HomeMy WebLinkAboutOrd. 1565-2018 (18-894)City of South San Francisco P.O. Box 711 (City Hall,
- 400 Grand Avenue)
South San Francisco, CA
City council
Ordinance: ORD 1565 -2018
File Number: 18 -894 Enactment Number: ORD 1565 -2018
ORDINANCE REPEALING AND REPLACING SOUTH SAN
FRANCISCO MUNICIPAL CODE CHAPTER 20.380,
INCLUSIONARY HOUSING REGULATIONS, TO UPDATE THE
CITY OF SOUTH SAN FRANCISCO'S 1NCLUSIONARY
AFFORDABLE HOUSING PROGRAM TO INCLUDE
RESIDENTIAL RENTAL DEVELOPMENTS AND REVISE
REQUIREMENTS FOR RESIDENTIAL FOR -SALE
DEVELOPMENTS.
WHEREAS, the City of South San Francisco ( "City ") aims to provide sufficient levels of affordable
housing for its residents; and
WHEREAS, in July of 2010, the City Council for the City of South San Francisco adopted a
comprehensive update to the City's zoning ordinance, which repealed the then - existing Title 20 of
the South San Francisco Municipal Code ( "Zoning Ordinance "), and replaced it with an entirely new
Title that, among other actions, established new zoning districts, revised and reformatted many
then - existing zoning provisions, eliminated inconsistent and outdated provisions, and codified
entirely new zoning provisions, including new land use regulations and development standards; and
WHEREAS, as part of the 2010 Zoning Ordinance Update, the City adopted Chapter 20.380
Inclusionary Housing Regulations, which require inclusionary below market rate housing units in
new, for -sale residential development; and
WHEREAS, the availability of housing is a substantial concern for individuals of all demographics,
ages, and economic backgrounds in communities throughout the State of California; and
WHEREAS, inclusionary housing regulations provide for below market rate housing within market
rate residential developments, providing housing to a range of income levels; and
WHEREAS, in 2017, the California State Legislature passed Assembly Bill 1505 ( "AB 1505 "),
which overruled the 2009 decision by the California Court of Appeals in the case of Palmer /Sixth
Street Properties L.P. a City of Los Angeles to allow jurisdictions to once again require inclusionary
affordable housing units in new, market -rate, rental developments; and
WHEREAS, on April 8, 2015 the City Council of the City of South San Francisco adopted its
2015 -2023 Housing Element; and
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File Number: 18 -894 Enactment Number. ORD 1565 -2018
WHEREAS, the new, proposed Chapter 20.380 of the Zoning Ordinance implements Housing Element
Goal I to "promote the provision of housing by both the private and public sectors for all income groups
in the community;" and
WHEREAS, the City's objective, as established by the Housing Element, is to ensure that all residential
developments, including all master planned and specific planned communities, provide a range of
housing opportunities for all identifiable economic segments of the population, including households of
very low -, low- and moderate - income; and
WHEREAS, the City has prepared a new ordinance (the "Ordinance ") repealing and replacing South
San Francisco Municipal Code Chapter 20.380, Inclusionary Housing Regulations, to update the City of
South San Francisco's inclusionary affordable housing program to include residential rental
developments and revise requirements for residential for -sale developments; and
WHEREAS, on August 16, 2018, the Planning Commission for the City of South San Francisco held a
lawfully noticed public hearing to solicit public comment and consider the proposed Ordinance, take
public testimony, and make a recommendation to the City Council; and
WHEREAS, the Planning Commission unanimously recommended that the City Council adopt the
Ordinance; and
WHEREAS, to implement the affordable housing goals, policies, and programs of the City's Housing
Element, the City Council proposes to adopt the Ordinance after a duly noticed public hearing; and
WHEREAS, ten (10) days advance notice of the public hearing at which the Ordinance was considered
was published in accordance Government Code Section 6062a; and
WHEREAS, the Zoning Ordinance was adopted after preparation, circulation, consideration, and
adoption of an Initial Study /Mitigated Negative Declaration ( "IS /MND ") in accordance with the
California Environmental Quality Act, Public Resources Code Sections 21000, et seq. ( "CEQA "), in
which the IS /MND analyzed the environmental impacts of adopting the Zoning Ordinance and
concluded that adoption of the Zoning Ordinance could not have a significant effect on the environment
because none of the impacts required to be analyzed under CEQA would exceed established thresholds
of significance; and
WHEREAS, the Planning Commission made findings that the Ordinance, as it relates to inclusionary
housing is minor in nature, the adoption of which would not result in any new significant environmental
effects or a substantial increase in the severity of any previously identified effects beyond those
disclosed and analyzed in the IS/MND prepared for the Zoning Ordinance, nor does the Ordinance
constitute a change in the project or change in circumstances that would require additional
environmental review; and
WHEREAS, the Planning Commission made findings that the Ordinance meets the purpose of the
Zoning Ordinance and are consistent with the adopted General Plan because the Ordinance will
reinforce the General Plan policies, are consistent with the relevant specific plans, and are consistent
with the City's overall vision for providing a diversity of housing types responsive to household size,
income, and age needs.
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File Number: 18 -894 Enactment Number: ORD 1565 -2018
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SOUTH SAN FRANCISCO DOES
HEREBY ORDAIN AS FOLLOWS:
SECTION 1. Incorporation of Recitals
The City Council of South San Francisco finds that all Recitals are true and correct and are incorporated
herein by reference.
