Encourage the development and availability of housing affordable to a broad range of House-holds with varying income levels within the City as mandated by State Law, California Government Code Sections 65580 et seq.;

Promote the City's goal to add affordable housing units to the City's housing stock in proportion to the overall increase in new jobs and housing units;

Offset the demand on housing that is created by new development and mitigate environmental and other impacts that accompany new residential and commercial 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; and

Increase the supply of affordable ownership and rental housing in San Leandro as identified in the established Housing Element Goal 53, Affordable Housing Development. Policy 53.04 of Goal 53 requires the inclusion of affordable housing in new housing developments.

Both California and the City face a serious housing problem that threatens their economic security. Lack of access to affordable housing has a direct impact upon the health, safety and welfare of the residents of the City. The City will not be able to contribute to the attainment of State housing goals or to retain a healthy environment without additional affordable housing. The housing problem has an impact upon a broad range of income groups including many who are not impoverished by standards other than those applicable to California's and the City's housing markets, and no single housing program will be sufficient to meet the housing need.

Rising land prices along with limited available land have been key factors in preventing development of new affordable housing. New housing construction in the City which does not include affordable units aggravates the existing shortage of affordable housing by absorbing the supply of available residential land. This reduces the supply of land for affordable housing and increases the price of remaining residential land. At the same time new housing contributes to the demand for goods and services in the City, increasing local service employment at wage levels which do not permit employees to afford housing in the City. Providing the affordable units required by this ordinance will help to insure that part of the City's remaining developable land is used to provide affordable housing.

The City's adopted Housing Element has determined that 35 percent to 40 percent of the Households in the city have very low or low incomes. There is an affordability gap for low and very low income Households in San Leandro for both rental and for sale units. Among City groups identified in the Housing Element with especially significant housing needs are large and extended families. Also, currently there are limited housing choices for young adults or singles within San Leandro.

Development of new commercial projects and Market-Rate housing encourages new residents to move to the City. These new residents will place demands on services provided by both public and private sectors. Some of these employees earn incomes only adequate to pay for affordable housing, not market rate housing. Because affordable housing is in short supply within the City, these employees may 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. These circumstances harm the City's ability to attain goals articulated in the City's General Plan.

A lack of new inclusionary units will have a substantial negative impact on the environment and economic climate because: (1) housing will have to be built elsewhere, far from employment centers and, therefore, commutes will increase, causing increased traffic and transit demand and consequent noise and air pollution; and (2) City businesses will find it more difficult to attract and retain the workers they need. Inclusionary housing policies contribute to a healthy job and housing balance by providing more affordable housing close to employment centers.

The California Legislature has required each local government agency to develop a comprehensive, long-term general plan establishing policies for future development. As specified in the Government Code (at Sections 65300, 65302(c), and 65583(c)), the plan must: (1) "encourage the development of a variety of types of housing for all income levels, including multifamily rental housing"; (2) "assist in the development of adequate housing to meet the needs of low-and moderate-income Households"; and (3) "conserve and improve the condition of the existing affordable housing stock, which may include addressing ways to mitigate the loss of dwelling units demolished by public or private action."

The citizens of the City seek a well-planned, aesthetically pleasing and balanced community, with housing affordable to very low-, low-and moderate-income Households. Affordable housing should be available throughout the City, and not restricted to a few neighborhoods and areas. Therefore, our primary goal with this policy is to have diverse housing. However, there may also be trade-offs where constructing affordable units at a different site than the site of the principal project may produce a greater number of affordable units without additional costs to the project applicant. Thus, the City finds that in certain limited circumstances, the purposes of this chapter may be better served by allowing the developer to comply with the inclusionary requirement through alternative means, such as development of off-site housing or dedication of land. For example, if a project applicant can produce a significantly greater number of affordable units off-site, it may (but not always) be in the best interest of the City to permit the development of affordable units at a different location than that of the principal project.

Federal and state funds for the construction of new affordable housing are insufficient to fully address the problem of affordable housing within the City. Nor has the private housing market provided adequate housing opportunities affordable to moderate-, low-and very low-income Households.

Calculation. For purposes of calculating the number of inclusionary units required by this chapter, any additional units authorized as a density bonus under California Government Code Section 65915(b)(1) or (b)(2) will not be counted in determining the required number of Inclusionary Units. In determining the number of whole Inclusionary Units required, any decimal fraction of 0.5 or more shall be rounded up to the nearest whole number.

Rental Project. The Inclusionary Units must be restricted to occupancy as follows:

For Sale Project. The Inclusionary Units shall be restricted to occupancy as follows:

Sequencing Inclusionary Units. To assure that the inclusionary units are occupied at the beginning of the project, a provision outlining the sequencing of the units will be included in the Inclusionary Housing Plan. An example of sequencing might be requiring the very low income inclusionary units to be occupied before moderate- or low-income or affordable units constructed in proportion to construction of Market Rate Units.

