HomeMy WebLinkAbout4.02 Tralee Afford House AgmtG~~~ OF DU~~ti
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`~~L~~ ~~~ DUBLIN CITY COUNCIL File # ^[~00-~0
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DATE: August 16, 2011
TO: Honorable Mayor and City Councilmembers
FROM: Joni Pattillo, City Manager
SUBJEC . Approval of Tralee Affordable Housing Agreements
Prepared by Jeri Ram, Community Development Director
EXECUTIVE SUMMARY:
Dublin Tralee II, LLC, and PCCP CS II Tralee Village, LLC each seek a new Affordable Housing
Agreement with the City to reflect changes in the City's Inclusionary Zoning Regulations and
their proposed compliance with their affordable housing obligation, which they acquired when
they succeeded Pfeiffer Ranch Investors, Inc. as developers of the Tralee project. For Phase I
of the original Pfeiffer project (the townhomes), Dublin Tralee II, LLC seeks to amend and
restate the original Affordable Housing Agreement entered i.nto by Pfeiffer in 2005, including a
provision that a portion of its inclusionary housing obligation would be satisfied through the
payment of in-lieu fees. PCCP CS II Tralee Village, LLC seeks to enter into an Affordable
Housing Regulatory Agreement reflecting that Phase II of the original Pfeiffer project (residential
over retail) will consist of residential rental units.
FINANCIAL IMPACT:
The cost of administering the proposed Affordable Housing Agreements is included in the fees
collected by the City for administration of the Agreements.
RECOMMENDATION:
Staff recommends that the City Council: 1) Adopt a Resolution Approving An Amended and
Restated Affordable Housing Agreement for the Construction of lnclusionary Units and the
Payment of Fees In-Lieu of Constructing Certain Affordable Ownership Units Between the City
of Dublin and Dublin Tralee II, LLC, and Authorizing the City Manager to Execute the
Agreement and Take Other Necessary and Appropriate Actions; and 2) Adopt a Resolution
Approving An Affordable Housing Regulatory Agreement and Declaration of Restrictive
Covenants Between the City of Dubliri and PCCP CS II Tralee Village, LLC, and Authorizing the
City Manager to Execute the Agreement and Take Other Necessary and Appropriate Actions.
S bmitted By
Community Development Director
Revie ed y
Assistant City anager
Page 1 of 4 ITEM NO. ~• ~
BACKGROUND:
Tralee is a mixed-use development that includes 223 residential units and approximately 35,000
square feet of retail space located on 10.61 acres at the northwest corner of Dublin Boulevard
and Dougherty Road. The original developer of the property, Bancor Properties (prior to Pfeiffer
Ranch Investors), proposed the development of Phase I(103 for-sale residential units) and
Phase II (130 for-sale residential units ar+d retail development) on the project site (Attachment
1). In July 2004, the City Council approved a Planned Development Rezone, Site Development
Review and Vesting Tentative Subdivision Map for the Project (collectively, the "Approvals").
At the time of the Project Approvals, the City's Inclusionary Zoning Regulations required that all
new developments of 20 or more units provide 12.5% of the units as affordable to households
with very low-, low- and moderate-income levels. The City's Inclusionary Zoning Regulations
allow the partial satisfaction of the Inclusionary Zoning obligation by the payment of 5% in-lieu
fee and a must-build requirement of 7.5%. At the time of the Project Approvals by the City
Council, Bancor indicated that they would construct the full obligation of 12.5%, or 29
Inclusionary Units (12.5% of 233 units). ~
Subsequently, Pfeiffer Ranch Investors, Inc. obtained the Project from Bancor and on October
19, 2005, entered into an Affordable Housing Agreement for the Construction of Inclusionary
Units (the "Original Agreement") with the City, pursuant to the existing Inclusionary Regulations.