SECTION 2. Amendments
The City Council hereby repeals and replaces Chapter 20.380 to Title 20, the Zoning Ordinance, of the
South San Francisco Municipal Code to read as follows:
Chapter 20.380 INCLUSIONARY HOUSING REGULATIONS
20.380.001
Purpose and Intent
20.380.002
Definitions
20.380.003
Applicability of Inclusionary Housing Requirement
20.380.004
Inclusionary Housing Plans
20.380.005
Calculating the Required Number of Inclusionary Units
20.380.006
Affordable Housing Standards
20.380.007
Alternatives to Constructing New Inclusionary Units
20.380.008
Waiver of Requirements
20.380.009
Disposition of Excess Inclusionary Units
20.380.010
Offsets to the Cost of Affordable Housing Development
20.380.011
In -Lieu Fees
20.380.012 Collection of Fees
20.380.013 Preliminary Project Application and Review Process
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20.380.014 Affordable Housing Agreement as a Condition of Development
20.380.015 Agreement Amendments
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20.380.016 Period of Affordability
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20.380.017 Pre - Existing Approvals
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- 20_380_017 &frames =on>
20.380.018 Enforcement
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20.380.019 Savings Clause
20.380.001 Purpose and Intent
The purpose and intent of this chapter is as follows:
A. On April 8, 2015 the City Council of the City of South San Francisco ( "City ") adopted its
2015 -2023 Housing Element to the City General Plan. As established by the Housing Element, the
objective of the City is to ensure that all residential development, including all master planned and
specific planned communities, provide a range of housing opportunities for all identifiable economic
segments of the population, including households of extremely low, very low, lower and moderate
income.
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File Number: 18 -894 Enactment Number. ORD 1565 -2018
B. City Housing Element Chapter 6. 1, entitled "Promote New Housing Development,"
includes Goal I to "promote the provision of housing by both the private and public sectors for all
income groups in the community."
C. Implementing Policy I -3 of the Housing Element provides that "[a]s feasible, the City
will investigate new sources of funding for the City's affordable housing programs."
D. There is a reasonable relationship between the need for affordable housing and the
impacts of market rate residential development within the City. Development of new market rate
residential projects increases the population of the City and generates additional resident demand for
goods and services, and some of the employees needed to provide those goods and services earn
incomes only adequate to pay for affordable housing; and
E. Because affordable housing is in short supply within the City, these employees might
otherwise be forced to live in less- than - adequate housing within the City, pay a disproportionate share of
their incomes to live in adequate housing within the City, or commute ever - increasing distances to their
jobs from housing located outside the City, thereby harming the City's ability to attain goals articulated
in the City's General Plan.
F. The City Council finds and determines that in order to provide sufficient affordable
housing to achieve the City's goal of providing a full range of affordable housing options to residents of
the City, in accordance with the standards established in the general plan, housing element, and other
applicable plans and regulations, residential development projects identified in Section 20.380.030
below shall provide inclusionary housing units, or provide one of the alternative means of compliance
specified in this chapter, in order to mitigate the impacts of these residential development projects on
affordable housing in the City.
G. It is the policy of the City to:
1. Require that for rental residential development of five or more units for which
applications are received and deemed complete during a period of one year from the effective date of
this ordinance, a minimum of 10 percent of the dwelling units in all such developments shall be
inclusionary units; and
2. Require that for rental residential developments of five or more units for which
applications are received and deemed complete upon and after the effective date of this ordinance, a
minimum of 15 percent of the dwelling units in all such developments shall be inclusionary units; and
3. Require that for for -sale residential developments of five or more units for which
applications are received and deemed complete upon and after the effective date of this ordinance, a
minimum of 15 percent of the dwelling units in all such developments shall be inclusionary units; and
4. Allow inclusionary requirements, at the option of the applicant, to be satisfied
through the payment of an in -lieu fee as an alternative to requiring inclusionary units to be constructed,
and under certain conditions with City Council approval, allow other alternatives to constructing new
inclusionary units on -site.
H. The City Council finds and determines that this chapter will:
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File Number: 18 -894 Enactment Number: ORD 1565 -2018
1. Encourage the development and availability of housing affordable to a broad
range of households with varying income levels within the City as mandated by Government Code
Section 65580, et seq.
2. Offset the demand for affordable housing that is created by new residential
development and mitigate impacts that accompany new residential development by protecting the
economic diversity of the City's housing stock; reducing traffic, transit and related air quality impacts;
promoting jobs/housing balance; and reducing the demands placed on transportation infrastructure in the
region.
3. Promote the City's policy to promote the provision of housing by both the private
and public sectors for all income groups in the community, as identified by the Housing Element of the
General Plan.
4. Support the Housing Element goal of encouraging high- quality residential
development, as well as ensure a full range of affordable housing and the policies and actions that
support this goal.
5. Support the Housing Element goal of providing suitable, decent, and affordable
housing for its residents.
6. Support the guiding principle of the Housing Element that housing in South San
Francisco supports increasing the range and diversity of housing options that will be an integral aspect
of the City's growth and development.
7. Support the guiding principle of the Housing Element that South San Francisco
values diversity and strives to ensure that all households have equal access to the City's housing
resources.
8. Meet the housing needs identified by the Housing Element of the General Plan.
9. Encourage the production of the very low, low, and moderate - income units
planned for by the Housing Element of the General Plan.
