HomeMy WebLinkAboutReso 157-08 BMRTemporary Rental PolicyRESOLUTION NO. 157 - 08
RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
ESTABLISHING A TEMPORARY POLICY FOR THE RENTAL OF
BELOW-MARKET RATE OWNERSHIP UNITS BY OWNERS
UNABLE TO SELL THEIR UNITS AT THE RESTRICTED RESALE PRICE
RECITALS
WHEREAS, the City of Dublin's ("City") Inclusionary Housing Program requires purchasers of
Below Market Rate ("BMR") for-sale units ("Unit") to execute and record a Resale Restriction
Agreement with Option to Purchase ("Resale Restriction Agreement"); and
WHEREAS, the Resale Restriction Agreement prohibits BMR owners from selling their BMR
Units at more than a restricted price; and
WHEREAS, due to the recent slow down in the housing market, BMR owners are having
difficulty finding qualified buyers willing to purchase their BMR units at the restricted resale price
because such prices are so close to market prices that qualified buyers would rather purchase Market Rate
homes free of resale restrictions; and
WHEREAS, BMR owners who are unable to sell their BMR units would like to rent their BMR
units; and
WHEREAS, the Resale Restriction Agreement prohibits the rental of the BMR units without the
consent of the City; and
WHEREAS, although the City does have a policy authorizing rental of BMR units when the
owner has a hardship, the City does not currently have a policy regarding the rental of BMR units by
BMR owners who are unable to sell their units at the restricted price; and
WHEREAS, this Resolution is intended to establish a temporary policy for the rental of BMR
units by BMR owners who are unable to sell their units.
NOW, THEREFORE, the City Council of the City of Dublin does hereby resolve as follows:
1. Policy. During the Policy Term, the owner of a BMR unit who is unable to find a qualified buyer
to purchase his or her unit at the Adjusted Resale Price may rent his or her unit provided that the
following requirements are satisfied:
(a) The BMR unit has been on the market for at least six (6) months and the Owner has made
commercially reasonable efforts to sell the BMR unit, as determined by the City. Such
efforts shall include, but shall not be limited to, listing the unit with a Real Estate Broker,
ensuring the unit is listed in the Multiple Listing Service, and making the unit reasonably
available for viewing by Brokers and potential purchasers and their agents;
(b) The BMR owner enters into a regulatory agreement with the City;
(c) The future Tenant is an Eligible Household in the same income category as the BMR unit;
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(d) The lease contains the provisions set forth in Section 4 below;
(e) The monthly rental payment does not exceed the amount set forth in Section 3 below;
(f) A copy of the lease is submitted to the City within five (5) days following execution of the
agreement by the Owner and Tenant;
(g) The BMR owner does not live in the BMR unit during the term of the lease; and
(h) The lease shall terminate no later than the Authorized Lease Termination Date.
2. Definitions. The following definitions shall apply to this Policy:
(a) "Authorized Lease Termination Date" means two (2) years from the effective date of this
Resolution.
(b) "Policy Term" means two (2) years from the effective date of this Resolution.
(c) Capitalized terms not defined herein shall have the meaning ascribed to such terms in the
Resale Restriction Agreement.
(d) Total Monthly Household Cost of the Unit means mortgage payment, taxes, homeowners
association fees and insurance (does not include utilities).
3. Rent. The monthly rental payment for the BMR unit shall not exceed either the maximum rent,
as calculated per Chapter 5.6 of the Layman's Guide to the Inclusionary Zoning Ordinance, for the
applicable income category and household size, or the total monthly household cost of the unit,
whichever is less. If the Tenant pays utilities or Homeowners' Association dues, maximum rent
must be decreased pursuant to the City's utility allowance schedule. Household size will be
assumed based on the number of bedrooms in the unit as follows: studio, 1 person; 1 bedroom, 2
persons; 2 bedroom, 3 persons; 3 bedrooms, 4 persons; 4 bedrooms, 5 persons; and 5 bedrooms, 6
persons.
4. Lease. The lease agreement shall clearly state: (1) the term of the lease; (2) the monthly rental
payment; (3) that the BMR unit is an affordable unit subject to certain restrictions imposed by the
City; (4) that the Tenant may be required to submit income documentation to the City upon
request; (5) that the lease term will expire no later than the Authorized Lease Termination Date;
and (6) that the City is a third party beneficiary to the lease.
5. Authority of City Manager. The City Manager or his or her designee shall have the authority and
responsibility for the implementation of this Policy, including the authority to enter into regulatory
agreements with the BMR owners in a form approved by the City Manager and the City Attorney.
6. Effect of Violation. Any lease that violates the provisions of this Policy is prohibited, and any
owner who violates this Policy shall be deemed to be in default under his or her Resale Restriction
Agreement.
7. Severability Clause. The provisions of this Resolution are severable and if any provision, clause,
sentence, word or part thereof is held illegal, invalid, unconstitutional, or inapplicable to any
Reso No. 157-08, Adopted 8/19/08, Item 7.2 Page 2 of 3
person or circumstances, such illegality, invalidity, unconstitutionality, or inapplicability shall not
affect or impair any of the remaining provisions, clauses, sentences, sections, words, or parts
thereof of this Resolution or their applicability to other persons or circumstances.
Effective Date. This Resolution shall take effect immediately.
PASSED, APPROVED AND ADOPTED this 19th day of August, 2008, by the following vote:
AYES: Councilmembers Hildenbrand, Oravetz, Sbranti, and Scholz and Mayor Lockhart
NOES: None
ABSENT: None
ABSTAIN: None
ATTEST•
City Clerk
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