted by bedroom size). The tenant shall also be income qualified as either a very low, low-income, or moderate-income household. B. AFFORDABILITY PERIODS According to the agreement with the County, the inclusionary owner agrees that the resale value of the home is restricted for a period of time. For agreements signed prior to May 23, 2003, the period is typically 30 years from the original purchase date. For agreements signed on or after May 23, • 22 Administrative Manual May 2003 • 2003_the period is in perpetuity or the life of the structure if the structure is de►nolished or abandoned after 55 years. C. MAINTENANCE AND INSURANCE The inclusionary unit owner must maintain the home, including landscaping, in decent condition. At the time of resale/refinancing, the owner can receive up to a 10%addition to the original sales price if the unit has been maintained in decent condition. The owner shall maintain a standard all risk property insurance policy equal to the replacement value of the home, naming the County as additional insured. D. REFINANCING OF FIRST MORTGAGE/SECURING A NEW SECOND MORTGAGE The inclusionary owner may refinance a first mortgage or secure a second mortgage on the property. The County's lien position shall never be less than 3`d position on the property. The owner must contact the Housing and Redevelopment Office staff prior to refinancing or securing new debt in order to determine a current property value (resale value). The staff procedures for responding to refinancing/resale request are specified in Appendix F of this document. E. TITLE CHANGES AND PROPERTY INHERITANCE In certain instances, the inclusionary owner may modify the title on the S property. One example is adding or deleting a spouse from title due to marriage, divorce or death. However, in all cases, the owner must contact the Housing and Redevelopment Office prior to the transfer. If the owner dies and there is no surviving owner and a child or stepchild of the owner inherits the property, the child/step-child shall provide the Housing and Redevelopment Office with information regarding income. If verified as income and asset eligible, he or she shall succeed to the Owner's interest and obligations under the original agreement. If the child or stepchild inheriting the property is not income eligible or has assets that exceed the maximum allowed or decides to sell the property, it must be sold to another eligible inclusionary applicant for the appropriate restricted resale price. However, the inheriting owner may own and occupy the unit until 12 months after the owner's death before offering the unit for sale and providing an Owner's Notice of Intent to Sell. F. DEFAULT AND FORECLOSURE If an owner violates the terms of the original "Buyers Occupancy and Resale Restriction"agreement, the owner can be found to be in default of the agreement. Further, if the inclusionary property goes into foreclosure, the County (pursuant to a subordination agreement with the first mortgage • 23 Administrative Manual May 2003 • lender) shall have the same rights as the owner to cure the defaults and prevent foreclosure of the home. IV. Rental Inclusionary Unit Requirements 1. ELIGIBILITY CRITERIA A. INCOME Households eligible for rental of inclusionary units shall be of very low, low or moderate income. Household income limits are determined annually by HCD/HUD and are based on household size. See Appendix E of this document for the current income limits for very low, low and moderate- income households. The definition of income is listed in Appendix D of this document. The County or its designee will initially verify the household income of tenants of inclusionary rental units. Subsequent annual certifications of income shall be the responsibility of the owner/manager of the rental units. B. ASSETS There is a maximum asset test for initial renter eligibility of inclusionary units. The County or its designee will verify the assets. See Appendix D of this document for a description of maximum assets and definitions of assets. • C. LIVE/WORK IN MONTEREY COUNTY Households who live or work in Monterey County shall have priority in the rental of inclusionary units. In selection of tenants, property owners and/or managers shall give preference to households who live or work in Monterey County. 2. RENT SCHEDULES A. INITIAL RENTS The Housing and Redevelopment Office staff shall determine initial rents. The inclusionary units shall be rented at affordable housing costs. An affordable rental housing cost is defined as rent plus a utility allowance as developed by the Housing Authority of the County of Monterey. Affordable housing costs shall not exceed 30% of very low-income limits (usually 50% of median income, adjusted by bedroom size) for very low-income households, 30% of 60% of median income (adjusted by bedroom size) for low-income households and 30% of 1 10% of median income for moderate- income households (adjusted by bedroom size). • 24 Administrative Manual May 2003 B. ANNUAL RENT CHANGES The Housing and Redevelopment Office shall notify property owners and/or property management companies of changes in the affordable rental housing cost annually upon receipt of revised income limits from HUD. At no time shall the new affordable rental housing cost be adjusted to less than the initial rent at the time the Master Inclusionary Developer Agreement was executed. 3. RENTAL INCLUSIONARY UNIT REQUIREMENTS A. HOUSEHOLD SIZE AND OCCUPANCY Upon initial occupancy, eligible households must have a household size appropriate for the rental unit. An appropriate household size is defined as two persons per bedroom plus two persons. B. LEASE REQUIREMENTS All tenants must be provided with a lease that has a minimum period of 12 months. The lease must comply with all applicable federal and state laws. The lease shall include provisions that specify the maximum household size allowed in the unit and requirements that the unit be maintained in a decent and safe condition. Further, the lease must include requirements that prohibit subleasing, require the tenant to report any changes in household size or income during their tenancy, and further specify that the tenant must comply with all monitoring requests of the Housing and Redevelopment Office or their designee. C. CHANGES IN HOUSEHOLD SIZE OR INCOME DURING TENANCY If the tenant's household income increases above the maximum allowed for very low, low or moderate-income households, the tenant may choose to remain in the inclusionary unit. However, the tenant would have a revised affordable rental housing cost based on their new income category. For example, a very low-income tenant whose income increases and is now a low-income tenant would have a new affordable rental cost based on affordable rents for a low-income unit. A low-income tenant whose income increases such that the household is now a moderate-income tenant would have a new rental cost based on a moderate-income unit. A previous very low, low or moderate income tenant whose income increases above the maximum moderate income limit would have a rental cost that would be the lesser of. a) thirty percent (30%) of the actual household income of the tenant; or b) market rate rent. 25 Administrative Manual May 2003 • V. Monitoring and Compliance Procedures I. PROJECT MONITORING AND COMPLIANCE A. MONITORING PROCEDURES: RENTAL PROPERTIES General Policies: Rental projects developed under the Inclusionary Program are monitored every two years to determine compliance with the terms of the Regulatory Agreement recorded against the property. The areas to be included in the monitoring process include tenant incomes and rents, payment of property taxes and hazard insurance and review of the terms of the leases. An annual certification of ownership is required. The rent schedule for the Inclusionary Program will be provided to the owner with the certification request. Procedures: 1. A Monitoring Review Form is initiated for each project. The terms of the Inclusionary Agreement are verified and the rent and occupancy limits are noted on the form. • 2. Initial letters are mailed to property owners requesting completion of certifications regarding non-discrimination policies, names and incomes of tenants and the household size, rents charged, and ownership status. Copies of Income Guidelines and Rent Schedules appropriate for the development will be included in the mailing. The owner is instructed to give the tenants a form entitled Tenant Income Verification for completion. These forms are to be returned along with documentation of hazard insurance and copies of current leases. 3. Second Notices are sent by certified mail if the property owner does not respond within fourteen business days. 4. Correspondence will be sent by the sheriffs office, process server, delivery service or hand delivered to the address by a staff member if the property owner fails to respond to the second notice or if mail has been refused or returned as undeliverable. Owners who fail to respond within seven business days will be referred to County Counsel for further action. 5. Assessors Office records will be reviewed to verify current ownership and mailing addresses where appropriate. 6. Failure to cooperate with the monitoring review process will be considered a breach of the Inclusionary Agreement and the • 26 Administrative Manual May 2003 Regulatory Agreement. Count Counsel will be notified of an • g Y g Y Y such breach in order that legal remedies may be initiated. 7. The income guidelines of the Section 8 Program are utilized by Housing and Redevelopment staff for the monitoring review. 8. Staff will review information provided by the owner and tenants to determine compliance with the Inclusionary Agreement and Regulatory Agreement as it pertains to allowable rents, number of restricted units, current income of tenants and any further restrictions on occupancy specified in the Agreement. 9. The review of rent affordability will include the standards set forth in the Inclusionary Agreement for each individual project. 10. Leases are reviewed to determine if non-discrimination policies and prohibitions against subletting are included. 11. If there are discrepancies between the statements of the owner and tenant, additional documentation will be requested. 12. Payment of hazard insurance in an amount sufficient to replace the structures shall be verified. 13. A letter will be issued to the property owner addressing any compliance issues. The letter will specify a corrective action deadline. In general, a 30-day period will be adequate. 14. When a property has changed ownership without notice to the County and this information becomes known at the time of the monitoring review, staff will schedule an appointment with the new owner to discuss the provisions of the Inclusionary Agreement. Current Rent Schedules and Income Guidelines will be provided. 15. The Monitoring Review Form will be completed. The Inclusionary Housing database will be updated to reflect compliance or non- compliance. 16. Other County offices may be alerted when the monitoring review reveals code violation or dangerous situations. 17. Every effort will be made to provide owners and tenants with the appropriate information to ensure a successful monitoring resulting in full compliance with the Inclusionary Housing Program. However, referrals will be made to County Counsel because of failure to cooperate or non-compliance. 27 Administrative Manual May 2003 • B. MONITORING PROCEDURES: FOR SALE UNITS General Policies: It is the policy of the County of Monterey to monitor compliance with the terms and conditions of the Inclusionary Housing Agreement recorded against for-sale units developed under the Inclusionary Housing Program. Annual Monitoring will include the owner occupancy requirement and prohibitions against rental of the dwelling. The review will provide owners with an opportunity to become familiar with the guidelines of the Inclusionary Housing Program and any changes in adopted policies and procedures. Monitorin,-Procedures: 1. Initial letters are mailed to property owners requesting completion of a certification of owner-occupancy and documentation in the form of utility bill with the name and address shown. 2. Second notices are sent by certified mail if the property owner does not respond within fourteen business days. 3. Correspondence will be sent by the sheriff s office, process server, delivery service or hand delivered by staff when the owner fails to . respond to the second notice. 4. Assessors Office records will be reviewed to verify current homeowner's exemption, possible change in ownership and mailing addresses where appropriate. 5. If property has changed ownership without notice to the County and this information becomes known at the time of the monitoring review, staff will schedule an appointment with the new owner to discuss the provisions of the Inclusionary Housing Agreement. Areas of concern will include review of the buyers' ability to meet standard program eligibility requirements, purchase price and continued participation in the program. County Counsel will be notified of any non-compliance issues in order that appropriate legal remedies can be implemented. 6. Where the review raises compliance concerns, the owner will receive written notice of the compliance issue. In general, a 30-day corrective action period will be given. 7. Other County offices may be alerted when the monitoring review reveals code violations or dangerous situations. 8. Every effort will be made to provide owners with the information needed to complete the monitoring review and maintain 28 Administrative Manual May 2003 compliance with the Inclusionary Housing Agreement. However, referrals will be made to County Counsel when appropriate because of non-compliance. Legal remedies specified in the Agreement or otherwise allowed under County Code or State and Federal law will be implemented 2. PROGRAM MONITORING A. ANNUAL REPORT As part of the Annual Report prepared each year by the Housing and Redevelopment Office, there will be a brief summary of the accomplishments and challenges of the Inclusionary Housing Program for the previous year. B. FIVE YEAR REPORT At least every five years beginning in 2007, the Housing and Redevelopment Office will prepare a complete evaluation of the Inclusionary Housing Program. This evaluation will include a summary of housing units produced, households assisted, In-Lieu Fees collected and the use of those fees, recommendations for policy or Ordinance revisions, etc. The public will be asked to comment on the report either prior to or during its preparation and the final report will be presented to all appropriate review bodies. • 29 • Administrative Manual May 2003 • VI. Other 1. EXEMPTIONS TO ORDINANCE There are exemptions from the Ordinance for developments such as farmworker housing, mobile home park developments and other specific development situations (Section 18.40.050). In addition, in situations where the party subject to a fully executed inclusionary housing agreement, or other document regulating or limiting the operation, price or rent of an inclusionary unit, believes that the document requires modification as a result of unusual circumstances which could not have been foreseen at the time the document was entered into, the affected party may apply to the County Board of Supervisors for modification of the document. (Section 18.40.100 D). Z. POLICIES FOR AMENDMENTS TO AGREEMENTS (For Agreements executed prior to the Adoption of the 2003 Inclusionary Housing Ordinance) An Inclusionary Buyers Agreement executed prior to the adoption of the 2003 Ordinance may be amended to include new provisions of the 2003 • Ordinance. Amendments may include allowing the existing inclusionary homeowner to refinance their unit with cash out and provide for bedroom additions with the total amount of encumbrances not to exceed 100% of value. However, the terms of their original agreement will prevail in all other areas including resale value calculations and affordability periods (except as noted below). 3. AFFORDABILITY PERIOD REQUIREMENTS FOR EXISTING INCLUSIONARY UNITS Inheritance of inclusionary unit bV Income Eligible Heir When an income eligible heir inherits an inclusionary unit, the new Buyers Agreement shall include an affordability period that shall be based on the affordability period in effect at the time the original owner died. Sale o[nn Existing inclusionary unit During Affordability Period If an inclusionary homeowner decides to sell their unit during the affordability period in effect according to the terms of their Buyers Agreement, the unit shall be sold to another qualified inclusionary buyer according to the procedures outlined in this manual. However, the new Buyers Agreement shall specify a new affordability period as defined in the Inclusionary Housing Ordinance in effect at the time the unit is sold. • 30 VII. APPENDICES APPENDIX A. HOMEOWNER FACT SHEET On the following page is a sample fact sheet that explains the Inclusionary Housing Program for a prospective homeowner. This fact sheet should be provided to potential applicants when they inquire about the program. This fact sheet should be available in both English and Spanish. • 31 • Administrative Manual March 2004 • INCLUSIONARY HOUSING PROGRAM INFORMATION FOR POTENTIAL INCLUSIONARY HOMEOWNERS 1. What is the Inclusionary Housing Program? The County of Monterey requires that 20%of all newly constructed units must be affordable to very low, low and moderate-income households. Developers must agree to sell 20% of their units at an affordable price to'a very low, low or moderate-income household. 2. What is an Affordable Price? The County of Monterey calculates affordable sales prices annually. The calculation is based on median household incomes for Monterey County and the assumption that no more than 30-35%of an average household's income should be spent for housing costs. 3. How Can I Buy an Inclusionary Housing Unit? The County maintains an eligibility list for prospective inclusionary homeowners. Generally,a household can qualify if it has a household income that is below the maximum limits for low or moderate-income. Priorities are given to households who have members that live or work in Monterey County. Contact the phone number listed on the bottom of this sheet for more information about household income limits or being placed on the eligibility list. 4. What are my Responsibilities if I Buy an Inclusionary Housing Unit? • In return for the opportunity to purchase a home at an affordable price, the County requires the following while you own the home: • Maintain property insurance on the home, • Keep your home (including landscaping) in decent condition, • Live in the home as your primary residence (in an emergency situation, you can rent Your home to another low/moderate income household BUT you must obtain the County's permission prior to renting it), • When you sell your home, you must sell it for the price determined by the County. You also must sell it to another eligible inclusionary homeowner. The RESALE PRICE is restricted and determined by the County—it is likely that the resale price will be less than other similar properties that are not inclusionary housing units, and • You must co-operate with any monitoring requests during the time you live in the home (such as verification that you are using the home as your primary residence or verification that you are maintaining your property insurance). FOR FURTHER INFORMATION: County of Monterey Office of Housing and Redevelopment (831) 786-1350 • 32 Administrative Manual March 2004 APPENDIX B. DEVELOPER FACT SHEET On the following page is a sample fact sheet that explains the Inclusionary Housing Program for a prospective developer of inclusionary housing units. 33 Administrative Manual March 2004 • INCLUSIONARY HOUSING PROGRAM INFORMATION FOR POTENTIAL DEVELOPERS OF INCLUSIONARY UNITS 1. What is the Inclusionary Housing Program? The County of Monterey requires that 20%of all developments of 3 or more units must be affordable to very low, low and moderate-income households. Developments of 3-4 units can pay an In-Lieu Fee instead of constructing a unit. Developments of 5 or more units are expected to construct Inclusionary housing units. 2. How Many inclusionary Units Will I Have to Provide? The 20% Inclusionary Requirement includes the following: 6% affordable to very low-income households, 6% affordable to low-income households, and 8% affordable to moderate-income-households. Depending on the size of the development you are proposing, you will be required to provide inclusionary units that are affordable to different household income levels. 3. Who Determines the Sales Price (or Rent) for the Inclusionary units? Staff at the County of Monterey, Office of Housing and Redevelopment, will be able to provide you with affordable sales prices or rents for the inclusionary units. The sales prices/rents are based on a formula using median household incomes for Monterey County. • 4. Who Can Buy or Rent an Inclusionary Unit from Me? Homeowner Units: The County maintains a list of prospective inclusionary homebuyers. When your inclusionary unit is ready to be sold, the County will provide you with the names of several prospective homebuyers. You must sell the unit to an eligible inclusionary household at the affordable sales price provided by the County. Rental Units: You must rent the inclusionary rental unit to a household that is qualified by the County (or its designee) as being very low, lower or moderate income. You can select the tenant assuming you follow all fair housin- laws and marketing/selection requirements specified by the County. 5. What Are My Responsibilities Once I Sell/Rent the Inclusionary Unit? Homeowner Units: Once your unit is sold to an eligible inclusionary homeowner, you have no further responsibilities. Rental Units: Rental units must continue to remain affordable and occupied by eligible households in perpetuity. Property owners must agree to these restrictions and ►nust agree to cooperate with all monitoring requests by the County. FOR FURTHER INFORMATION: County of Monterey Office of Housing and Redevelopment (831) 786-1350 34 Administrative Manual March 2004 APPENDIX C. DEVELOPER PROCEDURES INCLUSIONARY HOUSING PROGRAM DEVELOPMENT REVIEW PROCESS 1. Planning and Building Inspection (PBI) receives an application for development of a residential project(i.e., subdivision or use permit). 2. If the project will result in three or more new units PBI sends a referral package to the Housing office. 3. The Housing office reviews the application to determine the Inclusionary Housing requirements. 4. The Housing office notifies the assigned planner of the requirements and requests additional information as necessary. If the project involves on-site compliance the applicant will likely be asked to submit additional information about the proposed inclusionary units (design and location)to ensure that the CEQA review includes enough detail. 5. The Housing office prepares a draft memo to the approving body that provides a recommendation pertaining to the inclusionary • Housing requirements, draft Inclusionary Housing Agreement, and condition of approval for inclusion in the project approval packet. 6. The draft staff report prepared by the project planner for the project is reviewed by the Housing office prior to hearing to ensure that the conditions and draft findings of approval pertaining to Inclusionary Housing are acceptable. 7. The approving body is not required to approve but may consider the Inclusionary Housing Agreement as part of its approval of the project and can require that the approved Inclusionary Housing Agreement be recorded prior to the recordation of the Final Map or issuance of building permits. 8. The Inclusionary Housing Agreement and supporting documents are executed by the applicant and the Housing Office and recorded. 9. The Housing office "clears" the Inclusionary Housing conditions of approval by sending a memo to the project planner along with supporting documents. 35 • Administrative Manual March 2004 • APPENDIX D. INCOME AND ASSET DEFINITIONS The following definitions shall be used in determining applicant eligibility for the County's Inclusionary Housing Program. To be eligible for the program, applicants must meet both the income and the asset limitations. 