SR 04-12-2016 3K
City Council
Report
City Council Meeting: April 12, 2016
Agenda Item: 3.K
To: Mayor and City Council
From: Andy Agle, Director, Housing Division, Housing and Economic Development
Subject: New and Amended Housing Programs: Housing Opportunity Utilizing Subsidy
Enhancements (HOUSE), and Revisions to the Affordable Housing Production
Program Administrative Guidelines
Recommended Action
Staff recommends that the City Council:
Approve the proposed Housing Opportunities Utilizing Subsidy Enhancements
1.
(HOUSE) pilot program parameters outlined in Attachment A to expand and
sustain opportunities for households with housing vouchers; and
2. Approve the revised Administrative Guidelines to the Affordable Housing
Production Program, as redlined in Attachment B.
Executive Summary
Affordable housing opportunities for tenants with housing subsidy vouchers are very
limited in the current housing market, due to the significant gap between voucher
the Council-approved Strategic Goal of Maintaining an Inclusive and Diverse
Community, staff proposes a pilot program to incentivize new owner participation and
maintain existing owner participation in voucher programs. Key elements of the
proposed HOUSE (Housing Opportunities Utilizing Subsidy Enhancements) pilot
program include a signing bonus, loss mitigation measure, liaison services, and
targeted outreach. Staff also proposes minor revisions to the Administrative Guidelines
of the Affordable Housing Production Program to clarify protocols regarding eligibility,
rent increases, and waitlist management.
Background
At its retreat in August 2015, Council identified Maintaining an Inclusive and Diverse
Community as a top strategic goal and specified that affordable housing is a critical
component of that priority. At its August 25, 2015 study session (Attachment C)
regarding affordable housing, Council discussed the current state of affordable housing
in Santa Monica and considered opportunities to increase affordable housing
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opportunities. The proposed HOUSE program and the existing Affordable Housing
Production Program (AHPP) are both discussed in this report.
Participants issued housing vouchers are experiencing significant barriers to finding
owners willing to accept the voucher rent levels established by federal Department of
Housing and Urban Development (HUD), which are well below market rents.
For example, the Housing Authority payment standard (i.e., monthly rent limit) for a
one-bedroom apartment under the voucher program is $1,352 and recent data indicates
that the median market rent for a one-bedroom apartment in Santa Monica ranges from
$1,900 to $2,850 (based on data from the Rent Control Board and Westside Rentals).
At its October 27, 2015 meeting (Attachment D), Council approved a FY2015-16 budget
allocation of $250,000 to develop a pilot program to incentivize property owners to rent
to households with vouchers. The proposed program is intended to encourage greater
owner participation in voucher programs through participation-based financial
incentives, loss-mitigation assurances, and enhanced communications and outreach.
Concurrently, staff has submitted a request to HUD for an increase in the maximum
payment standard for Santa Monica vouchers, to be more competitive with market
rents. The request has received support from Congress member Ted Lieu, who is
advocating on behalf of the City. While it is uncertain whether HUD will approve an
increase in the payment standard, it is unlikely that, even with an increase, vouchers
would be fully competitive in the Santa Monica market. Therefore, staff recommends the
pursuit of additional tools that could increase voucher utilization, such as the proposed
HOUSE program.
annual budget allocation, based upon HUD protocols. The annual budget allocation is
based on the number of vouchers under lease during the prior period. From 2012
through 2015, voucher utilization has progressively declined from 1,018 to 945, which
represents a loss of 73 vouchers that would house 73 families for an entire year.
Each declining voucher utilization period is followed by a subsequently reduced annual
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results in fewer households that can be assisted.
The AHPP requires market-rate multifamily housing developers to either include
affordable housing within their developments or pay fees toward the development of
affordable housing. Over 1,000 deed-restricted, affordable apartments located on 133
properties have been completed under the AHPP (and previous inclusionary housing
-restricted affordable housing
stock. Based on experience administering the AHPP, staff has identified discrete areas
within the AHPP Administrative Guidelines that would benefit from clarification.
Discussion
To address affordable housing programmatic challenges, staff recommends that
Council approve the HOUSE pilot program to incentivize owners to participate in
housing voucher programs, as well as adopt revisions to the AHPP Administrative
Guidelines.
Owner Incentive Program
affordable housing options. Voucher programs serve extremely low-income households,
including elderly and disabled households, with incomes below 30 percent of the area
median income (e.g., $17,950 for a 1-person household). As a result of state-mandated
vacancy decontrol of rent-controlled apartments and continually increasing market rents
in Santa Monica, the reach of the voucher programs has become more and
more limited. Housing Authority data indicate that only seven percent of program
participants reside in housing not subject to rent limits (i.e., deed-restricted and rent-
controlled housing). The situation reflects the large gap between the voucher payment
standard and current market rents, leaving no economic incentive for the private
housing market to participate in the voucher programs. Existing tenants with vouchers
are protected from arbitrary evictions based upon Measure RR, adopted in 2010 by
Santa Monica voters. However, landlords often leave the voucher program as
apartments become vacant.
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Additionally, the housing market is very competitive as owners have numerous
applicants competing for a vacant apartment. To narrow the applicant pool, owners
conduct credit checks and review rental history to assess credit-worthiness. Voucher
program participants are extremely low-income or very low-income households who
might have experienced a past financial emergency, resulting in an undesirable credit
score or rental history. Such incidents act as a barrier to obtaining decent, safe and
affordable housing.
Finally, the households served by voucher programs include veterans, seniors, formerly
homeless persons, and persons living with disabilities. A portion of this population
struggles with living independently and benefits from social services. Targeted social
services support not only the tenants, but the owners as well, by providing specialized
assistance which enables tenants to remain in the community.
The proposed HOUSE Program would implement strategies to recruit and retain owners
to participate in voucher programs. The proposed components would include: 1) Signing
Bonus; 2) Loss Mitigation; and 3) Liaison and Outreach. Program components are
summarized below and the parameters of the proposed HOUSE Program are provided
in Attachment A.
SigningBonus:
1.
objective - incentivize and increase owner participation in housing voucher
o
programs; leverage unused federal voucher funds equal to approximately
$12,000 annually; match voucher holders with unsubsidized apartments;
method - provide $5,000 to the first 45 property owners of non-deed-
o
restricted, rent-controlled apartments who lease a vacant apartment to a
household with a housing voucher; the $5,000 amount is intended to
approximate the one-year gap between the payment standard and the
average rent-controlled, one-bedroom rent;
eligibility new voucher participants only; limited to rent-controlled
o
apartments without deed restrictions (i.e. apartments not subject to property-
specific covenants which restricts rent levels); not eligible if new voucher
holders are moving from deed-restricted or rent-controlled apartments;
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estimated budget - $225,000
o
Loss Mitigation:
2.
objective - provide assurance to property owners of non-deed-restricted,
o
rent-controlled apartments who ease credit standards to accommodate
tenants; prioritize involuntarily displaced Santa Monica tenants, and
veterans, seniors, formerly homeless persons, persons living with disabilities,
and families; couple loss mitigation assurance with signing bonus as an
enhanced incentive;
method - reimburse a maximum of $4,000 per apartment for actual rent loss
o
due to household hardship or default in rent, applicable attorney fees, and
excess wear and tear; documentation would be required regarding the actual
rent loss and the cost associated with restoring the components which
incurred excessive wear and tear; would be offered on discretionary basis
until all funds are reserved, and funds would only be accessed once the
estimated budget - $36,000
o
Owner Liaison and Outreach:
3.
objective provide support to help stabilize and prevent eviction for tenants
o
with special needs, including elderly, persons living with disabilities, and
formerly homeless; inform and educate existing and prospective owners
about the opportunities associated with the voucher programs and the
HOUSE Program;
method dedicated staff to respond and resolve owner concerns, including
o
assistance from a Licensed Clinical Social Worker (LCSW) under contract
with the Housing Authority to connect tenants with government and social
service agencies; estimated staff time of 18 hours per week, as well as 8-10
hours per week for LCSW; targeted outreach and marketing to individual
owners and owner organizations, and faith-based organizations, including
brochures, flyers, and newsletters; would also include occasional owner-
appreciation events;
estimated budget - $89,000 ($50,000 for staff and $39,000 for LCSW).
o
The $350,000 overall budget of the proposed HOUSE Program includes $100,000 of
discretionary funds reallocated from FY 2013-14 to FY 2015-16 and budgeted by
Council on June 23, 2015 (Attachment E), for use toward loss mitigation measures, and
$250,000 budgeted by Council on October 27, 2015, for owner incentives.
The recommendations above include estimated budget amounts for the various
components of the proposed HOUSE Program. The pilot program may require flexibility
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during implementation to shift resources to more successful elements of the HOUSE
Program. As a result, staff requests flexibility over line-item budgets, though the
allocated budget of $350,000 would not be exceeded. Additionally, the Housing
Commission recommended a quarterly status report, which staff proposes to prepare in
the form of an Information Item.
Proposed Revisions to AHPP Guidelines
Staff proposes amendments to Section 7 of the AHPP Administrative Guidelines, which
provides guidance regarding eligibility, rent increase limitations, and waitlist
-
Guidelines to reflect Council-approved revisions to the AHPP in 2013, as well as
specific stylistic changes. The proposed revisions to the Guidelines are provided as
Attachment B in redline format.
During the course of AHPP compliance monitoring, issues have arisen regarding
tenant eligibility. One issue involves clarification that the affordable residence must be
include employees associated with the owner, including the property management firm,
except when State law requires on-site staff. Staff also recommends that when the rent
being charged is below the deed-restricted rent limit, rent increases shall be restricted to
five percent annually.
Staff also recommends a change to the waitlist protocol in Section 7(C) (2). The current
protocol indicates that the waitlist will be re-opened when the number of households in
any income category decreases below 300; staff recommends that the language be
eliminated for consistency with a new waitlist approach involving a substantially reduced
and more active waitlist. Additionally, the language in Section 7(D) (1) regarding rules
for increases in household income is simplified and reformatted, without substantive
changes.
Commission Action
At its February 11, 2016 meeting, the Housing Commission voted to support the
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Staff has incorporated the suggested modifications into the proposed Guidelines
attached to this report.
On February 18, 2016, staff presented the proposed HOUSE Program to the Housing
Commission, with the same components as proposed in this report but with different
estimated budget allocations. The Commission voted to support the Program, with the
stipulation that the proposed Program include metrics of success (see page 3 of
Attachment A), and that staff provide quarterly status reports to the Commission.
Financial Impacts and Budget Actions
The cost of the proposed HOUSE Program would not exceed $350,000. Budget
authority was approved by Council on October 27, 2015 and the Fiscal Year 2015-16
appropriation of $250,000 is available in account SO015203.589000. Additional budget
authority of $100,000 from discretionary funds for loss mitigation measures was
approved by Council on June 23, 2015 and the Fiscal Year 2015-16 appropriation is
available in account 01201.579001. There is no immediate financial impact or budget
action necessary as a result of the recommended action regarding revisions to the
AHPP Administrative Guidelines.
Prepared By:
James Kemper, Housing Administrator
Approved Forwarded to Council
Attachments:
A. Proposed HOUSE Program Guidelines
B. Proposed AHPP Guidelines
C. Staff Report 8.25.2015
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D. Staff Report 10.27.2015
E. Staff Report 6.23.2015
F. Written comments
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Proposed Guidelines for Housing Opportunities Utilizing Subsidy Enhancements (HOUSE):
A Property Owner Incentive Pilot Program
This program is the
Santa Monica Housing Authority (SMHA) rental housing voucher programs. The goal of this pilot program is to
recruit new property owners to the voucher programs and retain existing property owners. HOUSEintends to
expand affordable housing opportunities in Santa Monica, specifically for extremely low-income and very low-
income residents and Santa Monica workers who hold a voucher or are voucher eligible. The pilot program will
apply exclusively to vouchers issued by the SMHA.
As this is a pilot program, staff seeks flexibility to adjust line items within the budget based on experience.
1)Signing Bonus Estimated Budget $225,000
a.Objective
i.The objectives of the Signing Bonuses are to incentivize and increase owner participation
in voucher programs, leverage unused federal voucher funds, and match voucher holders
with unsubsidized apartments.
b.Method
i.A Signing Bonus of $5,000 will be awarded to the first 45 property owners of non-deed-
restricted, rent-controlled apartments who lease a vacant apartment to a household with
a new housing voucher. The Signing Bonus will require a 12-month commitment from the
owner following the receipt of the bonus. Should a tenant vacate the apartment before
the 12-month period is over, the owner agrees to lease to a new voucher holder family
without an additional bonus. The Signing Bonus does not apply to situations in which new
voucher tenants are moving from a deed-restricted or rent-controlled apartment.
2)Loss Mitigation Estimated budget $36,000
a.Objective
i.The objective of Loss Mitigation is to assist households with overcoming unfavorable credit
histories by providing assurance to property owners. Loss Mitigation would be available
on a discretionary basis to property owners of non-deed-restricted, rent-controlled
apartments who ease credit standards to accommodate tenants. Priority households
include involuntarily displaced Santa Monica tenants, and veterans, seniors, formerly
homeless persons, persons living with disabilities and families. The assurance would cover
the property owner for an actual rent loss due to a household facing hardships or default
in rent, applicable attorney fees, and excess wear and tear on an apartment. Loss
Mitigation would offer a maximum dollar amount of up to $4,000 per apartment, and only
distributed in instances of actual loss.
b.Method
i.At initial screening and lease-up: Owner would provide their written policy to the SMHA
describing credit history thresholds for the subject property, as well as the tenant applicant
. The SMHA would review the
The owner will agree to hold the vacant apartment during the time the SMHA is reviewing
3 business days) for Loss Mitigation.
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Proposed Guidelines for Housing Opportunities Utilizing Subsidy Enhancements (HOUSE):
A Property Owner Incentive Pilot Program
ii.At time of payout: Documentation would be required regarding the actual rent loss,
including applicable attorney fees, and/or the cost associated with restoring the
components which incurred excessive wear and tear.
be exhausted prior to a Loss Mitigation payment.
iii.Loss mitigation assurance may be coupled with Signing Bonus as an enhanced incentive.
3)Owner Liaison, Licensed Clinical Social Worker (LCSW) and Outreach Estimated Budget $89,000
($50,000 for staff and $39,000 for LCSW contract)
a.Objective
i.The objective of the Owner Liaison is to inform current and prospective property owners
about the benefits and opportunities with voucher programs and HOUSE, and cultivate a
positive experience for participating property owners. The Owner Liaison will also assist in
coordinating relevant social services through the
Social Worker (LCSW), to stabilize and prevent eviction for tenants with special needs
including elderly, persons living with disabilities, and formerly homeless individuals.
b.Method
i.Owner Liaison
1.A staff person would be responsible for responding to property owners daily,
creating marketing materials, participating in ongoing outreach to owners,
coordinating resources, and tracking data and outcomes. Liaison will respond to
and resolve owner concerns, including collaborating with LCSW when appropriate.
