The density bonus ordinance codified in this chapter is intended to comply with the State Density Bonus Law, Government Code Section 65915, which provides that a local agency shall adopt an ordinance specifying how the agency will comply with that section.

(Ord. 16-2149, § 8, 2016)

1. Housing developments resulting in a net increase of at least five units (excluding density bonus units) are eligible for a density bonus as provided in this chapter, when the applicant for the housing development agrees or proposes at least one of the following and meets the requirements of Section 19.56.020C, if applicable:
   1. Construct:
      1. Ten percent of the total units affordable to lower income households at affordable rent or affordable housing cost; or
      2. Five percent of the total units affordable to very low income households at affordable rent or affordable housing cost; or
      3. Ten percent of the total units proposed in a common interest development for sale to moderate income households, provided that all units in the development are offered to the public for purchase; or
      4. A senior citizen housing development.
   2. Donate land in accordance with Section 19.56.030C;
   3. Provide affordable housing in a condominium conversion project in accordance with Section 19.56.030E.
2. In addition to meeting the requirements of 19.56.020A, a housing development which includes a child care facility in accordance with Section 19.56.030D, is entitled to an additional density bonus;
3. Housing developments on sites occupied by rental housing in the five-year period preceding the date of submittal of a density bonus application must either meet or provide:
   1. Affordable units in accordance with Section 19.56.020A; or
   2. Replacement affordable units in accordance with Government Code Section 65915(c)(3)(B), whichever requires a greater number of affordable units.
4. An applicant may also submit a proposal for specific incentives or concessions to be granted in conjunction with the density bonus, as provided in Section 19.56.040;
5. The granting of a density bonus, incentive or concession, in and of itself, shall not require a general plan amendment, zone change, or other discretionary approval and shall be reviewed concurrently with the review of the housing development.

(Ord. 16-2149, § 8, 2016)

A. Housing developments that meet the criteria in Section 19.56.020A(1) and Section 19.56.020C, if applicable, are eligible for a maximum density bonus as set forth in Table 19.56.030.

1. Incentives or Concessions:
   1. A housing development is eligible for incentives or concessions as shown in Table 19.56.040A. Incentives or concessions must be selected from only one category (very low, low, or moderate). No incentives or concessions are available for land donation or for a senior citizen housing development that is not affordable. Condominium conversions and day care centers may have one incentive or concession, or a density bonus, at the City's option, but not both.
      
      Table 19.56.040A: Incentives or Concessions Calculations:

      Unit Type	Percent of Affordable Units	Number of Incentives/ Concessions
      Very Low Income Units	5% or greater	1
      	10% or greater	2
      	15% or greater	3
      Low Income Units	10% or greater	1
      	17% or greater	2
      	24% or greater	3
      Moderate Income Units	10% or greater	1
      	20% or greater	2
      	30% or greater	3
      Affordable Housing Development	100%r*	4