Under the Original Agreement, Pfeiffer was to construct 13 for-sale Inclusionary Units during
Phase I, and 16 for-sale Inclusionary Units in Phase II. Pfeiffer did not elect to pay fees in lieu of
the construction, as permitted by the Ordinance. The 29 Inclusionary Units were allocated in
the following manner:
Table 1
Income Breakdown of Required Inclusionary Units
Very Low-Income
Units Low-Income
Units Moderate-Income
Units Total Inclusionary
Units
Phase I 4 3 6 13
Phase II 5 3 8. 16
Total 9 6 14 29
In December 2008, the City Council amended the Inclusionary Regulations to (i) eliminate the
requirement to construct very low-income ownership units; and (ii) change the income ratios for
Affordable Ownership Units (defined below) to 40% low-income units and 60% moderate-
income units.
Affordable Housing Agreements that are consistent with the City's Inclusionary Zoning
Ordinance are generally executed by the City Manager. In this instance, however, Staff has
brought this item forward for City Council approval because the developer's proposal for
achieving compliance with the Inclusionary Zoning Regulations varies from what was originally
approved by the City Council.
CURRENT REQUEST:
Recently, Phase I was acquired by Dublin Tralee II, LLC, and Phase II was acquired by PCCP
CS Tralee Village, LLC, each of which is a Delaware limited liability company. The two new
Page2of4
developers have requested new Affordable Housing Agreements that reflect their current
inclusionary housing proposals, as follows:
Phase /
In accordance with the Ordinance, Dublin Tralee II, LLC has a requirement to provide 13
Inclusionary Units for Phase 1(townhomes).
Table 2
Required Inclusionary Units for Phase I
Totaf Units
Phase 1 Inclusionary
Re uirement Inclusionary
Units
103 12.5% 13
Dublin Tralee II,.LLC is requesting to amend and restate the Original Agreement (Attachment 2)
with respect to its Phase I Project, to: (i) remove the obligation to construct the Inclusionary
Units required to be constructed in Phase II; (ii) adjust the income ratios for the Inclusionary
Units to make them consistent with the amended Ordinance; and (iii) as allowed by the City's
Inclusionary Regulations, provide for payment of fees in-lieu for five {nclusionary Units (5% in
lieu fees), while constructing eight Inclusionary Units (7.5% must build). Dublin Tralee II, LLC
will pay in-lieu fees in the amount of $519,440 ($103,888 per unit) in accordance with the
following phased construction schedule:
Table 3
Phased Construction Schedule Phase I
Total Units Low-Income
Units Moderate-Income
Units
Phase I A 50 1 2
Phase I B 53 2 ° 3
Pro'ect Total 103 3 5
Phase lI
PCCP CS II Tralee Village, LLC intends to develop Phase II (apartments) as a residential rental
project and rent their entire obligation of Inclusionary Units. Accordingly, it wishes to replace the
Original Agreement with an Affordable Housing Regulatory Agreement and Declaration of
Restrictive Covenants for the 16 Inclusionary Units required for inclusion in Phase II
(Attachment 3). The breakdown of the Inclusionary Units is as follows: ~
Table 4
Rental Restricted Inclusionary Units by Income Level Phase II
Total Restricted
Units Very Low-Income
Units Low-Income
Units Moderate-Income
Units
16 5 3 8
Page 3 of 4
Other Amendments
If the City Council approves the Amended Affordable Housing Agreements (Attachments 2 and
3), other amendments to Project Approvals will be required to maintain consistency between the
Planned Development, Site Development Review and the proposed Agreements. The Dublin
Zoning Ordinance allows the Community Development Director to modify these approvals by
administrative action if the changes are minor and found to be in substantial conformance with
the approved Planned Development and Site Development Review. The proposed changes are
consistent with the City's Ordinances and consistent with the intent of the approved Planned
Development and Site Development Review; therefore, an Administrative Amendment to the
Planned Development and Site Development Review Waiver would be subsequently approved
by the Community Development Director.
Workforce Housing Reward Program
Dublin Tralee II, LLC, has acknowledged that the City received $18,000 in Workforce Housing
Reward Program grant funds from the Department of Housing and Community Development
("HCD"), based on the City's issuance of Building Permits for four (4) Inclusionary Units, for
which the developer now wishes to pay in-lieu fees rather than construct. Accordingly, the
developer has issued a check in the amount of $18,000, which the City will be returning to HCD.