Liaison will market and outreach to individual owners and owner organizations.
Liaison will utilize specialized outreach tools such as brochures, flyers, newsletters
and occasional owner-appreciation events.
2.Estimated staff time: 18 hours per week
ii.LCSW
1.Under contract with SMHA, the LCSW will assess the clinical needs of
disabled/homeless households whose rents are currently subsidized by SMHA, as
well as coordinate care and stabilize persons who are in need of housing. LCSW will
identify existing resources for social service interventions in an effort to assist
property owners with high needs tenants.
2.Estimated LCSW time: 8-10 hours per week
Note: The SMHA recognizes there is an unmet need with respect to households without vouchers that are
severely rent-burdened. The HOUSE pilot program is not intended to address that issue. With additional resources
and research, the SMHA hopes to implement programing to assist severely rent-burdened households in Santa
Monica.
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Proposed Guidelines for Housing Opportunities Utilizing Subsidy Enhancements (HOUSE):
A Property Owner Incentive Pilot Program
Table 1: Program Components and Objectives
Program Objective Eligibility Anticipated # Measure*
Served
Annually
Non-Deed
Restricted,
Rent-controlled
participation in rental apartments Number of new vouchers
Signing Bonus 45
housing voucher only; New which lease-up
programs voucher
participants
only
Non-Deed
Provide assurance to Number of new leases to
Restricted,
Loss Mitigation owners who ease their 9 households with unfavorable
Rent-controlled
credit standards credit histories
apartments
LCSW:
Provide support to
120 LCSW: number of
property owners by
unduplicated interventions and number of
streamlining
Owner Liaison, All participating tenants tenants supported
communication and
LCSW and owners and
partnering with LCSW to
Outreach tenants Owner Liaison: Owner Liaison:
coordinate social
200 Number of tenants
services for tenants as
unduplicated supported
needed
tenants
*
1/12/2016. it may become difficult to assign the success of retaining and
recruiting owners to the HOUSE program versus the increased EPS.
Table 2. Anticipated Budget
Incentive Total Anticipated Budget
Signing Bonus $225,000
Loss Mitigation $36,000
Owner Liaison, LCSW, Outreach $89,000
Total Anticipated Budget $350,000
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ADMINISTRATIVE GUIDELINES
for the
AFFORDABLE HOUSING PRODUCTION PROGRAM
of the
ADMINISTRATIVE GUIDELINES
CITY OF SANTA MONICA
(Pursuant to Chapter 9.5664 of the Municipal Code)
Prepared by
The City of Santa Monica Housing Division
Approved by City Council June 12, 2012
Administrative Guidelines
Affordable Housing Production Program
ATTACHMENT A
_________, 2016
Administrative Guidelines
Affordable Housing Production Program
ATTACHMENT A
Table of Contents
1. Introduction .............................................................................................................. 11
2. Fee Methodology...................................................................................................... 32
A. Establishment and Periodic Adjustment of Base Fee ........................................... 32
B. Affordable Housing Unit Development Cost ......................................................... 43
3. On-Site Affordable UnitResidence Option ................................................................ 54
4. Off-Site Affordable UnitResidence Option ................................................................ 64
A. One-Quarter Mile Radius Maximum ..................................................................... 65
B. Exceptions to the One-Quarter Mile Radius Maximum ......................................... 65
C. Evidence of Site Control ....................................................................................... 86
D. Simultaneous Development of Off-Site Affordable UnitsResidences ................... 87
5. Land Acquisition Option ........................................................................................... 97
A. Eligible Land Parcels ............................................................................................ 97
B. Evidence of Site Control ................................................................................... 1210
C. Conveyance of the Site .................................................................................... 1210
D. Simultaneous Conveyance of Land or Option .................................................. 1412
E. Eligible Non-Profit Affordable Housing Developer ............................................ 1412
6. For-Sale Affordable UnitResidence Requirements ............................................... 1513
A. Establishment of the Initial PurchaseSales Price ............................................. 1513
B. Re-Sale of an Affordable UnitResidence to a Subsequent Purchaser.............. 1715
C. Subordination ..................................................................................... 1816
D. Default and Foreclosure ................................................................................... 1816
E. Distribution of Insurance and Condemnation Proceeds ................................... 1916
7. Tenant and Purchaser Eligibility Procedures ........................................................ 2017
A. Priority Households .......................................................................................... 2017
B. Persons Ineligible to Occupy an Affordable UnitResidence ............................. 2118
C. Establishment, Maintenance, and Update of Income-Qualified Tenants and
Purchasers List ................................................................................................ 2320
D.Tenant Income Increases, Initial Ineligibility and Advance Notice to City......... 2825
8. Adjustments or
Administrative Guidelines
Affordable Housing Production Program
i
ATTACHMENT A
Waivers................................................................................................................... 3128
............................................................................................................................... 3328
ATTACHMENTS
1-A Municipal Code ChapterSection 9.5664 Affordable Housing Production
Program
1-B AHPP Options Comparison Table
2-A Fee Adjustment Methodology
2-B Current Base Fees for Apartment and Condominium Projects
3-A Affordable UnitsResidences Table - Condominium Projects w/4+
UnitsResidences in Multifamily Zones
3-B Development Incentives Table Affordable Housing Developers
3-C Extremely-Low, Very -Low, Low and Moderate Income Levels
3-D of Maximum Allowable Rents
3-E Deed Restriction Sample of Deed Restrictions
4-A Affordable Housing Eligibility List Sample Application for Affordable Housing
Eligibility List
4-B Waiting List Referral Form Sample
Administrative Guidelines
Affordable Housing Production Program
ii
ATTACHMENT A
These Administrative Guidelines provide guidance on the implementation of the
Affordable Housing Production Program, Chapter 9.5664 of the Santa Monica Municipal
Code (see Attachment 1-A for a complete copy of the AHPP). The AHPP was
originally adopted by the City Council on July 21, 1998. It has been amended on several
occasions since then. The AHPP gives developers of multi-family housing a variety of
options
The precise options
vary depending on the housing type and location of the housing being produced.
All new multi-family housing developments of two or more unitsresidences, including
multi-family housing that is part of commercial or other developmentdevelopments, must
comply with Chapter 9.5664 unless specifically exempted by the terms of Chapter 9.5664.
See Attachment 1-B for a comparison table on the various options for complying with
Chapter 9.5664. The AHPP implements Proposition R. Approved by Santa Monica
voters in November, 1990, Proposition R requires that not less than 30 percent of all
newly constructed multi-family residential housing newly constructed inhousing in the City
each year be permanently affordable to, and occupied by, low- and moderate-income
households.
Fee Methodology
Section 2 of these Guidelines describes the . Section 3 provides
information about the number of affordable unitsresidences required and the development
On-Site Option
incentives associated with the . The remaining sections expand upon the
Off-Site Option
AHPP and provide additional requirements regarding the (Section 4), the
Land Dedication OptionFor-Sale Affordable Residences
(Section 5), Units (Section
Tenant and Purchaser Eligibility ProceduresAdjustments or
6), the (Section 7) and
Waivers
(Section 8).
Questions about how a particular multifamily project applicant shall satisfy the affordable
housing obligation (pay a fee, build unitsresidences onsite or offsite, or provide land
Administrative Guidelines
Affordable Housing Production Program
1
ATTACHMENT A
dedications) should be directed to either the City Planning Division at (310) 458-8341, or
to the Planning Counter in Room 111 in City Hall. Questions about current maximum
rents and sales price calculation, or Tenant Eligibility and Selection Procedures should
be directed to staff in the Housing Division at (310) 458-8702.
Administrative Guidelines
Affordable Housing Production Program
2
ATTACHMENT A
One way to satisfy the affordable housing obligation is through payment of the Affordable
Housing Unit Base Fee (§ 9.5664.070). The amount of the Affordable Housing Unit Base
Fee ("Base Fee") is based upon the floor area of the project. The floor area of the project,
as defined in the Municipal Code § 9.04.02.030.315, is multiplied by the Base Fee in order
to determine the total fee owed by each project. The proceeds from this Base Fee are
deposited into a special City Trust Fund and used to facilitate the development of housing
affordable to very low -income, low-income and moderate-income households. The Fee
Option is not available for ownership projects of 4four or more unitsresidences in the
-family residential zones.
A. Establishment and Periodic Adjustment of Base Fee
The Base Fee is set by a Resolution of the City Council (See Municipal Code 9.5664.070
(b)) and is subject to annual adjustment based on changes in land cost and construction
cost. The methodology for making these annual adjustments was established by the City
Council in June 2006. More specifically, construction cost inflation is established based
because itwhich is
updated monthly and is readily available via the Internet. The methodology uses annual
change in median condominium purchase prices as a proxy measure for land cost
changes. The relative balance between land cost inflation (based on changes in median
condo prices) and construction cost inflation (based on a construction cost index) is
determined based on current development cost data for recently completed or
construction-in-progress multi-family affordable developments assisted by the City. A
detailed explanation of the annual adjustment methodology is provided in Attachment 2-
A.
There aredifferent base fees for condominiums and apartment projects. Attachment 2-
B contains the current Base Fee amounts for apartment and condominium projects.
Administrative Guidelines
Affordable Housing Production Program
3
ATTACHMENT A
B. Affordable Housing Unit Development Cost
The Affordable Housing Unit Development Cost is set by a Resolution of the City Council
(See Municipal Code 9.5664.070(cC)) and is subject to annual adjustment based on
changes in land cost and construction cost. The methodology for making these annual
adjustments was established by the City Council in June 2006 and is the same
methodology used in adjusting the Affordable Housing Unit Base Fee described in
Section (3-)(A.). The Affordable Housing Unit Development Cost is the average cost to
the City to develop a unitresidence of housing affordable to low- and moderate-income
households. The Affordable Housing Production Program provides that when developers
of market rate multi-family housing are providing affordable unitsresidences on- or off-
site, and the calculation of the number of affordable unitsresidences required results in a
fractional unitresidence, these developers are eligible to pay a fee equal to the cost of
producing that fractional unitresidence based on the Affordable Housing Unit
Development Cost if that fraction is less than 0.75. See Attachment 2-A.
Example (6-unitresidence condominium project)
6 X .20 = 1.2 affordable housing unitsresidences
1 unitresidence would be constructed on-site
Fee payment of 0.2 X $265,632 = $53,126327,927 = $65,585.40
Administrative Guidelines
Affordable Housing Production Program
4
ATTACHMENT A
Another way to satisfy the affordable housing requirements of Chapter §9.5664 is by
constructing affordable unitsresidences on the same site as the proposed new multi-
family project (See § 9.5664.050). Ownership projects or 4 or more unitsresidences in
multifamily zones must provide affordable unitsresidences either onsite or offsite (See §
9.5664.040). All housing developments that provide onsite affordable unitsresidences in
accordance with the AHPP are entitled to a bonus over the maximum allowable number
of unitsresidences on the site (i.e., density bonus) or a development bonus
(commercial/industrial zones) and incentives (See Section 9.5664.050\[i\]).I\] and Section
9.22). This includes all unitsresidences for sale or rent such as:
Substantial remodel and conversion of commercial buildings to residential
unitsresidences
Substantial remodel of residential buildings
Condos and apartments.
Attachment 3-A provides a table indicating the minimum number of affordable
unitsresidences required in an ownership project in a multifamily zone and the fractional
portion of a unitresidence that may be paid as a fee. Attachment 3-B provides information
on density bonus and other development incentives allowed when providing onsite
affordable units. Attachmentresidences. Attachments 3-C and 3-D provide information
on the most current income eligibility and rent limits. Attachment 3-E provides an example
of the an Agreement Imposing Restrictions on Real Property between the City and thea
developer regarding a project containing affordable housing unitsresidences.
Administrative Guidelines
Affordable Housing Production Program
5
ATTACHMENT A
This section of the Guidelines specifies certain additional requirements concerning the
location of the Off-Site Affordable UnitsResidences, site control, and concurrent
development of the market-rate project and the off-site unitsresidences.
A. One-Quarter Mile Radius Maximum
Except as provided below, the alternative site for the Off-Site Affordable UnitsResidences
shall be located within a one-quarter mile radius of the parcel on which the market rate
unitsresidences are proposed, and within the boundaries of the City. (SMMC §
9.5664.060 (c(C)) The outer limit of this one-quarter mile radius area shall be determined
by the Planning and Communit
for so doing shall be similar to the method used for determining the area within which
written notice of a pending development permit is given. Specifically, on a map of City
parcels, the project applicant shall submit as part of the project application a set of one-
quarter mile radii from the corners of the parcel on which the market rate unitsresidences
will be constructed. Any multi-family parcel or commercial parcel on which multi-family
housing is a permitted use, located, in whole or in any part, within these intersecting one-
quarter mile radii is an eligible parcel for development of Off-Site Affordable
UnitsResidences.
B. Exceptions to the One-Quarter Mile Radius Maximum
The maximum one-quarter mile radius requirement may be waived by majority vote of the
City Planning Commission (whose decision shall be appealable to the City Council),
based upon substantial evidence demonstrating that the location of Off-Site Affordable
UnitsResidences more than one-quarter mile from the site of the market rate
unitsresidences
zoning and planning regulations, including maximizing affordable housing production and
dispersing affordable housing throughout the City. (SMMC § 9.5664.060 (f(F))
Administrative Guidelines
Affordable Housing Production Program
6
ATTACHMENT A
The project applicant shall have the burden of demonstrating why a location for the Off-
Site Affordable UnitsResidences of more than one-quarter mile from the market rate
unitsresidences better accom
its determination, the Planning Commission shall consider the recommendations of the
Planning Director and the Housing and Redevelopment Manager on the petition. An
application for an exception to the one-quarter mile radius shall be submitted as part of
the planning application for any other discretionary approvals on the project that are within
the purview of the Planning Commission.
By way of example, but not by limitation, factors that may justify the special exception
include:
No Available Sites. There are no multi-family or suitably zoned non-residential
parcels within the strict boundaries of the one-quarter mile radius that can
accommodate the required number of Affordable Off-Site UnitsResidences.
Dispersal of Affordable UnitsResidences. The alternative location makes it
possible to locate Off-Site Affordable UnitsResidences throughout the City.