      * Must meet the requirements of Government Code Section 65915(b)(1)(G) or successor provision.
   2. For purposes of this chapter, permissible incentives or concessions include, but are not limited to:
      1. A reduction of development standards or a modification of zoning code requirements or architectural design requirements that exceed the minimum building standards approved by the California Building Standards Commission as provided in Part 2.5 (commencing with Section 18901) of Division 13 of the Health and Safety Code, including but not limited to, a reduction in setback requirements, square footage or parking requirements, such that the reduction or modification results in identifiable, financially sufficient, and actual cost reductions.
      2. Approval of mixed-use zoning in conjunction with the housing development if commercial, office, industrial or other land uses will reduce the cost of the housing development, and if the commercial, office, industrial or other land uses are compatible with the housing development and the existing or planned development in the area where the proposed housing development will be located;
      3. Other regulatory incentives or concessions proposed by the developer or the City, which result in identifiable, financially sufficient, and actual cost reductions.
   3. Nothing in this section requires the provision of direct financial incentives for the housing development, including but not limited to the provision of financial subsidies, publicly owned land by the City or the waiver of fees or dedication requirements. The City, at its sole discretion, may choose to provide such direct financial incentives;
   4. A housing development which requests incentives or concessions must demonstrate, in compliance with Section 19.56.060B, that the requested incentives or concessions are required to provide for affordable rents or affordable housing costs, as applicable.
2. Waivers:
   1. An applicant may submit to the City a proposal for the waiver or reduction of development standards that will have the effect of physically precluding the construction of a housing development meeting the criteria outlined in Section 19.56.020 at the densities or with the concessions or incentives permitted under this chapter.
   2. A proposal for the waiver or reduction of development standards shall neither reduce nor increase the number of incentives or concessions to which the applicant is entitled to subject to Section 19.56.040A.
   3. The applicant shall demonstrate that the development standards that are requested to be waived will have the effect of physically precluding the construction of the development with the density bonuses and incentives or concessions.
3. Reduction of Parking Standards:
   1. If a housing development is eligible for density bonus as provided in Section 19.56.020, upon request of the applicant, the maximum off-street parking standards that can be applied to the housing portion of the development, inclusive of handicapped and guest parking are indicated in Table 19.56.040B. These may include tandem and uncovered parking spaces but not on-street parking spaces.
      
      Table 19.56.040B: Off-street parking standards for projects eligible for a density bonus:

      Number of bedrooms	Maximum number of required off-street parking spaces
      0 – 1	One (1)
      2 – 3	Two (2)
      4 +	Two and one-half (2.5)

   2. For certain other housing developments that are eligible for a density bonus as provided in Section 19.56.020, upon request of the applicant, the maximum off-street parking standards that can be applied for the housing portion of the development, inclusive of handicapped and guest parking, are indicated in Table 19.56.040C. These may include tandem and uncovered parking spaces but not on-street parking spaces.
      
      Table 19.56.040C: Off-street parking standards for certain housing developments:

      Type of development	Maximum number of required off-street parking spaces
      1. Rental or ownership housing development with: At least 11% very low income or 20% low income units; and Within one-half mile of a Major Transit Stop; and Unobstructed Access to the Major Transit Stop.	0.5 per bedroom
      2. Rental housing development with All units affordable to lower income households except manager's unit(s); and Within one-half mile of a Major Transit Stop; and Unobstructed Access to the Major Transit Stop.	0.5 per unit
      3. Rental housing development with: All units affordable to lower income households except manager's unit(s); and A senior citizen housing development; and either Has paratransit service; or Is within one-half mile of fixed bus route service that operates 8 times per day, with Unobstructed Access to that service.	0.5 per unit
      4. Rental housing development with: All units affordable to lower income households except manager's unit(s); and A Special Needs Housing development; and either Has paratransit service; or Is within one-half mile of fixed bus route service that operates 8 times per day, with Unobstructed Access to that service.	0.3 per unit

   3. If the City, at its cost, has conducted an area-wide or City-wide parking study in the last seven years, then the City may find, based on substantial evidence, that a higher parking ratio is required than shown in Table 19.56.040C. In no event, may the required parking be greater than the ratio shown in Table 19.56.040B. The parking study must conform to the requirements of Government Code Section 65915(p)(7).

(Ord. 21-2230, § 3, 2021; Ord. 16-2149, § 8, 2016)