The reconstruction of any structures that have been destroyed by fire, flood, earthquake or other act of nature.

Developments that already have more units that qualify as affordable to moderate-, low-and very low-income Households than this chapter requires.

Housing constructed by other government agencies.

Accessory dwelling units.

Design. Inclusionary Units built under this chapter shall generally be indistinguishable from the Market Rate Units and shall conform to the following standards:

Timing. All Inclusionary Units must be constructed and occupied concurrently with or prior to the construction and occupancy of Market-Rate Units or development or in accordance with the approved Inclusionary Housing Plan sequencing requirements. In phased developments, Inclusionary Units must be constructed and occupied in proportion to the number of units in each phase of the Residential Development.

Duration of Affordability Requirement. Inclusionary Units produced under this ordinance must be legally restricted to occupancy by Households of the income levels for which the units were designated for a minimum of 55 years for rental units and 45 years for owner occupied units.

Timing of Payment. The fee shall be calculated based on the price and cost figures established by the City at the time of building permit issuance. The fee must be paid prior to the issuance of the first building permit for the Development with the option to establish an alternative payment schedule if approved by the Community Development Director or designee. For phased developments, payments may be made for each portion prior to the issuance of a Building Permit for that phase. When payment is delayed, in the event of default, or for any other reason, the amount of the in-lieu fee payable under this chapter will be based upon the fee schedule in effect at the time the fee is paid.

Effect of No Payment. No final inspection for occupancy will be completed for any corresponding Market-Rate Unit in a Residential Development unless fees required under this chapter have been paid in full to the City.

General. The Approval Authority shall approve, conditionally approve, or reject the Inclusionary Housing Plan concurrent with action on any tentative map, parcel map, or planning approval for any Residential Development for which this chapter applies. The subsequent Inclusionary Housing Agreement shall be approved by the Community Development Director prior to approval of a final map or building permit for the applicable Residential Development. This section does not apply to projects where the requirements of this chapter are satisfied by payment of an in lieu fee under Section 6.04.124 In-Lieu Fees.

Inclusionary Housing Plan. The Community Development Director must determine completeness within 30 days of submittal of a complete application. If the Inclusionary Housing Plan is incomplete, the Inclusionary Housing Plan will be returned to the Developer along with a list of the deficiencies or the information required. No application for a tentative map, parcel map or planning approval to which this chapter applies may be deemed complete until an Inclusionary Housing Plan is submitted to the Community Development Director. At any time during the review process, the Community Development Director may require from the Developer additional information reasonably necessary to clarify and supplement the application or determine the consistency of the proposed Inclusionary Housing Plan with the requirements of this chapter. The Inclusionary Housing Plan must include:

Inclusionary Housing Agreement. The Inclusionary Housing Agreement shall consist of deeds of trust and other documents that address resale and rental restrictions, rights of first refusal, and other items required by this subsection. Any changes to such documents which materially alter any policy in the document, must be approved by the Community Development Director prior to being executed with respect to any Residential Development or affordable housing proposals. The form of the Inclusionary Housing Agreement will vary depending on the manner in which the provisions of this chapter are satisfied for a particular development. All Inclusionary Housing Agreements must include, at a minimum, the following:

Recording of Agreement. Inclusionary Housing Agreements that are acceptable to the Community Development Director must be recorded against owner-occupied Inclusionary Units and residential projects containing rental Inclusionary Units. Additional rental or resale restrictions, deeds of trust, rights of first refusal and/or other documents acceptable to the Community Development Director must also be recorded against owner-occupied Inclusionary Units. In cases where the requirements of this chapter are satisfied through the development of Off-Site Units, the Inclusionary Housing Agreement must simultaneously be recorded against the property where the Off-Site Units are to be developed.

Developer Proposal. A Developer may propose and the Approval Authority may approve an alternative means of compliance with an Inclusionary Housing Plan as provided in Subsection B of Section 6.04.128 Compliance Procedures which may include, but is not limited to the following provisions:

Discretion. The Approval Authority may approve, conditionally approve or reject any alternative proposed by a Developer as part of an Inclusionary Housing Plan. Any approval or conditional approval must be based on a finding that the purposes of this chapter would be better served by implementation of the proposed alternative(s). In determining whether the purposes of this chapter would be better served under the proposed alternative, the Approval Authority shall consider: (1) whether implementation of an alternative would overly concentrate Inclusionary Units within any specific area and, if so, must reject the alternative unless the undesirable concentration of Inclusionary Units is offset by other identified benefits that flow from implementation of the alternative in issue; and (2) the extent to which other factors affect the feasibility of prompt construction of the Inclusionary Units on the property, such as costs and delays, the need for an appraisal, site design, zoning infrastructure, clear title, grading and environmental review.