More Affordable UnitsResidences. The size, price or other characteristics of the
alternative site results in a project that yields more affordable unitsresidences than
the project would yield if it were located within the strict limits of the one-quarter
mile radius.
Deeper Level of Affordability. The size, price or other characteristics of the
alternative location makes it possible to offer the Off-Site Affordable
UnitsResidences to households at a lower household income level than would be
possible within the strict limits of the one-quarter mile radius.
In no event, however, shall the Off-Site Affordable UnitsResidences be located outside a
radius of one mile from the market rate unitsresidences. No more than five project
exceptions to the one-quarter mile radius shall be approved in any one City fiscal year.
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ATTACHMENT A
C. Evidence of Site Control
In order to exercise the Off-Site Affordable UnitResidence Option, the applicant must
provide evidence that the site is owned in fee or that an option to purchase, subject to
City project approval, has been secured. (SMMC § 9.5664.060 (b(B)) Evidence of such
site control (e.g., copies of purchase or option agreements) shall be provided to the City
as part of the project application package.
D. Simultaneous Development of Off-Site Affordable UnitsResidences
All affordable housing unitsresidences in a multi-family project or a phase of a multi-family
project shall be constructed concurrently with the construction of market rate
unitsresidences in the multi-family project or phase of that project. No building permit for
the market rate unitsresidences shall be issued until a building permit has been issued
for the Off-Site Affordable UnitsResidences, and no final City construction permit sign-off
or occupancy permit shall be granted for the market rate unitsresidences until final
construction permit sign-off or occupancy permit has been granted for the Off-Site
Affordable UnitsResidences. Off-Site Affordable UnitsResidences shall be offered for
rent or sale, as applicable, prior to or concurrently with rental or sale of the market rate
unitsresidences.
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ATTACHMENT A
This section of the Guidelines specifies additional requirements for exercising the Land
Acquisition Option.
A. Eligible Land Parcels
Only land parcels meeting the following minimum characteristics shall be eligible under
the Land Acquisition Option:
1. Zoning
Land parcels eligible for conveyance to the City, or an eligible non-profit affordable
housing developer, shall be located in a City multi-family housing, commercial or
industrial district in which multi-family housing is a permitted use.
2. Minimum Land Value
For sites dedicated to the City, or an eligible non-profit affordable housing
developer, the fair market value of the parcel(s) shall be at least equal to the
amount of the Affordable Housing Production Fee that would otherwise apply were
the market rate project applicant to elect that option under Chapter 9.5664 instead
of the Land Acquisition Option. The fair market value of the parcels proposed
under this Option shall be supported by an estimate of value prepared by a
appraisal. For situations involving option payments, rather than conveyance of
land in fee, see below. For below market rate sales, or option transfers, see below.
3. Site Characteristics
The parcel shall satisfy the following minimum criteria:
- 6,000 square feet
- Can be developed with at least 4 dwelling units
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ATTACHMENT A
- Free of characteristics that would make it difficult or impossible to develop
in a timely manner (i.e., irregular shape, excessive sloping, soil or other
contamination, adjacent to incompatible land use)
A Phase I environmental evaluation report shall be required before any parcel can
be considered for conveyance.
4. One-Quarter Mile Radius Maximum
Except as provided below, the land parcel(s) proposed to be conveyed to the City,
or an eligible non-profit affordable housing developer, shall be located within a one-
quarter mile radius of the parcel on which the market rate unitsresidences are
proposed and within the City limits. (SMMC § 9.5664.080) The outer limits of this
one-quarter mile radius area shall be determined by the Planning and Community
to the method used for determining the area within which written notice of a
pending development permit is given. Specifically, on a map of City parcels, the
project applicant shall draw a set of one-quarter mile radii from the corners of the
parcel on which the market rate unitsresidences will be constructed. Any multi-
family parcels located, in whole or in any part, within these intersecting one-quarter
mile radii is an eligible parcel for the Land Acquisition option.
5. Exceptions to the One-Quarter Mile Radius Maximum
The maximum one-quarter mile radius requirement may be waived by majority vote
of the City Planning Commission (whose decision shall be appealable to the City
Council), based upon substantial evidence demonstrating that the location of land
more than one-quarter mile from the site of the market rate unitsresidences better
maximizing affordable housing production and dispersing affordable housing
throughout the City. (SMMC § 9.5664.080)
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ATTACHMENT A
The project applicant shall have the burden of demonstrating why a proposed site more
than one-quarter mile from the market rate unitsresidences (but still within the City limits)
ing objectives. In making its determination,
the Planning Commission shall consider the recommendations of the Planning Director,
the Housing Manager, and the Housing and Redevelopment ManagerCommission. An
application for an exception to the one-quarter mile radius shall be processed simul-
taneously with any other discretionary approvals on the project that are within the purview
of the Planning Commission.
By way of example, but not by limitation, factors that may justify the special exception
include:
No Available Sites. There are no multi-family parcels within the strict boundaries
of the one-quarter mile radius that are suitable for multi-family development.
Dispersal of Affordable UnitsResidences. The alternative location makes it
possible to locate affordable housing throughout the City.
More Affordable UnitsResidences. The size, price or other characteristics of the
alternative site could result in an affordable housing project that yields more
affordable unitsresidences than would otherwise be required under the On-Site
Affordable UnitsResidences option or the Off-Site Affordable UnitsResidences
option in Ordinance 1918.
Deeper Level of Affordability. The size, price or other characteristics of the
alternative location makes it possible to offer affordable unitsresidences to
households at a lower household income level than would be possible within the
strict limits of the one-quarter mile radius.
In no event, however, shall the Land Acquisition Option apply to a site located outside a
radius of one mile from the market rate unitsresidences. No more than five project
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ATTACHMENT A
exceptions to the one-quarter mile radius maximum shall be approved in any one City
fiscal year.
B. Evidence of Site Control
In order to exercise the Land Acquisition Option, the market rate multi-family project
applicant shall provide evidence, subject to reasonable City approval, that the site to be
conveyed to the City, or an eligible non-profit affordable housing developer, is owned in
fee by the applicant, or that an option to purchase has been secured. Evidence of such
site control, including a current title report, and a copy of the option or lease agreement,
if applicable, shall be included as part of the application for the market rate project.
C. Conveyance of the Site
An eligible site, or option to purchase an eligible site, shall be conveyed to the City, or an
eligible non-profit affordable housing developer, as follows:
1. Fee Title Transfer
The site shall be sold or dedicated to the City or to a qualified non-profit housing
developer free of any encumbrances, contractual, physical or financial, that would
prevent it from being developed in a timely way by the City, or a qualified non-profit
housing developer, for affordable multi-family housing.
If the site is dedicated to the City, or to an eligible non-profit affordable housing
developer at no cost, the City shall provide reasonable cooperation as may be
requested to help the applicant secure any state or federal tax credit for which such
a dedication may be eligible.
If the site is sold to the City, or to an eligible non-profit affordable housing developer
at below market rate, the difference between the fair market value and the below
market sale price must be at least equal to the amount of the Affordable Housing
Production Fee otherwise due, if that option had been selected by the project
applicant.
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ATTACHMENT A
2. Option to Purchase
If the market rate project applicant secures an option for another site to fulfill the
Land Acquisition Option, the option must have a minimum term of six months and
clearly state that the option may be transferred to a third party, such as the City or
a qualified non-profit housing developer, under the same terms and conditions,
including the agreed upon purchase price. A copy of the option agreement and a
current title report shall be included with the application for the market rate project.
Any costs incurred by applicant to maintain the option from the date of project
application through successful transfer of the option to the City or to a qualified
non-profit developer shall be the responsibility of the applicant. If the sum of the
-of-pocket option-related expenses, from date of project application
through conveyance of the option, is less than the amount of the Affordable
Housing Production Fee Option, these costs will be treated as a credit against the
Affordable Housing Production Fee that would otherwise be due the City under
that Chapter 9.5664 option. The applicant shall pay any difference to the City as
a reduced Affordable Housing Production Fee. The applicant shall provide the City
a full accounting of all option payments and out-of-pocket option-related costs
eligible for offset against the Affordable Housing Production Fee amount, which
accounting shall be subject to reasonable City review and approval.
The land offered for option must have the following minimum site characteristics:
- 6,000 square feet
- Can be developed with at least 4 dwelling units
- Free of characteristics that would make it difficult or impossible to develop
(i.e., irregular shape, excessive sloping, soil or other contamination,
adjacent to incompatible land use)
A Phase I environmental evaluation report shall be required before any parcel can
be considered for option.
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ATTACHMENT A
The City shall exercise reasonable discretion in considering the option. The land
option must be consistent with all City funding requirements, including the
Consolidated Rental Housing Trust Fund Guidelines.
D. Simultaneous Conveyance of Land or Option
Conveyance of land or an option to purchase land to the City or an eligible non-profit
affordable housing developer, pursuant to Chapter 9.5664, shall be completed prior to the
-off on construction permits for the market rate unitsresidences, or
issuance of a certificate of occupancy, whichever occurs first.
E. Eligible Non-Profit Affordable Housing Developer
Dedication of land, below market rate sale of land or transfer of an option to purchase
-
For purposes of the Land Acquisition Option of Chapter 9.5664, an eligible not-profit
affordable housing developer is a private, non-profit corporation with: (1) a current
exemption under Section 501(c)(3) of the U.S. Internal Revenue Code; (2) a certificate of
good standing from the Secretary of State in which the organization is incorporated; (3)
has the development of housing affordable to low-income households as one of its
principle missions; and (4) has been approved by the City Housing and Redevelopment
mance
developing multi-family housing affordable to low-income households. The non-profit
affordable housing developer intended as the recipient of land pursuant the Land
Acquisition Option must be identified as part of the project application.
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ATTACHMENT A
In the event that the affordable unitsresidences required under either the On-Site
Affordable UnitResidence Option or the Off-Site Affordable UnitResidence Option are
intended to be for-sale unitsresidences, rather than rentals, the following rules shall apply.
A. Establishment of the Initial Sales Price
The developer shall establish the initial sales price for the affordable unitresidence so that
the total monthly housing costsTotal Monthly Housing Costs for the purchaser do not
exceed the following formula: Gross Monthly Area Median Income X Affordability Level
Xx 110% x Bedroom Adjustment X 38%. x 35% / 12. Total Housing Cost includes
mortgage principal and interest, property taxes, property insurance,
association dues and mortgage insurance, if applicable
Area Median Income is defined in SMMC Section 9.64.020(K) and determined
periodically by the City of Santa Monica based upon the United States Department of
Housing and Urban Development estimate of income for a 4-person household for the
Los Angeles area.
Affordability Level refers to Very Low Income, Low Income and Moderate Income levels
as defined in SMMC Section 9.56.020.
The Bedroom Adjustment Factors are:
0 Bedroom 0.7 3 Bedrooms 1.0850
1 Bedroom 0.8 4 Bedrooms 1.22508
2 Bedrooms .950.9
The total monthly housing costs shall include all of the following: mortgage payment
(principal and interest), property taxes, property insurance, and property mortgage
insurance, and homeowners' association dues.
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ATTACHMENT A
The conventional financing shall conform to all of the following terms:
Loan Term: 30 Years
Interest Rate: Fixed
Minimum Down payment: 5%
1
Maximum Front End Debt-to-Income Ratio: 38%
2
Maximum Back End Debt-to-Income Ratio: 41%
The buyer must be income-qualified pursuant to Santa Monica Municipal Code Chapter
9.5664 and this Agreement.
The actual price of the affordable unitresidence will be a combination of the bank loan
amount a buyer qualifies for plus the down payment provided by the buyer (consistent
with the total monthly housing costs and the financing terms listed above). The lending
criteria used by the private lender must be reasonable and customary and shall be subject
to review and approval by the City Housing Division prior to completion of the purchase
transaction. Moreover, any purchase price for an affordable unitresidence underwritten
with a back-end ratio of more than 41 percent (the maximum generally required by the
secondary mortgage market) will also require review and reasonable approval by the City
prior to completion of the purchase transaction.
1.
Front End Ratio: ratio of total monthly housing costs (including mortgage principal and interest,
) to total gross household income. Chapter 9.56 of the Municipal Code restricts the front-end ratio to no
more than 38%.
2. Back End Ratio: ratio of total monthly housing costs (including mortgage principal and interest, property
taxes, property insuranc
other monthly payments on long-term household debt to gross household income.
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ATTACHMENT A
B. Re-Sale of an Affordable UnitResidence to a Subsequent Purchaser
1. First Right of Refusal to the City
Throughout the 55-year period of the Agreement Imposing Restrictions on Real
Property, the City shall have the first opportunity to purchase affordable for-sale
unitsresidences created pursuant to the On-Site Affordable UnitResidence Option
or the Off-Site Affordable UnitResidence
wishing to sell their unitsresidences shall notify the City in writing at least 60 days
before the unitresidence is offered for sale to another qualifying party. The seller
shall ensure that the unitresidence is clean, in good repair and is available to be
shown to prospective buyers. Any Option-related time periods in favor of the City
shall be tolled until thes
The City shall have 60 days to notify the seller of its intent to exercise the Option
to Purchase, either by City purchase, by its designee (e.g., a non-profit affordable
housing developer), or by referral of a qualified moderate-income buyer. (See
below for the method for calculating the subsequent purchase price.)
In the event that the City does not exercise the Option to Purchase, or an offer to
purchase by the City or a qualified buyer is not accepted by the seller, the Option
shall terminate and the owner may sell the unitresidence to any income qualifying
buyer at a price consistent with Section 6-B2(B)(2) of these Guidelines. Seller
shall only accept an offer by an income qualified buyer at a price consistent with
Section 6-B2(B)(2) of these Guidelines. Closing costs shall be divided between
seller and buyer as is customary for like real estate transactions in Santa Monica
at the time that escrow is opened.
2. Maximum Subsequent Selling Price
The resale price restriction will provide that the price for resale of the affordable
unitresidence shall be calculated using the same formula and factors set forth in
Section 6A.6(A).
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ATTACHMENT A
3. Continuous Use as a Primary Residence
Each purchaser of an affordable unitresidence shall certify, prior to the close of
escrow, in a form acceptable to the City that the unitresidence is being purchased
purchaser to maintain el
shall be construed as evidence that the unitresidence is not the primary residence
of the purchaser.
C. Subordination
At the request of the qualifying may subordinate the
foregoing income eligibility and resale price restrictions to a first Deed of Trust at the time
of purchase, provided that the Deed of Trust does not exceed the purchase price of the
unitresidence.