1. INCOME Maximum Income Limitation Households occupying inclusionary units shall have incomes that are very low, low and moderate-income, as specified by the contractual agreement for the residential development in which they are located. The definition of very low, low (lower) and moderate-income shall be the same as provided by HCD/HUD and the State of California annually for the Monterey County area. See Appendix E of this document for the current income limits. 2. DEFINITION OF INCOME The definition of income shall be the same as the federal definition found in 24 CFR Part 5 (commonly known as the "Section 8"definition). As specified in 24 CFR Part 5, the income derived from any assets shall be included in the income calculation. The only exception to this is when a homeowner applicant is using any of their assets to pay for down payment or closing costs to purchase the inclusionary unit. In that case, the potential "income"from those assets shall not be calculated The value of the asset itself, however, is still counted under the asset limitation test below. 3. ASSETS Mavinzum Asset Limitation Homeowners: The maximum asset limitation is the total of the following for homeowner households: 1. 30% of the purchase price 2. 25%of current median income 3. 6 months of living expenses based on household size Renters: Upon initial occupancy, households who are applying for a rental inclusionary unit cannot have assets that exceed $30,000 for non-elderly households and $75,000 for elderly households. • 36 Administrative Manual March 2004 Deflnition !Lf Assets • Assets used to determine the maximum asset limitation allowed are defined in the following table. Any assets disposed of within 12 months prior to applying for an inclusionary unit shall also be included in the calculation of maximum assets. However, exceptions to this may be made in circumstances where assets were disposed of in order to pay medical, legal or other necessary expenses. The Housing and Redevelopment Manager shall approve all such exceptions. Assets to be-Included:in Maximum Assets to be Excluded in Maximum Asset Asset Limitation Limitation 1, Cash held in savings 1. Necessary personal property accounts, checking accounts, safe except as noted in#6 of the"included" deposit boxes, homes, etc. For assets. Necessary personal property savings accounts, use the current includes household goods and reasonable balance. For checking accounts, use transportation. the average 12 month balance 2.The current value of individual 2. Cash value of trusts retirement and Keogh accounts. (Any available to the applicant. income currently being received from such 3. Equity in real estate or accounts however shall be considered as other capital investments. Equity is "income" in the income calculations.) the estimated current market value of 3. Cash value of life insurance • the asset less the unpaid balance on policies available to the individual before all loans secured by the asset and all death. reasonable costs that would be incurred in selling the unit. 4.Assets that are part of an active business. "Business" does not include rental 4. Cash value of stocks, property that is held as an investment and bonds, Treasury bills, certificates of not a main occupation. deposit and money market accounts. 5. In the case of an inheritance of 5. Lump sum or one-time an inclusionary property, the equity in the receipts, such as inheritances, lottery inclusionary property shall not be counted as winnings, insurance settlements, etc. an asset in determining whether the party 6. Personal property held as who inherits the property is income/asset an investment such as gems, jewelry, eligible. coin collections, etc. 7. Mortgages or deeds of trusts held by the applicant. 37 • Administrative Manual March 2004 APPENDIX E. INCOME LIMITS (UPDATE ANNUALLY The following income limits shall be updated annually, based on information provided by the U.S. Department of Housing and Urban Development (HUD) or the State of California, Department of Housing and Community (HCD) Development. 2004 Household Maximum Income Limits, County of Monterey (Update Annually) INCOME 1 PERSON 2 PERSONS 3 PERSONS 4 PERSONS 5 PERSONS 6 PERSONS CATEGORY Very Low $21,300 $24,300 $27,350 $30,400 $32,850 $35,250 (0-50% of median income) Low/Lower $34,050 $38,900 $43,800 $48,650 $52,550 $56,400 (51-80%of median income) Moderate $51,050 $58,350 $65,650 $72,950 $78,800 $84,650 (81-120% of • median income) APPENDIX F. INITIAL SALES PRICE, REFINANCING AND RESALE STAFF PROCEDURES 1. CRITERIA FOR DETERMINING INITIAL SALES PRICE Very Low Income Units: • Housing Cost to Income Ratio: 30% of 50% of area wide median income or the maximum income for a very low income household, adjusted for bedroom and household size • Interest Rate and Tern: 7.5% Interest, 30 Year Term • Down Payment: 10% of Sales Price • Estimates of. property taxes, assessments, loan insurance and financing fees, allowance for property maintenance and repairs, homeowners insurance, homeowner association dues, allowance for utilities and land rent (if home is on rented land) 38 Administrative Manual March 2004 Low/Lower Income Units • Housing Cost to Income Ratio: 30% of 70%of area wide median income, adjusted for bedroom and household size • Interest Rate and Term: 7.5% Interest, 30 Year Term • Down Payment: 10% of Sales Price • Estimates of: property taxes, assessments, loan insurance and financing fees, allowance for property maintenance and repairs, homeowners insurance, homeowner association dues, allowance for utilities and land rent (if home is on rented land). Moderate income Units: • Housing Cost to Income Ratio: 3 5%of 110%of areawide median income, adjusted for bedroom and household size • Interest Rate and Term: 7.5% Interest, 30 Year Term • Down Payment: 10% of Sales Price • Estimates of property taxes, assessments, loan insurance and financing fees, allowance for property maintenance and repairs, homeowners insurance, homeowner association dues, allowance for utilities and land rent (if home is on rented land). 39 • Administrative Manual March 2004 INITIAL SALES PRICES FOR INCLUSIONARY UNITS CHART (Update Annually) 2004 Initial Sales Prices for Inclusionary Units, County of Monterey HOUSEHOLD = ", INCOME B LEVEL Very Low $83,300 $93,754 $104,211 $112,609 $120,836 Income (50%) Low/Lower $116,723 $131,292 $145,861 $157,515 $169,169 Income (70%) Moderate $213,964 $240,759 $267,554 $288,895 $310,347 Income (110%) r • 40 Administrative Manual March 2004 • 2. CRITERIA FOR DETERMINING RESALE/REFINANCING VALUES These procedures are used when an inclusionary housing owner decides to sell their property, refinance an existing mortgage or add a second deed of trust, during the period of affordability. A. Calculating Resale/Refinancini!Value Without a Bedroom Addition 1. Property Owner notifies County that they wish to sell, refinance or add a second deed of trust to their property. 2. Staff calculates new resale/refinancing value by: a. Use original sales price as base figure, b. Calculate percentage change in median income from original sales date to current date or most recent household income figures, c. Apply the percentage change figure for median income to original sales price, which is the maximum resale value/price with the following modifications, d. If unit is in decent condition based upon acceptable documentation, apply home improvement credit in the amount of 10%to original sales price, e. if unit is not in decent condition based upon acceptable documentation. the 10% credit shall be reduced in an amount sufficient to correct deficiencies. f. Add the additional home improvement credit amount (from steps "d"or"e") to the maximum resale value derived in step c. This is the new resale value/price as modified by home improvement credits. 3.Check new resale value/price to ensure that loan to value (including existing and proposed new loans) does not exceed 100% of resale value/price. Also check if new resale value/price derived from steps a-f above exceeds maximum affordability standard. If so, reduce the resale value/price to a value/price that does not exceed the maximum affordability standard. 4. Staff notifies property owner and lender(if appropriate) of new resale/refinancing value and, if applicable, amount of new encumbrance allowed (for refinancing/second deeds of trust). 5. If needed, Housing and Redevelopment Program Manager or designee shall execute agreement to subordinate County's interest 41 Administrative Manual March 2004 • to the first or second loan holder. The agreement shall include provisions for notice of default and cure rights for the County. 6. If owner takes cash out from the refinancing, staff prepares amendment to existing Resale Restriction Agreement, which will allow property owner to refinance or add additional second deed of trust. Staff sends amendment to property owner for their signature. Staff will verify whether cash is taken out from Estimated Closing Statement from Lender/Title Company. If no cash is taken out, no amendment is required. 7. Upon receiving signed amendment from property owner, staff arranges to have appropriate County representative sign amendment and then records amendment. 8. Staff files recorded agreement in property owner's file and ensures that the file reflects new refinancing/second deed of trust information. Staff obtains final closing statement at close of escrow. Staff also records request for notice of default. B. Calculating Refinancing Value With a Bedroom Addition 1. Property Owner notifies County that they wish to refinance or add a second deed of trust to their property and are planning on a bedroom addition. 2. Staff calculates new resale value and amount of new encumbrance allowed by: a. Use original sales price as base figure, b. Calculate percentage change in median income from original sales date to current date or most recent household income figures, c. Apply the percentage change figure for median income to original sales price, which is the maximum resale value/price with the following modifications, d. If unit is in decent condition based upon acceptable documentation, apply home.improvement credit in the amount of 10%to original sales price, e. If unit is not in decent condition based upon acceptable documentation, the 10% credit shall be reduced in an amount sufficient to correct deficiencies, f. Add the additional home improvement credit amount (from steps "d"or"e") to the maximum resale value derived in step c. This is the new resale value/price as modified by home improvement credits. 42 Administrative Manual March 2004 3. Calculate value of bedroom addition by calculating the change in household size estimate. For example, a bedroom addition to an existing 3-bedroom structure (4 person household size estimate) would result in a 4-bedroom unit and a 5-person household size estimate. The value of the bedroom addition depends on the dollar difference between the median income for a 5-person household as compared to the median income for a 4-person household. Using this dollar amount, estimate the amount of new loan that can be financed with this dollar amount using a 30% for low/very low income and 35% for moderate income housing cost to income ratio and the inclusionary underwriting standards. 4. Add the value of the bedroom credit(step 3)to the maximum resale value derived in step 2 (f). 5. Check new resale value/price from step 4 to ensure that loan to value (including existing and proposed new loans) does not exceed 100% of new resale value/price as derived in step 4. Also check if new resale value/price derived from step 4 exceeds maximum affordability standard. If so, reduce the resale value/price to a price that does not exceed the maximum affordability standard. 6. Staff notifies property owner and lender (if appropriate) of new resale value and amount of new encumbrance allowed (including bedroom addition • allowance as calculated in step 2 (e) above). 7. If needed, Housing and Redevelopment Program Manager or designee shall execute agreement to subordinate County's interest to the first or second loan holder. The agreement shall include provisions for notice of default and cure rights for the County. 8. If owner wants to take cash out from the refinancing, staff prepares amendment to existing Resale Restriction Agreement, which will allow property owner to refinance existing debt or add additional second deed of trust. Staff sends amendment to property owner for their signature. Staff will verify whether cash is taken out from Estimated Closing Statement from Lender/Title Company. If no cash out, no amendment is required. 9. Upon receiving signed amendment from property owner, staff arranges to have appropriate County representative sign amendment and then records amendment. 10. Staff files recorded agreement in property owner's file and ensures that the file reflects new refinancing/second deed of trust information. 11. Staff verifies that property owner has the appropriate building permit for the new bedroom addition. 43 Administrative Manual March 2004 • 12. Staff instructs lender or other appropriate body toopen escrow account for bedroom addition amount with joint signatures for releasing funds required of both property owner and County. If bedroom addition is not completed within a reasonable time frame, staff will instruct that the funds in escrow be paid back to the lender. 13. Upon notice from property owner, staff inspects property and approves release of funds for bedroom addition as appropriate during the construction process. Staff obtains final closing statement at close of escrow. Staff records request for notice of default. Bedroom Addition Calculation Calculate the value of bedroom addition by calculating the change in household size estimate. For example, a bedroom addition to an original 3-bedroom structure(4 person household size estimate) would result in a 4-bedroom unit and a 5-person household size estimate. The value of the bedroom addition depends on the dollar difference between the median income for a 5-person household as compared to the median income for a 4-person household. Using this dollar amount, estimate the amount of new loan that can be financed with this dollar amount using a 30% for low/very low income and 35% for moderate income housing cost to income ratio and the County's typical underwriting standards. • 2004 Bedroom Addition Values, County of Monterey (Update Annually) HOUSEHOLD INCOME WIN*.LEVELM A Very Low Income $10,900 $10,900 $8,760 $8,760 Low Income (70%) $15,190 $15,190 $12,150 $12,150 Moderate Income $27,950 $27,950 $22,320 $22,320 (110%) Example of Calculating Resale/Refinancing Value of Bedroom Addition 1. CALCULATE RESALEIREFINANCING VALUE Assumptions: • Originally, unit was a 3 bedroom, 2 bath single family unit (moderate income) • Initial Sales Price was $150,000 in 1995 • In 2003, the owners wanted to add a 4°i bedroom • 44 Administrative Manual March 2004 Calculation: $150,000 Initial Sales Price + 34,110 22.74%change in median _income, 1995-2003 $184,110 Maximum resale/refinancing value with following modifications: + 15,000 10% of initial sales price "credit" for improvements and/or maintenance + 18,768 bedroom addition value (from chart) $217,878 Modified Resale/Refinancing Value 2. CHECK MODIFIED MAXIMUM RESALE/REFINANCING VALUE AGAINST MAXIMUM AFFORDABILITY STANDARD 2003 Maximum Affordability Standard(see next section for more information on Maximum Affordability Standards) 4 Bedroom, Moderate Income $295,107 2003 Resale/Refinancing Value of Unit $21 7,878 Resale/Refinancing Value is less than Maximum Affordability Standard and can therefore be used as the inclusionary unit's Resale/Refinancing Value. 45 Administrative Manual March 2004 3. CRITERIA FOR DETERMINING MAXIMUM AFFORDABILITY STANDARD When inclusionary units are sold, refinanced or request a bedroom addition, staff needs to ensure that the resale price/value of the unit does not exceed the maximum affordability standard. This standard is the maximum allowable price or value for the inclusionary unit. The critical difference between the maximum affordability standard and the criteria used for sales price and bedroom addition determination is that: low/lower income limits are set at 80%of median instead of 70% and moderate income limits are set at 120% instead of 110%o. Very Low Income limits remain the sarne at approximately 50% of median income. The higher income limits for low/lower and moderate-income allow for some flexibility for inclusionary units that may have been priced incorrectly in the beginning years of the program and would experience substantial negative equity if 70%/l 10% income standards were imposed. Therefore,the 80%/120% limits provide slightly more flexibility in maximum sales prices while still retaining the affordability of the units to the next purchaser. CRITERIA TO BE USED IN DETERMINING MAXIMUM AFFORDABILITY STANDARDS: Very Low Income Units: • • Housing Cost to Income Ratio: 30% of very low income limit (usually 50% of area wide median income), adjusted for bedroom and household size • Interest Rate and Term: 7.5% Interest, 30 Year Term • Down Payment: 10% of Sales Price • Estimates of. property taxes, assessments, loan insurance and financing fees, allowance for property maintenance and repairs, homeowners insurance, homeowner association dues, allowance for utilities and land rent (if home is on rented land). Low/Lower Income Units: • Housing Cost to Income Ratio: 30% of lower income limit (usually 80% of area wide median income), adjusted for bedroom and household size • Interest Rate and Term: 7.5%Interest, 30 Year Term • Down Payment: 10% of Sales Price • Estimates of. property taxes, assessments, loan insurance and financing fees, allowance for property maintenance and repairs, • 46 Administrative Manual March 2004 homeowners meowner association dues allowance •insurance,u s ranee, homeowner , for utilities and land rent (if home is on rented land). Moderate Income Knits: • Housing Cost to Income Ratio: 35%of moderate income limit (usually 120% of areawide median income), adjusted for bedroom and household size • Interest Rate and Term: 7.5% Interest, 30 Year Term • Down Payment: 10% of Sales Price • Estimates of property taxes, assessments, loan insurance and financing fees, allowance for property maintenance and repairs, homeowners insurance, homeowner association dues, allowance for utilities and land rent (if home is on rented land). 2004 Maximum Affordability Standard for Inclusionary Units, County of Monterey (Update Annually) HOUSEHOLD MU_ MU IM. INCOME LEVEL QRD BILK 1=FORDABILDA0, a 0 ST�IDR=A�3p, �ED, �QMUNI �,�EDROOM UNt,w #BEDROOM UN E�..� Very Low Income $83,300 $93,754 $104,211 $112,609 (50%) Low Income $133,348 $150,145 $166,771 $180,142 (80%) Moderate $233,336 $262,545 $291,750 $315.146 I i Income(120%) 47 Administrative Manual March 2004 APPENDIX G. IN LIEU FEE AND IN-LIEU FEE PAYMENT PROCESS 1. 2003 In-Lieu Fee Calculation (Update Annually) The calculation below is based on the following assumptions: • Average construction and amenities for a single-family, 3 bedroom unit, • Construction and development costs of$182/square foot, including $125/square foot for hard costs and $57/square foot for soft costs, • Average housing unit size of 1500 square feet, • Average land costs represent 50% of total development cost for Greater Monterey and Coast Planning Areas and 30% of total development cost for all other areas of Monterey County, and • Affordable sales price is calculated for a 4-person household at 100%of median income. Greater Monterey and Coast Planning Areas: Construction and Development Costs (1500 sq.ft. @ $182/sq.ft.) _ $273,000 . Land Costs (50% of Total Development Cost) — $ 273,000 TOTAL DEVELOPMENT COST = $ 546,000 All Other Areas of the County: Construction and Development Costs (1500 sq.ft. @ $182/sq.ft.) = $ 273,000 Land Costs (30%of Total Development Cost) = $ 117,000 TOTAL DEVELOPMENT COST = $ 390,000 48 Administrative Manual March 2004 2003 IN-LIEU FEE (UPDATE ANNUALLY GREATER ALL OTHER G s` MONTEREY AND AREAS OF THE COAST PLANNING COUNTY AREAS AVERAGETOTAL � r $546,000 $390,000 �-DEVELOPMENT COSTS fi, AFFORDABLE SALES PRICE(4 PERSON ` $206,364 $206,364 HOUSEHOLD AT 100% OE MEDIAN INCOME SIN LIEU FEE* $339,636 $183,636 or$67,927 per unit or$36,727 per unit *Total to-Lieu Fee for a 5-unit development. 2. Processes Payment of In-Lieu Fee A. For developments that pay only an In-Lieu Fee(i.e. development does not include the provision of inclusionary units): Conditions of Approval for the development will include the In-Lieu Fee amount. The In-Lieu Fee would then be paid in full to the County prior to recordation of parcel or final maps of the development that created the In-LieLl Fee requirement, or where the residential development is not subject to subdivision approval, prior to issuance of the first building permit for the development. B. For developments that include both inclusionary units and payment of In-Lieu Fees: See flow chart on next page. 49, Administrative Manual March 2004 IN-LIEU FEE PAYMENT PROCESS (For Developments that include both inclusionary units and Payment of In-Lieu Fees) FINAL MAP FIRST APPROVAL OF A S"I-AGE/BUILDING PERMITS RESIDEN'1'1 AL DEVELOPMENT 1. Prior to recordation of 1. Conditions of approval specify the parcel map or final map, In-Lieu Fee obligation and states Developer and County sign that the fee shall be calculated Master Inclusionary based on the In-Lieu Fee in effect Developer Agreement. at the time the application is deemed complete for a subdivision/use permit or at the 2. In-Lieu Fee is paid prior to time of the first building permit recordation of Final Map, issuance,if there is no or if no map, prior to subdivision. issuance of first Building Permit, as specified in the Master Inclusionary Developer Agreement. 50, Administrative Manual March 2004 APPENDIX H. MAXIMUM RENTS AND UTILITY ALLOWANCE TABLES 2004 Maximum Rents (Includes Utility Allowances) STUDIO 1 2 3 4 5 BEDROOM BEDROOM BEDROOM BEDROOM BEDROOM Very Low $533 $608 $684 $760 $821 $881 (50%) Low/Lower $639 $730 $821 $912 $985 $1,058 (60%) Low/Lower $745 $851 $957 $1,064 $1,149 $1,234 (70%)* Low/Lower $851 $972 $1,095 $1,216 $1,314 $1,410 (80%)- Moderate $1,170 $1,337 $1,505 $1,673 $1,806 $1,940 (110%) * 70% and 80% rents are only to be used for units with agreements approved ' prior to April 22, 2003. Instructions for Calculating Rents: 1. Use household size of 1 person per bedroom plus 1 person (e.g. the rent for a 2 bedroom unit would be based on the median income for a 3 person household). 2. Use 30% of household income as the maximum rent allowed. 3. The maximum rent includes a utility allowance. Therefore, the rent that the tenant pays to the landlord is the maximum rent less the utility allowance. 4. Rents are based on 50%, 60% and 110% of median income. However, eligibility for the units is based on 50%, 80% and 120% of median income, adjusted for household size. Utility Allowances The Housing Authority updates utility allowances annually. On the following pages are the current utility allowances to be used in calculating affordable housing costs for inclusionary rental units. (Staff: Update these utility allowances annually. Go the Housing Authority web site and download the utility allowances. The web site is www.hanionterey.M. Under the "Where do you want to go?" bar, select Section 8 program. At the Section 8 page, scroll down to Utility Allowances.) 