Additional incentives may be provided in accord with the Density Bonus Ordinance, Chapter 6.08 Residential Density Bonus. However, the density bonus affordable housing production requirements would be in addition to the requirements to provide inclusionary units.

The Approval Authority may consider flexibility in zoning standards for a Residential Development such as, but not limited to, maximum density, lot size, lot width, yards, and parking in order to better accommodate the required Inclusionary Units if it is determined that such flexibility would result in a higher quality project and would improve the financial feasibility of the project.

General Eligibility. No Household may occupy an Inclusionary Unit unless the City or its designee has approved the Household's eligibility. If the City or its designee maintains a list or identifies eligible Households, initial and subsequent occupants will be selected first from the list of identified Households, to the maximum extent possible, in accordance with any rules approved by the Community Development Director.

Occupancy. Any Household that occupies a rental Inclusionary Unit or purchases an Inclusionary Unit must occupy that unit as a principal residence.

Initial Sales Price. The initial sales price of the Inclusionary Unit must be set so that the eligible Household will pay an Affordable Ownership Cost.

Resale Agreement. The initial purchaser of each Inclusionary Unit shall execute an instrument or agreement approved by the City restricting the sale of the Inclusionary Unit in accordance with this chapter during the applicable use restriction period. Such instrument or agreement shall be recorded against the parcel containing the Inclusionary Unit and shall contain such provisions as the City may require to ensure continued compliance with this chapter.

Resale. The maximum sales price permitted on resale of the Inclusionary Unit designated for owner-occupancy shall be the lower of: (1) fair market value; or (2) the seller's lawful purchase price, increased by the lesser of: (a) the rate of increase of Area Median Income during the seller's ownership, or (b) the rate at which the consumer price index increased during the seller's ownership. To the extent authorized in any resale restrictions or operative Inclusionary Housing Agreement, sellers may recover, at time of sale, the market value of capital improvements made by the seller and the seller's necessary and usual costs of sale, and may authorize an increase in the maximum allowable sales price to achieve such recovery feasible.

Changes in Title. Title in the Inclusionary Unit may change due to changes in circumstance, including death, marriage and divorce. Except as otherwise provided, if a change in title is occasioned by events that change the financial situation of the Household so that it is no longer income-eligible, then the property must be sold to an income-eligible Household within 180 days from the date of the event. Upon the death of one of the owners, title in the property may transfer to the surviving joint tenant without respect to the income-eligibility of the Household. Upon the death of a sole owner or all owners and inheritance of the Inclusionary Unit by a non-income-eligible child or step child of one or more owners, there will be a one-year compassion period between the time when the estate is settled and the time when the property must be sold to an income-eligible Household. Inheritance of an Inclusionary Unit by any other person whose Household is not income-eligible shall require resale of the unit to an income-eligible Household as soon as is feasible but not more than 180 days.

Selection of Tenants. The owners of rental Inclusionary Units may fill vacant units by selecting income-eligible Households from the Section 8 Housing Choice Voucher Waiting List maintained by the Alameda County Housing Authority or any other list maintained by the City or City's designee. Alternatively, owners may fill vacant units through their own selection process, provided that they publish notices of the availability of Inclusionary Units according to guidelines established by the Community Development Director.

Annual Report. The owner shall submit an annual report summarizing the occupancy of each Inclusionary Unit for the year, demonstrating the continuing income-eligibility of the tenant. The Community Development Director may require additional information if he or she deems it necessary.

Subsequent Rental to Income-Eligible Tenant. The owner shall apply the same rental terms and conditions to tenants of Inclusionary Units as are applied to all other tenants, except as required to comply with this chapter (for example, rent levels, occupancy restrictions and income requirements) or with other applicable government subsidy programs. Discrimination against persons receiving housing assistance is prohibited.

Changes in Tenant Income. If, after moving into an Inclusionary Unit, a tenant's Household income exceeds the limit for that unit, the tenant Household may remain in the unit as long as his or her Household income does not exceed 140 percent of the income limit. Once the tenant's income exceeds 140 percent of the income limit, the following shall apply:

Timing. To receive an adjustment or waiver, the Developer must make a showing when applying for a first approval for the Residential Development, and/or as part of any appeal that the City provides as part of the process for the first approval.