D. Default and Foreclosure
A Request for Notice of Default shall be recorded along with the Agreement Imposing
Restrictions on Real Property. The Agreement will provide that any Notice of Default will
s Option to
Purchase. In the event that the City does not exercise its Option and the unitresidence
is foreclosed upon, proceeds of the foreclosure sale shall be used first to satisfy the
he owner would have
received had there been no foreclosure, shall be paid to the owner. The remaining
balance of any surplus shall be paid to the City for deposit into the Citywide Affordable
Housing Trust Fund.
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ATTACHMENT A
E. Distribution of Insurance and Condemnation Proceeds
In the event that the unitresidence is destroyed and insurance proceeds are distributed
to the low-income household owner instead of being used to rebuild, or in the event of
assets of the
association to the members, including the owner, any surplus remaining after payment of
encumbrances shall be distributed as set forth above with respect to default and
foreclosure.
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ATTACHMENT A
Per Chapter 9.5664, multi-family project applicants who have opted to satisfy the
affordable housing obligation through the on-site or off-site option are required to fill
vacant affordable unitsresidences by selecting income-eligible tenants from a City-
developed list of income-qualified households, except if there are no qualified households
on the City-developed list or if the project applicant is developing ownership projects of
4four or more unitsresidences in the City's multi-family residential zones. Under these
exceptions, the project applicant may choose themselves to select income-qualified
households which shall be subject to eligibility certification by the City.
This section establishes priorities for eligibility to occupy On-Site Affordable
UnitsResidences, describes categories of persons ineligible to occupy On-Site Affordable
UnitsResidences, and outlines the procedures whereby the City Housing Division shall
establish, maintain, and update the list of eligible tenants.
A. Priority Households
In establishing the list of households eligible to occupy affordable unitsresidences, the
Housing Division shall adhere to the following priorities:
1) First Priority
Persons who have been permanently displaced or face permanent
displacement from their housing unitsresidences in Santa Monica as a
result of any of the following:
a) Ellis Act, owner-occupancy, or removal permit eviction
b) Earthquake, fire, flood, or other natural disaster
c) Funding reductions in Santa Monica housing voucher assistance
programs
d) Governmental Action, such as Code enforcement
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ATTACHMENT A
e) Closure of a mobile home park
2) Second Priority
Persons who are:
a) Residents of Santa Monica or
ab) Working in Santa Monica at least 36 hours per week
B. Persons Ineligible to Occupy an Affordable UnitResidence
ChapterSection 9.5664 of the Municipal Code (see § 9.5664.110(cB)) specifically
disqualifies the following categories of persons from occupying On-Site Affordable
UnitsResidences:
- All employees and officials of the City or its agencies, authorities, or commis-
sions who have, by virtue of their position, policy-making authority or influence over
the implementation of the Affordable Housing Production Program, as well as the
immediate relatives of employees of such City employees and officials.
- The immediate relatives of the applicant or owner, including a spouse, child,
parent, grandparent, brother, sister, father-in-law, mother-in-law, son-in-law,
daughter-in-law, aunt, uncle, niece, nephew, sister-in-law, and brother-in-law.
Other parties disqualified from occupying affordable residences include:
- Tenants for whom the affordable residence will not be their sole residence.
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ATTACHMENT A
- Employees of the owner or s, including but not limited to
employees of the property management company, except as required by law. An
example of an exception would be a 100 percent affordable building that is required
by law to provide onsite management, and must therefore use an affordable
residence.
- Employees of any corporation or other entities where the owner has more than
a 10 percent equity, participation, revenue, or ownership interest.
- Immediate relatives, including a spouse, child, parent, grandparent, brother,
sister, father-in-law, mother-in-law, son-in-law, daughter-in-law, aunt, uncle, niece,
nephew, sister-in-law, and brother-in-law, of any other individual or entity with a
financial interest in the property.
- Households where all adults are full-time students unless all members of the
household meet all of the following criteria:
- Twenty-four years of age or older,
- Have lived separate from their parents for at least one year,
- Are not claimed as a dependent pursuant to IRS regulations on
any tax return for the most recent tax year, and
- written certification of all financial assistance.
- and at least one member of the household meets one of the following
criteria:
- A veteran or active duty member of the U.S. military,
- Have one or more legal dependents other than a spouse,
- Live with a recognized disability,
- Be a graduate or professional student,
- Be married, or
- Have been an orphan or ward of the court through age 18.
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ATTACHMENT A
C. Establishment, Maintenance, and Update of Income-Qualified Tenants and
Purchasers List
The Santa Monica Housing Division shall be responsible for preparing and
maintaining an Eligibility List for this program and shall follow these Guidelines for
preparing, maintaining, and updating the Eligibility List. Subject to the
requirements below, the establishment, maintenance and update of the Eligibility
List shall be generally modeled after the Housing Authority Administrative Plan
with the Housing Division retaining the authority to adjust these protocols as
appropriate for this local program.
1) Public Noticing Procedures
To create the Eligibility List, the Housing Division shall publish notices in
newspapers circulated widely in Santa Monica, including newspapers that
reach minority communities., at a minimum. At least one notice shall be
published in a Spanish-language newspaper of general circulation. Examples
of appropriate newspapers include the Santa Monica Daily Press, L.A. Times,
La Opinion, and The Sentinel. The notices should briefly explain what
affordable housing is, state the applicable income requirements, indicate how
to apply for the Eligibility List, state when the application period opens and
closes, indicate priorities for eligible occupants, and provide a telephone
number for questions.
Applications may require name, address, telephone number, household size,
income
signature.
2) Creating the Eligibility List
The Housing Division shall create an Eligibility List using the information
provided on the applications received, including name, household size,
income, age, residency, place of employment (if applicable), priority status, and
any other relevant information. Additionally, the Eligibility List will include
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ATTACHMENT A
households on any existing waiting list who indicated their intent to be included
in the Eligibility List after being contacted by the Housing Division. Households
will be drawn from the Eligibility List as affordable unitsresidences become
available or in anticipation of affordable unitsresidences becoming available in
the near future and shall be income qualified for use in referrals for available
affordable units. Additionally, if the number of households on the Eligibility List
decreases to less than 300 households for any income category (i.e., Very Low,
Low or Moderate), the Housing Division will publicly notice the re-opening of
the Eligibility List using the protocols described in Section 7-C(1)
above.residences.
3) Eligibility List and Referral Process
Each time affordable unitsresidences become available for occupancy, the
owner and the Housing Division shall follow these procedures:
a) At least 90 days prior to issuance of a Certificate of Occupancy by the City
for newly developed unitsresidences, or within 5 business days of notice of
tenant vacation in existing developments, owners shall notify the City of the
number and type (low-/mod-incomeaffordability level, number of bedrooms,
ownership or rental) of unitsresidences available.
b) Within 20 business days of notice by the owner, the City shall provide the
owner with a Referral Form, for each household drawn from the Eligibility
List, and provide at least threefive names for each unitresidence available.
Additional names may be provided to the owner upon request, subject to
availability.
c) Owners shall directly contact the persons on the Referral Forms provided
by the City. Owners shall give applicants at least 5 business days to submit
a completed application. Owners who are not able to fill vacant
unitsresidences from the Referral Forms provided may request additional
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ATTACHMENT A
names from the City. Additional names will be provided within 5 business
days, subject to availability.
d) Owners shall conduct all further screening and selection of applicants. All
applicable State Fair Housing laws must be observed.
e) Eligibility List may be referred up to a maximum of
five times., except in cases involving a reasonable accommodation. After
the fifth referral, candidate names will be removed from the Eligibility List.
4) Updating the Eligibility List
a) Periodic Update: The Eligibility List shall be periodically updated at least
every two years. Letters shall be sent to all households on the Eligibility List
requesting verification of all information, including name, address, place of
residency, place of employment (if applicable), and continued interest in
staying on the list. Eligibility List households shall be given two weeks to
respond. At the end of the two week period, the names of households who
have failed to respond shall be taken off the Eligibility List. The Eligibility
List shall also be updated to incorporate any changes in status (place of
residency, eligibility for priority status, etc.) for each applicant.
b) Emergency Additions to Eligibility List: At any time, even if the Eligibility List
is closed, persons displaced from Santa Monica housing as set forth in
Section 7-(A()(1) of these Guidelines (i.e.- will
result in the automatic addition of that household to the Eligibility List with
the applicable priority.
c) The City will provide a Referral Form to the owner for each household
selected from the Eligibility List. The owner shall complete the Referral
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ATTACHMENT A
Form indicating whether a unitresidence was offered to the household and
whether the unitresidence was accepted or refused. A sample Referral
Form is provided in Attachment 4-B. If a unitresidence was not offered
because of a poor credit history or for any other reason, the owner will note
this as well. The City will incorporate this information into the Eligibility List,
but not disclose such information to other owners.
d) Households will be referred only for those
unitsresidences for which they qualify. For example, moderate income
households will only be referred for vacancies in moderate income
unitsresidences. Households must report any
changes to address, household size, Santa Monica residency, employment
in Santa Monica, and/or, income to the Housing Division within 10 days. of
the change.
5) Persons Dependent Upon Income from Other Sources
Households must report income from all sources.
Any households receiving support, including tuition
payments, rent payments, and/or, substantialregular gifts, and/or any
household who appears as a dependent upon the tax return of another
individual must so disclose. In these cases, the income of the other party will
be considered along with the income of the applicant/tenant householdin
determining eligibility.
6) Automatic Removal from Eligibility List
Applicant names will be removed immediately from the Eligibility List for:
a) Failure to appear for a scheduled qualification interview or prior to the
interview time contact the Housing Division to arrange an alternate time or
date, or;
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ATTACHMENT A
b) More than two refusals of offered unitsresidences, or;
c) FraudulentMisrepresentative statements on eligibility documentation, in
qualification interview(s), or Informal Review, or;
d) Failure to disclose dependent status or receipt of substantial support, or;
e) Acceptance of an affordable unitresidence stemming from a Referral.
Households whose names are removed from the Eligibility List will also have
their names removed from the Referral Form upon which their names appear.
Households whose names are removed from the Eligibility List shall be notified
by mail at the address which they have supplied to the City. The reason for
removal will be specified as part of the notification.
7) Appeal Process
a) Right to Appeal
The decision by the City to remove a name from the Eligibility List or from a
Referral Form may be appealed. All appeals must be in writing and
delivered to the Housing Division in person or by first class mail , by the
close of the business day, no later than 10 business days from the date of
the Housing Divisionnotification of removal from the Eligibility List.
b) Scheduling an Informal Review
Upon receipt of an appeal in writing, the Housing Division shall conduct an
Informal Review. The Housing Division will schedule an Informal Review to
take place within 10 days of receipt of the appeal. Once the Informal Review
date is set, the appellant may reschedule only upon showing "good cause,"
which is defined as an unavoidable conflict seriously affecting the health,
safety or welfare of the Appellant or his/her family.
c) Failure of Appellant to Appear for Informal Review
If the appellant does not appear at a scheduled Informal Review and has
not rescheduled the Informal Review in advance, the appellant must contact
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ATTACHMENT A
the Housing Division within two working days. The Housing Division shall
reschedule the Informal Review only if the appellant's absence was caused
by medical emergency or incarceration. In this event, the Informal Review
may be rescheduled only once.
d) Conduct of the Informal Review
The informal review must be conducted by a person other than the one who
made or approved the decision under review, or a subordinate of this
person. The Appellant must be provided an opportunity to present written
or oral objections to the decision to remove them from the Eligibility List and
both the Appellant and the Housing Division have a right to present any
information pertinent to the issue of the Informal Review.
e) Notification of the Informal Review Decision
The Housing Division must notify the Appellant within 14 days of the
decision regarding the Informal Review, including an explanation of the
decision and the associated findings. This decision shall be final and not
subject to further administrative review.
Tenant Income Increases, Initial Ineligibility and Advance Notice to City
D.
This subsection of the Guidelines provides protocols for changes in tenant income
during occupancy;, property owner and tenant responsibilities when tenant was
not income eligible at the time of initial occupancy; , and, advance notice to the
City regarding rent increases.
1) Tenant Income Increases
The published Maximum Allowable Income applies to the household from the day
the tenant moves in through the first year of occupancy or the first annual
recertification, whichever comes first. If after moving intothe first year of
occupancy in an affordable apartment, or during the first annual
recertification, the household income eventually exceeds the is found to exceed
Administrative Guidelines
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ATTACHMENT A
the maximum allowable income limit for the unitapartment, the tenant(s) may
remain in the unitapartment as long as his/herthe household income does not
exceed 140% percent of the income limit for the unitresidence.
% percent of the income limit for the
unitapartment, the following shall apply, depending upon the income mix of the
development:
a)
For Developments that are All Low-Income
140% of the income limit for the low income unit but remains within the
Program limit for a moderate-income unit, the tenant may remain in the unit
and his/her name shall be moved automatically to the top of the Waiting List
for the next available moderate-income unit of the same size or larger in the
a moderate income unit, the tenant may remain in the low income until the
next moderate income affordable unit of an appropriate size becomes
available. Once the tenant is offered tenancy in a moderate-income unit, if
the tenant does not accept the offer, then the tenant must move out of the
low income unit with 90 days of the offer of the moderate-income unit.
moderate income unit at any time during his/her tenancy in the low-income
b)
For Mixed Income Developments
income limits of other units in the development, the tenant may remain in
the original unit as long as a) the income limit for the original unit is re-
designated for an appropriate higher income category applicable to another
unit in the development, and b) the next vacant higher income unit in the
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ATTACHMENT A
development is re-designated for the same lower income category
applicable to the original unit.
for all affordable units in the mixed income development and also exceeds
the program limits for a moderate income affordable unit, the tenant shall
e the unit.
c)
For Mixed Income Projects Including Market Rate Units:
income exceeds the program limits for the original unit by 140%, and if there
are no units designated for a higher income category within the
development which may be substituted for the original unit, the tenant may
rate. However, the next vacant market rate unit in the development must
be re-designated for the same income limit formerly applicable to the
original unit.
d)
Tenants Residing in Moderate Income Units: If the income of a tenant
residing in a moderate-income unit exceeds the income limit for the unit, the
tenant may remain in the unit as long as his/her income does not exceed
exceeds 140% of the moderate income limit, the tenant shall be given one
a) If there is a vacant affordable apartment in the same building for which the
household qualifies, the household will be offered that apartment, providing
the move does not violate any other provisions of the law, including
minimum occupancy requirements. If the relevant Agreement Imposing
Restrictions on Real Property allows it, the property owner may also switch
the affordability levels of the two apartments to prevent the household from
having to move their belongings. The rent will then be adjusted to reflect
the higher level of affordability.
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ATTACHMENT A
If the household refuses to move to the higher affordability level apartment
for which they qualify, or refuses to pay the higher rent, they will be provided
with a one-year notice to vacate the apartment.