I. Nothing in this chapter is intended to create a mandatory duty on the part of the City or
its employees under the Government Tort Claims Act and no cause of action against the City or its
employees is created by this chapter that would not arise independently of the provisions of this chapter.
20.380.002 Definitions
Whenever the following terms are used in this chapter, they shall have the meaning established
by this section:
A. "Affordable housing" means, for the purposes of this chapter, housing that is affordable
to families with very low, low, or moderate incomes.
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B. "Affordable housing agreement" means a legally binding agreement between an applicant
and the City to ensure that the requirements of this chapter are satisfied in accordance with Section
20.380.014.
C. "Affordable initial sales price" means a sales price for which allowable housing expenses
do not exceed the following:
1. For an inclusionary unit sold to a moderate income household, allowable housing
expenses do not exceed 35% x 110% of AMI for a household size appropriate to the unit.
2. For an inclusionary unit sold to a lower income household, allowable housing
expenses do not exceed 30% x 70% of AMI for a household size appropriate to the unit.
D. "Affordable rent" means allowable housing expenses do not exceed the following:
1. For an inclusionary unit rented to a very low income household, allowable
housing expenses do not exceed 30% x 50% of AMI for a household size appropriate to the unit.
2. For an inclusionary unit rented to a lower income household, allowable housing
expenses do not exceed 30% x 60% of AMI for a household size appropriate to the unit.
E. "Allowable housing expense" means the total monthly or annual recurring expenses
required of a household to obtain shelter.
1. For a for -sale unit, allowable housing expenses include loan principal and interest
at the time of initial purchase by the homebuyer, allowances for property and mortgage insurance,
property taxes, homeowners association dues and a reasonable allowance for utilities.
2. For a rental unit, allowable housing expenses include rent and a reasonable
allowance for utilities, as well as all monthly payments made by the tenant to the lessor in connection
with use and occupancy of a housing unit and land and facilities associated therewith, including any
separately charged fees, utility charges, or service charges assessed by the lessor and payable by the
tenant.
3. Allowable housing expense may be further defined by regulation prepared by the
Economic and Community Development Department and adopted by the City Council.
F. "Area median income" or "AMI" means the annual median income for San Mateo
County, adjusted for household size, as published periodically in Section 6932 of Title 25 of the
California Code of Regulations, or its successor provision. In the event such area median income
figures are no longer published in the California Code of Regulations, area median income shall be as
established by the City.
G. "Conversion" means the change of status of a dwelling unit from a for -sale unit to a
rental unit or vice versa.
H. "Deemed complete" means an applicant has submitted all items listed on the Planning
Application Checklist used upon the date the application is received, including all required plans and full
payment of all required fees, and the Planning Division has determined each item contains all requested
and relevant information pursuant to the review procedures set forth in Chapter 20.450 "Common
Procedures" of the South San Francisco Municipal Code.
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File Number: 18 -894 Enactment Number. ORD 1565 -2018
I. "Density bonus" means a density increase in a residential development granted pursuant
to Government Code Section 65915, et seq., and Chapter 20.390 of the Municipal Code.
J. "Density bonus unit" means dwelling units approved in a residential development
pursuant to Government Code Section 65915, et seq., and Chapter 20.390 of the Municipal Code, that
are in excess of the maximum residential density otherwise permitted by the City general plan or zoning
ordinance.
K. "Dwelling unit' shall have the definition given for dwellings in Section 20.630.002 of the
Municipal Code.
L. "Financial assistance" means assistance to include, but not be limited to, the subsidization
of fees, infrastructure, land costs, or construction costs, the use of funds from the City housing trust
fund, the use of low and moderate income housing asset funds, community development block grant
(CDBG) funds, HOME funds, or the provision of other direct financial aid in the form of cash transfer
payments or other monetary compensation, by the City of South San Francisco.
M. "For -sale unit' means a dwelling unit, including an attached or detached single family
home, condominium, stock cooperative or community apartment, which is offered for sale to individual
buyers.
N. "Household size appropriate for the unit' means one person for a zero bedroom dwelling
unit, two persons for a one bedroom dwelling unit, three persons for a two bedroom dwelling unit, four
persons for a three bedroom dwelling unit, and five persons for a four bedroom dwelling unit.
O. "Incentives" means concessions and incentives as described in Government Code Section
65915(k), granted by the City in accordance with Government Code Section 65915 and Chapter 20.390
of the Municipal Code.
P. " Inclusionary housing project' means a new residential development or conversion of
existing residential buildings which includes units reserved and made affordable to very low, lower or
moderate - income households as required by this chapter.
Q. " Inclusionary unit' means a dwelling unit that will be offered for rent or sale exclusively
to and which shall be affordable to very low, lower or moderate income households, as required by this
chapter.
R. "Income" shall have the meaning as defined in Section 6914 of Title 25 of the California
Code of Regulations, or its successor provision, as may be further defined by regulations of the
Economic and Community Development Department.
S. "In lieu fee" means a fee payable to the City instead of constructing inclusionary units as
described in Section 20.380.011 of this chapter.
T. "Lower income household" shall have the meaning as defined in California Health and
Safety Code Section 50079.5.
U. "Market -rate unit' means a dwelling unit where the rental rate or sales price is not
restricted either by this chapter, Chapter 20.390 of the Municipal Code, or by requirements imposed
through other local, state, or federal affordable housing programs.