ATTACHMENTS: 1) Phasing Map
2) Resolution Approvi
Housing Agreement
the Payment of FeE
Ownership Units Bei
LLC, and Authorizin
and Take Other NecE
~ An Amended and Restated Affordable
or the Construction of Inclusionary Units and
s In-Lieu of Constructing Certain Affordable
veen the City of Dublin and Dublin Tralee II,
~ the City Manager to Execute the Agreement
~sary and Appropriate Actions
3) Resolution Approving
and Declaration of RE
and PCCP CS II T
Manager to Execute 1
Appropriate Actions
An Affordable Housing Regulatory Agreement
strictive Covenants Between the City of Dublin
alee Village, LLC, and Authorizing the City
~e Agreement and Take Other Necessary and
K:IStaff Reports- PC and CC120111Amendment to the AHA TraleelTralee I Staff Report for 08-16-11.DOC
Page 4~ of 4
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RESOLUTION NO. XX -11
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
~:~~*~*~~~:~~~~~***~~~~
APPROVING AN AMENDED AND RESTATED AFFORDABLE HOUSING AGREEMENT FOR
THE CONSTRUCTION OF INCLUSIONARY UNITS AND THE PAYMENT OF FEES IN-LIEU
OF CONSTRUCTING CERTAIN AFFORDABLE OWNERSHIP UNITS BETWEEN THE CITY
OF DUBLIN AND DUBLIN TRALEE II, LLC, AND AUTHORIZING THE CITY MANAGER
TO EXECUTE THE AGREEMENT AND TAKE OTHER NECESSARY AND APPROPRIATE
ACTIONS
, WHEREAS, pursuant to the requirements of the Inclusionary Zoning Regulations of the City of
Dublin Zoning Ordinance (the "Ordinance"), on October 19, 2005, the City of Dublin (the "City") and
Pfeiffer Ranch Investors, Inc. ("Pfeiffer"), entered into an Affordable Housing Agreement for the
Construction of Inclusionary Units (the "Original Agreement") for the construction of 233 residential
units known as the Tralee project, including the construction of 13 Inclusionary Units on certain property
it owned ("Phase I") and 16 Inclusionary Units in mixed use buildings to be developed on adjacent
property ("Phase II"); and
WHEREAS, subsequent to the issuance of the Development Approvals, the City amended the
Ordinance to (i) eliminate the requirement to construct very low-income ownership units; (ii) change the
income ratios foe Affordable Ownership Units to 40% low-income units and 60% moderate-income units;
and (iii) change the method by which sale prices for the Inclusionary Units are calculated; and
WHEREAS, subsequent to execution of the Original Agreement, Dublin Tralee II, LLC, a
Delaware limited liability company (the "Developer"), acquired the Phase I property from Pfeiffer, and
intends to complete the development of Phase I(the "Project"); and
WHEREAS, the Developer has requested an amendment to the Original Agreement, to set forth the
manner by which Developer will satisfy its inclusionary housing obligation for Inclusionary Units in the
Project pursuant to the Ordinance; and
WHEREAS, the Developer has proposed to amend and restate the Original Agreement to (i)
remove the obligation to construct the Inclusionary required to be constructed in Phase II (ii) adjust the
income ratios for the Inclusionary Units to make them consistent with the amended Ordinance; and (iii)
provide for payment of fees in-lieu of constructing a portion of the Inclusionary Units; and
WHEREAS, pursuant to the Ordinance, the Developer has proposed to provide thirteen (13) for-
sale Inclusionary Units, allocated as follows: construction of five (5) low-income units and eight
moderate-income units, and payment of fees in lieu of constructing five (5) Inclusionary Units; and
WHEREAS, the Developer shall sell the Inclusionary Units at sales prices that are affordable to
persons with low- or moderate-incomes, as applicable, as defined in the Ordinance; and
WHEREAS, the Project has been found to be Categorically Exempt from the California
Environmental Quality Act (CEQA); and
WHEREAS, a Staff Report setting forth in further detail the background and terms of the
proposed Amended and Restated Agreement has been submitted to the City Council for consideration of
this request. •
Attachment 2
~~~ ~~
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Dublin does
hereby approve the Amended And Restated Affordable Housing Agreement For The Constniction Of
Inclusionary Units And The Payment Of Fees In-Lieu Of Constructing Certain Affordable Ownership
Units Between The City Of Dublin and Dublin Tralee II, LLC, as described in Exhibit A.