Considerations. In making a determination on an application to adjust or waive the requirements of this chapter, the Approval Authority may assume each of the following when applicable: (1) that the Developer is subject to the inclusionary housing requirement or in-lieu fee; (2) the extent to which the Developer will benefit from inclusionary incentives under Section 6.04.136 Incentives for Rental and For-Sale On-Site Housing; (3) that the Developer will be obligated to provide the most economical Inclusionary Units feasible in terms of construction, design, location and tenure; and (4) that the Developer is likely to obtain other housing subsidies where such funds are reasonably available.

Modification of Plan. If the Approval Authority determines that the application of the provisions of this chapter lacks a reasonable relationship between the impact of a proposed residential project and the requirements of this chapter, or that applying the requirement of this chapter would take property in violation of the United States or California Constitutions, the Inclusionary Housing Plan shall be modified, adjusted or waived to reduce the obligations under this chapter to the extent necessary to avoid an unconstitutional result. If the Approval Authority determines no violation of the United States or California Constitutions would occur through application of this chapter, the requirements of this chapter remain applicable.

The Trust Fund. There is hereby established a separate Affordable Housing Trust Fund ("Fund"). This Fund shall receive all fees contributed under Section 6.04.124 In-Lieu Fees, as required in Section 66606(a) of the California Government Code. The Fund may also receive monies from other sources.

Purpose and Limitations. Monies deposited in the Fund must be used to increase and improve the supply of housing affordable to moderate-, low-, and very low-income Households in the City. Monies may also be used to cover reasonable administrative or related expenses associated with the administration of this chapter.

Administration. The fund shall be administered by the Community Development Director, who may develop procedures to implement the purposes of the Fund consistent with the requirements of this chapter and any adopted budget of the City.

Expenditures. Fund monies shall be used in accordance with City's Housing Element, Consolidated Plan or subsequent plan adopted by the City Council to construct or convert to affordable housing or assist other governmental entities, private organizations or individuals to do so. Permissible uses include, but are not limited to, assistance to housing development corporations, equity participation loans, grants, pre-home ownership co-investment, pre-development loan funds, participation leases or other public-private partnership arrangements. The Fund may be used for the benefit of both rental and owner-occupied housing. The Fund may also be used to administer the City's housing monitoring program to assure long term compliance with all affordable housing agreements.

Annual Report. The Community Development Director shall provide a report to the City Council on the status of activities undertaken with the Fund as provided by Section 66006(b) of the California Government Code. The City Council shall review the information made available to the public at the next regularly scheduled public meeting, not less than 15 days after this information is made available to the City Council and the public. Notice of the time and place of the meeting, including the address where this information may be reviewed, shall be mailed, at least 15 days prior to the meeting, to any interested party who files a written request with the City for mailed notice of the meeting.

The report shall include a statement of income, expenses, disbursements and other uses of the Fund. The report should also state the number and type of inclusionary units constructed or assisted during that year and the amount of such assistance. The report will evaluate the efficiency of this chapter in mitigating the City's shortage of affordable housing and recommend any changes to this chapter necessary to carry out its purposes, including any adjustments to the number of units to be required.

Penalty for Violation. It shall be a misdemeanor to violate any provision of this chapter. Without limiting the generality of the foregoing, it shall also be a misdemeanor for any person to sell or rent to another person an affordable unit under this chapter at a price or rent exceeding the maximum allowed under this chapter or to sell or rent an inclusionary unit to a Household not qualified under this chapter. It shall further be a misdemeanor for any person to provide false or materially incomplete information to the City or to a seller or lessor of an Inclusionary Unit to obtain occupancy of housing for which he or she is not eligible.

Legal Action. The City may institute any appropriate legal actions or proceedings necessary to ensure compliance with this chapter, including: (1) actions to revoke, deny or suspend any permit, including a building permit, certificate of occupancy, or discretionary approval; (2) actions to recover from any violator of this chapter civil fines, restitution to prevent unjust enrichment from a violation of this chapter, and/or enforcement costs, including attorneys fees; (3) eviction or foreclosure; and (4) any other appropriate action for injunctive relief or damages. Failure of any official or agency to fulfill the requirements of this chapter shall not excuse any person, owner, Household or other party from the requirements of this chapter.

A brief description of the proposed housing development;

The total number of housing units proposed in the development project, including unit sizes and number of bedrooms;

The total number of units proposed to be granted through the density increase and incentive program over and above the otherwise maximum density for the project site;

The total number of units to be made affordable to or reserved for sale or rental to, very low, low, or moderate income households, or senior citizens, or other qualifying residents;

The zoning, general plan designations and assessor's parcel number(s) of the project site;

A vicinity map and preliminary site plan, drawn to scale, including building footprints, driveway(s) and parking layout; and

A list of any concession(s) or incentive(s) being requested to facilitate the development of the project, and a description of why the concession(s) or incentive(s) is needed.