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File Number: 18 -894 Enactment Number: ORD 1565 -2018
V. "Maximum resale price" means the maximum amount a for -sale inclusionary unit may be
sold, except for the initial sale of the inclusionary unit, as provided in Section 20.380.006(F) of this
chapter.
W. "Moderate income household" shall have the meaning as defined in California Health and
Safety Code Section 50093.
X. "Offsets" means concessions or assistance to include, but not be limited to, direct
financial assistance, density increases, modifications of standards or any other financial, land use, or
regulatory concession which would result in an identifiable cost reduction enabling the provision of
affordable housing.
Y. "Reasonable allowance for utilities" means the utility allowance published by the
Housing Authority of the County of San Mateo from time to time. If the foregoing utility allowance is
no longer published, then a reasonable allowance for utilities shall be calculated based upon comparable
governmental published figures as determined by regulation of the City.
Z. "Rental unit" means a dwelling unit that is not a for -sale unit.
AA. "Residential development' means any new residential construction of rental or for -sale
units; or development revisions, including those with and without a master plan or specific plan, planned
unit developments, site development plans, mobilehome developments and conversions of apartments to
condominiums, as well as dwelling units for which the cost of shelter is included in a recurring payment
for expenses, whether or not an initial lump sum fee is also required.
BB. "Total dwelling units" means the total units approved by the final decision making
authority. Total dwelling units are composed of both market rate units and inclusionary units. For
purposes hereof, total dwelling units does not include density bonus units.
CC. "Utilities" means garbage collection, sewer, water, electricity, gas and other heating,
cooling, cooking and refrigeration fuels for a dwelling unit. Utilities does not include telephone, cable
or internet service.
DD. "Very low income household" shall have the meaning as defined in California Health and
Safety Code Section 50105. For purposes hereof, very low income households shall include extremely
low income households, as defined in California Health and Safety Code Section 50106.
20.380.003 Applicability of Inclusionary Housing Requirement
A. The requirements of this chapter shall apply as follows:
1. This chapter shall apply to all residential market -rate dwelling units resulting
from new construction of for -sale and rental residential developments consisting of five or more
dwelling units, as well as the conversion of apartments to condominiums or condominiums to
apartments.
2. An applicant shall not avoid the requirements of this chapter by submitting
piecemeal planning permit applications. For purposes of this chapter a residential development shall
include all contiguous property under common ownership and control.
B. The requirements of this chapter shall not apply to the following:
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File Number. 18 -894 Enactment Number. ORD 1565 -2018
1. Existing residences which are altered, improved, restored, repaired, expanded or
extended, provided that the number of dwelling units is not increased, except that this chapter shall
pertain to the subdivision of land for the conversion of apartments to condominiums or condominiums to
apartments;
2. Conversion of a mobile home park;
3. The construction of a new residential structure which replaces a residential
structure that was destroyed or demolished within two years prior to the approval of a building permit
for the new residential structure, provided that the number of dwelling units is not increased from the
number of dwelling units of the previously destroyed or demolished residential structure;
4. Accessory dwelling units not constructed to fulfill inclusionary housing
requirements and developed in accordance with Section 20.350.035 ( "Accessory Dwelling Units ");
5. Those dwelling units which have obtained approval of a vesting tentative map or
a development agreement prior to the effective date of the ordinance codified in this chapter, as set forth
in Section 20.380.017 ( "Pre- Existing Approvals ").
6. Applications for rental residential dwelling units that are deemed complete prior
to the effective date of this ordinance.
20.380.004 Inclusionary Housing Plans
Applications for planned unit development permits, tentative maps, vesting tentative maps, and
other land use entitlements that seek approval of a residential development project of five or more
dwelling units shall submit an inclusionary housing plan as follows:
A. All applications approved or deemed complete on or after the effective date of the
ordinance codified in this chapter are required by this chapter to provide an inclusionary housing plan
with the application for development. The inclusionary housing plan will include appropriate text,
maps, tables, or figures to establish the basic framework for implementing the requirements of this
chapter. It shall establish, at a minimum, but shall not be limited to, the following:
1. The number of market rate units in the master plan or specific plan;
2. The number of required inclusionary units for very low, lower and moderate
income households in the project, including the specific levels of affordability;
3. The location of the inclusionary units, including, but not limited to, any sites for
locating off -site inclusionary housing projects;
4. Acknowledgement that an affordable housing agreement shall be a condition of
all future discretionary permits for the development area such as tentative maps, parcel maps, planned
unit developments and site development plans. The affordable housing agreement shall be consistent
with Section 20.380.014 ( "Affordable Housing Agreement as a Condition of Development ").
B. The location and phasing of inclusionary dwelling units may be modified by the body
granting final approval of the project as a condition of approval for the project.
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File Number. 18 -894 Enactment Number: ORD 1565 -2018
C. All existing planned unit development permits, Conditional Use Permits, master plans or
specific plans proposed for major amendment, pursuant to Chapter 20.530 ( "Specific Plans and Plan
Amendments "), shall incorporate into the amended master plan or specific plan document an affordable
housing agreement, consistent with this section.
D. In the event the residential development obtains a density bonus, the affordable housing
agreement shall also contain the terms of the agreement required pursuant to Government Code Section
65915, et seq., and Chapter 20.390 of the Municipal Code.
20.380.005 Calculating the Required Number of Inclusionary Units
A. The requirements for rental residential developments, which shall apply to both
construction of rental units and conversion of for -sale units to rental units, are as follows:
1. For rental residential developments consisting of five or more units for which
applications are received and deemed complete during a period of one year from the effective date of
this ordinance, a minimum of 10 percent of the dwelling units in all such developments shall be
inclusionary units designated for lower income households.