1. Affordable rental low and very low income units must remain affordable to low or very low income households, as applicable, for fifty-five (55) years or for a longer period of time if required by a construction or mortgage financing assistance program, mortgage insurance program, or rental subsidy program. Affordable for-sale moderate income units must remain affordable to moderate-income households for the duration required by Chapter 19.172, Below Market Rate Housing Program and implementing procedures and policies adopted by the City Council, or for a longer period of time if required by a construction or mortgage financing assistance program, mortgage insurance program, or subsidy program. Sales price for for-sale affordable very low, low, and moderate income units shall be set at affordable housing cost. Rents for affordable low and very low income rental units shall be set at an affordable level.
2. The affordable dwelling units and land dedication that qualify a housing development for a density bonus may also be used to meet the below-market-rate housing provisions of the City's Residential Housing Mitigation Program, provided that the affordable units and land dedication comply with the requirements of both Chapter 19.56, Density Bonus, Chapter 19.172, Below Market Rate Housing Program; and implementing procedures and policies adopted by the City Council regarding the required number of affordable units, required level of affordability, and term of affordability so as to provide the greatest affordability to the most households for the longest term.
3. Unless otherwise governed by other funding sources, to the extent consistent with fair housing laws, preferences for the affordable units will be given as specified in Chapter 19.172, Below Market Rate Housing Program, and implementing procedures and policies adopted by the City Council.
4. An agreement shall be entered into between the developer and the City to ensure compliance with the provisions of this chapter and state law and shall include, without limitation the household type, number, location, size, affordability, and construction scheduling of all affordable units, and such information as shall be required by the City for the purpose of determining the developer's compliance with this chapter. For rental affordable very low and low income units, the agreement shall additionally contain, without limitation, provisions for certification of tenant incomes, reporting and monitoring of affordable units, and management and maintenance of affordable units.
5. The agreement shall be recorded against the housing development prior to final or parcel map approval, or, prior to issuance of any building permits, whichever occurs first, and shall be binding on all future owners and successors in interest.
6. Affordable units in a project and phases of a project shall be constructed concurrently with or prior to the construction of market-rate units.
7. Affordable units shall be provided as follows:
   1. Affordable units shall be dispersed throughout the project;
   2. Affordable units shall be identical with the design of any market rate rental units in the project with the exception that a reduction of interior amenities for affordable units will be permitted upon prior approval by the City Council as necessary to retain project affordability.
8. Prior to the rental or sale of any affordable unit, the City or its designee, shall verify the eligibility of the prospective tenant or buyer. All affordable units shall be occupied by the household type that qualified the housing development for the density bonus and incentives or concessions.
9. The City may establish fees for processing applications under this chapter and recovery of costs associated with the establishment and monitoring of affordable units.

(Ord. 16-2149, § 8, 2016)