51 - Ilk CITY AND COUNTY OF SAN FRANCISCO RESIDENTIAL INCLUSIONARY AFFORDABLE HOUSING PROGRAM MONITORING AND PROCEDURES MANUAL Adopted 6/28/2007 Rev.6/15/07 PREFACE The Residential Inclusionary Affordable Housing Program ("Program") requires developers to sell or rent a certain percentage of units in new developments at a "below market rate" price that is affordable to low-income, median-income and moderate-income households. The Program is governed by San Francisco Planning Code Section 315 et seq., and is administered by the San Francisco Mayor's Office of Housing ("MOH"). Planning Code Section 315 requires that MOH and the San Francisco Planning Department publish a Procedures Manual containing procedures for monitoring and enforcement of the policies and procedures for implementation of the Program. This Monitoring and Procedures Manual ("Manual") contains information regarding the Program for potential buyers and renters of below market rate units, as well as for information for projects sponsors, owners and property managers of units developed under the Program. Updates to the Manual occur as needed. This Manual should be read in conjunction with the applicable requirements of the Program, found in San Francisco Planning Code Section 315 et seq., including prior versions of that section. Previous versions of Planning Code section 315 et seq. can be found on the MOH website at www.sfgov.org/moh. While every effort has been made to harmonize the information in this Manual with the requirements of the Planning Code and previous versions of the Code, should there be any conflict with the Manual and the Planning Code or previous versions of Section 315 et seq (whichever is applicable to a particular development), the terms of the Planning Code or those previous versions shall prevail over this Manual. The provisions of a Notice of Special Restrictions recorded on a property or unit developed under the Program shall prevail over any general requirements in the Manual or the Planning Code. Users of this Manual are encouraged to seek their own legal counsel to aid in understanding of the requirements of the Program. If there are general questions regarding the Manual. users may call the Mayor's Office of Housing at (415) 701- 5500, or visit their website at www.sfgov.org/moh. Any request for the interpretation and applicability of the provisions of the Planning Code may be sought by contacting the Zoning Administrator, pursuant to Planning Code Section 307(a). Any BMR unit entering the marketing stage on or after the effective date of this Manual is subject to the Manual in its entirety. The effective date of this Manual is June 28, 2007. 2 Rev.6/15/07 • TABLE OF CONTENTS I. DEFINITION OF TERMS........6-15 11. BUYER QUALIFICATIONS AND RESTRICTIONS ON BMR OWNERSHIP UNITS A. Buyer Qualifications for BMR Ownership Units........16-19 1. Qualifying Household for BMR Ownership Units 2. Preferences for BMR Ownership Units 3. First-time Homebuyer Requirement for BMR Ownership Units 4. First-time Homebuyer Education Workshop Requirement for BMR Ownership Units 5. Household Size Requirement for BMR Ownership Units 6. Income Requirement for BMR Ownership Units 7. Asset Test for BMR Ownership Units B. Buyer Application Requirements........19 C. Financing Requirements........20 1. Loan Review for BMR Ownership Units 2. Allowable Loan Types for BMR Ownership Units 3. Loan Types Not Allowed for BMR Ownership Units 4. Documentation Requirements for BMR Ownership Units e D. Restrictions on BMR Ownership Units........20-26 1. Term of Restriction on BMR Ownership Units and Owners 2. Documents that Govern the BMR Ownership Unit and Owner 3. Occupancy Requirement for BMR Ownership Units 4. Restrictions on Renting BMR Ownership Units 5. Resale Restrictions and Procedures for BMR Ownership Units 6. Restrictions on Title Transfers for BMR Ownership Units 7. Owner Refinancing of BMR Ownership Units E. Capital Improvements........26-29 F. Monitoring of BMR Ownership Units........29-30 III. RENTER QUALIFICATIONS AND RESTRICTIONS ON BMR RENTAL UNITS A_ BMR Renter Qualifications........30-32 1. Qualifying Household for BMR Rental Units 2. Preferences for BMR Rental Units 3. Non-Homeowner Requirement for BMR Rental Units 4. Household Size Requirement for BMR Rental Units 5. Income Requirement for BMR Rental Units 6. Asset Test for BMR Rental Units B. BMR Renter Application Requirements........33 • 3 Rev.6/15/07 C. Restrictions on BMR Rental Units........33-34 1. Term of Restriction on BMR Ownership Units 2. Documents that Govern the BMR Rental Unit 3. Occupancy Requirement for BMR Rental Units 4. Restrictions on Renting or Subleasing BMR Rental Units 5. Restrictions on Lease Changes for BMR Rental D. Permissible Rent Increases........34 E. Monitoring of BMR Rental Units........35 IV. PROCEDURES FOR PROJECT SPONSORS, OWNERS AND PROPERTY MANAGERS A. Monitoring and Reporting Procedures........35-36 1. Monitoring and Reporting Procedures for BMR Ownership Units 2. Monitoring and Reporting Procedures for BMR Rental Units 3. Statistical Information 4. Annual Report for BMR Ownership Units 5. Annual Report for BMR Rental Units B. Compliance Procedures........37-47 1. Compliance Through New Construction On-Site 2. Compliance Through Conversion of Use On-Site 3. Compliance Through New Construction Off-Site 4. Compliance Through In-Lieu Fees C. Initial Sales Procedures for BMR Ownership Units........47-52 1. Request for Pricing for BMR Ownership Units 2. Methodology for Pricing Initial Sale BMR Ownership Units 3_ Parking Space Policy for BMR Ownership Units 4. Marketing Procedure for BMR Ownership Units 5_ Verification of Owner Qualification for BMR Ownership Units 6. Buyer Approval for BMR Ownership Units 7. Buyer Financing for BMR Ownership Units 8. Restrictions on BMR Ownership Units 9. Transaction Fees for BMR Ownership Units 10. Inability to Find a Buyer for BMR Ownership Units D. Initial Rental Procedures for BMR Rental Units........52-56 1. Request for Pricing for Rental BMR units 2. Methodology for Setting Initial Rent Levels for BMR Rental Units 3. Parking Space Policy for BMR Rental Units a. Marketing Procedures for BMR Rental Units 4. Verification of Renter Qualification for BMR Rental Units 5. Renter Approval for BMR Rental Units 6. Permissible Rent Increases for BMR Rental Units 7. Rental Rate Upon Subsequent Occupancy by Qualifying households for BMR Rental Units 8. Documentation of Annual Rent Levels for BMR Rental Units 4 Rev.6J15107 • E. "arketing Procedures for Initial Sale and Rental of BMR Units........56- 59 1. General Requirements for Marketing of all Initial Sales and Rentals of BMR units 2. Contents of Marketing Plan 3. Conduct of Marketing Plan F. Marketing Procedures for Resale of BMR Ownership Units........60 G. Marketing Procedures for Subsequent Rentals of BMR Rental Units........60 H. Selection of BMR Purchasers or Tenants at Initial Sale or Rental........60 I. Conversion of BMR.Rental Units to Ownership Units........61-62 J. Documentation and Enforcement of Sales Restrictions for BMR Ownership Units........62-66 K. Conflict of Interest........66 • • 5 Rev.6/15/07 I. DEFINITIONS OF TERMS (Bold Face words are further defined in this subsection). AFFORDABLE A housing project or mixed use project, whether new HOUSING construction or conversion of use, which contains units PROJECT satisfying affordable housing requirements imposed by the Inclusionary Housing Ordinance, planning approvals or other use restrictions. APPRAISED FAIR The value of a BMR unit determined without regard to sales MARKET VALUE or rental restrictions on that unit pursuant to (1) an independent appraisal conducted by an appraiser acceptable to MOH and paid for by the prospective purchaser of such unit, or (2) mutual agreement as to value between MOH and the prospective purchaser. This appraisal may be required by MOH prior to any sale of a BMR unit. BMR OWNERSHIP Below Market Rate ("BMR") Ownership Unit. A BMR unit UNIT owned and occupied by a qualifying household. BMR RENTAL UNIT Below Market Rate ("BMR") Rental Unit. A BMR unit rented and occupied by a qualifying household. is BMR UNIT Below Market Rate ("BMR") Unit. An affordable dwelling unit or other approved residential unit which is sold or rented at a price specified in the planning approvals or other use restrictions which may be lower than the appraised fair market value of comparable units. BMR units may be either ownership for first time homebuyer households or rental. The sales or rental price limits on the BMR unit are as described in the planning approvals or other use restrictions as required by the City and County of San Francisco. CAPITAL As referenced in section II (E) (5), the difference between the IMPROVEMENTS resale price and the final resale price of a BMR unit after CAP the addition of approved eligible capital improvements and eligible replacement and repair. In order to maintain the affordability of the BMR unit for subsequent buyers, MOH will review and approve eligible capital improvements and eligible replacement and repair when submitted. However, at the time of sale, MOH will cap these improvements at 7% of the resale price. For example: Formula Calculated Resale Price 6 Rev_6/8//07 t + Eligible Capital Improvements and/or Eligible Replacement and Repair (Cost of Approved CI's or 7% of Sale Price, whichever is less) + Special assessments (dollar-for-dollar) + 5% of Original resale price if using MLS = Final resale price CERTIFICATE OF A certificate issued to a Project Sponsor by the Bureau of FINAL Building Inspection (DBI) that certifies that all Building Code COMPLETION AND provisions and building specifications for the development OCCUPANCY project have been satisfied. CITY The City and County of San Francisco CLOSE OF The closing of the sale of a BMR Ownership Unit to a ESCROW qualifying household. COMPARABLE A unit that is of good quality and that is consistent with the UNIT current standards for new housing. CONDITIONS OF A set of written conditions imposed b the City Planning P Y Y APPROVAL Commission or another permit-issuing City agency or appellate body when it receives a Conditional Use Permit for the construction of a principal project or other housing project subject to this program. CONVERSION Change in use of a property. DEPARTMENT OF San Francisco Department of Building Inspections BUILDING INSPECTIONS, or °DBI" DOMESTIC A legal or personal relationship between individuals who live PARTNER together and share a common domestic life but are not joined in a traditional marriage or a civil union as formalized through a local or state registry. DWELLING UNIT A room or suite of two or more rooms that is designed for, or 7 Rev.6/8//07 is occupied by, one family doing its own cooking therein and having only one kitchen. EQUAL The federal fair housing symbol used to identify the OPPORTUNITY adherence to fair housing rules. HOUSING SYMBOL ESCROW CLOSING Documents signed by a buyer to complete the sale of a BMR DOCUMENTS unit. FAIR HOUSING State or federal laws that govern the fair and unbiased treatment of buyers and renters when selling or renting a housing unit. FIRST Either a temporary certificate of occupancy or a Certificate of CERTIFICATE OF Final Completion and Occupancy as defined in San OCCUPANCY Francisco Building Code Section 109, whichever is issued first. FIRST SITE OR The first Department of Building Inspection (DBI) issued BUILDING PERMIT permit for the construction of land. FIRST-TIME A course designed to provide basic education to first time HOMEBUYER homebuyers offered by a counseling agency certified by EDUCATION MOH. WORKSHOP GROSS INCOME All income from whatever source derived as provided in the Internal Revenue Code (26 USC Section 61), whether or not exempt from federal income tax. Such income includes, but is not limited to, the following: Compensation for services, including fees, commissions, and similar items; Income from assets; Gross income derived from business; Gains derived from dealings in property, Interest; Rents; Royalties; 8 Rev.6/81/07 • Dividends; Alimony and separate maintenance payments; Annuities; Income from life insurance and endowment contracts; Pensions; Income from discharge of indebtedness; Distribution share of.partnership gross income; Income in respect of a decedent; Income from an interest in an estate or trust; and Public benefits including but not limited to CalWorks, SSI, Disability income. HUD AREA Unadjusted income levels derived from the Department of MEDIAN INCOME Housing and Urban Development("HUD") on an annual basis and used to calculate the income levels of qualifying BMR households and to price BMR units. HOME OWNERS A nonprofit association that manages the common areas of a • ASSOCIATION, or condominium or planned unit development (PUD). Unit "HOA" owners pay to the association a fee to maintain areas owned jointly. HOME OWNERS Monthly payments due to a homeowners association for the ASSOCIATION upkeep, maintenance and improvement of common areas in DUES or"HOA" a residential building. DUES HOUSING A development that has residential units as defined in the PROJECT Planning Code, including but not limited to dwellings, group housing, independent living units, and other forms of development which are intended to provide long-term housing to individuals and households. Housing project shall not include that portion of a development that qualifies as an Institutional Use under the planning code. Housing project for the purpose of the program shall also include the development of live/work units as defined by Planning Code Section 102.13. Housing project for the purpose of this Program shall mean all phases or elements of a multi-phase or multiple lot development. HOUSING UNIT "Housing Unit'or"unit"shall mean a dwelling unit as defined • 9 Rev.6/8//07 in San Francisco Housing Code Section 401. • IMPUTED INCOME Gross income plus a percentage of the value of allowable assets. Ten percent (10%) of allowable assets between thirty thousand ($30,000) and one hundred thirty thousand ($130,000) dollars will be added to a household's gross income. Allowable assets over one hundred and thirty thousand ($130,000) dollars will be added to a household's gross income at a rate of thirty-five percent (35%). INCLUSIONARY The Guidelines adopted by the Planning Commission on GUIDELINES September 10, 1992, by Resolution 13405, setting forth inclusionary policies in effect as of that date. INCLUSIONARY Sections 315-315.9 inclusive of the San Francisco Planning ORDINANCE Code, as amended from time to time. INCLUSIONARY The Residential Inclusionary Affordable Housing Program. PROGRAM INCOME TABLE Income information that is based on a specific federal source and geographic area. Income tables in this Manual include the HUD Area Median Income table and the San Francisco • Median Income table. The income table used to calculate the income level of a BMR household shall be determined by the date on which the principal project for which the household applies received its first site or building permit. Income levels for,buyers in principal projects that received their first site or site or building permit before September 9, 2006 will be reviewed using the HUD Area Median Income as adjusted for household size. Income levels for buyers in principal projects that received their first site or site or building permit on or after September 9, 2006 will be reviewed using the San Francisco Median Income as adjusted for household size. LIFE OF THE The time period during which a principal project or off-site PROJECT project exists as a residential development regardless of change in principal project or off-site project ownership. The affordable housing requirement of a principal project or off-site project shall be in effect shall be for the life of the project for units marketed after the formal adoption of this Procedures Manual. 10 Rev.6/8//07 • LOW-INCOME A household whose combined annual gross income for all HOUSEHOLD members does not exceed sixty (60) percent of median income. MANUAL The City and County of San Francisco Residential Affordable Housing Program Procedures and Monitoring Manual. MARKETING A person representing a development of BMR units who CONSULTANT markets and sells the BMR units in accordance with the procedures set forth in this Manual and by MOH. MARKETING PLAN A compliance procedure, described in Section IV (C), (D) and (E) of this manual, which requires the Project Sponsor of a principal project that has an affordable housing requirements to undertake certain measures that are directed to advertise and sell available affordable housing units to qualifying households. MAYOR'S OFFICE Mayor's Office of Housing ("MOH") or its successor. OF HOUSING, or "MOH" • MAXIMUM The monthly monetary consideration paid by a qualifying MONTHLY RENT household for use of the designated BMR rental unit as the household's principal residence; it shall be determined at the time of first occupancy by a qualifying household based on either the income limit established for the percentage of median income specified in the planning approvals or other use restrictions for the BMR unit. Maximum monthly rent, together with a utility allowance in an amount determined by the San Francisco Housing Authority, shall not exceed thirty (30) percent of the percentage of the income limit required by the planning approvals or other use restrictions. The rent at first occupancy of a BMR unit shall not exceed the maximum monthly rent. Subsequent rents may be increased on each anniversary of a tenant's occupancy of a BMR Rental Unit according to the formula set forth in Section IV (D) (7) of this manual. MAXIMUM SALES The maximum initial or resale price of a Below Market Rate PRICE ownership unit as established by the Mayor's Office of Housing. 1� Rev.6181/07 MEDIAN INCOME The income that reflects the halfway point between all incomes for a certain-sized household based on a sample representation of the population. The income table used to determine the median income is determined by the date on which a housing development received its first site or building permit. MEDIAN-INCOME A household whose combined annual gross income for all HOUSEHOLD members does not exceed one hundred (100) percent of median income. MODERATE- A household whose combined annual gross income for all INCOME members does not exceed one hundred twenty (120) percent HOUSEHOLD of median income. MINORITY Minority communities or minority households shall include, as COMMUNITIES a guideline, members of the following racial, ethnic, gender or otherwise specially disadvantaged groups: African-American - defined as persons of African origin. Latino - defined as persons of Mexican, Caribbean, Central American or South American origin. Asian - defined as persons of Chinese, Japanese, Korean, Pacific Islander, Samoan, Filipino, Southeast Asian or Asian Indian origin. Native American - defined as persons whose origins are of indigenous peoples of North America. Women - defined as persons of female gender. Gay and Lesbian - defined as a male and female homosexual. Families with dependents - defined as a household with two or more persons in which the head of household is an adult and at least one other household member is an elderly or handicapped person who is financially dependent on the head of household or a person under the age of 18 years who is related to the head of the household by blood, marriage or adoption or related to the domestic partner by blood or adoption. Person with a disability- defined as a person who satisfied the definition of "handicapped" under Federal Fair Housing Law on the basis of presence of a long-term physical or mental impairment which substantially limits one or more of such person's major life activities including mobility, visual or 12 Rev 6/8//07 • • hearing impairment, terminal illness or AIDS diagnosis. Elderly- defined as persons over the age of 65 years. NEW The construction of new habitable living and accessory CONSTRUCTION space, including additions to existing structures. It does not include conversion of use of existing building space or rehabilitation of existing building space. NOTICE OF A document recorded with the City and County of San SPECIAL Francisco Recorder's Office for any unit subject to this RESTICTIONS Program detailing the sales and resale or rental restrictions (NSR) and any restrictions on purchaser or tenant income levels included as a Conditional of Approval of the principal project relating to the unit. OFF-SITE BMR Shall mean unit affordable to a qualifying household UNIT constructed pursuant to the Inclusionary Ordinance, Section 315.4, on a site other than the principal project. OFF-SITE A development constructed pursuant to the Inclusionary PROJECT Ordinance, Section 315.4, on a site other than the principal • project. ON-SITE BMR UNIT Shall mean a unit affordable to a qualifying household constructed pursuant to the Inclusionary Ordinance, Section 315.4, on the site of the Principal project. ON-SITE PROJECT Shall mean project constructed pursuant to the Inclusionary Ordinance, Section 315.4, with on-site BMR units. PLANNING A general term for the Planning Motion, Conditions of APPROVAL Approval, Planning Permits, Zoning Administrator determinations or other planning approvals issued for a specific housing development. PLANNING CODE The City and County of San Francisco Planning Code. PLANNING A planning approval issued by the San Francisco Planning MOTION Commission. PLANNING PERMIT A planning approval issued by the San Francisco Planning Departments. • 13 Rev.6/8//07 • PRINCIPAL A development on which a requirement to provide affordable PROJECT housing units is imposed as a condition of planning approval, pursuant to other applicable use restrictions or any project that includes a certain number of residential units. PROCEDURES The City and County of San Francisco Affordable Housing MANUAL Monitoring Procedures Manual. PROJECT The applicant for a site or building permit and any other SPONSOR permit to allow construction of a principal project which, as a condition of approval or as a matter of the project being a certain number of units or greater, must provide affordable BMR unit(s). "Project Sponsor" includes any successors in interest to ownership of all or part of the principal project or any BMR unit. The term "Project Sponsor" shall be the developer or owner for the purposes of this Procedures Manual. QUALIFYING A household that satisfies the following criteria: HOUSEHOLD Annual income at the time of initial occupancy of a BMR unit, adjusted for household size, does not exceed the percentage of median income limits specified in the planning approvals or other applicable use restrictions of the project; The household must occupy the unit as a principal residence; The size of the unit must be compatible with the household size, at a minimum of one person per bedroom; In the case of a BMR Ownership Unit, a qualifying household must be a first-time homebuyer household; In the case of ownership BMR units, a percentage of the value of allowable assets will be added to a household's gross income. This new income shall be referred to as a household's imputed income; One titleholder lives or works in the City and County of San Francisco. In the case of ownership BMR units, all titleholders must be the holder of a standard mortgage from a primary lending institution. In the case of ownership BMR units, all titleholders must have attended an approved first-time homebuyer education workshop before applying for the unit. 14 Rev.6/8//07 • Each household member must either be on the loan and title for the BMR unit or be claimed as a dependent as reflected in the most recent tax years. RESALE PRICE The purchase price to be paid by a buyer of a BMR unit previously purchased by a qualified first-time homebuyer household, as calculated according to Section II (D) (5) of this Manual. SAN FRANCISCO Median income adjusted for household size derived from the MEDIAN INCOME statistical relationship between the American Community Survey (ACS) income profile and the regional U.S. Department of Housing and Urban Development(HUD)AMI calculation used to calculate the income levels of qualifying BMR households and to price BMR units. The index shall be updated every year or upon availability of an updated ACS. SPECIAL A proportional fee charged to the owner by the Homeowner's ASSESSMENT Association (HOA) to cover the cost of physical improvement to.the entire building. UNBUNDLED A parking space that is not an amenity included in the price PARKING of a residential unit. USE RESTRICTION A restriction which is recorded in the official records of San Francisco County on the principal project and any linked off-site affordable housing project; (ii) restrictions contained in applicable provisions of San Francisco Codes, or (iii) restrictions contained in the Ordinance, any of which restricts the use of real property, either totally or partially as affordable housing. UTILITY A dollar amount established periodically by the San ALLOWANCE Francisco Housing Authority based on U.S. Department of Housing and Urban Development(HUD) standards for cost of basic utilities for households. ZONING The Zoning Administrator for the City and County of San ADMINISTRATOR Francisco 15 Rev_6/8//07 11. BUYER QUALIFICATIONS AND RESTRICTIONS ON BMR OWNERSHIP UNITS (Boldface words are defined in Section 1) A. Buyer Qualifications 1. Qualifying Household for BMR Ownership Units A qualifying household meets the following standards: a. The household is income qualified; b. The household is a first-time homebuyer household; c. The household must live in the unit as their primary residence within 60 days of the close of escrow on the unit; d. The household includes one member who has lived or worked in San Francisco by the application deadline for the BMR unit; e. The household includes all spouses or domestic partners of titleholders as joint titleholders; f. The household must be of a size that is equal to or greater than the number of bedrooms in the BMR unit; g. The household includes titleholders who have taken an approved first-time homebuyer education workshop; h. The household is defined in terms of financial relationships and can include any owner partnerships as long as the combined household meets the eligibility requirements; i. All titleholding household members must appear on the loan for the BMR unit. 2. Preferences for BMR Ownership Units a. At least one applicant in each BMR household must live or work in San Francisco in order to apply for a BMR unit per Section 315.4 of the Planning Code. This household member must have lived or worked in San Francisco by the application deadline for a BMR unit. b. Verification of Preference Qualification i. MOH shall verify a person's residency by examining one document from the list below: 16 Rev.6/8//07 • (a) One utility bill with a San Francisco address dated within the 45 days preceding the application deadline for the BMR unit. Utility bills can include gas, electric, garbage or water; (b) Current paystubs with a San Francisco address; or (c) A current, formal lease with a San Francisco address. ii. MOH shall verify that a person works in San Francisco by reviewing an applicant's paystubs. If an applicant's employer is not based in San Francisco, or if a person's paystubs do not reflect a San Francisco work address, the applicant must supply a notarized letter from the employer stating that the person works primarily in San Francisco and demonstrate that at least 75% of their working hours are in San Francisco. 