If, before the term of the notice has passed, the tenant recertifies the
household income and they again qualify for the apartment, the one year
notice to vacate will be rescinded.
b) If the previous section does not apply, and there is a vacant market-rate
apartment of equal accommodations in the same building, the owner may
designate the market-rate apartment as the affordable apartment. The rent
in the formerly affordable apartment may then be raised to the market-rate
for the apartment. However, this option cannot be chosen if the relevant
enumerates which apartments in the building are designated as the
affordable apartments.
c) If neither of the two previous sections apply, the household will be provided
with a one-year notice to vacate the apartment.
i) If, before the term of the notice has passed, a market-rate apartment
becomes vacant in the same building, the tenant under notice to
move will have first right of refusal to lease the market-rate
apartment.
ii) If, before the term of the notice has passed, the tenant recertifies the
household income and they again qualify for the apartment, the one-
year notice to vacate will be rescinded.
2) Initial Tenant Ineligibility
If during compliance monitoring by the City, or the property owner, it is determined
that ed the income limit for the unitresidence at the time
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ATTACHMENT A
the tenant initially moved into the unitresidence, the tenant shall be given a 90-day
notice to vacate the unitresidence. Notwithstanding the above, if the tenant would
qualify for an affordable unitapartment targeted to a higher affordability level and
such a unitvacant residence is available within the subject property, then the tenant
may be allowed to move to that unitvacant residence, subject to Section 7-(D.)(3)
below.
3) Property Owner to Pay for Relocation
When it is determined that a
affordable unitresidence at initial occupancy, then it shall be the
responsibility to pay the costs directly associated with relocating the tenant to
another residence within Santa Monica or adjacent area, unless the tenant
provided fraudulentmisrepresented pertinent information to obtain the
unitresidence. Such costs would include packing/unpacking, moving/movers and
utility connection fees, but would not include the differential in rent between the
affordable (AHPP) residence and new residence.
4) Notice to City of Rent Increases
A property owner must provide a 30-day advanceadvanced written notice to the
City before issuing a rent increase notice to a tenant. The information
provideprovided in the notice to the City shall include the
unitresidence identification, tenant name, affordability level of the unitresidence
(i.e., extremely low-, very low,-, low- or moderate-income) current rent, amenities
included in rent (e.g., parking, water, trash), proposed rent, and proposed rent start
date. The City will have 30-days upon which to review the proposed rent increase
and notify the property owner of any objections before the property owner may
issue a rent increase notice to a tenant. In the absence of any other, more
stringent, rent increase limitations on the property, the rent of an affordable
apartment shall not be increased by more than five percent in any twelve month
period, up to the published maximum allowable rent.
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ATTACHMENT A
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ATTACHMENT A
The AHPP authorizes a project applicant to request an adjustment or waiver of the AHPP
based on a showing that applying the requirements of this Chapter would effectuate an
unconstitutional taking of property or otherwise have an unconstitutional application to the
property.
To receive an adjustment or waiver, the applicant must submit an application to the
Director of Housing and Economic Development, or his/her designee, at the time the
applicant files a multi-family project application. The applicant bears the burden of
presenting substantial evidence to support the request and set forth in detail the factual
and legal basis for the claim, including all supporting technical documentation.
In making a determination on an application to adjust or waive the requirements of this
Chapter, the Director of Housing and Economic Development, or City Council on appeal,
may assume each of the following when applicable:
(1) The applicant is subject to the affordable housing requirement of this Chapter;
(2) The applicant will benefit from the inclusionary incentives set forth in this Chapter
(3) The applicant will be obligated to provide the most economical affordable
housing
unitsresidences feasible in terms of construction, design, location and tenure.
The Director of Housing and Economic Development must make a written decision within
ninety days after a complete application is filed.
to the City Council if such appeal is filed within fourteen consecutive calendar days from
the date thatof the decision.
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ATTACHMENT A
If the Director of Housing and Economic Development, or City Council onresponding to
an appeal, upon legal advice provided by or at the behest of the City Attorney
decision, determines that applying the requirements of this Chapter would effectuate an
unconstitutional taking of property or otherwise have an unconstitutional application to the
property, the affordable housing requirements shall be adjusted or waived to reduce the
obligations under this Chapter to the extent necessary to avoid an unconstitutional result.
If an adjustment or waiver is granted, any change in the use within the project shall
invalidate the adjustment or waiver. If the Director, or City Council on appeal, determines
that no violation of the United States or California Constitutions would occur through the
application of this Chapter, the requirements of this Chapter shall remain fully applicable.
Administrative Guidelines
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35
ATTACHMENT A
ATTACHMENTS
(All Attachments have been updated for the 2016 version of the AHPP Guidelines)
1-A Municipal Code Chapter 9.5664 (Subject to Amendments)
1-B AHPP Options Comparison Table
2-A Fee Adjustment Methodology
2-B Current Base Fees for Apartment and Condominium Projects (Adjusted Annually)
3-A Affordable UnitsResidences Table - Condominium Projects w/4+
UnitsResidences in Multifamily Zones
3-B Development Incentives Table
3-C Very Low, Low and Moderate Income Levels (Adjusted Annually)
3-D Maximum Rents (Adjusted Annually)
3-E Sample of Deed Restrictions
4-A Sample Application for Affordable Housing Waiting List
4-B Referral Status Form
Administrative Guidelines
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36
ATTACHMENT 1-A
(Updated for 2016 AHPP Guidelines Update)
Municipal Code Chapter 9.64
Chapter 9.64 AFFORDABLE HOUSING PRODUCTION PROGRAM
9.64.010 Findings and Purpose
-
family developments to contribute to affordable housing production and thereby help the City
meet its affordable housing need. As detailed in the findings supporting the ordinance codified in
this Chapter, the requirements of this Chapter are based on a number of factors including, but
-standing commitment to economic diversity; the serious need for
affordable housing as reflected in local, state, and federal housing regulations and policies; the
demand for affordable housing created by market rate development; the depletion of potential
affordable housing sites by market-rate development; and the impact that the lack of affordable
housing
impacts on traffic, transit and related air quality impacts, and the demands placed on the
regional transportation infrastructure. (Added by Ord. No. 2486CCS §§ 1, 2, adopted June 23,
2015)
9.64.020 Definitions
The following words or phrases as used in this Chapter shall have the following meanings:
30% Income Household
A. means a household whose gross income does not exceed the
30% income limits applicable to the Los Angeles-Long Beach Primary Metropolitan
Statistical Area, adjusted for household size, as published and periodically updated by
HUD.
50% Income Household
B. means a household whose gross income does not exceed
50% of the area median income, adjusted for household size, as published and periodically
updated by HUD. 50% income households include 30% income households.
80% Income Household
C. means a household whose gross income does not exceed
80% of the area median income, adjusted for household size, as published and periodically
updated by HUD. 80% income households include 50% income households.
Adjusted for Household Size
D. means 70% adjustment for a household of one person,
80% adjustment for a household of two persons, 90% adjustment for a household of three
persons, 100% adjustment for a household of four persons, 108% adjustment for a
household of five persons, 116% adjustment for a household of six persons, 124%
adjustment for a household of seven persons, 132% adjustment for a household size of
eight persons. For households of more than eight persons, adjustments shall be made in
accordance with applicable HUD regulations.
Adjusted for Household Size Appropriate for the Unit
E. means for a household of one
person in the case of a studio unit, two persons in the case of a one-bedroom unit, three
Administrative Guidelines
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Attachment 1-A: Page 1
persons in the case of a two-bedroom unit, four persons in the case of a three-bedroom
unit, and five persons in the case of a four-bedroom unit.
Affordable Housing Fee
F. means a fee paid to the City by a multi-family project applicant
pursuant to Section 9.64.070 of this Chapter to assist the City in the production of housing
affordable to 30% income households, 50% income households, 80% income households,
and moderate-income households.
Affordable Housing Unit
G. means a housing unit developed by a multi-family project
applicant pursuant to Section 9.64.050 or 9.64.060 of this Chapter which will be affordable
to 30% income households, 50% income households, 80% income households, or
moderate-income households.
Affordable Housing Unit Development Cost
H. means the
a unit of housing affordable to 30% income households, 50% income households, 80%
income households or moderate income households.
Affordable Ownership Housing Cost
I. . Affordable ownership housing cost means: For
moderate income households whose gross incomes exceed the maximum income limits for
80% income households, affordable housing cost shall not be less than 28 percent of the
gross income of the household, nor exceed the product of 35 percent times 110 percent of
the area median income adjusted for household size appropriate for the unit.
Affordable Rent
J. . Affordable rent means:
1. For 30% income households, the product of 30 percent times 30 percent of the
area median income adjusted for household size appropriate for the unit.
2. For 50% income households, the product of 30 percent times 50 percent of the
area median income adjusted for household size appropriate for the unit.
3. For 80% income households whose gross incomes exceed the maximum
incomes for 50% income households, the product of 30 percent times 60 percent of
the area median income adjusted for household size appropriate for the unit.
4. For moderate income households, the product of 30 percent times 110 percent of
the area median income adjusted for household size appropriate for the unit.
For purposes herein, affordable rent shall be adjusted as necessary to be consistent with
pertinent Federal or State statutes and regulations governing Federal or State assisted
housing.
Area Median Income or AMI
K. . Area median income or AMI means the median family
income published from time to time by HUD for the Los Angeles-Long Beach Metropolitan
Statistical Area.
Dwelling Unit
L. . One or more rooms, designed, occupied or intended for occupancy as
separate living quarters, with full cooking, sleeping and bathroom facilities for the exclusive
use of a single household. Dwelling unit shall also include single-room occupancy units as
defined in Santa Monica Municipal Code Section 9.52.020 or any successor thereto.
Floor Area
M. . Floor area as defined in Santa Monica Municipal Code Section 9.52.020or
any successor thereto.
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Gross Income
N. . Gross income has the same meaning as provided in Title 25, Section
6914 of the California Code of Regulations, as amended from time to time, in accordance
with law.
HCD
O. . The California Department of Housing and Community Development or its
successor.
Housing Cost
P. . Housing cost has the same meaning as provided in Title 25, Section
6920 of the California Code of Regulations, as amended from time to time in accordance
with law.
HUD
Q. . The United States Department of Housing and Urban Development or its
successor.
Income Eligibility
R. . Income eligibility is based upon the gross income of the household,
including the income of all wage earners, elderly or disabled family members, and all other
sources of household income.
Market Rate Unit
S. . A dwelling unit as to which the rental rate or sales price is not
restricted by this Chapter.
Moderate Income Household
T. means a household whose gross income exceeds the
maximum income for an 80% income household and whose gross income does not exceed
the lesser of: (i) 120% of the area median income, adjusted for household size, as
published and periodically updated by HCD or (ii) twice the income limit for 50% income
households, adjusted for household size, as published and periodically updated by HUD.
Multi-family Project
U. . A multi-family residential development, including but not limited to
apartments, condominiums, townhouses or the multi-family residential component of a
mixed use project, for which City permits and approvals are sought.
Multi-family Project Applicant
V. . Any person, firm, partnership, association, joint
venture, corporation, or any entity or combination of entities which seeks City development
permits or approvals to develop a multi-family project.
Multi-family Residential District
W. . Any district designated in the Santa Monica Zoning
Ordinance as a multi-family residential district.
Parcel
X. . Parcel as defined in Santa Monica Municipal Code Section 9.52.020 or any
successor thereto.
Rent
Y. . Rent has the same meaning as provided in Title 25, Section 6918 of the California
Code of Regulations, as amended from time to time in accordance with law.
Vacant Parcel
Z. . A parcel in a multi-family residential district that has no residential
structure located on it as of August 20, 1998 or which had a residential structure located on
it on that date which was subsequently demolished pursuant to a demolition order of the
City. No demolition of structures shall be permitted except in accordance with Santa
Monica Municipal Code Chapter 9.25 et seq. or any successor thereto. (Added by Ord. No.
2486CCS §§ 1, 2, adopted June 23, 2015)
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9.64.030 Applicability of Chapter
A. The obligations established by this Chapter shall apply to each multi-family project
involving the construction of two or more multi-family units, which project has not received
its ministerial or discretionary planning approvals including, without limitation: variances,
conditional use permits, administrative approvals, development review permits, and
development agreement ordinances which have not yet become effective (collectively,
. No building permit shall be issued for any multi-
family project unless such construction has been approved in accordance with the
standards and procedures provided for by this Chapter. Notwithstanding the above, a multi-
family rental housing project that will be developed by a nonprofit housing provider
receiving financial assistance through one of the housing trust fund programs shall
not be subject to the requirements of this Chapter so long as the project is an affordable
housing project meeting the requirements of Santa Monica Municipal Code Section
9.52.020 affordability obligations will be secured
by a regulatory agreement, memorandum of agreement, or recorded covenant with the City
for a minimum period of fifty-five years.
B. Multi-family projects which have received Approvals prior to the effective date of this
ordinance shall be subject to the provisions of Santa Monica Municipal Code Section
9.64.010 et seq., as they existed on the date of their approvals, except that pricing
requirements for affordable housing units shall be published by the City on an annual basis
instead of adoption by resolution of the City Council.
C. A designated landmark building or contributing structure to an adopted Historic District
that is retained and preserved on-site as part of a multi-family project shall not be
considered or included in assessing any of the requirements under this Chapter. (Added by
Ord. No. 2486CCS §§ 1, 2, adopted June 23, 2015)
9.64.040 Affordable Housing Obligation
A. Except as provided in Section 9.23.030(A), all multi-family project applicants shall
comply with the requirements of this Chapter in the following manner:
1. Multi-family project applicants for multi-family ownership projects of four or more
units in multi-family residential districts shall choose one of the two following options:
a. Providing affordable housing units on-site in accordance with Section
9.64.050;
b. Providing affordable housing units off-site in accordance with Section
9.64.060.
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2. In addition to the options established in subsections (1)(a) and (b), all other multi-
family project applicants may also choose one of the following options:
a. Paying an affordable housing fee in accordance with Section 9.64.070;
b. Acquiring land for affordable housing in accordance with Section
9.64.080.