1. An applicant may submit a preliminary proposal for housing development for a density bonus and incentives or concessions prior to the submittal of any formal application.
2. All requests pursuant to this Chapter shall be submitted to the City concurrently with the application for the first discretionary permit or other permit required for the housing development and shall be processed concurrently with the discretionary application following the review process as set forth for permits in Chapter 19.12, Administration, of the Cupertino Municipal Code established by the City. The applicant shall provide additional information as specified in this chapter, specifically:
   1. A summary table showing the maximum number of units permitted by the zoning and general plan excluding any density bonus units, proposed affordable units by income level, proposed bonus percentage, proposed number of density bonus units, and total number of proposed dwelling units on site;
   2. A site plan, drawn to scale, showing the number and location of all proposed units, designating the location of proposed affordable units and density bonus units and the type, size, and construction scheduling of affordable and market-rate units;
   3. For a housing development that replaces rental housing on a site within the five-year period preceding the date of an application:
      1. A description and documentation of all dwelling units existing on the site in the five-year period preceding the date of submittal of the application and identification of any units rented in the five-year period. If dwelling units on the site are rented as of the date of application, income and household size of all residents of the occupied units. If any dwelling units on the site were rented in the five-year period but are not currently rented, the income and household size, if known, of residents occupying dwelling units when the site contained the maximum number of dwelling units; and
      2. Documentation of recorded covenant, ordinance, or law applicable to the site that restricted rents to levels affordable to very low or lower income households in the five-year period preceding the date of submittal of the application.
   4. If a density bonus is requested for a land donation, the location of the land to be dedicated, proof of site control, and evidence that each of the requirements included in Section 19.56.030C can be met.
   5. If a density bonus or incentive or concession is requested for a child care facility, evidence that all of the requirements in Section 19.56.030D can be met.
   6. If a density bonus or incentive or concession is requested for a condominium conversion, evidence that all of the requirements in Section 19.56.030E can be met.
   7. A written statement specifying the various incentives or concessions, waivers and reduction in off-street parking standards requested;
   8. To ensure that each incentive or concession contributes significantly to the economic feasibility of the proposed affordable housing, for any incentive(s) or concession(s) requested, the following shall be submitted:
      1. A project financial report (which may be in the form of a pro forma) demonstrating that the requested incentive(s) or concession(s) will result in identifiable, financially sufficient, and actual cost reductions to the housing development and that they are required to provide for affordable rents or affordable housing costs, as applicable. The financial report shall include the capital costs, operating expenses, return on investment, loan-to-value ratio and the debt coverage ratio including the contribution(s) provided by any applicable subsidy program(s);
      2. An appraisal report indicating the value of the density bonus and of the incentive(s) or concession(s); and
      3. A use of funds statement identifying the financial gaps for the housing development with the affordable housing units. The analysis shall show how the funding gap relates to the incentive(s) or concession(s); and
      4. A deposit to cover any expenses that the City expects to incur in retaining consultant(s) and in administering consultant contract(s) to provide a peer review of the above information. However, if the applicant is a federally recognized nonprofit organization proposing a housing development where all units (except manager's unit(s)) are affordable to lower income households, the cost of consultant(s) may be paid by the City upon prior approval of the City Council;
   9. For any requested waiver of a development standard, plans showing the existing development standard, the requested waiver and a demonstration that the development standard for which the waiver is requested will have the effect of physically precluding the construction of the housing development with the density bonus and incentives or concessions that the applicant is entitled to.
   10. If a mixed use building or project is proposed as an incentive or concession, evidence that non-residential land uses will reduce the cost of the housing development and that the non-residential land uses are compatible with the development and the existing or planned development in the area.
   11. If a parking reduction is proposed, a table showing parking otherwise required by the zoning ordinance and the proposed parking. If a parking reduction shown in Table 19.56.040C is requested, evidence that the housing development is eligible for the requested parking reduction.
   12. Any other information requested by the Director of Community Development to determine if the required findings can be made.

(Ord. 16-2149, § 8, 2016)

1. Before approving an application that includes a request for a density bonus, incentive or concession, waiver or reduction in parking standards, pursuant to this chapter, the decision-making body shall determine that the proposal is consistent with State Law by making the following findings, as applicable:
   1. That the housing development is eligible for the density bonus requested and any incentives or concessions, waivers or reductions in parking standards requested.
   2. That all the requirements included in Section 19.56.030C have been met, if the density bonus is based all or in part on donation of land.
   3. That all the requirements included in Section 19.56.030D have been met, if the density bonus or incentive(s) or concession(s) are based all or in part on the inclusion of a child care facility.
   4. That all the requirements included in Section 19.56.030E have been met, if the density bonus or incentive or concession is based on a condominium conversion.
   5. That the requested incentive(s) or concession(s) will result in identifiable, financially sufficient, and actual cost reductions based upon the financial analysis and documentation provided by the applicant and the findings of the peer-reviewer, if incentive(s) or concession(s) are requested (other than mixed use development).
   6. That the proposed non-residential land uses within the proposed development will reduce the cost of the housing development and are compatible with the housing development and the existing or planned development in the area where the proposed development will be located, if an incentive or concession is requested for mixed use development.
   7. That the development standard(s) for which the waiver(s) are requested would have the effect of physically precluding the construction of the housing development with the density bonus and incentives or concessions permitted, if a waiver is requested.
   8. That all the applicable requirements in Section 19.56.040C have been met, if a reduction in off-street parking standards for an eligible housing development is requested.
2. If the findings required by subsection (A) of this section, as applicable, can be made, the decision-making body may deny an application for an incentive or concession or waiver requested pursuant to Section 19.56.040 only if one of the following written findings as applicable to each type of application, supported by substantial evidence:
   1. That the incentive or concession, or waiver would have an adverse impact on real property listed in the California Register of Historic Resources; or
   2. That the incentive or concession, or waiver would have a specific, adverse impact upon public health or safety or the physical environment, and there is no feasible method to satisfactorily mitigate or avoid the specific, adverse impact without rendering the residential project unaffordable to low and moderate income households. For the purpose of this subsection, "specific, adverse impact" means a significant, quantifiable, direct, and unavoidable impact, based on objective, identified, written public health or safety standards, policies, or conditions as they existed on the date that the application for the residential project was deemed complete; or
   3. That the incentive or concession, or waiver is contrary to state or federal law.
3. An application for an incentive or concession may also be denied if the decision-making body makes the written finding, supported by substantial evidence, that the requested incentive or concession is not required to provide for affordable housing costs or affordable rents.
4. If the findings required by subsection A. of this section can be made, the decision-making body may deny an application for a density bonus or incentive or concession that is based on the provision of child care only if it makes a written finding, based on substantial evidence, that the city already has adequate child care facilities.