2. For rental residential developments consisting of five or more units for which
applications are received and deemed complete upon and after one year from the effective date of this
ordinance, a minimum of 15 percent of the dwelling units in all such development shall be inclusionary
units with two - thirds designated for lower income households and one -third designated for very low
income households.
B. The requirements for for -sale residential developments, which shall apply to both
construction of for -sale units and conversion of rental units to for -sale units, is as follows:
1. For for -sale residential developments of five or more units for which applications
are received and deemed complete upon and after the effective date of this ordinance, a minimum of 15
percent of the dwelling units in all such developments shall be inclusionary units with 50 percent
designated for moderate income households and 50 percent designated for lower income households.
C. If the calculation of the required total number of inclusionary units results in a fraction of
one -half or greater, the number of inclusionary units shall be rounded up to the next whole number. If
the calculation of the required total number of inclusionary units results in a fraction of less than one -
half, the fractional amount shall be provided to the City through payment of an in lieu fee as provided in
Section 20.380.011 hereof. (For example, if 6.4 inclusionary units are required for a for -sale residential
development, the applicant would be required to construct six inclusionary units and pay an in lieu fee
for 0.4 units).
D. Where the calculation of the designated income levels of inclusionary units results in a
fractional number, the number of inclusionary units designated at each required income level shall be
rounded toward the higher income level. (For example, if seven inclusionary units are required for a
for -sale residential development, four would be designated for moderate income households and three
would be designated for lower income households).
E. The applicant may voluntarily elect to provide more inclusionary units at a lower income
or very low income level than required by this chapter. Voluntarily providing more units at a lower
affordability level than otherwise required under this section shall satisfy the applicant's requirements
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related to affordability distribution, provided the applicant has provided the total required number of
inclusionary units.
20.380.006 Affordable Housing Standards
The affordable housing standards are as follows:
A. All residential developments subject to this chapter must satisfy the inclusionary housing
requirements of this chapter, notwithstanding an applicant's request to process a residential development
under other program requirements, laws or regulations. Affordable units provided in order to obtain a
density bonus under Chapter 20.390 ( "Bonus Residential Density "), which otherwise meet the
requirements of this chapter, shall qualify as inclusionary units for purposes of this chapter.
B. Unless an alternative method of compliance is allowed pursuant to Section 20.380.007 of
this chapter, inclusionary units shall be built on the residential development project site.
C. The required inclusionary units shall be constructed concurrently with market -rate units
unless both the final decision - making authority of the City and applicant agree within the affordable
housing agreement to an alternative schedule for development. The schedule for construction of
inclusionary units shall be included in the affordable housing agreement.
D. Inclusionary units which are rental units shall be made available and rented to the
designated income group at an affordable rent for 55 years from the date of a final certificate of
occupancy for the project. Notwithstanding anything to the contrary in this chapter, no inclusionary
rental unit shall be rented for an amount which exceeds 90 percent of the actual rent charged for a
comparable market -rate unit in the same residential development, if any.
E. Inclusionary units which are for -sale units shall remain affordable for a term of 55 years
from the date of a final certificate of occupancy for the inclusionary unit, and a resale restriction
containing such affordability term shall be filed and recorded as a restriction on those individual lots,
units or projects which are designated as inclusionary for -sale units.
F. The initial sale of inclusionary for -sale units shall be at an affordable initial sales price.
The maximum resale price at which an owner of an inclusionary for -sale unit may sell that inclusionary
unit shall be annually adjusted by the percentage increase or decrease in area median income for a
family of four in effect between the date of the owner's purchase and the date of the owner's sale of the
inclusionary unit. The maximum resale price shall be increased by the market value, if any, of any
documented, permanent capital real estate or fixed improvements to the inclusionary unit approved by
City. As a condition of obtaining such an adjustment, the owner shall present to the City written
documentation of all expenditures made by owner for which an adjustment is requested. The maximum
resale price shall be decreased by the amount necessary to repair any damages and to put the unit into a
sellable condition, including items such as paint, cleaning, construction repairs, and to bring said unit
into conformity with all applicable provisions of the City Municipal Code and the affordable housing
guidelines established by the City. The amount of price adjustments shall be reasonably determined by
the City. The resulting price shall be the maximum resale price of the inclusionary unit.
G. The design of the inclusionary units shall be consistent with General Plan standards;
compatible with the design of the total project development in terms of appearance, materials and
finished quality and conform to General Plan standards; and consistent with affordable housing
development standards prepared by the Department of Economic and Community Development as
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File Number: 18 -894 Enactment Number: ORD 1565 -2018
adopted by the City Council. The distribution of the size of inclusionary units, as measured by the
number of bedrooms in an inclusionary unit, shall be in the same proportion as the distribution of the
size of market rate units, as measured by the number of bedrooms in the market rate units. Residents of
inclusionary units shall be entitled to use all of the same amenities and facilities of the residential
development as residents of market rate units within the residential development.
H. No building permit shall be issued, nor any development approval granted for a
residential development which does not meet the requirements of this chapter. No inclusionary unit shall
be rented or sold except in accordance with this chapter.