B. A multi-family project application will not be determined complete until the applicant has
submitted a written proposal which demonstrates the manner in which the requirements of
this Chapter will be met. (Added by Ord. No. 2486CCS §§ 1, 2, adopted June 23, 2015)
9.64.050 On-Site Option
The following requirements must be met to satisfy the on-site provisions of this Chapter:
A. For ownership projects of at least four units but not more than fifteen units in multi-family
residential districts, the multi-family project applicant agrees to construct at least: (1) twenty
percent of the total units as ownership units for moderate-income households, or as an
alternative; (2) twenty percent of the total units as rental units for 80% income households
if these rental units are provided by the applicant in accordance with Civil Code Sections
1954.52(b) and 1954.53(a)(2); (3) ten percent of the total units as rental units for 50%
income households if these rental units are provided by the applicant in accordance with
Civil Code Sections 1954.52(b) and 1954.53(a)(2); or (4) five percent of the total units as
rental units for 30% income households if these rental units are provided by the applicant in
accordance with Civil Code Sections 1954.52(b) and 1954.53(a)(2).
B. For ownership projects of sixteen units or more in multi-family residential districts, the
multi-family project applicant agrees to construct at least: (1) twenty-five percent of the total
units as ownership units for moderate-income households, or as an alternative; (2) twenty-
five percent of the total units as rental units for 80% income households if these rental units
are provided by the applicant in accordance with Civil Code Sections 1954.52(b) and
1954.53(a)(2); fifteen percent of the total units as rental units for 50% income households if
these rental units are provided by the applicant in accordance with Civil Code Sections
1954.52(b) and 1954.53(a)(2); or (4) ten percent of the total units as rental units for 30%
income households if these rental units are provided by the applicant in accordance with
Civil Code Sections 1954.52(b) and 1954.53(a)(2).
C. For all other multi-family applicants, the multi-family project applicant agrees to construct
at least:
1. Five percent of the total units of the project for 30% income households;
2. Ten percent of the total units of the project for 50% income households;
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Attachment 1-A: Page 5
3. Twenty percent of the total units of the project for 80% income households; or
4. One hundred percent of the total units of a project for moderate income
households.
D. Except as provided in Section 9.23.030(A), any fractional affordable housing unit that
results from the formulas of this Section that is 0.75 or more shall be treated as a whole
affordable housing unit (i.e., any resulting fraction shall be rounded up to the next larger
integer) and that unit shall also be built pursuant to the provisions of this Section. Any
fractional affordable housing unit that is less than 0.75 can be satisfied by the payment of
an affordable housing fee for that fractional unit only pursuant to Section 9.64.070(A)(4) or
by constructing all the mandatory on-site affordable units with three or more bedrooms.
The City shall make available a list of income levels for 30% income households, 50%
income households, 80% income households, and moderate income households, adjusted
for household size, the corresponding maximum affordable rents adjusted by household
size appropriate for the unit, and the minimum number of units required for 30% income
households, 50% income households, or 80% income households required for typical sizes
of multi-family projects, which list shall be updated periodically.
E. The multi-family project applicant may reduce either the size or interior amenities of the
affordable housing units as long as there are not significant identifiable differences
between affordable housing units and market rate units visible from the exterior of the
dwelling units; provided, that all dwelling units conform to the requirements of the
applicable Building and Housing Codes. However, except as provided in Section
9.23.030(A), each affordable housing unit provided shall have at least two bedrooms
unless:
1. The proposed project comprises at least ninety-five percent one bedroom units,
bedroom;
2. The proposed project comprises at least ninety-five percent zero bedroom units,
bedroom units;
3. The proposed project comprises zero and one bedroom units, excluding the
ase the affordable housing units must be at least one
bedroom units; or
4. The multi-family project applicant has elected not to pay the affordable housing
fee pursuant to Section 9.64.070(A)(4), in which case the affordable housing units
must be at least three bedroom units. The design of the affordable housing units shall
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Attachment 1-A: Page 6
be reasonably consistent with the market rate units in the project. An affordable
housing unit shall have a minimum total floor area, depending upon the number of
bedrooms provided, no less than the following:
Affordable housing units in multi-family projects of one hundred units or more must be
evenly disbursed throughout the multi-family project to prevent undue concentrations
of affordable housing units.
F. All affordable housing units in a multi-family project or a phase of a multi-family project
shall be constructed concurrently with the construction of market rate units in the multi-
family project or phase of that project.
G. On-site affordable housing units must be rental units in rental projects. In ownership
projects, these affordable housing units may be either rental units or ownership units.
H. Each multi-family project applicant, or his or her successor, shall submit an annual report
to the City identifying which units are affordable units, the monthly rent (or total housing
cost if an ownership unit), vacancy information for each affordable unit for the prior year,
verification of income of the household occupying each affordable unit throughout the prior
year, and such other information as may be required by City staff.
I. A multi-family project applicant in a residential district who meets the requirements of
this Section shall be entitled to the density bonuses and incentives provided by Section
9.22.020 or any successor thereto and Section 9.22.030 or any successor thereto and the
waiver/modification of development standards provided by Section 9.22.040 or any
successor thereto. A multi-family project applicant in a commercial or industrial district shall
be entitled to the development bonuses and incentives provided in the Land Use and
Circulation Element and implementing ordinances.
J. All residential developments providing affordable housing on-site pursuant to the
provisions of this Section shall receive priority building department plan check processing
by which housing developments shall have plan check review in advance of other pending
developments to the extent authorized by law.
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K. The City Council may by resolution establish compliance monitoring fees which reflect
the reasonable regulatory cost to the City of ensuring compliance with this Section when
affordable housing units are being initially rented or sold, when the required annual reports
are submitted to the City, and when the units are being re-sold or re-leased. (Added by
Ord. No. 2486CCS §§ 1, 2, adopted June 23, 2015)
9.64.060 Off-Site Option
The following requirements must be met to satisfy the off-site option of this Chapter:
A. The multi-family project applicant for ownership projects of four or more units in multi-
family residential districts shall agree to construct twenty-five percent more affordable
housing units than number of affordable housing units required by Section 9.64.050(A) and
(B).
B. For all other multi-family project applicants, the applicant shall agree to construct the
same number of affordable housing units as specified in Section 9.64.050(C).
C. The multi-family project applicant shall identify an alternate site suitable for residential
housing which the project applicant either owns or has site control over (e.g., purchase
agreement, option to purchase, lease) subject to City review to ensure that the proposed
D. The off-site units shall be located within a one-quarter mile radius of the market rate
units.
E. The off-site units shall satisfy the requirements of subsections (D) through (J) of Section
9.64.050.
F. The off-site units shall not count towards the satisfaction of any affordable housing
obligation that development of the alternative site with market rate units would otherwise be
subject to pursuant to this Chapter.
G. Exceptions to the location of the off-site units specified in this Section may be granted by
the Planning Commission on a case-by-case basis upon a showing by the multi-family
project applicant, based upon substantial evidence, that the location of off-site units in a
location different from that specified in this Section better accomplishes the goals of this
Chapter, including maximizing affordable housing production and dispersing affordable
housing throughout the City.
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H. The City Council may by resolution establish compliance monitoring fees which reflect
the reasonable regulatory cost to the City of ensuring compliance with this Section when
affordable housing units are initially being rented or sold, when the required annual reports
are submitted to the City, and when the units are being re-sold or re-leased. (Added by
Ord. No. 2486CCS §§ 1, 2, adopted June 23, 2015)
9.64.070 Affordable Housing Fee
A multi-family project applicant eligible to meet the affordable housing obligations established by
this Chapter by paying an affordable housing fee shall pay the fee in accordance with the
following requirements:
A. An affordable housing fee may be paid in accordance with the following formulas:
1. Affordable housing unit base fee x floor area of multi-family project;
2. Multi-family projects with fractional affordable housing units of less than 0.75
based on the formula established in Section 9.64.050:
() x (fractional percentage)
B. For purposes of this Section, the affordable housing unit base fee shall be established
by resolution of the City Council. Commencing on July 1, 2006 and on July 1st of each
fiscal year thereafter, the affordable housing unit base fee shall be adjusted based on
changes in construction costs and land costs. The amount of the affordable housing fee
that the multi-family project applicant must pay shall be based on the affordable housing
unit base fee resolution in effect at the time that the affordable housing fee is paid to the
City.
C. fordable housing unit development cost shall
be established by resolution of the City Council. Commencing on July 1, 2007 and on July
be adjusted based on changes in construction costs and land costs. The affordable
housing fee that the multi-family project applicant must pay shall be based on the
affordable housing unit development cost resolution in effect at the time of payment to the
City.
D. The amount of the affordable housing unit base fee may vary by product type (apartment
or condominium) and shall reflect, among other factors, the relationship between new
market rate multi-family development and the need for affordable housing.
E. The affordable housing fee shall be paid in full to the City prior to the City granting any
approval for the occupancy of the project, but no earlier than the time of building permit
issuance.
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F. The City shall deposit any payment made pursuant to this Section in a reserve account
separate from the General Fund to be used only for development of affordable housing,
administrative costs related to the production of this housing, and monitoring and
evaluation of this affordable housing production program. Any monies collected and
interest accrued pursuant to this Chapter shall be committed within five years after the
payment of such fees or the approval of the multi-family project, whichever occurs later.
Funds that have not been appropriated within this five-year period shall be refunded on a
pro rata share to those multi-family project applicants who have paid fees during the
period. Expenditures and commitments of funds shall be reported to the City Council
annually as part of the City budget process.
G. An affordable housing fee payment pursuant to this Section shall not be considered
provision of affordable housing units for purposes of determining whether the multi-family
project qualifies for a density bonus pursuant to Government Code Section 65915. (Added
by Ord. No. 2486CCS §§ 1, 2, adopted June 23, 2015)
9.64.080 Land Acquisition
A. A multi-family project applicant may meet the affordable housing obligations established
by this Chapter by making an irrevocable offer:
1. Dedicating land to the City or a non-profit housing provider;
2. Selling of land to the City or a non-profit housing provider at below market value;
or
3. Optioning of land on behalf of the City or a non-profit housing provider.
Each of these options must be for a value at least equivalent to the affordable housing
obligation otherwise required pursuant to this Section.
B. The multi-family project applicant must identify the land at the time that the development
application is filed with the City. Any land offered pursuant to this Section must be located
within one-quarter mile radius of the market rate units unless the multi-family project
applicant demonstrates that locating the land outside of this radius better accomplishes the
goals of this Chapter, including maximizing affordable housing production and dispersing
affordable housing throughout the City. The City may approve, conditionally approve or
reject such offers subject to administrative guidelines to be prepared by the City Manager
or designee. If the City rejects such offer, the multi-family project applicant shall be
required to meet the affordable housing obligation by other means set forth in this Chapter.
(Added by Ord. No. 2486CCS §§ 1, 2, adopted June 23, 2015)
Administrative Guidelines
Affordable Housing Production Program
Attachment 1-A: Page 10
9.64.090 Fee Waivers
The Condominium and Cooperative Tax described in Section 6.76.010 of the Santa Monica
Municipal Code or any successor thereto and the Park and Recreation Facilities Tax
established in Chapter 6.80 of Article 6 of the Santa Monica Municipal Code or any successor
thereto, the Transportation Impact Fee required by Chapter 9.66, or any successor thereto, the
Open Space Fee required by Chapter 9.67, or any successor thereto, and the Childcare
Linkage Fee required by Chapter 9.65, or any successor thereto, shall be waived for required
affordable housing units and for 30%, 50%, 80% and moderate-income dwelling units
developed by the City or its designee using affordable housing fee. However, any multi-family
project applicant who elects to pay an affordable housing fee shall not be eligible for any fee
waiver under this Section. (Added by Ord. No. 2486CCS §§ 1, 2, adopted June 23, 2015)
9.64.100 Pricing Requirements for Affordable Housing Units
The City shall publish, on an annual basis, the 30%, 50%, 80%, and moderate income
household levels, and affordable rents for affordable housing units, adjusted for household size
appropriate for the unit. (Added by Ord. No. 2486CCS §§ 1, 2, adopted June 23, 2015)
9.64.110 Eligibility Requirements
A. Only 30%, 50%, 80% and moderate-income households shall be eligible to occupy or
own and occupy affordable housing units. The City shall develop a list of income-qualified
households. Multi-family project applicants shall be required to select households from the
City-developed list of income-qualified households, except applicants of ownership projects
of four or more units in the multi-family residential zones may themselves select
income-qualified households which shall be subject to eligibility certification by the City.
B. The following individuals, by virtue of their position or relationship, are ineligible to
occupy an affordable housing unit:
1. All employees and officials of the City of Santa Monica or its agencies,
authorities, or commissions who have, by the authority of their position, policy-making
authority or influence over the implementation of this Chapter and the immediate
relatives and employees of such City employees and officials;
2. The immediate relatives of the applicant or owner, including spouse, children,
parents, grandparents, brother, sister, father-in-law, mother-in-law, son-in-law,
daughter-in-law, aunt, uncle, niece, nephew, sister-in-law, and brother-in-law. (Added
by Ord. No. 2486CCS §§ 1, 2, adopted June 23, 2015)
9.64.120 Relation to Units Required by Rent Control Board
30%, 50%, 80% and moderate-income dwelling units developed as part of a market rate
project, pursuant to replacement requirements of the Santa Monica Rent Control Board,
Administrative Guidelines
Affordable Housing Production Program
Attachment 1-A: Page 11
shall count towards the satisfaction of this Chapter if they otherwise meet applicable
requirements for this Chapter including, but not limited to, the income eligibility
requirements, deed restriction requirements, and pricing requirements. New
inclusionary units required by the Rent Control Board which meet the standards of this
Chapter shall count towards the satisfaction of this Chapter. (Added by Ord. No.
2486CCS §§ 1, 2, adopted June 23, 2015)
9.64.130 Deed Restrictions
Prior to issuance of a building permit for a project meeting the requirements of this Chapter by
providing affordable units on-site or off-site, the multi-family project applicant shall submit deed
restrictions or other legal instruments setting forth the obligation of the applicant under this
Chapter for City review and approval. Such restrictions shall be effective for at least fifty-five
years. In addition to the administrative guidelines specifically required by other provisions of this
Chapter, the City Manager or designee shall be the designated authority to enter into recorded
agreements with multi-family project applicants. (Added by Ord. No. 2486CCS §§ 1, 2, adopted
June 23, 2015)
9.64.140 Enforcement
No building permit or occupancy permit shall be issued, nor any development approval granted,
for a project which is not exempt and does not meet the requirement of this Chapter. All
affordable housing units shall be rented or owned in accordance with this Chapter. (Added by
Ord. No. 2486CCS §§ 1, 2, adopted June 23, 2015)
9.64.150 Annual Report
The City Manager or designee, shall submit a report to the City Council on an annual basis
which shall contain information concerning the implementation of this Chapter. This report shall
also detail the projects that have received planning approval during the previous year and the
manner in which the provisions of this Chapter were satisfied. This report shall further assess
whether the provisions of Proposition R have been met and whether changes to this Chapter or
its implementation procedures are warranted. In the event the provisions of Proposition R have
not been met, the City Council shall take such action as is necessary to ensure that the
provisions will be met in the future. This action may include, but not be limited to, amending the
provisions of this Chapter or its implementation. (Added by Ord. No. 2486CCS §§ 1, 2, adopted
June 23, 2015)
9.64.160 Principles and Guidelines
The City Manager or designee, shall develop guidelines to implement this chapter, which
guidelines shall be subject to approval of the City Council. The guidelines shall include, but not
be limited to, the methodology for the establishment and periodic adjustment of the base fee
and the affordable housing unit development cost; for-sale affordable unit requirements, tenant
and purchaser eligibility procedures; and additional requirements for exercise of the off-site
option and land acquisition option. (Added by Ord. No. 2486CCS §§ 1, 2, adopted June 23,
2015)
Administrative Guidelines
Affordable Housing Production Program
Attachment 1-A: Page 12
9.64.170 Adjustments or Waivers
A. A multi-family project applicant may request that the requirements of this Chapter be
adjusted or waived based on a showing that applying the requirements of this Chapter
would effectuate an unconstitutional taking of property or otherwise have an
unconstitutional application to the property.