(Ord. 16-2149, § 8, 2016)

If any portion of this Chapter 19.56 conflicts with State Density Bonus Law (Government Code Section 65915 et seq.) or other applicable state law, state law shall supersede this Chapter. Any ambiguities in this section shall be interpreted to be consistent with State Density Bonus Law. All code references in this Chapter include all successor provisions.

(Ord. 21-2230, § 3, 2021)

B. Senior housing developments are entitled to a maximum density bonus of 20 percent provided the development comprises of at least 35 units, conforms to Civil Code Section 51.3 and the units are reserved for qualifying residents. The development does not have to provide affordable units unless subject to Section 19.56.020C.

C. Donation of Land:

1. When an applicant donates land to the City or to a housing developer approved by the City in accordance with the requirements of Section 19.56.030C(2) and meets the requirements of Section 19.56.020C, the development shall be entitled to a 15 percent density bonus. The development is entitled to an additional one percent density bonus for the donation of land that would allow the development of an additional one percent of affordable units above the minimum requirements in Section 19.56.020A(1), up to a maximum of 35 percent.
2. The donation of land must meet the following requirements:
   1. The land shall be donated and transferred no later than the date of approval of the housing development, final subdivision map, parcel map, or building permit, whichever occurs first.
   2. The developable acreage and zoning classification of the land being transferred are sufficient to permit construction of units affordable to very low income households in an amount not less than ten percent of the number of residential units of the proposed development.
   3. The transferred land is at least one acre in size or of sufficient size to permit development of at least 40 units, has the appropriate General Plan designation, is appropriately zoned with appropriate development standards for development at the density described in Government Code Section 65583.2(c)(3), and is or will be served at the time of construction, by adequate public facilities and infrastructure.
   4. The transferred land shall have all of the permits and approvals, other than building permits, necessary for the development of the very low income housing units on the transferred land no later than the date of approval of the final subdivision map, parcel map, or building permit, whichever occurs first, except that the City may subject the proposed development to subsequent design review to the extent authorized by Government Code Section 65583.2(i) if the design is not reviewed by the City prior to the time of transfer.
   5. The land shall be transferred to the City or to a housing developer approved by the City. The City may require the applicant to identify and transfer the land to the developer.
   6. The transferred land shall be within the boundary of the proposed development or, if the City agrees, within one-quarter mile of the boundary of the proposed development.
   7. A proposed source of funding for the very low income units shall be identified not later than the date of approval of the proposed housing development.
   8. The transferred land and the affordable units shall be subject to a deed restriction ensuring continued affordability of the units consistent with Section 19.56.050A, such deed restriction shall be recorded at the time of transfer.