20.380.007 Alternatives to Constructing New Inclusionary Units
Each applicant may, at the sole discretion of the applicant, elect to pay the in lieu fee as provided
in Section 20.380.011 of this chapter instead of the construction of new inclusionary units within the
residential development. In addition to the foregoing, and notwithstanding any contrary provisions of
this chapter, the City may, at the sole discretion of the City Council, determine that one or more of the
following alternatives A through E to the construction of new inclusionary units within the residential
development is acceptable. Such determination shall be based on findings that new construction would
be infeasible or present unreasonable hardship in light of such factors as project size, site constraints,
market competition, price and product type disparity, applicant capability, and financial subsidies
available. Evidence must be submitted to the City Manager or his or her designee and included in the
request for any approval of alternatives to the construction of new inclusionary units.
A. Off -Site Construction. The applicant may construct some or all of the inclusionary units
at a location within the City outside of the residential development. Off -site inclusionary units should, if
feasible, be located on sites that are in proximity to or will provide access to employment opportunities,
urban services, or major roads or other transportation and commuter rail facilities and that are
compatible with adjacent land uses.
B. Dedication of Land. The applicant may donate land to the City or to the designee of the
City. The land shall meet all of the requirements of Government Code Section 65915(g). The value of
the land shall be not less than the sum of the in -lieu fee that would be due under Section 20.380.011 of
this chapter. The valuation of any land offered in -lieu shall be determined by an appraisal made by an
appraiser mutually agreed upon by the City and the applicant. Costs associated with the appraisal shall
be borne by the applicant.
C. Construction of Accessory Dwelling Units. The applicant may construct accessory
dwelling units which shall be rented to very low and lower income households at an affordable rent, in
accordance with an affordable housing agreement.
D. Funding of Affordable Housing Project. The applicant may make a contribution to a
special needs housing project or program or other affordable housing project. The requisite contribution
shall be calculated in the same manner as an in -lieu fee per Section 20.380.011 ( "In -lieu Fees ").
E. The City Council may approve other alternatives to the construction of new inclusionary
units within the residential development where the proposed alternative supports specific housing
element policies and goals of the City and assists the City in meeting its state housing requirements.
Alternatives may include, but are not limited to, acquisition and rehabilitation of affordable units,
conversion of existing market units to affordable units, or construction of special needs housing projects
or programs (shelters, transitional housing, etc.).
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20.380.008 Waiver of Requirements
Applicants may apply to the City for a waiver, adjustment or reduction of the requirements of
this chapter. In connection with such a request, the applicant shall present evidence to the City in
support of the request. The City may approve or disapprove an application for waiver, adjustment or
reduction in its sole discretion, provided that the City shall approve requests for waiver, adjustment or
reduction when the application of this chapter to a residential development would result in a taking of
property in violation of the United States or California Constitutions or otherwise be contrary to
applicable law.
20.380.009 Disposition of Excess Inclusionary Units
Inclusionary units created which exceed the final requirement for a residential development may,
subject to City Council approval in the affordable housing agreement, be utilized by the applicant to
satisfy inclusionary requirements for other residential developments of the applicant or other developers.
20.380.010 Offsets to the Cost of Affordable Housing Development
The City shall consider making offsets available to applicants when necessary to enable
residential developments to provide a preferable product type or affordability in excess of the
requirements of this chapter.
A. Offsets may be offered by the City to the extent that resources and programs for this
purpose are available to the City and approved for such use by the City Council, and to the extent that
the residential development, with the use of offsets, assists in achieving the City's housing goals. If the
City makes available programs to provide offsets, applicants may make application for such programs.
B. The City's evaluation of requests for offsets shall be based on the effectiveness of the
offsets in achieving a preferable product type and /or affordability objectives as set forth within the
housing element; the capability of the development team; the reasonableness of development costs and
justification of subsidy needs; and the extent to which other resources are used to leverage the requested
offsets.
C. Nothing in this chapter establishes, directly or through implication, a right of any
applicant to receive any offsets from the City or any other party or agency to enable the applicant to
meet the obligations established by this chapter.
D. Offsets may include incentives provided by the City to residential developments
qualifying for a density bonus pursuant to the provisions of Chapter 20.390.
E. Any offsets approved by the City Council shall be described in the affordable housing
agreement.
F. Applicants are encouraged to utilize local, state or federal assistance, when available, to
meet the affordability standards set forth in this chapter.
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20.380.011 In -Lieu Fees
Payment of an in -lieu fee to the City instead of construction of inclusionary units is permitted as
follows:
A. For any residential development or development revision consisting of five or more
dwelling units, the applicant may elect to satisfy the inclusionary unit requirements through the payment
to the City of an in -lieu fee.
B. The in -lieu fee to be paid for each inclusionary dwelling unit shall be determined by
resolution of the City as approved by the City Council from time -to -time.
C. In lieu -fees shall be paid at the time a building permit is issued for the development.
D. Where an applicant elects to pay an in lieu fee instead of the development of inclusionary
units, any approvals for the residential development shall be conditioned upon a requirement to pay the
in -lieu fee in an amount established by the chapter in effect at the time of payment.
20.380.012 Collection of Fees
All in -lieu fees collected hereunder shall be deposited in a housing trust fund. The housing trust
fund shall be administered by the City and shall be used only for the purpose of providing funding
assistance for the provision of affordable housing and reasonable costs of administration consistent with
the policies and programs contained in the housing element of the General Plan.