B. To receive an adjustment or waiver, the applicant must submit an application to the City
Manager or designee, at the time the applicant files a multi-family project application. The
applicant shall bear the burden of presenting substantial evidence to support the request
and set forth in detail the factual and legal basis for the claim, including all supporting
technical documentation.
C. In making a determination on an application to adjust or waive the requirements of this
Chapter, the City Manager or designee, or City Council on appeal, may assume each of
the following when applicable:
1. The applicant is subject to the affordable housing requirement of this Chapter;
2. The applicant will benefit from the inclusionary incentives set forth in this Chapter
3. The applicant will be obligated to provide the most economical affordable
housing units feasible in terms of construction, design, location and tenure.
D. The City Manager or designee shall render a written decision within ninety days after a
complete application is filed. The decision may be appealed
to the City Council if such appeal is filed within fourteen consecutive calendar days from
the date that the decision is made in the manner provided in Chapter 9.37 Common
Procedures of this Code or any successor thereto.
E. If the City Manager or designee, or City Council on appeal, upon legal advice provided
by or at the behest of the City Attorney, determines that applying the requirements of this
Chapter would effectuate an unconstitutional taking of property or otherwise have an
unconstitutional application to the property, the affordable housing requirements shall be
adjusted or waived to reduce the obligations under this Chapter to the extent necessary to
avoid an unconstitutional result. If an adjustment or waiver is granted, any change in the
use within the project shall invalidate the adjustment or waiver. If the City Manager or
designee, or City Council on appeal, determines that no violation of the United States or
California Constitutions would occur through application of this Chapter, the requirements
of this Chapter remain fully applicable. (Added by Ord. No. 2486CCS §§ 1, 2, adopted
June 23, 2015)
Administrative Guidelines
Affordable Housing Production Program
Attachment 1-A: Page 13
ATTACHMENT 1-B
(Updated for 2016 AHPP Guidelines Update)
AHPP Options Comparison Table
Project Type: Rental Ownership Ownership Ownership Ownership
Project Size: 2+ Apartments 2-3 Units 4-15 Units 16+ Units 2+ Units
Zoning: Any Multifamily Multifamily Multifamily Not Multifamily
Developer Chooses
One Option Below:
1. Construct Units
Onsite:
Moderate Income
1
Units 100% 100% 20% 25% 100%
80% Income
Household Rental 20% 20% 20% 25% 20%
50% Income
Household Rental 10% 10% 10% 15% 10%
30% Income
Household Rental 5% 5% 5% 10% 5%
2. Construct Units Same as Same as Onsite Onsite Same as Onsite
Offsite: Onsite Options Onsite Options Options +25% Options +25% Options
3. Pay Affordable
Housing Fee: $31.25/Sq.Ft. $36.51/Sq.Ft. Not Applicable Not Applicable $36.51/Sq.Ft.
4. Acquire and Donate See SMMC See SMMC See SMMC
Not Applicable Not Applicable
Land 9.64.080 9.64.080 9.64.080
Note 1: Moderate-Income residences in this row are the same as the Project Type in terms of owner versus renter.
Administrative Guidelines
Affordable Housing Production Program
Attachment 1-B
ATTACHMENT 2-A
(Updated for 2016 AHPP Guidelines Update)
Fee Adjustment Methodology
Table 1 Affordable Housing Unit Base Fee
Administrative Guidelines
Affordable Housing Production Program
Attachment 2-A: Page 1
ATTACHMENT 2-A
(Updated for 2016 AHPP Guidelines Update)
Fee Adjustment Methodology
Table 2 Affordable Housing Unit Development Cost
Administrative Guidelines
Affordable Housing Production Program
Attachment 2-A: Page 2
ATTACHMENT 2-B
(Updated for 2016 AHPP Guidelines Update)
Current Base Fees for Apartment and Condominium Projects
FEE FOR APARTMENT PROJECTS
Current Fee: $31.25 (Effective November 1, 2015)
FEE FOR CONDOMINIUM PROJECTS
Current Fee: $36.25 (Effective November 1, 2015)
TIMING OF FEE PAYMENT
Base Fee is due prior to completion of project, but not before building permit issuance,
and the amount of fee due is based on fee amount in effect at time of payment.
Administrative Guidelines
Affordable Housing Production Program
Attachment 2-B
ATTACHMENT 3-A
(Updated for 2016 AHPP Guidelines Update)
Affordable Housing Table for 4+ Ownership Residences
in Multi-Family Zones
Number of Number of
FRACTIONS***
residences affordable
Fraction eligible Fractional cost of
in project before residences to be
for fee payment developing a residence
density bonus provided**
2
On-site or off-site residences are not mandatory.
May pay affordable housing fee.
3
4 1.00 0.00 $0.00
S X 20%\]
5 1.00 0.00 $0.00
6 1.00 0.20 $65,585.40
*
7 1.00 0.40 $131,170.80
N
O
I
8 1.00 0.60 $196,756.20
T
9 2.00 0.00 $0.00
P
E
O
C
10 2.00 0.00 $0.00
N
E
11 2.00 0.20 $65,585.40
E
T
-I
D
I
S
12 2.00 0.40 $131,170.80
ON
S
13 2.00 0.60 $196,756.20
E
\[#
R
14 3.00 0.00 $0.00
15 3.00 0.00 $0.00
\[# residences x
16+ \[fraction < 0.75\] \[fraction x unit development cost\]
25%\]
2
On-site or off-site residences required are not mandatory
May pay affordable housing fee.
3
\]
4 1.00 0.00 $0.00
%
*5 1.00 0.25 $81,981.75
5
N
2
6 1.00 0.50 $163,963.50
O
I
X
7 2.00 0.00 $0.00
T
S
8 2.00 0.00 $0.00
P
E
9 2.00 0.25 $81,981.75
O
C
10 2.00 0.50 $163,963.50
E
N
T
E
11 3.00 0.00 $0.00
I
-
D
S
OFF
12 3.00 0.00 $0.00
I
S
13 3.00 0.25 $81,981.75
E
\[#
14 3.00 0.50 $163,963.50
R
15 4.00 0.00 $0.00
etc. etc. \[fraction < 0.75\] \[fraction x unit development cost\]
*Ownership residences must be available for very low, low, or moderate income households
*Rental residences must be available for very low or low income households
**For fractions of 0.75 or more - round up to next whole number
***For fractions less than 0.75 - there are 2 options:
1) Pay the fractional cost of developing the unit based on affordable housing unit development cost
($327,927 per residence)
2) Construct all mandatory affordable residences with 3+ bedrooms
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-A
ATTACHMENT 3-B
(Updated for 2016 AHPP Guidelines Update)
Development Incentives
Density Bonus Table for Housing Developments in Residential Zones
* See Santa Monica Municipal Code Section 9.22 for more information.
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-B: Page 1
ATTACHMENT 3-C
(Updated for 2016 Guidelines Update)
Extremely-Low, Very-Low, Low- and Moderate Income Levels
2015 Income Limits
MAXIMUM ALLOWABLE INCOME (ANNUAL)
Household Extremely Very Low Low Moderate
Size Low (30%) (50%) (80%) (120%)
1 $17,950 $29,900 $47,850 $54,450
$34,200
2 $20,500 $54,650 $62,200
3 $23,050 $38,450 $61,500 $70,000
4 $25,600 $42,700 $68,300 $77,750
5 $28,410 $46,150 $73,800 $83,950
6 $32,570 $49,550 $79,250 $90,200
7 $36,730 $52,950 $84,700 $96,400
8 $40,890 $56,400 $90,200 $102,650
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-C
ATTACHMENT 3-D
(Updated for 2016 AHPP Guidelines Update)
Maximum Allowable Rents
2015 Maximum Allowable Rent Limits
MAXIMUM ALLOWABLE RENTS
(Based on 30% Affordability Standard)
Very
Residence Extremely Low Low Moderate
Type Low (30%) (50%) (80%) (120%)
0-Bdrm $340 $567 $680 $1,247
1-Bdrm $389 $648 $778 $1,426
2-Bdrm $437 $729 $875 $1,604
3-Bdrm $486 $810 $972 $1,782
4-Bdrm $525 $875 $1,050 $1,925
Rents: Median Income for 4-person household x Income Level x Bedroom Adjustment x Affordability
Standard (30%) / 12. (Ref: CA H&SC 50053, H&SC 50052.5(h), SMMC 9.64.020(D))
* Rents limits reflect a hold-harmless approach and are therefore held at their highpoint reached in
2011.
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-D
ATTACHMENT 3-E
(Updated for 2016 AHPP Guidelines Update)
Sample Deed Restriction
AGREEMENT IMPOSING RESTRICTIONS
ON RENTS & OCCUPANCY OF REAL PROPERTY
THIS AGREEMENT IMPOSING RESTRICTIONS ON RENTS & OCCUPANCY
\[____\]\[month, 20--\]
OF REAL PROPERTY, entered into this day of , by and between the
\[name
CITY OF SANTA MONICA, a Municipal Corporation (hereinafter the "City"), and
of applicant\]
, a \[California Limited Liability Company\] (hereinafter the "Developer"), is
made with reference to the following:
R E C I T A L S:
\[address\]
A. Developer is the owner of certain real property located at in the City
of Santa Monica, in the County of Los Angeles, California (hereinafter referred to as the
"Subject Property"). The Subject Property is more particularly described in Exhibit "A"
which is attached hereto and incorporated herein by this reference.
\[project description include # stories,
B. Developer wishes to construct a
building square footage, form of ownership apt/condo\]
a (hereinafter referred to as
\[type of application #AA, DR, VAR etc.\]
the "Project"). The City has approved for the
\[type of application\]
Project. The City approved the subject to the conditions of this
Agreement, which are imposed for the benefit of the City, the public and surrounding
\[type of application\]
landowners and without which the would not be approved.
C. The Project is subject to the requirements of the City's Affordable Housing
Production Program, Santa Monica Municipal Code Chapter 9.64, and the
Administrative Guidelines for Chapter 9.64, as they may be amended from time to time
(all collectively, referenced herein as "Affordability Restrictions"). The Developer has
agreed to satisfy the Affordability Restrictions by fully complying with this Agreement.
NOW, THEREFORE, it is mutually agreed by and between the undersigned parties as
follows:
1. RECITALS.
The Recitals stated above, are hereby incorporated by reference into this
Agreement and adopted by the parties to this Agreement as true and correct.
2. DEFINITIONS.
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-E
: Page 10
2.1means dwelling units within the Project that are
available to and occupied by Fifty Percent Income Households and Eighty Percent
Income Households at Affordable Rent.
Affordable Rent means:
2.2
(a) For thirty percent income households, the product of thirty percent times
thirty percent of the area median income adjusted for household size appropriate for the
unit.
(b) For fifty percent income households, the product of thirty percent times fifty
percent of the area median income adjusted for household size appropriate for the unit.
(c) For eighty percent income households whose gross incomes exceed the
maximum incomes for fifty percent income households, the product of thirty percent
times sixty percent of the area median income adjusted for household size appropriate
for the unit.
2.3means the median family income
published from time to time by the United States Department of Housing and Urban
Development ("HUD") for the Los Angeles-Long Beach Metropolitan Statistical Area.
2.4 means a household whose gross
income does not exceed the eighty percent income limits applicable to the Los Angeles-
Long Beach Primary Metropolitan Statistical Area, adjusted for household size, as
published and periodically updated by HUD. Eighty Percent Income Households
include Fifty Percent Income Households.
2.5 means a household whose gross
income does not exceed the fifty percent income limits applicable to the Los Angeles-
Long Beach Primary Metropolitan Statistical Area, adjusted for household size, as
published and periodically updated by HUD. Fifty percent income households include
Thirty Percent Income Households.
2.6 shall mean a period commencing on the date of
Certificate of Occupancy is issued for the Project and ending on the date which is fifty-
five (55) years from Certificate of Occupancy for the Project; provided, however, that if
the Project is damaged or destroyed and cannot be rebuilt in accordance with the
development standards permitted in this Agreement, then the Life of the Project shall be
deemed to have ended as of the date of such damage or destruction.
2.7 has the same meaning as provided in title 25, section 6918 of the
California Code of Regulations, as amended from time to time in accordance with law.
2.8 means a household whose gross
income does not exceed the thirty percent income limits applicable to the Los Angeles-
Long Beach Primary Metropolitan Statistical Area, adjusted for household size, as
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-E
: Page 10
published and periodically updated by HUD.
3. CONTRACT WITH CITY.
\[type of application\]
Developer hereby acknowledges that in issuing the for the
Project, the City is reducing or modifying development standards otherwise applicable to
the Project such as increasing unit density, reducing parking and other property
development standards, and/or waiving fees. In exchange for such forms of assistance
from the City, which are of financial benefit to the Developer, Developer has entered into
\[type of permit see
this contract with this City and agreed to the other conditions of the
above\]\[#\]
, including the requirement included in this Agreement to provide and maintain
Affordable Units on the Subject Property for occupancy by qualified households who meet
the requirements specified in this Agreement. The parties agree and acknowledge that
this is a contract providing forms of assistance to the Developer within the meaning of
Civil Code Section 1954.52 (b) and Government Code Section 65915 et seq.
\[Total # deed restricted
4. DEVELOPER TO PROVIDE AND MAINTAIN
units\]
Example: TEN (10) AFFORDABLE UNITS.