3. First-time Homebuyer Requirement for BMR Ownership Units a. No member of the qualifying household must have owned any interest in a dwelling unit, any commercial real estate, or any land for a three-year period prior to applying to • qualify for purchase of a BMR unit. The period shall be counted backwards from the application deadline for the BMR unit. b. This definition is a legal requirement and includes, among other properties, those in which an applicant's name appears on title regardless of whether or not that interest results in a financial gain, is in another state or country, or if they have ever used the property as a primary residence. If any purchaser has had their name on title of a property but it was sold more than three years ago, the program considers them a first-time buyer. c. MOH may verify first-time homebuyer status by (1) reviewing mortgage deductions on the three most recent years of federal tax returns for each person on title; (2) a signed statement on the application stating homeownership status; and (3) a title search. 4. First-time Homebuyer Education Workshop Requirement for BMR Ownership Units Each BMR applicant who will hold title in a BMR unit must attend a qualified first-time homebuyer education workshop before applying for a BMR Ownership Unit. The workshop provider must 17 Rev_8/8//07 be approved by MOH. Applicants must provide a certificate of completion from the workshop with the BMR application package. For one year following the effective date of this Manual, MOH may allow applicants to provide certification of completion of a qualified workshop after the applicant's name is selected through a lottery. 5. Household Size Requirement for BMR Ownership Units The size of a household must be compatible with the size of the unit being purchased. A minimum of one person per bedroom is required. There is no restriction on purchasing a unit that has fewer bedrooms than the household size. 6. Income Requirement for BMR Ownership Units a. Unless stated otherwise in planning approvals or other use restrictions, BMR Ownership Units in one development will, on average, be available to households with a combined income of no more than 100% of median income. Income maximums are based on "gross" income derived from all sources as detailed in Internal Revenue Code (26 USC Section 61). The amounts are adjusted on an annual basis and are posted on the MOH website. b. The income table used to calculate the income level of a • BMR household shall be determined by the date on which the principal project for which the household applies received its first site or building permit. Income levels for buyers in principal projects that received their first site or site or building permit before September 9, 2006 will be reviewed using the HUD Area Median Income as adjusted for household size. Income levels for buyers in principal projects that received their first site or site or building permit on or after September 9, 2006 will be reviewed using the San Francisco Median Income as adjusted for household size. All off-site projects will be held to the date on which the principal project received its first site or building permit. c. MOH calculates income based on the gross income on each applicant's past three pay stubs. The income is derived by dividing the year-to-date gross income by the current pay period count and then by annualizing an estimated pay period amount by the total pay period count over one year. d. In the case of a self-employed person, MOH reviews the person's last 2 years of tax returns; past, present and projected Profit and Loss Statements; and other relevant documents on a case-by-case basis. 18 Rev_6/8//07 • e. MOH must review qualifying requirements for all household members. 18 years and older, regardless of dependency status. 7. Asset Test for BMR Ownership Units MOH will apply an asset test to all applicants 18 years or older, including all custodial accounts held for minors. Assets include all liquid asset accounts, including but not limited to savings accounts, checking accounts, Certificates of Deposit, stocks, and gifts. Assets also include any money that will be used toward a down payment on a BMR unit. MOH will not count qualified retirement income toward an applicant's asset. 10% of all assets between $30,001 and 130,000 will be added to the total household income; and 35% of assets above $130,000 will be added to the total household income. B. Buyer Application Requirements for BMR Ownership Units 1. Households applying for BMR ownership units must supply the following documentation in order to apply for a BMR unit: a. An application from the proposed purchaser on a form specified by MOH; b. Supporting documentation from all members 18 years or older of the purchaser household, including: i. Past three (3) years IRS returns; ii. Past three (3) years W-2 forms; iii. Three (3) current and consecutive pay stubs or equivalent; iv. Three (3) current and consecutive statements from every liquid asset account or personal cash holdings, including all custodial accounts held for minors; v. Verification of San Francisco residency or employment; vi_ Verification of completion of an approved First- time Home Buyer Education workshop. 2. To proceed with a BMR unit purchase post-lottery, the BMR buyer's lender or sales agent must supply the following documentation: a. A completed sales agreement; b. An appraisal showing the Appraised Fair Market Value of the BMR unit; c. A mortgage loan application to an institutional lender; d. A Preliminary Title Report for the BMR unit. • 1 9 Rev.6/8//07 C. Financing Requirements 0 1. Loan Review for BMR Ownership Units MOH will review loans for reasonable interest rates and other factors important to sound lending. 2. Allowable Loan Types for BMR Ownership Units All BMR buyers must be able to secure a loan through a lending institution for a BMR unit. BMR buyers must use fully amortizing 30- or 40-year fixed-rate loans. 3. Loan Types Not Allowed for BMR Ownership Units Except for specifically approved loans programs, BMR buyers cannot use stated-income loans, negative amortizing loans, adjustable rate mortgages, "balloon payment" loans, or interest- only loans. MOH reserves the right to identify additionally prohibited loan characteristics. 4. Documentation Requirements for BMR Ownership Units Loan agreement documents must name all BMR titleholders and no other persons- D. Restrictions on BMR Ownership Units 1. Term of Restriction on BMR Ownership Units Per Section 315.7 of the Planning Code, all BMR ownership units that entered the marketing process on or after the effective date of this Manual are restricted in their resale price and other applicable restrictions for the life of the project unless otherwise noted in the planning approvals or other use restrictions for the project. All BMR ownership units that entered the marketing process before the effective date of this Manual are restricted in their resale price and other applicable restrictions for 50 years unless otherwise stated in the planning approvals or other use restrictions for the project. The 50-year restriction period shall restart with each resale of a BMR unit. 2. Documents that Govern the BMR Ownership Unit and Owner All titleholders to BMR Ownership Units will sign documents provided by MOH that maintain restrictions on a BMR unit. These documents include but are not limited to the following: 20 Rev.6/8//07 • a. Deed of Trust—A deed that is subordinate only to the primary deed, executed by the buyer as trustor, for the benefit of the City to secure the Promissory Note described as follows: b. Promissory Note—Alien.that is based upon the difference between Appraised Fair Market Value and the BMR maximum sales price, insuring compliance with the resale restrictions outlined in the planning approvals or other use restrictions. The lien will be reconveyed to the new BMR unit owner upon resale. BMR owners in units marketed before the effective date of this Manual may only repay the lien when the unit leaves its restricted period, generally no sooner than 50 years from date of purchase for one BMR owner household. BMR owners living in units that entered the marketing period on or after the effective date of this Manual may not repay the lien at any time. c. Grant of Right of First Refusal—A document that requires the seller to notify MOH upon resale, giving the City the option to exercise their right to substitute a qualified buyer. d. Acknowledgement of Special Restrictions—Verification that the buyer has been advised of the terms of the affordability restrictions contained in the planning approvals • and other use restrictions for the BMR unit. 3. Occupancy Requirement for BMR Ownership Units BMR units are to be owner-occupied and never used as investment or rental property. 4. Restrictions on Renting BMR Ownership Units a. An owner of a BMR unit may not rent or sublease any part or the entire unit without prior written consent of MOH. b. BMR Ownership Units are to be owner-occupied and not used as rental property. However, MOH may grant consent to a BMR owner to rent in circumstances where the household is temporarily forced to temporarily relocate due to employment requirements, or for other reason deemed acceptable by MOH in its sole discretion, provided that: i. The total period for which the unit may be leased does not exceed six (6) months; ii. The tenant satisfies the income, household size and other qualifying household requirements placed • 21 Rev.6/8//07 on the BMR unit by planning approvals or other use restrictions; and iii. Initial rent does not exceed the maximum monthly rent, calculated according to the income percentages under subsection IV (D) (2) above. 5. Resale Restrictions and Procedures for BMR Ownership Units A BMR Ownership Unit owner shall follow the ensuing policies and guidelines of MOH when reselling a BMR ownership unit. a. The owner of a BMR Ownership Unit shall, at least thirty (30) days prior to marketing the BMR unit, advise MOH of his/her intent to sell the unit and shall request a determination of resale price from MOH. MOH shall price the unit only upon receipt of a signed intent to resell the unit and request for pricing; a statement of all approved capital improvements made to the unit; and a signed listing agreement with a certified realtor. b. Within the 30-day period, MOH shall inform the owner of the permissible sales price of that unit and any other conditions of sale. c. Pricing Methodology for BMR Units Upon Resale i. A BMR unit will be repriced so that it remains affordable to a household sized one person larger than the bedroom count of the unit at a designated percentage of median income. ii. Units in developments that were not sold under this Manual will be re-priced using the methodology dictated by planning approval for the specific development. iii. Units in developments that are initially sold under this Manual will be re-priced using the percentage change in the designated percentage of median income from the date of the current owner's purchase to the date of the resale pricing. iv. Owners of BMR units purchased before the effective date of this Manual may opt to have their units repriced according to the change in median income by signing a contract agreeing to abide by the current the current Manual in all aspects except for the income table requirements set forth for projects 22 Rev.6/8//07 • • receiving their first site or building permit on or after September 9, 2006. v. The income table used to calculate the resale price of a BMR unit shall be determined by the date on which the principal project received its first site or building permit. Units in developments with corresponding principal projects that received their first site or building permit before September 9, 2006 will be repriced using the historical and current percentage of HUD Area Median Income for a household sized one person larger than the number of bedrooms in the unit. Per Section 315.1 of the Planning Code, units in developments with corresponding principal projects that received their first site or building permit on or after September 9, 2006 will be repriced using the historical and current percentage of San Francisco Median Income for a household sized one person larger than the number of bedrooms in the unit. vi. The resale price shall be equal to the sum of(a) plus (b) plus (c) below. If the resale price as calculated above is lower than the original purchase price for the unit, MOH will give the seller the option . between the resale price as calculated, or the original purchase price (b) plus (c) below. A purchase price is recalculated at the time of sale pursuant to the following formula: (a) The formula outlined in sections i through v above; plus (b) The cost of approved capital improvements and special assessments as defined in Section II (E) of this Manual; plus (c) The fee to the owner and buyer's realtor for representation and for listing the unit on the Multiple Listing Service, equal to five (5) percent of the sum of the dollar amount calculated pursuant to subsections (a) and (b) above. d. Appreciation gained from the sale of a BMR Ownership Unit belongs to the owner unless the owner has an additional loan from the City or other entity that requires an appreciation share. However, the price of a BMR unit at resale is not guaranteed to exceed the initial purchase price of the unit. 23 Rev_6/8/l07 e. The owner must market the unit. Marketing must include listing of the unit on the Multiple Listing Service (MLS) by a certified realtor and listing of the unit on MOH's website for at least 14 calendar days. All MLS listings must include information on the qualifications and restrictions of the BMR unit as supplied by MOH. f. All potential buyers who are on the general BMR interest list shall be notified by MOH of units available for resale and invited to participate in the lottery, as will the general public. g. A public lottery for the resale unit must be held by MOH for all BMR unit resales. MOH will record the results and the realtor will make the results available to all interested applicants or members of the public. h. To enter a lottery for resale, a potential buyer must submit a BMR application and all supporting materials pursuant to section II (B) above as well as a loan pre-approval and a completed San Francisco purchase agreement. All applications and materials will be submitted directly to the buyer's realtor. i. At least sixty (60) days prior to the anticipated date of the close of escrow, the buyer shall submit to MOH for approval • the following documentation: i. An application from the proposed purchaser on a form specified by MOH; ii. Supporting documentation from all members 18 years and older of the purchaser household, including: (a) Past three (3) years IRS returns; (b) Past three (3) years W-2 forms; (c) Three (3) current and consecutive pay stubs or equivalent; (d) Three (3) current and consecutive statements from every liquid asset account and personal cash holdings, including all custodial accounts held for minors; (e) Verification of San Francisco residency or employment; (f) Verification of completion of an approved First-time Homebuyer Education Workshop; (g) A loan pre-approval; (h) A completed San Francisco Purchase Agreement. 24 Rev_6/8//07 • j. To proceed with a BMR unit purchase post-lottery, the BMR buyer's lender must supply the following loan and sales agreement documentation at least thirty (30) days prior to the anticipated date of the close of escrow: i. An appraisal showing the Appraised Fair Market Value of the BMR unit; ii. A mortgage loan application to an institutional lender; iii. A Preliminary Title Report for the BMR unit. k. Timing of Buyer Approval by MOH i. Upon receipt of a complete BMR homeownership application and all supporting materials, MOH shall verify the household qualification within 15 working days. ii. Upon receipt of loan and sales agreement documentation, MOH shall draft escrow closing documents within five (5) working days. I. No sale may proceed without the written approval of MOH. m. Broker fees paid by the seller must be shared in a • commission agreement with the buyer's representing agent. n. Sales agreements with terms requiring the payment of seller's brokerage fees by the buyer will not be approved. No separate terms can be required within a sales agreement that requires the buyer to purchase appliances. furnishings, or other disallowed capital improvements. o. BMR owners and realtors shall comply with the documentation and enforcement procedures set forth in Section IV (J) of this manual. p. In cases where, despite the owner's good faith efforts, no qualifying household has contracted to purchase a BMR Ownership Unit within six (6) months after the lottery for the unit, the owner shall inform MOH, which may then increase the permissible income levels for prospective purchasers of that unit up to a maximum twenty (20) percent over the income percentage limit specified in the planning approvals or other use restrictions, but shall not increase any current or future permissible sale price of that unit as indicated in planning approvals or other use restrictions. 6. Restrictions on Title Transfer of BMR Ownership Units • 25 Rev.6/8//07 a. Title transfers on BMR units are not allowed except as determined by MOH on a case-by-case basis. BMR owners must seek approval from MOH before adding or removing any person from title. b. MOH may require that a spouse or registered domestic partner become a co-owner by assuming title and by executing an addendum to the Deed of Trust, Promissory Note, Acknowledgement of Special Restrictions, and Right of First Refusal. 7. Owner Refinancing of BMR Ownership Units a. MOH must approve all refinancing agreements for BMR ownership units. b. Owners may be permitted to refinance up to the original value of their first mortgage in order to obtain lower interest rates or lower monthly payments. The new loan must be approved under the guidelines set out in section II (C) of this Manual. c. Owners may also refinance their units to withdraw cash only in an amount equal to the amount paid on the unit. E. Capital Improvements for BMR Ownership Units • 1. BMR units may begin claiming capital improvements made 10 years after the unit was originally occupied. Once the building becomes eligible for capital improvements credit, homeowners may begin submitting documentation of completed work. 2. MOH will review all capital improvements claims and categorize them into three distinct categories: Eligible Capital Improvements, Eligible Replacement and Repair and Ineligible Costs. Each category is defined below. a. Eligible Capital Improvements include major structural system upgrades, special assessments, new additions to the unit and improvements related to increasing the health, safety and energy efficiency of the property. Improvements that meet these criteria will be given 100% credit. b. Eligible Replacement and Repair includes in-kind replacement of existing amenities, repairs and general maintenance that keeps the property in good working condition.Costs that meet these criteria will be given 50% credit. 26 Rev 6/8//07 • • c. Ineligible costs include cosmetic enhancements, installations with limited useful life spans and non-permanent fixtures. Homeowners may undertake these projects at their discretion, however they will not be given capital improvements credit. 3. Procedure for Submitting Capital Improvements a. Homeowners must submit capital improvements to MOH for review within 6-months of the completion of the project. In order to document the improvements, each homeowner must submit: i. List of Capital Improvements with Description ii. Receipt/Invoice for Each Eligible Improvement iii. Proof of Payment, such as a cancelled check, bank account statement or credit card bill iv. A Copy of Site or Building Permits, if required v. Contractor's License Number for Projects Exceeding $500 b. Upon receipt of a complete capital improvements claim, MOH staff will arrange a site visit to inspect the completed project. Once the improvements have been verified, MOH will • send a written response to approve or deny the submitted capital improvements within 60 days of original receipt_ This information will be placed in the property file at MOH for use when the property is being sold. 4. Special Assessments Homeowner's Association initiated special assessments are considered capital improvements and will be added to the resale price of the home. In order to receive credit for special assessments, homeowners must submit the following documentation within 6-months of payment: a. Invoice for Special assessment b. Proof of Payment, such as a cancelled check, bank account statement or credit card bill 5. Capital Improvements Cap In order to maintain the affordability of the BMR unit for subsequent buyers, MOH will approve all eligible capital improvements, eligible replacement and repair, and special assessments when submitted. At the time of sale, MOH will cap • 27 Rev.6/8!/07 all eligible capital improvements and eligible replacement and • repair at 7% of the resale price. 