20.380.013 Preliminary Project Application and Review Process
The preliminary project application/review process shall be as follows:
A. An applicant of a residential development, proposing an inclusionary housing project
shall have an approved site development plan prior to execution of an affordable housing agreement for
the project. The applicant may submit a preliminary application to the director of the Department of
Economic and Community Development prior to the submittal of any formal applications for such
housing development. The preliminary application shall include the following information if applicable:
1. A brief description of the proposal, including the number of inclusionary units
proposed;
2. The zoning, General Plan designations and assessor's parcel number(s) of the
project site;
3. A site plan, drawn to scale, which includes: building footprints, driveway and
parking layout, building elevations, existing contours and proposed grading; and
4. A letter identifying what specific offsets, incentives and /or adjustments are being
requested of the City. Justification for each request should also be included.
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B. Within 30 days of receipt of the preliminary application by the planning director for
projects not requesting offsets or incentive adjustments, or ninety days for projects requesting offsets or
incentive adjustments the Economic and Community Development Department shall provide to an
applicant, a letter which identifies project issues of concern, the offsets and incentive adjustments that
the City Manager or his or her designee can support when making a recommendation to the final
decision - making authority, and the procedures for compliance with this chapter. The applicant shall also
be provided with a copy of this chapter and related policies, the pertinent sections of the California
codes to which reference is made in this chapter and all required application forms.
20.380.014 Affordable Housing Agreement as a Condition of Development
This chapter requires the following:
A. Applicants subject to this chapter shall demonstrate compliance with this chapter by
executing an affordable housing agreement prepared by the Department of Economic and Community
Development and submitted to the applicant for execution. Agreements which conform to the
requirements of this section and which do not involve requests for offsets and /or incentives, other than
those permitted by right, if any, shall be reviewed by the City Manager or his or her designee and
approved by the City Manager or his or her designee.
B. Agreements which involve requests for offsets and /or incentives, or for alternate means
of compliance with the inclusionary housing requirements, other than those permitted by right, shall
require the recommendation of the Department of Economic and Community Development and action
by the City Council as the final decision - maker.
C. Following the approval and execution by all parties, the affordable housing agreement
with approved site development plan shall be recorded against the entire development, including market -
rate lots and units and the relevant terms and conditions therefrom filed and subsequently recorded as a
separate deed restriction or regulatory agreement on the affordable project individual lots or units of
property which are designated for the location of inclusionary units.
D. The approval and execution of the affordable housing agreement shall take place prior to
final map approval and shall be recorded upon final map recordation or, where a map is not being
processed, prior to the issuance of building pen-nits for such lots or units.
E. The affordable housing agreement may require that more specific project and /or unit
restrictions be recorded at a future time.
F. The affordable housing agreement shall provide that the project applicant pay an
administrative fee to reimburse the City for all administrative and processing costs and fees incurred in
processing the affordable housing plan and implementing the requirements of this chapter on a project
specific basis. The City may waive the administrative fee as an incentive or offset for the provision of
inclusionary units.
G. The affordable housing agreement shall bind all future owners and successors in interest
for the term of years specified therein.
H. An affordable housing agreement, for which the inclusionary housing requirement will be
satisfied through new construction of inclusionary units, either on -site or off -site, shall establish, but not
be limited to, the following:
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File Number. 18 -894 Enactment Number. ORD 1565 -2018
1. The number of inclusionary dwelling units proposed, with specific calculations
detailing the application of any incentive adjustment credit;
2. The unit square footage, and number of bedrooms;
3. The location of the inclusionary units;
4. Amenities and services provided, such as daycare, after school programs,
transportation, job training/employment services and recreation;
5. Level and tenure of affordability for inclusionary units;
6. Schedule for production of dwelling units;
7. Approved offsets provided by the City;
8. Where applicable, requirements for other documents to be approved by the City,
such as marketing, leasing and management plans; financial assistance and loan documents; resale
agreements; and monitoring and compliance plans;
9. Where applicable, identification of the affordable housing developer and
agreements specifying their role and relationship to the project.
10. An affordable housing agreement, for which the inclusionary housing requirement
will be satisfied through payment to the City of any in -lieu contributions other than fee monies, such as
land dedication, shall include the method of determination, schedule and value of total in -lieu
contributions.
11. An affordable housing agreement will not be required for projects which will be
satisfying their inclusionary housing requirement through payment to the City of an in -lieu fee unless
the applicant requests payment options not provided by this chapter.
20.380.015 Agreement Amendments
Any amendment to an affordable housing agreement shall be processed in the same manner as an
original application for approval, except as authorized in Section 20.380.004(C).
20.380.016 Period of Affordability
The City or its designee shall have a first right of refusal to purchase inclusionary for sale units
offered for sale during the tenure of affordability. The first right of refusal to purchase the affordable
unit shall be submitted in writing to the director of the Department of Economic and Community
Development. Within 90 days of its receipt, the City shall indicate its intent to exercise the first right of
refusal for the purpose of providing affordable housing.
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File Number. 18 -894 Enactment Number: ORD 1565 -2018
20.380.017 Pre - Existing Approvals
Any project for which an executed development agreement has become effective prior to the
effective date of this ordinance, or for which a complete application for a vesting tentative map has been
filed prior to the effective date of this ordinance, shall not be subject to the requirements of this
ordinance, but shall be subject to the requirements of the City's inclusionary housing ordinance, if any,
in effect at the time the development agreement became effective or the complete vesting tentative map
application was filed.