BE IT FURTHER RESOLVED that the City Manager is authorized and directed to execute the
Amended and Restated Agreement and such other documents, and to take such other and further action,
as necessary and appropriate to carry out the Intent of this Resolution.
PASSED, APPROVED AND ADOPTED this 16th day of August 2011 by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
City Clerk
Exhibit A- Amended and Restated Affordable Housing Agreement
Mayor
K: ISlnff Reports- PC and CCI20111Amendment to the AKA TraleelCC Reso Tralee Amended AHATownhomes 8-16-2011.doc
Page 2 of 2
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AMENDED AND RESTATED AFFORDABLE HOUSING AGREEMENT
FOR THE CONSTRUCTION OF INCLUSIONARY UNITS AND THE PAYMENT OF
FEES IN-LIEU OF CONSTRUCTING CERTAIN AFFORDABLE OWNERSHIP UNITS
PA 02-062, Dublin Tralee II, LLC, a Delaware limited liability company.
(Townhomes)
This Agreement ("Agreement") is entered into this day of , 2011
("Effective Date") by and between the City of Dublin, a municipal corporation (the "City"), and
Dublin Tralee II, LLC, a Delaware limited liability company (the "Developer"). This
Agreement amends and restates in its entirety an Affordable Housing Agreement for the
Construction of Inclusionary Units, dated October 19, 2005, by and between City and
Developer's predecessor-in-interest (the "Original Agreement"), a memorandum of which was
recarded in the Official Records of Alameda County on October 21, 2005 as Instrument No.
2005455428. The City and Developer are hereinafter collectively referred to as the "Parties."
Recitals
1. Developer is the owner of real property located in the City of Dublin, County of
Alameda, State of California generally located at the northwest corner of Dublin Boulevard and
Dougherty Road, more particularly described in Exhibit 1 attached hereto and incorporated into
this Agreement by reference (the "Property").
2. Chapter 8.68 of the Dublin Zoning Ordinance ("Ordinance") requires developers
of residential projects consisting of 20 units or more to set aside 12.5% of the units in the project
as Inclusionary Units (defined below) and to execute and record an affordable housing
agreement against the project property prior to the issuance of building permits.
3. The City of Dublin adopted the Ordinance pursuant to Strategy I.B. of the City's
General Plan Housing Element, recognizing that the cost of new housing is so high that persons
with very low-, low- and moderate-incomes are increasingly unable to locate affordable housing
in the City. The purpose of the Ordinance is to achieve a balanced community with housing
available at all income levels.
4. The original developer of the Property, Bancor Properties, proposed the
development of 233 residential units in a residential and retail development on land consisting of
the Property and other real property located immediately adjacent thereto.
5. In order to induce the City Council to approve the General Plan Amendment that
was necessary to approve the project, Bancor committed to construct a1129 Inclusionary Units
required by the Ordinance. On July 20, 2004, the City Council approved, Site Development
Review (Reso. No. 143-04) and a tentative subdivision map (Reso. No.143 -04) (the
"Development Approvals") for the project. Based on 233 units and in accordance with the
Ordinance, the Development Approvals for the project require the developer to construct 29
Inclusionary Units (12.5% of 233 = 29).
6. Subsequently, Pfeiffer Ranch Investors, Inc. obtained the project from Bancor.
Pfeiffer and the City entered into the Original Agreement specifying the location of the
Affordable Housing Agreement
PA 02-062 Dublin Tralee Il, LLC
1-1
EXHIBIT A TO
ATTACHMENT 2
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Inclusionary Units required to be constructed under the Development Approvals. The Original
Agreement requires the construction of 13 Inclusionary Units on the Property (referenced in the
Original Agreement as "Phase I"), and 16 Inclusionary Units in the mixed use buildings to be
developed on adjacent property (referenced in the Original Agreement as "Phase II").
7. Developer has now acquired the Property and intends to complete the
development of Phase I, hereinafter referred to as the "Project." Another developer, PCCP CS
II Tralee Village,. LLC ("PCCP"), has acquired the Phase II property and intends to complete the
development of Phase II.