D. Provision of Child Day Care Facilities

1. When a housing development is proposed that contains affordable housing, as provided in Section 19.56.030A and Section 19.56.030C, and includes a child day care facility that will be located on the premises of, as part of, or adjacent to, the project, the City shall grant either of the following if requested by the developer:
   1. An additional density bonus in residential square footage that is equal to or greater than the square footage of the child day care facility.
   2. An additional concession or incentive that contributes significantly to the economic feasibility of the construction of the child day care facility in accordance with Section 19.56.040.
2. The City shall also require that as a condition of approving the housing development:
   1. The child day care facility shall remain in operation for a period of time that is as long as or longer than the period of time during which the affordable units are required to remain affordable.
   2. Of the children who attend the child day care facility, the children of very low income households, lower income households, or families of moderate income shall equal a percentage that is equal to or greater than the percentage of dwelling units that are required for very low income households, lower income households, or families of moderate income.
3. Notwithstanding any requirement of Section 19.56.030D, the City shall not be required to provide a density bonus or concession for a child day care facility if the City finds, based upon substantial evidence, that the City has adequate child day care facilities.

E. Condominium Conversions

1. When an applicant for approval of a condominium conversion agrees to provide at least 33 percent of the total units of the proposed condominium project to low or moderate income households, or 15 percent of the total units of the proposed condominium project to lower income households; to include the affordable units required by Section 19.56.020C, if applicable, and agrees to pay for the reasonably necessary administrative costs incurred by the City, the City shall either:
   1. Grant a density bonus of 25 percent over the number of apartments to be provided within the existing structure or structures proposed for conversion; or
   2. Provide other incentives of equivalent financial value. This shall not require the City to provide cash transfer payments or other monetary compensation but may include the reduction or waiver of requirements that the City might otherwise apply as conditions of conversion approval.
2. The City may place such reasonable conditions on the granting of a density bonus or other incentives of equivalent financial value as the City finds appropriate. The proposed lower or moderate income units shall be subject to a deed restriction ensuring continued affordability to lower or moderate income households consistent with Section 19.56.050A.
3. An application shall be ineligible for a density bonus or other incentives under this section, if the apartments proposed for conversion constitute a housing development for which a density bonus or other incentives were previously provided under Government Code Section 65915 or this Chapter.
4. Nothing in this section shall be construed to require the City to approve a proposal for a condominium conversion. Condominium conversions are subject to the requirements of Chapter 19.116.

F. Density Bonus Calculations:

1. A density bonus may be selected from only one category listed in Section 19.56.020A(1), except that density bonuses for land donation may be combined with others, up to a combined maximum of 50 percent, and an additional square-foot bonus may be granted for a child day care facility as provided in Section 19.56.030C.
2. In determining the number of density bonus units to be granted, any fractions of density bonus units shall be rounded up to the next whole number.
3. Density bonus units authorized by this section shall not be included when determining the number of affordable units required to qualify for the density bonus. In determining the number of affordable units required to qualify for a density bonus, any fractions of affordable units shall be rounded up to the next whole number.
4. An applicant may request a lower density bonus than the housing development is entitled to, but no reduction will be permitted in the percentage of required affordable units as shown in Section 19.56.020 or Section 19.56.020C.
5. Regardless of the percentage of affordable units, no housing development will be entitled to a density bonus of more than provided in Government Code Section 65915, unless approved by the City pursuant to Section 19.56.030F(6).
6. The City, at its discretion, may grant a density bonus higher than the maximum set forth in Table 19.56.030 or in paragraph (5) above to a housing development where all units (except manager’s unit(s)) are affordable to lower income households.
7. For purposes of calculating a density bonus, the residential units do not have to be based upon individual subdivision maps or parcels. The bonus units shall be permitted in geographic areas of the housing development other than the areas where the affordable units are located.

(Ord. 21-2230, § 3, 2021; Ord. 21-2226, §§ 3.1, 3.2, 2021; Ord. 16-2149, § 8, 2016)