(a) Upon issuance of a Certificate of Occupancy for the Project, Developer shall
\[#\]
provide and maintain Affordable Units on the Subject Property, as follows:
\[# and type of unit\]
Example: Ten (10) one-bedroom Affordable Units shall be
\[insert affordability level\]
available to and occupied by Example: Fifty Percent Income
Households at Affordable Rent.
Developer shall submit plans to the City's Building Official, identifying the unit
numbers and exact locations of all of the Affordable Units. The submittal of these plans
with the required identification of Affordable Units shall be a condition precedent to
Developer's obtaining a building permit for the Project.
(b) The Affordable Units shall be rental units and the maximum rent shall be
calculated pursuant to the formula set forth in Section 5 of this Agreement.
(c) The City shall issue a Certificate of Occupancy for the Project ("Certificate")
expressly contingent upon compliance with the terms of this Agreement. A valid
Certificate shall be required at all times to continue to use or occupy the Project. A breach
of this Agreement shall be grounds for revoking the Certificate. The City shall provide
reasonable notice and an opportunity to cure any breach of this Agreement prior to
revoking the Certificate.
5. TERMS FOR THE RENTAL OF THE AFFORDABLE UNITS.
\[#\]
The maximum Affordable Rent for the Affordable Units on the Subject Property
shall be as follows:
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-E
: Page 10
(a) If the household is receiving a rental housing subsidy, the maximum
allowable rent shall be the lesser of the Affordable Rent calculated under subparagraph
(b) of this Section 5 or the payment standard authorized by the Santa Monica Housing
Authority.
(b) If the household is not receiving federal rental assistance as defined above,
the maximum allowable rent for the unit shall be calculated as follows:
For Fifty Percent Income Households
Area Median Income x 50% x Bedroom Adjustment Factor x 30% = Maximum
Affordable Rent (Annual).
For Eighty Percent Income Households
Area Median Income x 60% x Bedroom Adjustment Factor x 30% = Maximum
Affordable Rent (Annual).
The Maximum Allowable Rent figures must be divided by twelve to determine the
maximum allowable monthly rent.
The formula for the calculation of rents as of the date of this Agreement is as
follows:
(c) Area Median Income - As periodically published by HUD, currently $64,800
(for a family of four).
(d) Bedroom Adjustment Factors
0 Bedroom .7 3 Bedrooms 1.00
1 Bedroom .8 4 Bedrooms 1.08
2 Bedroom .90
3
2015, to be updated annually
(e) Affordable Rents
Studio 1-BR 2-BR 3BR
Fifty Percent Income Household $567 $648 $729 $810
Eighty Percent Income Household $680 $778 $875 $972
(f) In the event the standards for establishing the monthly rental rate of the
3 These numbers include the utility allowance adopted by the City's Housing Authority for 2015, and is
adjusted annually thereafter.
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-E
: Page 10
Affordable Units set forth in Section 5 cease to exist, the parties shall substitute a similar
standard established by HUD or its successor governmental agency. If the parties are
unable to agree upon a substitute standard, the parties shall refer the choice of the
substitute standard to binding arbitration in accordance with the rules of the American
Arbitration Association.
(g) Minimum Occupancy Requirements
0 bedroom 1 occupant
1 bedroom 1 occupants
2 bedroom 2 occupants
3 bedrooms 3 occupants
4 bedrooms 5 occupants
6. HOUSEHOLD ADJUSTMENT FACTORS.
The Household Adjustment Factors are as follows:
1 person 0.7
2 persons 0.8
3 persons 0.9
4 persons 1.0
5 persons 1.08
6 persons 1.16
7 persons 1.24
8 persons 1.32
Developer agrees to make reasonable efforts to rent vacant Affordable Units within
sixty days for the duration of this agreement.
7. TENANT SELECTION.
Developer shall select households from the City-developed list of income qualified
households. Only households selected from the City-developed list of income qualified
households shall occupy any of the Affordable Units.
8. CITY APPROVAL OF DOCUMENTS.
The Conditions, Covenants and Restrictions (CC&R's), if any, for the Subject
Property shall include reference to all applicable obligations and duties of the parties
created by this Agreement. The City Attorney of the City of Santa Monica shall approve
as to form the CC&R's prior to recordation of the final subdivision or parcel map for the
Subject Property.
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-E
: Page 10
Developer shall rent the Affordable Units pursuant to the terms and conditions of
a lease or rental agreement approved by the City. At least ninety days prior to the
expected completion date, Developer shall submit to the City Housing Division for review
a copy of the lease agreement to be used. In addition to any other provision required by
the City to ensure compliance with Chapter 9.64 and the Administrative Guidelines for
Chapter 9.64, as they may be amended from time to time, said lease or rental agreement
shall contain a provision prohibiting subleasing of the Affordable Units or revising the
composition of the household without Developer's permission. Developer shall not
approve any change that renders the Affordable Units in noncompliance with the
household income requirements of this Agreement. The addition to the household of
minor children, a spouse, or registered domestic partner shall not be deemed a change
in the household requiring Developer's prior approval pursuant to this Section.
Developer shall lease the Affordable Units concurrently with all other units in the
Project so as to avoid prolonged vacancy of the Affordable Units during lease-up of the
Project.
9. ATTORNEYS' FEES AND COSTS.
In the event of any controversy, claim or dispute between the parties hereto, arising
out of or relating to this Agreement or breach thereof, the prevailing party shall be entitled
to recover from the losing party reasonable expenses, attorneys' fees and costs.
10. APPOINTMENT OF OTHER AGENCIES.
The City may designate, appoint or contract with any other public agency to
perform City's obligations under this Agreement.
11. SEVERABILITY.
In the event any limitation, condition, restriction, covenant or provision contained
in this Agreement is held to be invalid, void or unenforceable by any court of competent
jurisdiction, the remaining portions of this Agreement shall, nevertheless, be and remain
in full force and effect.
12. NOTICES.
All notices required under this Agreement shall be sent by certified mail, return
receipt requested, to the following addresses:
TO THE CITY OF SANTA MONICA: City of Santa Monica
Planning and Community Development
Department
1685 Main Street, Room 212
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-E
: Page 10
Santa Monica, California 90401
Attention: Director, Planning and
Community Development Department
\[enter developer name/address\]
TO THE DEVELOPER:
Any party may change the address to which notices are to be sent by notifying the
other parties of the new address, in the manner set forth above.
13. HOLD HARMLESS.
As between the City and the Developer, the Developer is deemed to assume
responsibility and liability for, and the Developer shall indemnify and hold harmless the
City and its City Council, boards and commissions, officers, agents, servants or
employees from and against any and all claims, loss, damage, charge or expense,
whether direct or indirect, to which the City or its City Council, boards and commissions,
officers, agents, servants or employees may be put or subjected, by reason of any
damage, loss or injury of any kind or nature whatever to persons or property caused by
or resulting from or in connection with any act or action, or any neglect, omission or failure
to act when under a duty to act, on the part of the Developer or any of Developer's officers,
agents, servants, employees or subcontractors in his or their performance hereunder.
14. BURDEN TO RUN WITH PROPERTY.
The covenants and conditions herein contained shall apply to and bind the heirs,
successors and assigns of all the parties hereto and shall run with and burden the Subject
Property for the benefit of the City, the public and surrounding landowners, until
terminated in accordance with the provisions hereof. Developer shall expressly make the
conditions and covenants contained in this Agreement a part of any deed or other
instrument conveying any interest in the Subject Property.
15. SALE OR CONVERSION OF PROPERTY.
In the event of sale or conversion of the subject property, any Conditions,
Covenants and Restrictions (CC&R's) for the property, shall incorporate by reference all
obligations and duties of the parties created by this Agreement. Reporting obligations set
forth in Section 24 below, shall be set forth in the CC&R's if any, for the project.
16. PROHIBITION AGAINST DISCRIMINATION.
Developer agrees not to discriminate against any actual or potential occupant of
the subject property on the basis of sex, race, color, religion, ancestry, national origin,
sexual orientation, age, pregnancy, marital status, handicap, HIV, family composition, or
the potential or actual occupancy of minor children. Developer further agrees to take
affirmative action to ensure that no such person is discriminated against for any of the
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-E
: Page 10
aforementioned reasons.
17. STANDING TO ENFORCE AGREEMENT.
Violation of this Agreement may be enjoined, abated or remedied by appropriate
legal proceeding in a court of competent jurisdiction by any aggrieved party, including but
not limited to, the parties hereto, or their respective successors, heirs and assigns.
The right to specific performance of this Agreement shall be an appropriate remedy
for a breach of this Agreement because of the uniqueness of the Property and the inherent
difficulty in calculating adequate damages.
18. INTEGRATED AGREEMENT.
This Agreement constitutes the entire agreement between the parties and no
modification hereof shall be binding unless reduced to writing and signed by the parties
hereto.
19. APPLICABLE LAW.
All questions pertaining to the validity and interpretation of this Agreement shall be
determined in accordance with the laws of California applicable to contracts made to and
to be performed within the State.
20. CITY AUTHORITY TO ENFORCE LAW
The obligation of the Owner pursuant to this Agreement are in addition to, and in
no way limit, the authority of the City to enforce all laws and regulation applicable to the
Subject Property. Nothing in this Agreement shall limit the authority of the City to take
appropriate action to enforce the terms of any permit issued by the City relating to the
Subject Property.
21. DURATION OF AGREEMENT.
This Agreement shall terminate and become null and void fifty-five (55) years from
issuance of the Certificate of Occupancy.
22. AMENDMENT OF AGREEMENT.
This Agreement, and any Section, subsection, or covenant contained herein, may
be terminated or amended only upon the written consent of all parties hereto.
23. RECORDING OF AGREEMENT.
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-E
: Page 10
The parties hereto shall cause this Agreement to be recorded in the Official
Records of the County of Los Angeles.
24. YEARLY REPORT.
Developer shall issue a written report to City on an annual basis commencing one
year from the date of issuance of the Certificate of Occupancy and continuing thereafter
throughout the term of the Agreement. The report shall state the rent level then being
charged for the Affordable Units, whether the occupants are assisted by a rental housing
subsidy program, the number of occupants in the household, whether there have been
any changes in the composition of the household, whether any vacancies have occurred
during the reporting year, any changes in income of the residents of the affordable units,
and such other information as may be required by City staff.
25. COMPLIANCE MONITORING.
Pursuant to City of Santa Monica Resolution 10635 (CCS) and Santa Monica
Municipal Code Sections 9.64.050 and 9.64.060, Developer shall pay the reasonable
regulatory costs of ensuring compliance with this Agreement through a Compliance
Monitoring Fee, adopted and approved on November 22, 2011 and administratively
revised on an annual basis.
\\\\\\
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-E
: Page 10
26. AUTHORITY TO EXECUTE.
The undersigned declare they have full authority to execute this Agreement on
behalf of Developer, and bind Developer to all the terms and conditions contained herein.
\[Note: document text needs to be part of signature page; set hard page breaks
when necessary\]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the day and year first above written.
ATTEST:
CITY OF SANTA MONICA
a Municipal Corporation
___________________________
Sarah Gorman
City Clerk By: ____________________________
Rick Cole
APPROVED AS TO FORM: City Manager
SANTA MONICA CITY ATTORNEY
__________________________
MARSHA JONES MOUTRIE
City Attorney
\[Name\]
, LLC
a California limited liability company
By_______________________
\[name, and title, i.e. Manager, trustee,
owner etc\]
Prepared by: Planner Name
Reference Number: XXDED-XXX
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-E
: Page 10
EXHIBIT A
LOT -----------, BLOCK ---------, TRACT ------------ IN THE CITY OF SANTA MONICA,
COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN
BOOK XX PAGE XXX, IN THE OFFICE OF THE COUNTY RECORDER OF SAID
COUNTY.
(Insert Complete Legal Description)
APN ___________
Commonly Known As: \[Street Address\]
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-E
: Page 10
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the
document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
ACKNOWLEDGMENT
ss:
STATE OF __________________
COUNTY OF ________________
On before me, , a Notary Public,
(insert name and title of the officer)
personally appeared
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by
his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the
instrument.
I certify under PENALTY OF PERJURY under the laws of the State of _______________________ that the foregoing paragraph is
true and correct.
WITNESS my hand and official seal.
Signature (Seal)
Administrative Guidelines
Affordable Housing Production Program
Attachment 3-E
: Page 10
ATTACHMENT 4-A
(Updated for 2016 AHPP Guidelines Update)
Sample Application for Affordable Housing Eligibility List
Administrative Guidelines
Affordable Housing Production Program
Attachment 4-A
Administrative Guidelines
Affordable Housing Production Program
Attachment 4-A
Housing Division
Waiting List Referral Form
ATTACHMENT 4-B
(Updated for 2016 AHPP Guidelines Update)
Property Address
Owner/Manager Name
Phone #/Email
Residence #
Name and Phone Number
Referral #1:
Was #1 Comments:
Offered the Yes No
Residence?
Did #1 Comments:
Accept the Yes No
Residence?
Name and Phone Number
Referral #2:
Was #2 Comments:
Offered the Yes No
Residence?
Did #2 Comments:
Accept the Yes No
Residence?
Name and Phone Number
Referral #3:
Was #3 Comments:
Offered the Yes No
Residence?
Did #3 Comments:
Accept the Yes No
Residence?
Administrative Guidelines
Affordable Housing Production Program
Attachment 4-B
Add to 3-K
04/12/2016
Anne Samartha
From:Denise McGranahan <DMcGranahan@lafla.org>
Sent:Monday, April 11, 2016 3:45 PM
To:Clerk Mailbox; Kevin McKeown Fwd; Tony Vazquez; Gleam Davis; Sue Himmelrich; Pam
OConnor; Terry OÔDay; Ted Winterer
Cc:Marsha Moutrie; Barbara Collins; David Martin; Yibin Shen; Adam Radinsky; Gary
Rhoades
Subject:LAFLA Letter to Council for April 12, 2016 Council Meeting on Agenda items 3-K, 3-T,
7-A
Attachments:Letter to Mayor & City Council.pdf
Importance:High
Follow Up Flag:Follow up
Flag Status:Flagged
PleasefindattachedalettertotheMayorandCouncilmembersfortomorrowƓźŭŷƷƭcouncilmeetingonAgendaItems3K,3T,and
7A.
Sincerely,
DeniseMcGranahan
DeniseMcGranahan|SeniorAttorney
LegalAidFoundationofLosAngeles
16405thStreet,Suite#124|SantaMonica,CA90401
323.801.7966 direct|310.899.6208 facsimile
dmcgranahan@lafla.org|www.lafla.org
TheFrontlineLawFirmforPoorandLowIncomePeopleinLosAngeles
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