8. City and Developer are entering into this Agreement to govern the 13
Inclusionary Units required by the Development Approvals to be constructed in Phase I. PCCP
and City have or will enter into a separate agreement governing the construction of the 16
Inclusionary Units required by the Development Approvals to be constructed in Phase II.
9. Subsequent to the issuance of the Development Approvals, the City amended its
Ordinance to (i) eliminate the requirement to construct very low-income ownership units; (ii)
change the income ratios for Affordable Ownership Units (defined below) to 40% low-income
units and 60% moderate-income units; and (iii) change the method by which sale prices for the
Inclusionary Units are calculated.
10. The City and Developer wish to amend and restate the existing Affordable
Housing Agreement with respect to the Project, and the Property, to (i) remove the obligation to
construct the Inclusionary Units required to be constructed in Phase II; (ii) adjust the income
ratios for the Inclusionary Units to make them consistent with the amended Ordinance; and (iii)
provide for payment of fees in-lieu of constructing a portion of the Inclusionary Units.
11. The purpose of this Ageement is to set forth the manner by which Developer will
satisfy its inclusionary housing obligation for Inclusionary Units in the Project pursuant to the
Ordinance.
NOW, THEREFORE, in satisfaction of the requirements of Chapter 8.68 of the Dublin
Municipal Code, conditions 121 & 122 of CC Resolution No. 143-04 and in consideration of the
City's approval of the Project, Developer and City for themselves and their respective successors
and assigns hereby agree as follows:
1. Definitions and Interpretations. The following terms have the meaning set
forth in this Section wherever used in this Agreement.
"Inclusionary Unit" means a dwelling unit which is reserved for sale at an
affordable price as set forth in Subsection S.a.l.
Other terms used in this Agreement shall be defined as set forth in the Ordinance.
2. Developer's Compliance with Affordable Housing Obligation.
a. Developer shall provide thirteen (13) Inclusionary Units, allocated as follows:
five (5) low-income units and eight (8) moderate-income units; provided, however, Developer
Affordable Housing Agreement
PA 02-062 Dublin Tralee II, LLC
1-2
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may pay fees in lieu of constructing five (5) Inclusionary Units, pursuant to Section 3 of this
Agreement.
b. Prior to Developer's acquisition of the Project, Pfeiffer completed and sold
one residential unit and partially completed construction of forty-nine (49) additional residential ~
units. Developer intends to complete the Project in phases, completing the forty-nine (49)
partially-constructed units in the first phase, and constructing the remaining fifty-three (53) units
in the second phase. The location of the phases is shown on the Diagram of BMR Locations,
attached hereto as Exhibit 2. Section 8.68.030 of the Ordinance requires that all Inclusionary
Units in a project be constructed concurrently with a project or phase of a project. Developer has
proposed, and the City hereby approves, subject to the conditions contained in this paragraph, the
phased schedule for the construction of the Inclusionary Units.
Total units Low-income Moderate-
units income units
Phase I(A) 50 _1_ (3- _2_ (3-
bdrms) bdrms)
Phase I(B) 53 _2_ (3- _3_ (3-
bdrms) bdrms)
Proj ect Total 103
3. In-Lieu Fees. Developer has elected to satisfy its remaining obligation for five
(5) Inclusionary Units in Phase I by paying fees in lieu of constructing said units. Accordingly,
Developer shall pay in-lieu fees in the amount of $519,440 (or $103,888 per unit) to fulfill the
obligation to construct five (5) of the thirteen (13) Inclusionary Units required by the Ordinance.
As required by the Ordinance, the entirety of the fees shall be paid at time of issuance of the first
building permit in Phase I(B), and in the amount set forth in the in lieu fee resolution of the
Dublin City Council that is in effect at the time of such issuance. Developer acknowledges that
such amount may differ from the figure estimated in this Agreement.