6. List of Approved Capital Improvements a. Eligible Capital Improvements include major structural system upgrades, new additions to the unit and improvements related to increasing the health, safety and energy efficiency of the property. Improvements that meet these criteria will be given 100% credit. i. Major Electrical Wiring System Upgrade ii. Major Plumbing System Upgrade iii. Room Additions iv. Installation of Additional Closets and Walls v. Alarm System vi. Smoke Detectors vii. Removal of Toxic Substances, such as: (a) Asbestos (b) Lead (c) Mold/Mildew (d) Insulation (e) Upgrade to Double Paned Windows (f) Fireplace Glass Screen viii. Upgrade to Energy Star Built-In Appliances, as follows: • (a) Furnace (b) Water Heater (c) Stove/Range (d) Dishwasher (e) Microwave Hood b. Eligible Replacement and Repair includes in-kind replacement of existing amenities, repairs and general maintenance that keeps the property in good working condition. Costs that meet these criteria will be given 50% credit for repairs. i. Electrical Maintenance and Repair, such as: (a) Switches (b) Outlets ii. Plumbing Maintenance and Repair, such as: (a) Faucets (b) Supply Line (c) Sinks iii. Flooring iv. Countertops v. Cabinets vi. Bathroom Tile 28 Rev-6/8//07 vii. Bathroom Vanity viii. Replacement of Built-In Appliances, as follows: (a) Furnace (b) Water Heater (c) Stove/Range (d) Dishwasher (e) Microwave Hood (f) Garbage Disposal ix. Window Sash x. Fireplace Maintenance or In-kind Replacement (Gas) xi. Heating System xii. Lighting System (Recessed) c. Ineligible costs include cosmetic enhancements, installations with limited useful life spans and non-permanent fixtures. Homeowners may undertake these projects at their discretion, however they will not be given capital improvements credit. i. Cosmetic Enhancements, such as: (a) Fireplace Tile and Mantel (b) Decorative Wall Coverings or Hangings (c) Window Treatments (Blinds, Shutters, Curtains, etc.) • (d) Installed Mirrors (e) Shelving (f) Refinishing of Existing Surfaces ii. Non-Permanent Fixtures, such as: (a) Track Lighting (b) Door Knobs, Handles and Locks (c) Portable Appliances (Refrigerator, Microwave, Stove/Oven, etc.) iii. Installations with Limited Useful Life Spans, such as: (a) Carpet (b) Painting of Existing Surfaces (c) Window Glass (d) Light Bulbs F. Monitoring of BMR Ownership Units MOH shall monitor and require occupancy certification for BMR ownership units on an annual basis. Owner(s) of a BMR unit will be required to submit an annual monitoring and enforcement report on a form provided by MOH and submitted on a date and at a location determined by MOH. The report shall provide information regarding 29 Rev.6/8//07 occupancy status, changes in title, and any other information MOH may • reasonably require to monitor compliance with the BMR units specific planning approvals or other use restrictions. III. RENTER QUALIFICATIONS AND RESTRICTIONS ON BMR RENTAL UNITS A. BMR Renter Qualifications 1. Qualifying Household for BMR Rental Units A qualifying household meets the following standards: a. The household is income qualified; b. The household is a non-homeowner household; c. The household must live in the unit as their primary residence within 60 days of the signing of the lease for the unit; d. The household includes one member who has lived or worked in San Francisco by the application deadline for the BMR unit; e. The household must be of a size that is equal to or greater than the number of bedrooms in the BMR unit; • f. The household is defined in terms of financial relationships and can include any rental partnerships as long as the combined household meets the eligibility requirements; g. All non-dependents must appear on the lease for the unit. 2. Preferences for BMR Rental Units a. A least one applicant in each BMR household must live or work in San Francisco in order to apply for a BMR unit per Section 315.4 of the Planning Code. This household member must have lived or worked in San Francisco by the application deadline for a BMR unit. b. Verification of Preference Qualification i. MOH shall verify a person's residency by examining one document from the list below. Each document must be in the applicant's name: (a) One utility bill with a San Francisco address dated within the 45 days preceding the 30 Rev 6,'8J/07 application deadline for the BMR unit. Utility bills can include gas, electric, garbage or water; (b) Current paystubs with a San Francisco address; or (c) A current, formal lease with San Francisco address. ii. MOH shall verify that a person works in San Francisco by reviewing an applicant's paystubs. If an applicant's employer is not based in San Francisco, or if an applicant's paystubs do not reflect a San Francisco work address, the applicant must supply a formal letter from the employer stating that the applicant works primarily in San Francisco and demonstrate that at least 75% of the applicant's working hours are in San Francisco. 3. Non-homeowner Requirement for BMR Rental Units a. No member of the qualifying household must own any interest in a dwelling unit, any commercial real estate, or any land upon applying to qualify for the rental of a BMR unit. b. This definition is a legal requirement and includes, among other properties, those in which an applicant's name appears • on title regardless of whether or not that interest results in a financial gain, is in another state or country, or if they have ever used the property as a primary residence. c. MOH may verify non-homeowner status by (1) a signed a statement on their application stating their homeownership status, and (2) a title search. 4. Household Size Requirement for BMR Rental Units The size of a household must be compatible with the size of the unit being purchased. A minimum of one person per bedroom is required. There is no restriction on purchasing a unit that has fewer bedrooms than the household size. 5. Income Requirement for BMR Rental Units a. Unless stated otherwise in the planning approvals or other use restrictions, BMR Rental Units in one development will be available to households with a combined income of no more than 60% of median income. Income maximums are based on "gross" income derived from all sources as detailed in Internal Revenue Code (26 USC Section 61). The amounts are adjusted on an annual basis. 31 Rev_6/8!/07 b. The income table used to calculate the income level of a BMR household shall be determined by the date on which the principal project for which the household applies received its first site or building permit. Per Section 315.1 of the Planning Code, income levels for renters in principal projects that received their first site or site or building permit before September 9, 2006 will be reviewed using the HUD Area Median Income as adjusted for household size. Income levels for renters in principal projects that received their first site or site or building permit on or after September 9, 2006 will be reviewed using the San Francisco Median Income as adjusted for household size. All off-site projects will be held to the date on which the principal project received its first site or building permit. c. MOH calculates income based on the gross income on each applicant's past three pay stubs. The income is derived by dividing the year-to-date gross income by the current pay period count and then by annualizing an estimated pay period amount by the total pay period count over one year. d. In the case of a self-employed person, MOH reviews the person's last 2 years of tax returns; past, present and projected Profit and Loss Statements-, and other relevant • documents on a case-by-case basis. e. MOH must review qualifying requirements for all household members 18 years and older, regardless of dependency status. 6. Asset Test for BMR Rental Units MOH will apply an asset test to all applicants, including all custodial accounts held for minors. Assets include all liquid asset accounts, including but not limited to savings, checking accounts, Certificates of Deposit, stocks, and gifts. Assets also include any money that will be used toward a down payment on a BMR unit. MOH will not count qualified retirement income toward an applicant's asset. 10% of all assets between $30,001 and 130,000 will be added to the total household income, and 35% of assets above $130,000 will be added to the total household income. B. BMR Renter Application Requirements a. Households applying for BMR rental units must supply the following documentation in order to enter the lottery for a BMR unit: 32 Rev 6i8L107 • • i. An application from the proposed purchaser on a form specified by MOH; ii. Supporting documentation from all members 18 years or older of the purchaser household, including: (a) Past one (1) year IRS returns; (b) Past one (1) year W-2 forms; (c) Three (3) current and consecutive pay stubs or equivalent; (d) Three (3) recent and consecutive statements from every liquid asset account and personal cash savings, including all custodial accounts held for minors- (e) Verification of San Francisco residency or employment. b. To proceed with a BMR unit rental post-lottery, the rental representative must supply a draft lease agreement to MOH before MOH will approve the rental household. C. Restrictions on BMR Rental Units 1. Term of Restriction on BMR Rental Units • Per Section 315.7 of the Planning Code all BMR Rental Units that entered the marketing process on or after the effective date of this Manual are restricted in their rent levels and other applicable restrictions for the life of the project unless otherwise stated in the planning approvals or other use restrictions for the project. All BMR Rental Units that entered the marketing process before the effective date of this Manual are restricted in their rent levels and other applicable restrictions for 50 years unless otherwise stated the planning approvals or other use restrictions for the project. 2. Documents that Govern the BMR Rental Unit and Renter MOH may require all leaseholders of BMR Rental Units to sign documents stating leaseholders' acknowledgement of the restrictions on the BMR rental unit and any monitoring procedures. 3. Occupancy Requirement for BMR Rental Units BMR units are intended to be renter-occupied and never used as investment or rental property. 4. Restrictions on Renting or Subleasing BMR Rental Units • 33 Rev.6!8/107 i. A renter of a BMR unit may not rent or sublease any part or the entire unit without prior written consent of MOH. ii. BMR Rental Units are to be occupied by the qualifying household and not used as rental property. However, MOH may grant consent to a BMR renter to rent in circumstances where the household is temporarily forced to temporarily relocate due to employment requirements, or for other reasons deemed acceptable by MOH in its sole discretion, provided that: (a) The total period for which the unit may be leased does not exceed six (6) months; (b) The sub-tenant satisfies the income, household size and other qualifying household requirements placed on the BMR unit by planning approvals or other use restrictions; (c) The sublease complies with any requirements in the lease between the Project Sponsor and the tenant; and (d) Initial sublease rent does not exceed the rent then payable by the current tenant. 5. Restrictions on Lease Changes for BMR Rental Units BMR renters may not add or subtract any person from the lease for a BMR Rental Unit without consent from MOH. Should MOH consent to the addition or subtraction of a qualified household member in BMR Rental Unit, the new household must submit a new application for the unit and meet the current qualification standards for a BMR Rental Unit. D. Permissible Rent Increases The Project Sponsor may increase the maximum monthly rent for a qualifying household on each anniversary of a tenant's occupancy in an amount that does not exceed the amount determined by MOH based on the percent of median income established in planning approvals or other use restrictions and the then-existing median income amounts. E. Monitoring of BMR Rental Units 34 Rev.6/8//07 • BMR Rental Units shall be monitored by MOH on an annual basis to determine the continued eligibility of the BMR renter household. BMR rental households, owner(s) or those charged with the management of affordable BMR rental housing units satisfying the requirements of their planning approvals or other use restrictions may be required to submit an annual monitoring and enforcement report on a form provided by MOH and submitted on a date and at a location determined by MOH. The report shall provide information regarding rents, household and income characteristics of tenants of designated affordable units, services provided as part of the housing service such as security, parking, utilities, and any other information MOH may reasonably require to monitor compliance with the BMR unit's specific planning approvals or other use restrictions. IV. PROCEDURES FOR PROJECT SPONSORS, OWNERS AND PROPERTY MANAGERS A. Monitoring and Reporting Procedure 1. Monitoring and Reporting Procedures for BMR Ownership Units MOH shall monitor and require occupancy certification for BMR ownership units on an annual basis. Owner(s) of a BMR unit will be required to submit an annual monitoring and enforcement • report on a form provided by MOH and submitted on a date and at a location determined by MOH. The report shall provide information regarding occupancy status, changes in title, and any other information MOH may reasonably require to monitor compliance with the BMR units specific planning approvals or other use restrictions. 2. Monitoring and Reporting Procedures for BMR Rental Units Project Sponsors of BMR Rental Units shall retain initial rental application forms and household income documentation for the greater of (i) five (5) years from the date of a tenant's occupancy of a BMR Rental Unit, or(ii) the duration of the tenure of the tenant occupying the BMR unit. This data may be requested by MOH, along with an administrative fee if any is authorized at the time of the request. BMR Rental Units shall be monitored by MOH on an annual basis to determine the continued eligibility of the BMR renter household. BMR rental households, owner(s) or those charged with the management of affordable BMR rental housing units satisfying the requirements of their planning approvals or other use restrictions may be required to submit an annual monitoring and enforcement report on a form provided by MOH and submitted on • 35 Rev.6/8//07 a date and at a location determined by MOH. The report shall • provide information regarding rents, household and income characteristics of tenants of designated affordable units, services provided as part of the housing service such as security, parking, utilities, and any other information MOH may reasonably require to monitor compliance with the BMR unit's specific planning approvals or other use restrictions. 3. Statistical Information for BMR Units MOH may at any time require the Project Sponsor to collect information from the owners or tenants of all BMR units in the project regarding their ethnicity, gender, age, and such other information as may be requested to allow MOH to verify that there have been no discriminatory practices in the selection of such tenants or owners. The collection of such information shall be conducted in a manner and using a form acceptable to MOH, ensuring that the information is being collected after the tenant or owner selection process is complete, and is used solely for statistical reasons and not as the basis for making any decision regarding the qualification of a tenant or owner for occupancy of a BMR unit. B. Compliance Procedures 1. Compliance Through New Construction On-Site • a. When required by planning approvals or other applicable use restrictions to adhere to the Inclusionary Ordinance, the Project Sponsor may provide the number and type of BMR units satisfying the planning approvals or other applicable use restrictions through the construction of said units on the site of the principal project. b. Project Sponsors who submitted a first application to the Planning Department prior to July 18, 2006 for the construction of a project containing ten (10) or more units are required to provide ten (10%) or twelve (12%) percent, (depending on the distinction between an As-of-Right or Conditional Use authorization) of all units as BMR units. If the total number of BMR units required is not a whole number, the obligation shall be rounded up to the nearest whole number for any portion of .5 or above. c. Project Sponsors who submitted a first application to the Planning Department on or after July 18, 2006 must provide fifteen (15%) of all units as BMR units for any project containing five (5) or more units or any project requiring rezoning, with exception to projects 120 feet in height or 36 Rev.6/8//07 • • higher. Projects 120 feet in height or higher which do not require a zoning map amendment or planning code text amendment that result in a net increase in the number of permissible residential units or in a material increase in the net permissible residential square footage are required to provide twelve percent (12%) of all units as BMR units. Unless amended by the Board of Supervisors, the exception of projects 120 feet in height or higher shall expire January 1, 2012. d. If the total number of BMR units required is not a whole number, the obligation shall be rounded up to the nearest whole number for any portion of .5 or above. e. Projects receiving Planning Commission or Planning Department approval on or after September 9, 2006, must make a Declaration of Intent stating the on-site, off-site and/or in-lieu fee option before receiving first planning approval. Project Sponsors may only amend the Declaration of Intent if they choose to change from the in-lieu fee or off- site option to the on-site option. f. BMR units must be constructed, completed, and ready for occupancy no later than the principal project's market rate units. Additionally, BMR units must be a comparable unit to • the market rate units. g. The Project Sponsor shall construct and, when applicable, manage the BMR units. BMR units shall not remain vacant for more than sixty (60) days from the date of first certificate of occupancy. h. Affordable housing units shall not have received development subsidies from any federal, state or local program established for the purpose of providing affordable housing. Any such units receiving such subsidies shall not be counted to satisfy any affordable housing project requirements for the on-site development, except as provided in Section IV (B) (1) (i). i. A Project Sponsor may use California Debt Limit Allocation Committee (CDLAC) tax-exempt bonds to help fund its obligations per Section 325.4 and 315.5 of the Planning Code as long as it provides 20% of the units as affordable at 50% of median income for on-site housing or 25% of the units as affordable at 50% of median income for off-site housing. Except as provided in this subsection, all units provided under this section must meet all of the requirements of the inclusionary Ordinance and the Manual for either on- or off- • 37 Rev.6/8!/07 site projects. The income tables to be used for the CDLAC • units are those used by MOH for Inclusionary Housing units and not those used by the Tax Credit Allocation Committee (TCAC) or CDLAC. Sponsors shall contact MOH for the applicable income table. j. On-site units satisfying a Project Sponsor's On-site Inclusionary Ordinance obligation must be offered as BMR Rental Units affordable to households earning up to sixty percent (60%) of median income on average or as BMR for- sale units affordable to households earning one hundred percent (100%) of median income, unless stated otherwise in planning approvals or other use restrictions. In the case of BMR Ownership Units, the BMR units in one development may range in price from 80% to 120% median income when the average median income for the building is 100%. MOH will work with Project Sponsors on a case-by-case basis to determine the allowable range of income levels. k. Projects must record a Notice of Special Restrictions (NSR) and provide a copy of the NSR to MOH prior to the issuance of the first site or building permit. The NSR must identify the restricted BMR units by unit name or number, the income level of the units, the final approved floor plans that identify the BMR units, and the portions of the planning • approvals or other use restrictions that reference the Inclusionary Program requirements. I. All BMR units that entered the marketing process on or after the effective date of this Manual are restricted in their resale price or rental price and other applicable restrictions for the life of the project. All BMR units that entered the marketing process before the final adoption date of this Manual are restricted in their resale price or rental price and other applicable restrictions for 50 years unless otherwise stated in the planning approvals or other use restrictions for the project. 2. Compliance Through Conversion of Use On-Site The Conditions of Approval may provide that the Project Sponsor may partially or completely comply with its BMR obligation through the conversion of non-residential space to residential units, provided that the-following provision is satisfied: a. The unit shall satisfy all City Codes and standards; or b. If rear yard, parking, exposure or other residential zoning standards are not met and requirements for exceptions or 38 Rev.6/8//07 • variances are met pursuant to the Code, additional BMR units or lower income limits on qualifying households shall be imposed. 3. Compliance Through New Construction Off-Site a. When required by planning approvals or other applicable use restrictions to adhere to the Inclusionary Ordinance, the Project Sponsor may provide the number and type of BMR units satisfying the planning approvals or other applicable use restrictions through the construction of said units off-site from the principal project. b. Project Sponsors who submitted a first application to the Planning Department prior to July 18, 2006 for the construction of a project containing ten (10) or more units must provide fifteen (15%) or seventeen (17%) percent, (depending on the distinction between an As-of-Right or Conditional Use authorization), of all units as BMR units. If the total number of BMR units required is not a whole number, the obligation shall be rounded up to the nearest whole number for any portion of .5 or above. c. Project Sponsors who submitted a first application to the Planning Department on or after July 18, 2006 must provide • twenty percent (20%) of all units as BMR units for any project containing five (5) or more units or any project requiring rezoning. If the total number of BMR units required is not a whole number, the obligation shall be rounded up to the nearest whole number for any portion of .5 or above, with exception to projects 120 feet in height or higher. Projects 120 feet in height or higher which do not require a zoning map amendment or planning code text amendment that result in a net increase in the number of permissible residential units or in a material increase in the net permissible residential square footage are required to provide seventeen percent (17%) of all units as BMR units. d. Projects receiving Planning Commission or Planning Department approval on or after September 9, 2006, must make Declaration of Intent stating the on-site, off-site and/or in-lieu fee option. Project Sponsors may only amend the Declaration of Intent if they choose to change from the in-lieu fee or off-site option to the on-site option. Additionally, off-site BMR units must be located within a one (1) mile radius of the principal project. Off-site units satisfying a Project Sponsor's Inclusionary obligation must be offered as BMR Rental Units for the life of the project or as BMR for-sale • 39 Rev.6/8//07 units affordable to households earning up to eighty percent e (80%) of median income. e. BMR units must be constructed, completed, and ready for occupancy no later than the principal project's market rate units. f. The Project Sponsor shall construct and, when applicable, manage the BMR units. BMR units shall not remain vacant for more than sixty (60).days from the date of the certificate of final completion and occupancy. g. Affordable housing units shall not have received development subsidies from any federal, state or local program established for the purpose of providing affordable housing. Any such units receiving such subsidies shall not be counted to satisfy any affordable housing requirements for the on-site development except as provided in Section IV (3) (h) below. h. A Project Sponsor may use California Debt Limit Allocation Committee (CDLAC) tax-exempt bonds to help fund its obligations per Section 325.4 and 315.5 of the Planning Code as long as it provides 20% of the units as affordable at 50% of median income for on-site housing or 25% of the units • as affordable at 50% of median income for off-site housing. Except as provided in this subsection, all units provided under this section must meet all of the requirements of the inclusionary Ordinance and the Manual for either on- or off- site projects. The income tables to be used for the CDLAC units are those used by MOH for Inclusionary Housing units and not those used by the Tax Credit Allocation Committee (TCAC) or CDLAC. Sponsors shall contact MOH for the applicable income table. i. On-site units satisfying a Project Sponsor's Off-site Inclusionary Ordinance obligation must be offered as BMR Rental Units affordable to households earning up to sixty percent (60%) of median income or as BMR ownership units affordable to households earning eighty percent (80%) of median income on average, unless stated otherwise in planning approvals or other use restrictions. j. Projects must record a Notice of Special Restrictions (NSR) and provide a copy of the NSR to MOH prior to the issuance of the first site or building permit. The NSR must identify the restricted BMR units by unit name or number, the income level of the units, the final approved floor plans that identify the BMR units, and the portions of the planning 40 Rev.6/8//07 • . approvals or other use restrictions that reference the Inclusionary Program requirements. k. All BMR units that entered the marketing process on or after the effective date of this Manual are restricted in their resale price or rental price and other applicable restrictions for the life of the project. All BMR units that entered the marketing process before the final adoption date of this Manual are restricted in their resale price or rental price and other applicable restrictions for 50 years unless otherwise stated in the planning approvals or other use restrictions for the project. I. Quality Standards for Off-Site BMR Units All BMR units constructed off-site under the provisions of Section 315.5 shall be of good quality and generally equivalent to current market rate housing standards commonplace in San Francisco as determined by the .Zoning Administrator in accordance with official Planning Department policy. Off-site affordable units shall be comparable in number of bedrooms, number of bathrooms, exterior appearance and overall quality of construction to market rate units in the principal project, and shall meet • at a minimum, or exceed, the following standards: i. Individual Unit Sizes Average individual unit square footages shall be no less than 70% of the average principal project unit square footage for corresponding unit types classified by number of bedrooms, and in no case shall individual unit square footages be less than the following for each unit type: Studios: 250 square feet 1-Bedrooms: 500 square feet 2-Bedrooms: 800 square feet 3-Bedrooms: 1,000 square feet 4-Bedrooms: 1,250 square feet Exceptions to these square footage minimums may be made at the Zoning Administrator 's discretion where the principal projects average unit size by corresponding unit type classification is less than these minimums. When using such discretion, the Zoning Administrator shall take into account any anticipated occupant needs of the BMR units for a particular development. • 41 Rev.6/8/!07 The average off-site BMR unit size for a given unit type may be permitted to be less than 70% of the average size of the corresponding unit type of the principal project at the discretion of the Zoning Administrator on a case-by-case basis, provided there is a corresponding increase in unit numbers and all other provisions of this section are met. No reduction in the required total minimum BMR unit square footage per Section 315.5(d) of the Planning Code shall be permitted. ii. Design of Off-site BMR units (a) Room sizes (i) No required bedroom shall be smaller than 120 square feet, and at least one bedroom in every unit, except for studios shall be a minimum of 144 square feet. The minimum horizontal dimension for any bedroom, excluding alcoves not included in the minimum square foot calculation, shall be 10 feet. (ii) Primary rooms in studios shall be no less than 165 square feet excluding any • contiguous kitchen area. The minimum horizontal dimension for any such primary room, excluding alcoves not included in the minimum square foot calculation, shall be 11 feet. (iii) No living room shall be smaller than 144 square feet, with a minimum dimension excluding alcoves not included in the minimum square foot calculation, of 11 feet. (iv)At least one bathroom shall meet ADA size requirements, and all other full bathrooms required by this section must be at least 40 square feet in size. (v) Smaller room size minimums may be permitted at the discretion of the Zoning Administrator on a case-by- case basis, if such smaller room sizes are typical of the principal market rate 42 Rev.6/8//07 • project and are consistent with current City building and housing codes. (b) Interior Heights Prevailing floor-to-ceiling heights in each unit shall be no less than 8'-6", Lower ceiling heights in bathrooms, hallways, or small portions of other rooms may be permitted to allow for central heat and air ductwork where necessary, but in no case shall any ceiling height in such areas be less than 8'-0". (c) Kitchen and Bathroom Amenities (vi)At a minimum, all kitchens shall have a full size four-burner cook top and full size oven, with built-in exhaust hood/microwave oven unit (or an equivalent thereof), full size kitchen sink with in-drain electric disposal, full size dishwasher, full size refrigerator/freezer, good quality upper and lower level • cabinets with doors, quality counter top surfaces, and a suitable good quality floor surface. While appliances and finishes need not match or be equivalent to those in the principal project, they should be new and of good quality in terms of performance, durability and appearance. At the discretion of the Zoning Administrator, appliance sizes may be scaled down for studio units if such downsizing is typical of the principal market rate project_ For the purpose of preserving interior materials or character of older buildings or providing aesthetic compatibility therein, fully restored vintage appliances and finishes may be used as long as they are of good quality, durability, and in good working condition. (vii)Bathrooms shall consist of a shower stall, toilet and lavatory. At least one bathroom in each unit shall have both a shower stall and standard size tub or a combination tub-shower unit. • 43 Rev.6/8//07 d Closets • Each dwelling unit shall have a coat closet and a linen closet, plus a closet for each bedroom. Minimum dimensions for coat closet shall be 4'X 2'. Minimum closet dimensions for required linen closet shall be 36"X 18". Minimum closet size for the first/master bedroom shall be 16 square feet with a minimum depth of two feet. Minimum closet size for each additional bedroom shall be 12 square feet with a minimum depth of two feet. (e) Laundry facilities Off-site BMR projects shall provide laundry facilities comparable to the principal project. Each unit shall contain laundry facilities if such facilities are provided in the principal project. Each floor shall contain a laundry facility if such facilities are in the principal project, with one full-size washer and one-full size dryer for every four units per floor. There shall be a common laundry room for the entire building if such a facility is provided in the principal project with one washer and one dryer unit for every eight units. Individual laundry facilities within units shall consist of both a washer and dryer unit. Studios, one- and two-bedroom units may utilize stacker units; three bedroom units and larger shall have full size laundry machine units. Laundry machines shall be new and of good quality and durability. (f) Finish qualities (viii) Finish qualities throughout dwelling units and common areas including: doors; windows; wall and floor materials and finishes; bathroom finishes and fixtures; trim; hardware; lighting and other electric features, need not match or be equivalent to that of the principal project, but should be new and of good quality in terms of 44 Rev.6/8//07 . performance, functionality, durability and appearance and should reflect current residential interior styles, except in cases where vintage styles are appropriate to the interior finish design of the building, or where it is desired to preserve historic features or finishes. iii. Smaller room size minimums may be permitted at the discretion of the Zoning Administrator on a case- by-case basis, if such smaller room sizes are typical of the principal market rate project and are consistent with current City building and housing codes. iv. The standards in this section may be reduced at the discretion of the Zoning Administrator on a case- by-case basis provided the intent of this section—that all affordable units shall be of good quality and generally equivalent to current market rate housing standards commonplace in San Francisco - is generally being met as determined by the Zoning Administrator. Absent timely amendments to this section, requirements may be added or eliminated at the discretion of the Zoning Administrator to allow for • changes in market standards or in technology. In adding or eliminating such requirements, the Zoning Administrator shall take into account the likely occupancy of the Off-site BMR units in consultation with MOH. 4. Compliance Through In-Lieu Fee Payment a. When permitted by planning approvals or other applicable use restrictions, the Project Sponsor may pay an in-lieu fee to satisfy the Inclusionary Ordinance requirements. The per-unit size fee shall be updated annually on July 1. b. The fee is established as the amount of the affordability gap identified in the 2006 Planning Department Nexus Study for the Inclusionary Housing Program. Section 315.6 of the Planning Code calls for fees to be adjusted annually using the annual percentage change in the Construction Cost Index as published by Engineering News Report (ENR). c. MOH shall conduct a comprehensive study of the in lieu fee structure every five years. • 45 Rev.6/8//07 d. In lieu fees for developments that received their first site • or building permit on or after September 9, 2006 will be reviewed using the San Francisco Median Income as adjusted for household size. e. Projects receiving Planning Commission or Planning Department approval on or after September 9, 2006 must make a Declaration of Intent stating the on-site, off-site and/or in-lieu fee option prior to project approval. Project Sponsors may only amend the Declaration of Intent if they choose to change from the in-lieu fee or off-site option to the on-site option. Projects must provide a complete in-lieu fee payment before the issuance of the first site or building permit. f. The in lieu fee unit requirement shall be calculated by using the direct fractional result of the total number of units multiplied by the percentage of off-site housing required, rather than rounding up the resulting figure. g. The Project Sponsor shall request an in-lieu fee determination from MOH in the form of a letter. MOH shall provide a fee determination letter within fifteen (15) business days of the receipt of the request and the letter shall expire in thirty (30) business days. In cases where the determination • has expired, the Project Sponsor will be required to request an updated determination in order to make the payment to the Treasurer's Office. The in-lieu fee request letter shall contain the following: i. Project Sponsor contact information ii. The name and address of the project iii. Copies of all applicable planning approvals iv. The number of total units by unit size h. MOH may require the completion of a standard form in order to request an in lieu fee determination. i. Prior to issuance by DBI of the first site or building permit for the project applicant, the Project Sponsor must have paid in full the sum required to the San Francisco Treasurer's Office. C. Initial Sales Procedures for BMR Ownership Units 1. Request for Pricing for BMR Ownership Units a. Prior to marketing a BMR ownership unit for initial sale, the Project Sponsor shall transmit a copy of the Notice of 46 Rev.6/8//07 • • Special Restrictions ("NSR"), final planning approval, approved floor plans indicating the location of the BMR units in the building, and final HOA dues for each BMR unit to MOH, together with a request for determination of initial sales price. The request for prices shall be submitted no sooner than 60 days prior to the beginning of the marketing period for the BMR units and at no time sooner than 6 months before the issuance of the First Certificate of Occupancy for the development. The pricing shall be valid for thirty (30) days and shall serve as the final pricing for the BMR units only upon approval of the Marketing Plan for the BMR units. b. MOH may require the completion of a standard form in order to request an in BMR unit pricing. 2. Methodology for Pricing Initial Sale BMR Ownership Units a. MOH shall calculate the initial sales price of the BMR unit according to the following assumptions: (i) the income limits specified in planning approvals or other use restriction documents; (ii) total payments of no more than thirty-three (33) percent of the gross monthly income, based on the income limits required by planning approvals or other use restrictions and including an allowance for taxes, insurance, homeowner or association's fees and related costs; (iii) a • mortgage interest rate as identified by MOH that is the higher of the ten-year rolling average of interest rate data, based on 30-year interest rate data provided by Fannie Mae, Freddie Mac or an equivalent, nationally recognized mortgage lending institution; and (iv) a ten (10) percent down payment assumption. MOH shall transmit this information to the Project Sponsor within ten (10) working days after receipt of the request for determination. b. The income table used to calculate the income level of a BMR household shall be determined by the date on which the principal project for which the household applies received its first site or building permit. Income levels for buyers in principal projects that received their first site or site or building permit before September 9, 2006 will be reviewed using the HUD Area Median Income as adjusted for household size. Income levels for buyers in principal projects that received their first site or site or building permit on or after September 9, 2006 will be reviewed using the San Francisco Median Income as adjusted for household size. All off-site projects will be held to the date on which the principal project received its first site or building permit. 3. Parking Space Policy for BMR Ownership Units • 47 Rev.6/8//07 a. In developments in which parking is sold or leased as a O p p 9 part of the sales price for market rate units, parking spaces shall be granted to BMR buyers (1) at the same ratio of parking spaces to residential units, as identified in the planning approvals or other use restrictions for the building overall and (2)within the maximum purchase price set by MOH. All parking spaces granted to BMR buyer households shall be resold or re-leased with the BMR unit upon resale. b. In developments in which parking is "unbundled," or sold or leased separately from every residential unit in a development, parking spaces shall be made available to BMR buyers at the same ratio of parking spaces to residential units as identified in planning approvals or other use restrictions for the building overall. The sales price of each BMR unit, as determined by MOH, shall be reduced by the cost of constructing a parking space (as determined by MOH) multiplied by the ratio of parking spaces to units in the building overall. The sponsor may then charge the BMR buyer the lowest market rate price available for a parking space to any buyer in the building. The details of this policy are as follows: i. Sponsors must offer BMR buyers the opportunity to • purchase or lease parking spaces according to the overall ratio of parking spaces to units in the building. ii. In developments where 1:1 parking is available in the building, the price of each BMR unit will be lowered by a standardized amount equivalent to the cost of constructing either a structured, above-ground parking space or a below-grade parking space, exact amount to be established by MOH through cost analysis and adjusted annually. iii. In developments with less than 1:1 parking availability, MOH will lower the price of each BMR unit by an amount equivalent to the cost of constructing either a structured, above-ground parking space or a below-grade parking space multiplied by the ratio of parking spaces to units in the building overall. iv. The price of each BMR unit will be reduced regardless of the BMR buyer household's choice to purchase or lease a parking space. 48 Rev.6/8//07 • v. BMR buyers must be offered the opportunity to purchase or lease parking at the lowest market rate price offered to any buyer in the housing development. vi. This policy applies only to developments in which the parking is 100% unbundled, or sold or leased separately, from the all units in the development. vii. Project Sponsors cannot charge special fees for parking to BMR buyers that are not charged to all buyers. viii.A first parking space that is purchased either(1) at the same time that the BMR unit is initially purchased or(2) purchased by BMR owner household anytime after the initial purchase of the BMR unit shall be re- sold with the BMR unit upon resale of the unit. The price of the parking space will be governed by the same limits as the overall resale price as outlined in Section II (D) (5). ix. The price of a parking space must never exceed the maximum established during the initial marketing of the units, but it may fall below this price. • x. In buildings with less than 1:1 parking, the opportunity to purchase or lease a space will be allocated by lottery rank. xi. BMR households may purchase or lease a second parking space at any time without any restrictions placed on the Project Sponsor or the BMR buyer household. 4. Marketing Procedures for BMR Ownership Units The Project Sponsor shall commence marketing of the BMR unit according to the procedures set forth in Section IV (E) of this manual. 5. Verification of Owner Qualification for BMR Ownership Units a. At least sixty (60) days prior to the anticipated close of escrow, the Project Sponsor shall submit to MOH for approval the following documentation: i. An application from the proposed purchaser on a form specified by MOH; • 49 Rev.6/8//07 ii. Supporting documentation from all members 18 years and older of the purchaser household, including: (a) Past three (3) years IRS returns; (b) Past three (3) years W-2 forms; (c) Three (3) current and consecutive pay stubs or equivalent; (d) Three (3) current and consecutive statements from every liquid asset account or personal cash holdings, including all custodial accounts held for minors; (e) Verification of San Francisco residency or employment; (f) Verification of completion of an approved First-time Home Buyer Education workshop. b. To proceed with a BMR unit purchase post-lottery, the BMR buyer's lender or sales agent must supply the following documentation: i. A completed sales agreement; ii. An appraisal showing the Appraised Fair Market Value of the BMR unit; iii. A mortgage loan application to an institutional • lender; iv. 'A Preliminary Title Report for the BMR unit. 6. Buyer Approval for BMR Ownership Units a. Upon receipt of a complete BMR homeownership application; MOH shall verify the household qualification within fifteen (15) working days. b. Upon receipt of lender and sales contract documentation, MOH shall draft escrow closing documents within five (5) working days. c. Buyer Time to Qualify The Project Sponsor shall allow the proposed purchaser no less than thirty (30) days from the time of the signing of the sales contract to qualify for mortgage financing and no more than sixty (60) days. 7. Financing for BMR Ownership Units The Project Sponsor shall not allow mortgage financing that includes unreasonable or predatory fees associated with the loan. 50 Rev.6/8//07 • Specifically approved and disapproved loan types are outlined in Section II (C) of this Manual. 8. Restrictions on BMR Ownership Units The Project Sponsor must comply with the documentation and enforcement procedures contained in Section J of this manual. MOH shall prepare documentation to be placed into escrow, including (1) a Promissory Note, as applicable, for the difference in the appraised value and the BMR unit sales price as described in Section J; (2) a Deed of Trust securing the City's interest in the BMR unit, (3) a Grant of Right of First Refusal giving the City the right to find an eligible buyer should the BMR unit be sold; and (4) certification that the purchaser is aware of the special restrictions on the BMR unit. 9. Transaction Fees for BMR Ownership Units The Project Sponsor shall pay all usual, customary and reasonable transaction costs normally borne by the seller in a residential real estate transaction, including but not limited to broker fees and real estate transfer taxes. 10. Inability to Find a Buyer for a BMR Ownership Unit • In cases where, despite the owners good faith efforts, no first- time homebuyer household purchaser of the required income level has contracted to purchase a BMR Ownership Unit within six (6) months after the lottery for the BMR units, the owner shall inform MOH, which may then increase the permissible income levels for prospective purchasers of that unit up to a maximum twenty (20) percent over the income percentage limit specified in planning approvals or other use restrictions, but shall not increase any current or future permissible sales price of that unit as indicated in planning approvals or other use restrictions. D. Initial Rental Procedures of BMR Rental Units 1. Request for Initial Rental Rates for BMR Rental Units a. Prior to marketing a BMR Ownership Unit for initial rental, the Project Sponsor shall transmit (1) a copy of the Notice of Special Restrictions ("NSR"); (2) the final Planning Motion or planning approval for the development; and (3) approved floor plans indicating the location of the BMR units in the building, together with a request for determination of initial rent levels. The request for rent levels shall be submitted no sooner than 6 months before the issuance of the First Certificate of Occupancy for the development. • 51 Rev.6/81/07 • b. Within ten (10) working days after receipt of a complete request for determination, MOH shall calculate the maximum monthly rent for each BMR unit, adjusted for unit size, based on the percent of median income established in the Conditions of Approval or other use restrictions and the then-existing median income amounts and shall transmit this information to the Project Sponsor. 2. Methodology for Setting Initial Rent Levels for BMR Rental Units a. MOH shall calculate initial rent levels of the BMR Rental Unit according to the following assumptions: (i) the income limits specified in the Conditions of Approval or other use restriction documents; (ii) total payments of no more than thirty (30) percent of the gross monthly income, based on the income limits required by the Conditions of Approval or other use restrictions. b. The income table used to calculate the income level of a BMR household and the subsequent BMR unit rent shall be determined by the date on which the project received its first site or building permit. Initial rent levels for BMR Rental Units in developments that received their first site or building permit before September 9, 2006 will be calculated • using the HUD Area Median Income as adjusted for household size. Initial rent levels for BMR Rental Units in developments that received their first site or building permit on or after September 9, 2006 will be calculated using the San Francisco Median Income as adjusted for household size. 3. Parking Space Policy for BMR Rental Units a. In developments in which parking spaces are provided to renters within the rent for market rate units, parking spaces shall be granted to BMR renters (1) at the same ratio of parking spaces to residential units as identified in planning approvals or other use restrictions for the building overall and (2) BMR renters shall be granted the parking space within the maximum monthly rent set by MOH. b. In developments in which parking is "unbundled," or rented separately from every residential unit in a development, parking spaces shall be made available to BMR renters at the same ratio of parking spaces to residential units as identified in planning approvals or other use restrictions for the building overall. The rental price of each BMR unit, as determined by MOH, shall be reduced by the cost of constructing the parking space, as determined by MOH, multiplied by the ratio of 52 Rev 6/8//07 • • parking spaces to units in the building. This amount will be amortized over a 30-year period. The sponsor may then charge the BMR renter the lowest market rate rent available to any renter in the building. The details of this policy are as follows: i. Sponsors must offer BMR renter the opportunity to rent parking spaces according to the ratio of parking spaces to overall units in the building. ii. In developments where 1:1 parking is available in the building, the rent of each BMR unit will be lowered by a standardized amount equivalent to the cost of constructing either a structured, above-ground parking space or a below-grade parking space, exact amount to be established by MOH through cost analysis and adjusted annually. iii. In developments with less than 1:1 parking availability, MOH will lower the price of each BMR unit by an amount equivalent to the cost constructing either a structured, above-ground parking space or a below- grade parking space and multiplied by the ratio of parking spaces to units. • iv. In developments where 1:1 parking is available in the building, MOH will lower the maximum rent of each BMR unit by a standardized amount equivalent to the cost of constructing either a structured parking space or a below-grade parking space amortized over a 30- year period, exact amount to be established by MOH. v. This amount will be deducted from the monthly rent of each BMR unit regardless of the renter's decision to lease a parking space. vi. In developments with less than 1 A parking availability, MOH will lower the maximum rent of each BMR unit by an amount equivalent to the monthly cost of parking in either a structured parking space or a below-grade parking space amortized over a 30-year period and multiplied by the ratio of parking spaces to units. vii. BMR buyers must be offered the opportunity to rent parking at the lowest market rate rent offered to any market rate renter in the development. • 53 Rev.6/8//07 viii. This policy applies only to developments in which S the parking is 100% unbundled, or rented separately, from the all units in the development. ix. Project Sponsors cannot charge special fees for parking to BMR renters that are not charged to all renters. x. Parking spaces rented with rental BMR units must be offered to subsequent renters upon re-rental of the unit. xi. In buildings with less than 1:1 parking, the opportunity to rent a space will be allocated by lottery rank. 4. Marketing Procedures for BMR Rental Units The Project Sponsor shall commence marketing the BMR unit(s) according to the procedures set forth in Section IV (E) of this manual. 