20.380.018 Enforcement
Enforcement provisions are as follows:
A. The provisions of this chapter shall apply to all applicants and their agents, successors
and assigns proposing a residential development governed by this chapter. No building permit or
occupancy permit shall be issued, nor any entitlement granted, for a project which is not exempt and
does not meet the requirements of this chapter. All inclusionary units shall be rented or owned in
accordance with this chapter.
B. The applicant and its agents, successors and assigns shall annually certify tenants as to
the income eligibility for occupancy of inclusionary rental units and the annual certification shall be
submitted to the Department of Economic and Community Development. If applicant and its agents,
successors and assigns fail to perform an annual certification, applicant shall be fined $1,000 for each
inclusionary unit whose tenants were not subject to an annual certification. The City shall continue to
fine the applicant an additional $1,000 for every 30 -day period for each inclusionary unit whose tenants
have not been subject to an annual certification. City shall take steps to assess these fines as a lien
against either the property where the inclusionary units are located or against the project property.
C. If applicant at any time fails to make available or to provide below inclusionary rental
unit at the required affordable rent levels, applicant is subject to a fine of $2,500 for each inclusionary
unit not provided pursuant to the affordable housing agreement. The City shall continue to fine applicant
an additional $2,500 for every 30 -day period after the initial fine for each inclusionary unit not provided
pursuant to the affordable housing agreement. City shall take steps to assess these fines as a lien against
either the property where the inclusionary units are located or against the subject property.
D. If an owner sells a for -sale inclusionary unit during the 55 year affordability term at a
price higher than the maximum resale price in violation of this chapter, the City will be entitled to
receive from the seller the difference between the maximum resale price and the actual sales price of the
inclusionary unit. If an owner rents a rental inclusionary unit during the 55 year affordability term at a
rent higher than the affordable rent in violation of this chapter, the City will be entitled to receive from
the owner the difference between the affordable rent and the actual rental amount of the inclusionary
unit. Any funds recaptured by the City shall be placed in the housing trust fund as set forth in Section
20.380.012 of this chapter.
E. The City may institute any appropriate legal actions or proceedings necessary to ensure
compliance with this chapter, including but not limited to actions to revoke, deny or suspend any permit
or development approval. In the event the City must institute legal action to enforce the provisions of
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File Number: 18 -894 Enactment Number: ORD 1565 -2018
this ordinance, the City shall be entitled to recover its administrative costs, including reasonable
attorneys' fees, in addition to any other remedy provided by the court.
20.380.019 Savings Clause
All code provisions, ordinances, and parts of ordinances in conflict with the provisions of this
chapter are repealed. The provisions of this chapter, insofar as they are substantially the same as existing
code provisions relating to the same subject matter shall be construed as restatements and continuations
thereof and not as new enactments. With respect, however, to violations, rights accrued, liabilities
accrued, or appeals taken, prior to the effective date of this ordinance, under any chapter, ordinance, or
part of an ordinance shall be deemed to remain in full force for the purpose of sustaining any proper suit,
action, or other proceedings, with respect to any such violation, right, liability or appeal.
_SECTION 3. Severability
If any provision of this Ordinance or the application thereof to any person or circumstance is held
invalid or unconstitutional, the remainder of this Ordinance, including the application of such part or
provision to other persons or circumstances shall not be affected thereby and shall continue in full force
and effect. To this end, provisions of this Ordinance are severable. The City Council of the City of South
San Francisco hereby declares that it would have passed each section, subsection, subdivision,
paragraph, sentence, clause, or phrase hereof irrespective of the fact that any one or more sections,
subsections, subdivisions, paragraphs, sentences, clauses, or phrases be held unconstitutional, invalid, or
unenforceable.
SECTION 4. Compliance with the California Environmental Ouality Act
Approval of this ordinance is exempt from environmental review under the general rule in California
Environmental Quality Act ( "CEQA ") Guidelines Section 15061(b)(3) that CEQA only applies to
projects that have the potential for causing a significant effect on the environment. This ordinance
requires the inclusion of affordable housing units with some residential development projects. Those
projects will be the subject of independent environmental review, if required by CEQA, at the earliest
possible time prior to approval. It can therefore be seen with certainty that there is no possibility that the
adoption of the ordinance itself will have a significant effect on the environment.
SECTION 5. Publication and Effective Date of Ordinance
Pursuant to the provisions of Government Code Section 36933, a summary of this Ordinance shall be
prepared by the City Attorney. At least five (5) days prior to the Council meeting at which this
Ordinance is scheduled to be adopted, the City Clerk shall (1) publish the Summary, and (2) post in the
City Clerk's Office a certified copy of this Ordinance. Within fifteen (15) days after the adoption of this
Ordinance, the City Clerk shall (1) publish the summary, and (2) post in the City Clerk's Office a
certified copy of the full text of this Ordinance along with the names of those City Council members
voting for and against this Ordinance or otherwise voting. The effective date of this Ordinance shall be
November 1, 2018.
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Enactment Number. ORD 1565 -2018
Introduced at a regular meeting of the City Council of the City of South San Francisco held the 12th day
of September 2018.
At a meeting of the City Council on 9/26/2018, a motion was made by Mark Addiego, seconded by
Pradeep Gupta, that this Ordinance be adopted. The motion passed.
Yes: 5 Mayor Normandy, Mayor Pro Tem Matsumoto, Councilmember Garbarino,
Councilm Tnb rr upta, and Councilmember Addiego
by
Liza Normandy, Mayor
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