4. Inclusionary Unit Desi~n, Location, and Size.
a. Exterior Materials and Exterior Architectural Design. The exterior
materials and exterior architectural design of the Inclusionary Units shall be consistent with the
Project's market-rate units as reviewed and approved through the Site Development Review by
the City Council on July 20, 2004;.provided, however, that minor changes to unit size may be
approved by the Community Development Director through a Site Development Review waiver.
b. Unit Location. Consistent with Section 8.68.030 of the Ordinance, the
Inclusionary Units shall be dispersed throughout the individual phase in which they are
constructed. The Diagram of BMR Locations ("Diagram"), attached hereto as Exhibit 2, shows
the location of the Inclusionary Units as proposed by the Developer, and the City hereby finds
that the units as shown are reasonably dispersed through the Project as required by Section
8.68.030.E of the Ordinance. Developer may request that the Community Development Director
approve changes to the Diagram that alter the location of the Inclusionary Units. Upon the
Affordable Housing Agreement
PA 02-062 Dublin Tralee II, LLC
1-3
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Community Development Director's approval, which shall be administrative, the revised
Diagram shall automatically be incorporated into this Agreement as Exhibit 2, replacing the
previous Exhibit 2. In approving any revised Diagram, the Community Development Director
shall find that the Inclusionary Units are "reasonably dispersed" through the Project, as required
by Section 8.68.030 E of the Ordinance.
c. Unit Bedrooms and Size. The size of the Inclusionary Units shall be
consistent with the Site Development Review approval of the City Council on July 20, 2004,
provided however, that minor changes to unit size may be approved by the Community
Development Director through a Site Development Review Waiver. As set out in Section 2, the
developer proposes to provide:
Three (3) low-income Inclusionary Units (3 three-bedroom units); and
Five (5) moderate-income Inclusionary Units (5 three-bedroom units).
The City hereby finds this breakdown reflects the range of numbers of bedrooms provided in the
project as a whole, as required by Section 8.68.030.E of the Ordinance.
5. Ensuring Affordability.
a. Sales Price and Marketin~. Developer shall sell the Inclusionary Units at
sales prices that are affordable to persons with low-, or moderate-incomes, as applicable, as
defined in the Ordinance. For moderate-income households, the maximum sales price shall be a
price that results in annual housing expenses that do not exceed 35% of 110% of the area median
income for Alameda County, adjusted for household size. For low-income households, the
maximum sales price shall be a price that results in annual housing expenses that do not exceed
35% of 70% of the area median income for Alameda County, adjusted for household size.
Additional detail on the manner of calculating sales prices for the Inclusionary Units is set forth
in the City's Guidelines to the Inclusionary Zoning Ordinance Regulations, adopted by the City
Council on November 18, 2008 and revised January 2, 2009 ("Guidelines") and attached hereto
as Exhibit 3. All units shall be marketed and sold consistent with the Ordinance.
b. Marketing Plan. Prior to the City's issuance of final approval of an
Inclusionary Unit for occupancy in Phase I(A), Developer shall submit a revised Marketing Plan
for approval by City, as required by Section 4.10 of the Guidelines.
c. Resale Agreements. Developer shall require the initial buyer of each
Inclusionary Unit to execute a Resale Restriction and Option to Purchase Agreement in
substantially the form attached hereto as Exhibit 4. This Agreement shall serve as the agreement
required by Section 8.68.030 of the Ordinance.
6. Term. This Agreement shall be effective until all Inclusionary Units required to
be constructed on the Property are constructed, sold, and subjected to resale restrictions approved
by the City pursuant to the terms of this Agreement.
7. Memorandum of Agreement to be Recorded. Developer and City shall execute
and acknowledge a Memorandum of this Agreement ("Memorandum") substantially in the
Affordable Housing Agreement
PA 02-062 Dubiin Tralee II, LLC
1-4
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form attached hereto as Exhibit 5, and City shall cause the Memarandum to be recorded in the
Official Records of Alameda County upon its execution.
8. Agreement Runs with the Land. All of the provisions, rights, terms, covenants,
and obligations contained in this Agreement shall be binding upon the Parties and their .
respective heirs, successors and assignees, representatives, lessees, and all other persons
acquiring the Property, or any portion thereof, or any interest therein, whether by operation of
law or in any manner whatsoever. All of the provisions of this Agreement shall be enforceable
as equitable servitudes and shall constitute covenants running with the land pursuant to
applicable laws, including, but not limited to, Section 1468 of the Civil Code of the State of
California. Each covenant to do, or refrain from doing, some act on the Property hereunder (a) is
for the benefit of the Property and is a burden upon the Property, (b) runs with the Property, and
(c) is binding upon each Party and each successive owner during its ownership of the Property or
any portion thereof, and shall be a benefit to and a burden upon each Party and the Property
hereunder and each other person succeeding to an interest in the Property.