5. Verification of Renter Qualification for BMR Rental Units At least thirty (30) days prior to the anticipated date of lease, the • Project Sponsor shall submit to MOH for approval the following documentation: a. A complete MOH BMR rental application from the proposed renter household-, b. Supporting documentation from all members of the BMR renter household, including: i. Past one (1) year IRS returns; ii. Past one (1) year W-2 forms; iii. Three (3) current and consecutive pay stubs or equivalent; iv. Three (3) recent and consecutive statements from every liquid asset account and personal cash holdings, including custodial account for all minors,- v. Verification of San Francisco residency or employment. c. A sample lease agreement that clearly states the rent to be charged to the new tenant. 6. Renter Approval for BMR Rental Units 54 Rev.6/8//07 • • Upon receipt of a complete BMR rental application, supporting documentation, and a sample lease, MOH shall verify the household qualification within fifteen (15) working days. 7. Permissible Rent Increases for BMR Rental Units The Project Sponsor may increase the maximum monthly rent for a qualifying household on each anniversary of a qualifying household's occupancy in an amount which does not exceed the amount determined by MOH based on the percent of median income established in the planning approvals or other use restrictions and the then-existing income amounts. 8. Rental Rate Upon Subsequent Occupancy by Qualifying Households for BMR Rental Units a. The Project Sponsor shall notify MOH of a vacancy of a BMR unit prior to offering the unit for rent and prior to marketing the unit according to the marketing procedures set forth in Sections IV (E) of this manual. b. Rental rates for qualifying households shall not exceed the applicable amounts published in accordance with the provisions of section IV (D) (2) and (3) above. 9. Documentation of Annual Rent Levels for BMR Rental Units The qualifying household income limits and maximum monthly rent for BMR units shall be updated annually and will be available on the MOH website. Owner(s) or those charged with the management of affordable BMR rental housing units satisfying the requirements of their planning approvals or other use restrictions may be required to submit an annual monitoring and enforcement report on a form provided by MOH and submitted on a date and at a location determined by MOH. The report shall provide information regarding rents, household and income characteristics of tenants of designated affordable units, services provided as part of the housing service such as security, parking, utilities, and any other information MOH may reasonably require to monitor compliance with the BMR units specific planning approvals or other use restrictions. E. Marketing Procedures for Initial Sale and Rental of BMR Units 1. General Requirements for Marketing of All Initial Sales and Rentals of BMR Units a. The Project Sponsor shall use good faith and affirmative efforts to attract potential qualifying households from all • 55 Rev.6/8/(07 minority and low income, median income and moderate • income communities through the marketing and advertising of the BMR units. Toward that goal, the Project Sponsor shall prepare and provide to MOH a copy of the Marketing Plan for the sale or rental of the BMR units prior to accepting applications or statements of interest for the purchase or lease of the units. No marketing or advertising material shall be distributed or published without the prior written approval of the Marketing Plan by MOH and all such materials shall be consistent with the approved Marketing Plan. Approval or disapproval of the Marketing Plan shall be made within ten (10) days of receipt of a complete marketing plan. In instances were the Marketing Plan has been disapproved; MOH will provide recommendations to remedy any deficiencies. b. To insure access and outreach to minority and low income, median income and moderate-income communities, the Project Sponsor must hire as part of the marketing and outreach strategy a Marketing Consultant certified by MOH as having demonstrated capacity in reaching identified targeted populations. The targeted populations will be identified by MOH based on an analysis of the demographic characteristics of minority and low income, median income and moderate-income populations of San Francisco, and applicants to the BMR program. A list of 0 certified Marketing Consultants will be maintained by MOH and updated on at least an annual basis on June 151h. c. The Project Sponsor shall submit the Marketing Plan to MOH at least thirty (30) days prior to the anticipated commencement of the project's marketing and outreach and at least one-hundred and twenty days prior to the anticipated close of escrow for BMR ownership units and lease origination dates for BMR rental units. 2. Contents of Marketing Plan a. MOH shall prescribe the form of the Marketing Plan and shall provide the format to the Project Sponsor for completion and submittal. Unless determined by MOH to be inapplicable to a particular project, the Marketing Plan shall include. b. The name, address, email address, and phone number of the project sponsor; c. The name, address, email address, and phone number of the sales or rental agent(s); 56 Rev 6/8//07 • • d. The planning approval for the project; e. The Notice of Special Restrictions for the project; f. The name of the City Planner assigned to the housing project; g. A description of the total number of units in the principal project or applicable off-site project; h. A description of the total number of market rate or non- BMR units in the building; i. A description of the total number of BMR units in the building; j. The Home Association Dues (HOA Dues) for each BMR unit; k. All amenities included in the sale of the BMR unit; I. Parking available to all residential tenants in the building; m. Buyer or renter qualifications; • n. Workshop and open house dates; o. A media plan; p. A strategy for marketing to residents of the immediate neighborhood; q. A comprehensive strategy for reaching out to low-income, median-income, moderate-income and minority communities in San Francisco; r. Dates and strategy for the application process; s. Dates and strategy for the lottery selection process; t. Dates and strategy for the process of working with lottery winners; u. Marketing materials which clearly define rental or first time homebuyer household eligibility and which specify documentation and monitoring procedures; v. Notices that buyers of BMR units are subject to special use restrictions, including an acknowledgement of these • 57 Rev.6/8//07 restrictions and a sample packet of the City's escrow closing • documents that each buyer will be expected to execute upon the purchase of a BMR unit; w. On resale, listing of BMR Ownership Units with the San Francisco Multiple Listing Service (MLS); x. A list of community housing organizations which are to receive written notification regarding the availability of the BMR units prior to commencement of advertising or marketing of such units; y. A list of community housing organizations that the Project Sponsor or the Project Sponsor's marketing representative must work with in order to meet language or cultural needs of minority communities; z. An attached copy of all planning approvals, the NSR and approved floor plans associated with the principal project and any applicable off-site project. 3. Conduct of Marketing Plan a. No marketing of the BMR unit(s) shall begin until the Project Sponsor has received written approval of the • Marketing Plan and confirmation from MOH of the number, type, location, and price or rent of the BMR units and permissible income limits of purchasers or tenants, pursuant to Sections II (A), III (A); IV (C), IV (D) of this manual. b. The Project Sponsor or the Project Sponsor's marketing and sales representative shall give adequate time, in no case less than twenty eight(28) days after first public notification or advertisement, for application submissions. c. The Project Sponsor shall alert sales or rental staff to the BMR units and provide such staff with a copy of this Manual and the special use restrictions applicable to the BMR units. d. The sales or rental programs and procedures shall not have the effect of excluding or discriminating against any person on the basis of race, religion, national origin, sex, sexual preferences, health status, source of income such as disability insurance, social security, TANF, or any other basis prohibited by federal, state or local law. e. The Equal Housing Opportunity symbol shall be displayed in a visible location at any sales of rental office, and 58 Rev_6/8//07 shall be incorporated in all advertisements and printed materials. f. Units must be advertised in at least five (5) local newspapers that reach minority and low-income, median income and moderate-income communities in San Francisco for a period of at least 3 weeks and at least one local newspaper of general San Francisco circulation for at least two Sundays prior to the established application deadlines for the BMR units. g. All available BMR units must be listed on the MOH website of available BMR units for at least twenty-eight (28) days prior to the application deadline for the BMR unit(s). F. Marketing Procedures for Resale of BMR Ownership Units Marketing of resale of individual BMR Ownership Units shall be in compliance with all applicable federal, state and local laws related to fair housing. Owners and their agents may be asked to certify that the units have not been marketed in such a manner as to be discriminatory. The procedures for resales are more fully described in Section I of this Manual G. Marketing Procedures for Subsequent Rentals of BMR Rental Units • 1. Marketing of re-rental of individual BMR Rental Units shall be in compliance with all applicable federal, state and local laws related to fair housing rules. Owners and their agents may be asked to certify that the units have not been marketed in such a manner as to be discriminatory. The sales or rental programs and procedures shall not have the effect of excluding or discriminating against any person on the basis of race, religion, national origin, sex, sexual preferences, health status, source of income such as disability insurance, social security, TANF, or any other basis prohibited by federal, state or local law. 2. Upon re-rental, BMR Rental Unit managers must follow the process established by MOH for re-renting units. This process includes the following: a. The Project Sponsor shall inform MOH at least thirty (30) days prior to the intended lease origination date of a new BMR renter of the availability of any such unit before beginning any general marketing; b. Units must be listed on the MOH website list of available BMR units for at least a seven (7) working day period before . 59 Rev.6/8//07 an established application review date. Applications must not • be reviewed until the seven (7) working day application period has ended; c. Applicants must complete a MOH BMR rental application and return the application and all supporting materials by the application deadline; d. Project Sponsors must follow all fair housing rules when choosing a new renter for a BMR unit; e. Marketing of BMR Rental Units following the vacancy of any such unit must include advertisement of that unit in at least one print media for at least one Sunday prior to entering into any rental agreement for that unit. H. Selection of BMR Buyers or Renters at Initial Sale or Rental of BMR Units 1. The Project Sponsor shall utilize a public lottery to select BMR buyers or renters. The following guidelines shall be applicable to the lottery process: a. Lotteries for BMR units shall be held in a public, accessible location. • b. A non-prioritized list of interested buyers will be kept by MOH ("general BMR list"). At least twenty-one (21) days prior to a lottery, all those signed up on the list will be notified of the availability of units and invited to participate in the lottery by MOH. The general public will be invited to participate in the lottery; as well. c. All applicants who have submitted a complete application by the application deadline shall be entered into the lottery. d. Households submitting significantly incomplete applications may be deemed ineligible to enter the lottery for the purchase or rental of a BMR unit or to proceed with a purchase or rental of a BMR unit following the lottery. e. Applicants shall be invited to attend lotteries, but attendance is not mandatory. f. A representative of MOH shall conduct the lottery and record the order of lottery numbers drawn. 60 Rev.6/8//07 • g. Within 5 business days, the Project Sponsor shall notify all applicants of their position in the lottery and inform MOH of the lottery winners' intent to purchase or rent the BMR unit. h. The Project Sponsor shall deliver complete applications and supporting materials of interested lottery winners to MOH within 21 days of the lottery date. i. The Project Sponsor shall adhere to the rank order of the lottery list when offering BMR units to lottery winners. j. Only those household members listed on the BMR application may move in to the BMR unit unless MOH allows the addition of an additional person. I. Conversion of BMR Rental Units to Ownership Units When authorized by planning approvals or other use restrictions placed on a principal project, a BMR Rental Unit may be permitted to be converted for owner occupancy only upon satisfaction of all of the following additional conditions: 1. If the rental BMR unit is subject to planning approvals or other use restrictions specifying that the BMR unit.be a rental unit, conversion shall be subject to the approval of the Planning • Commission; 2. The conversion from rental to condominium ownership of the BMR unit shall be subject to any applicable City procedures, standards, fees and regulations in effect at the time of application; 3. The BMR unit must have been maintained in good physical condition as an affordable rental unit at all times since its initial construction; 4. If the planning approvals or other use restrictions for the principal project specified a minimum period during which the BMR unit must be rented, that period shall have elapsed; 5. The Project Sponsor shall prepare and submit a Marketing Plan and conduct sales of the BMR units in conformity with the Requirements of this Manual in force at the time of marketing and sale; 6. The BMR ownership unit shall be priced at the level of affordability dictated for the current BMR rental unit as stated in the planning approvals or other use restrictions. • 61 Rev.6/8/107 7. The prospective purchaser must be a first-time homebuyer • household whose combined gross annual household income does not exceed the percentage of median income specified in the planning approvals or other use restrictions for permissible occupancy of the BMR unit as a rental unit; 8. Existing tenants who meet the requirements to purchase the BMR unit shall be offered a right of first refusal to purchase the unit, which right of first refusal shall afford the tenant at least six (6) months to exercise the right to purchase; 9. Once converted, units shall be subject to all restrictions applicable to the marketing, sale and resale of BMR Ownership Units as set forth in this Manual. J. Documentation and Enforcement of Sales Restrictions for BMR Ownership Units 1. At the request of MOH, and at the time of the initial or any subsequent sale of a BMR unit, the purchaser shall enter into such agreements or other documents as MOH may require to ensure that the unit will be subject to the affordability restrictions described in the planning approvals or other use restrictions. 2. These documents include the following: a. Promissory.Note i. To secure the obligations contained in the Conditions of Approval, a purchaser of a BMR unit shall execute and deliver to the City a promissory note in a form prepared by MOH (a "BMR Note") in an original principal amount equal to the difference between (i) the appraised fair market value of the BMR unit at the time of such sale, determined without regard to the sales and rental restrictions on such unit, and (ii) the affordable purchase price owed by the purchaser of that unit at the time of the initial sale of such unit pursuant to the planning approvals or other use restrictions. All such BMR Notes shall contain the above restrictions on resale and rental of a BMR unit. The BMR Note shall provide for a stated rate of deferred interest and/or a stated share of any appreciation in the value of the applicable BMR unit. ii. No BMR Note shall be required if MOH determines that the affordable purchase price of the applicable BMR unit is approximately equal to the appraised fair market value of that unit at the time of its initial sale, 62 Rev.6/81/07 determined without regard to sales or rental restrictions on that unit. In the event that no BMR Note is required for a BMR unit, MOH may require the recordation of an Acknowledgment of Special Restrictions by the owner of such unit that the unit is subject to the affordability restrictions contained in the planning approvals or other use restrictions. iii. Subject to the provision of subparagraph IV (J) (5) below, the BMR Note shall be due and payable, in full, upon (i) the sale of the BMR unit to which it pertains, or(ii) in the event of a default of any of the conditions, obligations or covenants contained in the BMR Note (including without limitation the covenant to sell the applicable BMR unit in compliance with the planning approvals or other use restrictions). All funds received by the City from the repayment of BMR Notes shall be used to subsidize low-income to moderate- income housing in the City. b. Deed of Trust Repayment of the BMR Note shall be secured by a deed of trust encumbering the applicable BMR unit in a form prepared by MOH. • c. Grant of Right of First Refusal BMR buyers shall execute and deliver to the City a Grant of Right of First Refusal, a document that requires the seller to notify MOH upon resale, giving the City the option to exercise their right to substitute a qualified buyer. d. Buyer Acknowledgment of Special Restrictions BMR buyers shall execute and deliver to the City an Acknowledgement that they have thoroughly reviewed this Manual and the recorded NSR on the BMR unit. 3. Function of Documents a. Reconveyance of Note and Deed Upon Resale Upon any resale of a BMR unit, assuming (i) that there has been no event of default that is continuing under the existing BMR Note, and (ii) that the resale of the BMR unit complies with this Manual and the planning approvals or other use restrictions,.MOH shall accept a replacement BMR Note made to the order of the City by the new • 63 Rev.6/8//07 purchaser of the unit, in form and substance acceptable to MOH, as full satisfaction of the existing BMR Note by the City, the deed of trust securing the existing BMR Note shall be reconveyed by the City, and the new purchaser of the BMR unit shall deliver to the City new BMR Note and a new deed of trust securing the new BMR Note and encumbering the applicable BMR unit. The principal amount of the new BMR Note shall equal the difference between the appraised fair market value of the BMR unit and the affordable purchase price owed by the purchaser of such unit at the time of the resale. b. Term of Note and Deed i. For BMR units marketed before the effective date of this Manual, the following process applies: (a) BMR Ownership Units Upon the expiration of the 50-year term of the affordability restrictions contained in planning approvals or other use restrictions for any ownership BMR unit, any deed of trust securing a BMR Note shall remain a valid, enforceable lien on the applicable BMR unit until the next resale of such unit, at which time the maker of such BMR Note shall pay to the City the full amount due under the BMR Note. At such time a BMR Note is repaid pursuant to this subparagraph, the lien of the deed of trust securing such BMR Note shall be released and the unit shall no longer be subject to the affordability restrictions. (b) BMR Rental Units Upon the expiration of the 50-year term of the affordability restrictions contained in the Conditions of Approval or by ordinance for any rental BMR unit that has remained a rental unit for the duration of the restriction, the unit shall be released from all restrictions and the current building owner may rent the unit at market rate. ii. For all BMR units marketed on or after the effective date of this Manual, the following process applies: 64 Rev.6/8//07 • • The BMR unit will remain restricted for the life of the project. For ownership BMR units, the BMR note may not be repaid at any time. For rental BMR units, the rental unit will remain restricted for the life of the project. 