9. Assignments and Transfers.
a. Right to Assi~n. Developer may wish to sell, transfer or assign all or portions
of its Property to other developers (each such other developer is referred to as a"Transferee").
In connection with any such sale, transfer or assignment to a Transferee, Developer may sell,
transfer or assign to such Transferee any or all rights, interests and obligations of Developer
arising hereunder and that pertain to the portion of the Property being sold or transferred, to such
Transferee, provided, however, that: no such transfer, sale or assignment of Developer's rights,
interests and obligations hereunder shall occur without prior written notice to City and approval
by the City Manager, which approval shall not be unreasonably withheld or delayed.
Notwithstanding the foregoing, provided written notice is given, no City approval shall be
required for any transfer, sale, or assignment of this Agreement, in whole or in part, to any entity
or group, a majority interest of which is owned or held under common control with Developer
("Affiliate") in connection with the transfer of all or a portion of the Property to such Affiliate,
provided that in the event of a partial transfer, Developer has, at the time of the transfer,
complied with all obligations of this Agreement or provided evidence satisfactory to the City
Manager demonstrating that the remaining obligations have been allocated between Developer
and Affiliate.
b. Approval and Notice of Sale, Transfer or Assi ment. The City Manager
shall consider and decide on any transfer, sale or assignment within thirty (30) days after
Developer's notice thereof, provided all necessary documents, certifications and other
information are provided to the City Manager to enable the City Manager to determine whether
the proposed Transferee can perform the Developer's obligations hereunder. Notice of any such
approved sale, transfer or assignment (which includes a description of all rights, interests and
obligations that have been transferred and those which have been retained by Developer) shall be
recorded in the official records of Alameda County, in a form acceptable to the City Manager,
concurrently with such sale, transfer or assignment.
c. Effect of Sale, Transfer or Assignment. Developer shall be released from any
obligations hereunder sold, transferred or assigned to a Transferee pursuant to Section 9.a of this
Affordable Housing Agreement
PA 02-062 Dublin Tralee II, LLC
1-5
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Agreement, provided that: a) if required, such sale, transfer or assignment has been approved by
the City Manager pursuant to Sections 9.a and 9.b; and b) such obligations are expressly
assumed by Transferee and provided that such Transferee shall be subject to all the provisions
hereof.
10. Successors. Except as specifically provided in this Agreement, this Agreement
shall bind and inure to the benefit of all successors and assigns of the parties and any associates
in interest, and their respective directors, officers, agents, servants, and employees, and the
successors and assigns of each of them, separately and collectively. Developer shall provide
notice to the City of the names and mailing addresses of any such successors or assigns.
11. Hold Harmless. Developer shall hold City, its elective and appointive boards,
commission, officers, agents and employees harmless from and against any or all loss, liability,
expense, claim, costs, suits, damages of every kind, nature and description directly or indirectly
arising from the performance of the obligations or undertakings of Developer pursuant to this
Agreement. Developer shall defend City and its elective and appointive boards, commission,
officers, agents and employees from any suits or actions at law or in equity for damages caused
or alleged to have been caused, by reason of any of the obligations or undertakings of Developer
pursuant to this Agreement. It is further provided that this hold harmless agreement shall apply
to all damages and claims for damages for every kind suffered, or alleged to have been suffered,
by reason of any of the obligations or undertakings of Developer pursuant to this Agreement.
12. Enforcement. If the Developer defaults in the performance or observance of any
covenant, condition, restriction or obligation_of the Developer as set forth in this Agreement, and
such default remains uncured for a period of thirty (30) days after notice thereof is given by the
City (or such longer period as may be necessary to cure the default, provided that Developer
commence the cure within the thirty (30) day period and diligently prosecutes the cure to
completion), the City may take any one or more of the following steps:
a. By specific performance or other action or proceeding at law or in equity,
require the Developer to perform its obligations under this Agreement or enjoin any acts or
things which may be unlawful or in violation of the rights of the City hereunder.
b. Take such other action at law or in equity as may appear necessary or
desirable to enforce the obligations, covenants, conditions and restrictions of the Developer
under this Agreement.