4. Order of Liens a. Any liens shall not be subordinated to any other liens or restrictions affecting the project or a BMR unit to which the planning approvals or other use restrictions apply except for the buyer's primary mortgage loan to which the BMR lien may take second place. The BMR lien can only be subordinated to the primary mortgage. b. The restrictions imposed by planning approvals or other use restrictions, and any liens recorded pursuant thereto, shall not be subordinated to any other liens or restrictions affecting the project or a BMR unit to which the planning approvals or other use restrictions apply; provided, however, that MOH may approve a refinancing of a first-priority mortgage of the BMR unit to secure a lower interest rate, in an amount not to exceed the value of the original mortgage plus customary transaction costs. • 5. Recordation of Restrictions Before the issuance of the first site or building permit, a Notice of Special Restrictions and other appropriate documentation (including deeds of trust securing the obligations of the purchasers of BMR units) against the land record shall be filed with the Office of the Recorder of the City and County of San Francisco for the BMR units in order to implement the planning approvals or other use restrictions. Such deed restrictions and other recorded documents shall include language restricting the sale of the BMR units in accordance with planning approvals or other use restrictions. K. Conflict of Interest The Project Sponsor may not make an initial sale or rental of a BMR unit to the project architect, attorney, prime contractor, or to anyone of its or their employees, directors, officers or agents, or to any of their family members, as determined by MOH. • 65 Rev.6/8//07 ��ri v�t e�� ► I z � -�� CITY AND COUNTY OF SAN FRANCISCO MAYOR'S OFFICE OF HOUSING (MOH) • BELOW-MARKET-RATE("BMR") INCLUSIONARY HOUSING OWNERSHIP UNITS Resale Procedures The Mayor's Office of Housing (MOH) requires owners of Inclusionary Affordable Housing Program BMR units to follow the ensuing process when marketing and selling their units. These requests are in addition to the standards detailed in Section 2 (D) (5) the City of San Francisco Residential Inclusionary Affordable Housing Monitoring Procedures Manual 2007 (called "Procedures Manual"). (The Procedures Manual governs all MOH BMR units.) Please note that the resale process can take from 60-90 days in total. Please plan accordingly when selling your BMR unit. Step One BMR owners must contract with a realtor to list the BMR unit on the Multiple Listing Service (MLS). This listing ensures that the unit will be broadly advertised. Owners are allowed to add 5% to their sales price to pay their realtor and the buyer's realtor. It is assumed that each realtor will earn half of this amount. Step Two The BMR owner must submit the following documents to MOH before the unit can be priced: o A signed listing agreement with a real estate agent who will list the unit on the Multiple Listing Service. o A signed and dated letter (from the seller) stating the unit address; the intent to sell the unit; a request for pricing of the unit; and the current homeowner association fees for the unit. • o Documentation of eligible capital improvements on the property. See capital improvements policy for specific information on documenting and submitting this information. BMR units must be at least 10 years old in order for a BMR owner to claim certain eligible capital improvements on their unit and to have this amount added to their resale price. (Please send all documentation to the contact listed at the bottom of this page.) Step Three MOH will price the unit within 30 days of the submission of the listing agreement, resale request and capital improvements documentation. MOH will send a letter to the owner stating the resale price. This letter will be copied to the owner's realtor. Explanation of Pricing— A BMR unit will be priced so that it remains affordable to a household at a designated percentage of area median income that is sized one person larger than the bedroom count of the unit. Most units are priced at a level that is affordable to households earning 100% of area median, but there may be variations. Units sold before the effective date of the Procedures Manual (June 28, 2007) will be re-priced using one of two methodologies as dictated by the planning approval for the specific development: (1) the complete MOH pricing formula that is based on the current median income and the current Cost of Funds Index; or (2) the percentage change in the consumer price index from the time of the current owner's purchase to the time of sale. Most pre-2007 units are to be repriced using method #1. •Units sold on or after the effective date of the Procedures Manual (June 28, 2007) will be re-priced using the percentage change in the local median income from the time of the current owner's purchase to the time of sale. 1 SOUTH VAN NESS AVENUE,57H FL.*SAN FRANCISCO,CALIFORNIA 94103*(415)701-5500*FAX(415)701-5501 *TDD(415)701-5503 See Repricing Guidelines on the MOH website for more information. There is the possibility that the unit price may decrease from the time of purchase to the time of sale. In this situation, the Mayor's Office of Housing will allow owners the option of selling the unit for their original purchase price plus MLS commission and eligible capital improvements. However, BMR units must be governed by the City and County of San Francisco Residential Inclusionary Affordable Housing Program Monitoring and Procedures Manual 2007 in order to take advantage of this option. (Most units pre-2007 area governed by the 1992 Procedures Manual.) A current BMR owner may sign and notarize an agreement to abide by the 2007 Procedures Manual rather than an older version in order for their BMR unit in order to sell their unit at their initial purchase price. The unit will also be priced according to the change in area median income into the future upon signing into the new Procedures Manual. Step Four Guidelines for Marketing the Unit: • Seller's Realtor sends MOH a completed MOH website posting template for resale units and the intended MLS language to review. See required MLS language. Both documents can be found on the Inclusionary Housing website under"Information for Realtors Assisting Current BMR Owners." • Seller's real estate agent must post the announcement of the resale unit to the Mayor's Office of Housing website before beginning any general marketing for the unit, including the MLS listing. Posting on the MOH website and general marketing may begin on the same day, however. • Seller's real estate agent must set an offer deadline of 14 days from the date on which the listing is posted on the Mayor's Office of Housing website and the MLS. • Seller's real estate agent will provide interested buyers with the MOH application form and requirements, as well as any additional forms that the agent requires for the transaction. • Seller's real estate agent will collect MOH application materials, plus a complete 7-page San Francisco Purchase Agreement and a loan pre-approval from each applicant household. Purchase agreements must state a purchase amount no higher than the maximum resale price e set by the Mayor's Office of Housing. • Seller's real estate agent must hold at least two open houses for the unit—one on a weekday evening and one on a weekend day. Step Five Public Lottery for the Unit: • Seller's real estate agent must work in conjunction with MOH to hold a public lottery of offers submitted by the deadline. This lottery should take place no sooner than 48 hours from the offer submission deadline. The lottery will be held at the MOH office and conducted by a representative from the Mayor's Office of Housing. Step Six Closing on the Unit: • Seller's real estate agent will work through the lottery list from top to bottom to sell the unit. Often, lottery winner#1 will purchase the unit. • Seller's real estate agent submits lottery winner#1's complete MOH Inclusionary Housing Application to MOH for review. It is the sales agent's responsibility to ensure that the application is complete. Incomplete applications will be returned to sale's representative. • MOH reviews application and sends an approval or disapproval letter to buyer within 10 days of the receipt of a complete application. Buyer may be concurrently seeking a final loan but purchase of the unit by the buyer must be approved by MOH. • Buyer is subject to MOH lending guidelines. Buyer's realtor, seller's realtor and buyer's lender must be aware of these guidelines. Lending guidelines are posted on MOH website. • The lottery winner should secure a loan approval within 14 calendar days of signing a sales • contract. The seller's realtor should contact MOH if this is not the case and be watchful of the time passing. MOH will decide when a buyer has passed the standard time for securing a loan. Page 2 of 4—Lending Guidelines rev.3.27.08 • Buyer's lender works in conjunction with seller's real estate agent to supply MOH with the documents needed for the creation of MOH's closing documents: final loan approval (1003 and 1008); fair market appraisal; preliminary title report; and sales contract.• • Upon receipt of the above documents, MOH drafts contracts for buyer(s) to sign and sends to Title Company within 5 working days. • Title company works with buyer to review and sign MOH contracts/closing documents and sends signed, notarized and recorded documents back to MOH within 30 days. Commonly Asked Questions: Q: How long will it take MOH to price my unit? A: Technically, MOH has up to 30 days to price the unit. However, most pricing occurs within 10 working days. Capital improvement request require inspection by a MOH representative and may extend the pricing period to the full 30 day period. Q: Can I have my unit priced even if 1 do not intend to sell? A: No. MOH does not have the capacity to reprice BMR units without a serious intent to sell, as verified through the required submission of a listing agreement. Q: Do I have to pay a realtor to submit a listing agreement for me? A: Typically, you do not have to pay a realtor to submit a listing agreement for you. Q: Can I decide not to sell my unit once I receive my pricing from MOH? A: Yes. Q: How long is the lottery winner allowed to find a loan? A: The lottery winner should have a loan approval (preliminary approval only) within 14 calendar days of signing a sales agreement. The seller's realtor should contact MOH if this is not the case. Q: What if lottery winner#1 cannot secure a loan? A: Winner#1 cannot purchase the unit unless able to secure a loan. Realtor sends MOH application of lottery winner#2 and the process re-starts. Q: What is the entire length of time it takes to sell a BMR unit? •A: This varies, but it can take up to 60-90 days from the time of requesting a resale price in order for the buyer to close on the unit. Example: Unit is Priced 12 days (longer if reviewing capital improvements) Unit is Marketed on MOH Website and MLS 14 days Lottery for Resale Buyer 48 hours after application deadline 2 days MOH Reviews Application of Resale Lottery Winner 12 days once a complete packet is submitted Buyer Secures Loan Approval 14 days (days overlap with application review Lender completes loan approval, conducts appraisal of the 5 days unit, gathers Preliminary Title Report, and final sales agreement and submits to MOH. MOH completes contracts to be signed by buyer (closing 5 days documents)for resale lottery winner and sends to title company once a complete packet is submitted Buyer works with Title Company to sign closing documents 2-3 days from Title Company, lender and MOH TOTAL CALENDAR DAYS Approximate) 60-90 days total Contact Information: Inclusionary Housing Program • Mayor's Office of Housing 1 South Van Ness Avenue, 5th Floor San Francisco, CA 94103 (415) 701-5500 Page 3 of 4—Lending Guidelines rev.3.27.08 www.sfgov.or /q moh O e Page 4 of 4—Lending Guidelines rev.3.27.08 - LAW OFFICES LONG WILLIAMSON & DELIS OF THOMAS D. ROTH A PROFESSIONAL CORPORATION LAWYERS One Market,Spear Tower,Suite 3600 5 Hutton Centre Drive,Suite 1000 San Francisco,California 94105 Santa Ana,California 92707 (415)293-7684 (714)668-1400 (415)435-2086(fax) (714)668-1411(fax) RothlawlQwcomcast.net January 20, 2008 FILE NO: 94-4070 By Hand Delivery HUNTINGTON BEACH CITY COUNCIL City of Huntington Beach 2000 Main Street - Huntington Beach, CA 92648 RE: COMMENTS ON PROPOSED MODIFICATIONS TO THE INCLUSIONARY HOUSING PROGRAM Dear City Council Members: Our firms represent approximately 50 Cape Ann households on issues related to the City's affordable housing program and the restrictions that the City claims currently are in place.' On their collective behalf, we submit these written comments as a starting point for discussion in the City Council's January 20, 2009 Study Session. For many years now, the homeowners have asked the City Council to address a number of problems and flaws in the program. These problems are not hypothetical, but instead have real life impacts on all of the residents and families in Cape Ann. The City's previous refusal to respond in any way to the homeowners' concerns has resulted in may homeowners becoming completely disillusioned with the City's ability to govern effectively and fairly. The homeowners in the pending litigation expressly reserve all arguments and claims made in --,' Agee v. City of Huntington Beach. The comments made in this letter are filed to bring to the Council's attention serious flaws in the program, assuming(for purposes of this study session only)that it applies to the Cape Ann homeowners. 1 LIFT • Nonetheless, the stated purpose of the affordable housing program is to help families participate in the American dream of real home ownership in one of the highest priced markets in the country. The homeowners are thus hopeful that this first City Council Study Session will be the beginning of a genuine effort by the City Council to address the very serious shortcomings in the program as it has evolved. We encourage the City to schedule a follow up session in which staff and the homeowners can enter into a true dialogue on these issues. Problems cannot be effectively or comprehensively solved without such a dialogue. By analogy, complex program issues in the environmental field are often addressed through a"stakeholders" meeting sponsored by the regulatory agency in which all groups—permit applicants, homeowners, environmental organizations, etc. —are invited to attend to have an open dialogue and to try to form a consensus that results in a net benefit to all involved. That model would serve the City well her in trying to address the problems that have arisen in the City's affordable housing program. Through that open dialogue the City would have an opportunity to explain the competing pressures and concerns that it must balance, and the homeowners can share creative ideas to help the City achieve all of its goals without unfairly penalizing any one constituency. We have one additional comment as a preface: it is unclear whether the power . point presentation slides prepared by staff refer to proposed changes to the program as it applies to everyone including Cape Ann, or whether only certain changes would apply to Cape Ann, or whether any changes would apply to Cape Ann. Thus, it is not possible to respond directly to that presentation. With those caveats, the homeowners offer the following comments: Overview of Concerns Resale Pricing Formula Problem 1: The Resale Price Is Disconnected From the Real Estate Market and Driven By Fluctuating Mortgage Interest Rates. The resale pricing formula currently in use includes numerous variables. However, one of those variables far outweighs all others in terms of determining what the price is—mortgage interest rates. The formula is configured so that as mortgage interest rates rise, the resale price of the condo drops. This is a problem for several reasons. First, no Cape Ann homeowner(including Jill Hardy) was told of this relationship when he or she bought the condo. Any buyer would naturally expect the resale price would somehow go up or down as the overall real estate market does. But, in fact, that's • not how it works. Rather, in the City's program, the price is set artificially in a way that has no connection to the real estate market. By divorcing the resale price from "supply 2 i ONA-TI"L^ ]LEFT LANK and demand" and the actual real estate market, a homeowner is left with a wildly fluctuating condo value that rises and falls on a daily basis—sometimes dramatically— based on the whims of mortgage interests rates. This makes financial and family planning impossible. The owner's major financial asset is essentially a lottery ticket that changes value each day. Second, the mortgage interest rate component of the pricing mechanism dominates the formula and overwhelms all other variables. So as interest rates go, so goes the resale price—in the opposite direction. So when rates rise, the price of the unit decreases, and there is no floor on how low the price can go. Most other affordable housing programs have a floor to ensure that the affordable unit owner doesn't end up in a worse position than when he or she bought the unit. Looking at the other scenario, even when rates drop, and the resale price increases, because the resale price is disconnected from the real estate market, the new buyer typically cannot qualify for a loan AND also stay within the income limitation restrictions imposed by the City For these reasons, the resale formula needs to be modified to eliminate the interest rate risk that has been transferred to owners (without them knowing). Problem 2: The Remaining Variables in the Resale Formula Are Not Constrained by Objective, Predictable Standards. A second problem is that the remaining variables in the formula are not constrained by objective standards. The formula should be reworked to include objective standards so that homeowners can know with greater certainty what to expect in terms of pricing. Problem 3: HUD Has Changed the Way It Figures Median Income. Another component of the resale price formula is the HUD median income figure each year. There are two issues here. First, in 2002 or 2003, HUD changed its income formula in a way that resulted in a 7 percent decrease in median income for Orange County even though median income did not really decline in those years. Thus, a revised formula needs to allow for adjustments when external regulatory events like that occur so that the homeowner is not penalized. Second, there is a concern that HUD's changes to its median income calculation may be underreporting median income in Orange County now. Problem 4: The Resale Formula Penalizes the Original Owners for Purchasing Upgrades. The original buyers were told that upgrades that they purchased from the developer, John Laing Homes, would be added to the resale price. Some owners also paid "lot premiums" based on location. But the City doesn't allow these expenses to be added to the resale price. Thus, upon resale, the homeowners will lose up to $20,000 in upgrades and lot premiums that they previously purchased. Problem 5: The Resale Formula Doesn't Recognize After Purchase Upgrades. Most affordable housing programs recognize that over a 30-year period a home will need • to be updated. Those programs establish objective standards that allow homeowners, under regulated circumstances, to add the cost of upgrades (subsequent to purchase) to 3 �a LY • the price of the home upon resale. This provides an incentive to the homeowners to keep the units current and attractive, thus preserving and enhancing the value of the units. Huntington Beach's program does not allow for this and thus, over time, the units become less desirable because homeowners don't want to sink money into a unit when the expense cannot be recouped upon sale. Problem 6: The Resale Formula Is Not Transparent. Even now, the current formula is not transparent to the typical owner, or even bank officers. A revised formula should be fashioned in a way that makes it easy for anyone at any time to know what the resale price is. Perhaps there should be a website calculator. This would lessen staff time and would avoid the need to charge fees just to learn what the resale price is. (In any event, there should be no fee to learn what the resale price is.) Problem 7: The Formula Has No Floor. The resale formula is devised in a way that allows the resale price to fall well below what the owners paid for it. Other jurisdictions place a floor on the resale price to protect the purchaser from losing his downpayment, and the amount of the mortgage he or she has paid down. Overall Affordable Housing Program In addition, there are concerns about the City's affordable housing regulations • generally. Problem 1: The Qualification Criteria Have Changed Dramatically. Years after the initial sale of these units,the City changed the way that individuals qualified for the program. For instance, at the time of initial purchase, there were no limitations on assets. Now, it appears that the City does place a limit on assets. As a result, it is now much harder to qualify and thus much harder to sell a unit. A certain level of assets-is necessary because the lender has requirements that are different than the City's requirements (e.g., requiring a substantial downpayment on these units). In addition, there was not previously a restriction on owning other real estate. Problem 2: Flexibility to Lease Out the Unit Is Needed At Times Over a 30- Year Period. Most programs have restrictions on renting out the unit and that is understandable; these are not intended to be investor units. However, many programs allow exceptions. Virtually every human being will have some life event over a 30-year period that necessitates a temporary relocation. Sometimes a close relative is ill and needs care following an illness. Sometimes a person has a short term (one year) assignment outside of Orange County. Other life circumstances arise. Other programs allow the owners to lease out the unit for a year or two upon prior approval by the City if the rental is a below market lease, ensuring housing for lower or moderate income individuals. This provides flexibility for a 30-year owner, but maintains the subdivision's • purpose of providing lower cost housing in the area. 4 L,2"P s-0 Problem 3: The Property Should Transfer Upon Death. Previously, there were not transfer restrictions upon the death of an owner, i.e., the owner could leave the unit to his or her heirs. The new rules appear to have changed this. Problem 4: Transfer to a Family Trusts Should Be Expressly Recognized. The rules should be clarified so that owners may place the unit in a family trust for estate planning purposes. This is permitted, but the program rules are not clear on this point. Problem 5: The City Has Changed the Date From Which the 30-Year Term Runs. The City has recently, without notice, and ignoring the CC&Rs, changed the date from which the 30-year term runs, adding years to the restrictions. Fixing the Problem: Possible Solutions One eloquent solution to the concerns raised above would be for the City to apply the recently adopted Ordinance No. 3764 (or some variation) to Cape Ann. Based on our reading of the Ordinance, the revised resale pricing mechanism adopted by the City Council would appear (at least with our minimal analysis at this juncture) to resolve the majority of problems identified with the resale pricing mechanism. But that is not the only solution. Dozens of other jurisdictions around the state • have functional affordable housing programs that address all of these problems. The homeowners have made copies of power point slides (for each City Council member) that further detail possible solutions with citations to other existing programs around the state. The flaws can be fixed any number of ways and the Cape Ann homeowners are flexible—they just want to see the problems addressed instead of ignored or swept under the rug. Thank you. Ve Truly Yours, John D lis and Tom Roth Cc: Scott Field • 5 S, .. ' � : - �_._. -.1.���,��d!. .�.�...�.. ,_ ��9iy �'�'�..� :,.'�i.:� �, Administrative Manual May 2003 • (number of bedrooms in unit +one person =appropriate household size) 2. Identify 110%of median income for the appropriate household size(use current income limits as specified in Appendix E) 3. Determine monthly household allowance for housing payment: i. Multiply 35% of 1 10% of median income for appropriate household size ii. Divide amount by 12 for monthly allowance 4. Determine the maximum sales price that the monthly household allowance for housing payment can support using the following parameters: i. 7.5% fixed interest rate mortgage ii. 30 year mortgage term iii. 10% down payment iv. estimates of property taxes, assessments, loan insurance and financing fees, allowance for property maintenance and repairs, homeowners insurance, homeowner association dues, allowance for utilities and land rent(if home is on • rented land) B. MAXIMUM RESTRICTED RESALE VALUE/ PRICE FOR INCLUSIONARY UNITS (FOR UNITS WITH AGREEMENTS DATED ON OR AFTER MAY 23, 2003) Inclusionary owners may refinance, obtain a second mortgage or decide to sell their unit. In those instances, the Housing and Redevelopment Office staff shall determine the appropriate resale value/price by using the following formula: Resale Value/Price Without a Bedroom Addition: Staff calculates new resale value/price allowed by: 1. Use original sales price as base figure, 2. Calculate percentage change in median income from original sales date to current date or most recent household income figures, 3. Apply the percentage change figure for median income to original sales price, which is the maximum resale value/price with the following modifications, 4. If unit is in decent condition based upon acceptable documentation, apply home improvement credit in the amount of 10%to original sales price, 18