If Developer transfers any portion of the Project in bulk and a Transferee defaults under
this Agreement, the City shall exercise the foregoing remedies only with respect to the defaulting
Transferee and its portion of the Project; and so long as Developer has not otherwise defaulted
hereunder, the City shall not seek to exercise any rights and remedies against Developer.
13. Attorneys' Fees. If legal action is necessary to enforce any provisions of this
Agreement, the prevailing party shall be entitled to reasonable attorneys' fees and legal costs.
14. Amendments. This Agreement shall be amended only by a written instrument
executed by the parties hereto or their successors in interest, and the amendment, or a
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memorandum thereof, shall be duly recorded in the Official Records of the County of Alameda,
California.
In the event that Developer is unable to perform its obligations under Section 2 of this
Agreement due to significant changes in circumstances, such as unanticipated delays in
construction, the City shall confer with Developer in an effort to reach a mutually acceptable ,
resolution, consistent with the terms of the affordable housing conditions in the Approvals. If an
agreement is reached, this Agreement shall be amended accordingly. Developer shall pay the
City its reasonable costs, including attorneys' fees, incurred in such negotiations and in
amending this Agreement, and Developer shall, if requested by the City, provide the City with a
reasonable deposit to cover the City's reasonable costs, upon Developer initiating such
negotiations.
15. Corporate Authority. If either party is a corporation, each individual signing
this Agreement on behalf of that corporation represents and warrants that each of them is duly
authorized to execute and deliver this Agreement on behalf of the corporation and that the
Agreement is binding on the corporation in accordance with its terms.
16. Counterparts. This Agreement may be executed in multiple counterparts, each
of which shall be an original and all of which together shall constitute one agreement.
17. Severability. If any provision of this Agreement is held invalid, illegal, or
unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of
the remaining provisions shall not be affected or impaired thereby.
18. Governin~ Law. This Agreement shall be construed in accordance with the laws
of the State of California without regard to principles of conflicts of law.
19. Entire A~reement. This Agreement, together with Exhibits 1 through 5,
contains the entire understanding between the parties relating to the transaction contemplated
hereby, and all prior or contemporaneous agreements, understandings, representations and
statements, oral or written, are merged herein and shall be of no further force or effect. No
provision of this Agreement may be amended, waived, or added except by an instrument in
writing signed by the Parties hereto. The exhibits attached hereto are incorporated herein by this
reference.
20. Notices. Except as otherwise specified herein, all notices to be sent pursuant to
this Agreement shall be made in writing, and sent to the Parties at their respective addresses
specified below or to such other address as a Party may designate by written notice delivered
to the other parties in accordance with this Section. All such notices shall be sent by:
personal delivery, in which case notice is effective upon
delivery;
ii. certified ar registered mail, return receipt requested, in which
case notice shall be deemed delivered upon receipt if delivery is confirmed by a return
receipt;
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iii. nationally recognized overnight courier, with charges prepaid or
charged to the sender's account, in which case notice is effective on delivery if delivery is
confirmed by the delivery service;
iv. facsimile transmission, in which case notice shall be deemed
delivered upon transmittal, provided that (a) a duplicate copy of the notice is promptly
delivered by first-class or certified mail or by overnight delivery, or (b) a transmission report
is generated reflecting the accurate transmission thereof. Any notice given by facsimile shall
be considered to have been received on the next business day if it is received after 5:00 p.m.
recipient's time or on a nonbusiness day.
City: City of Dublin
100 Civic Plaza
Dublin, CA 94568
Attention: City Manager
Facsimile: (925) 833-6651
Developer: Dublin Tralee II, LLC
c/o Signature Development Group, Inc.
2201 Broadway, Suite 604
Oakland, CA 94612
Attention: Mr. Patrick Van Ness
Facsimile: (510) 832-2638
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date and year first above written.
CITY OF DUBLIN
By:
City Manager
Attest:
City Clerk
Dublin Tralee II, LLC,
a Delaware limited liability company
By:
Authorized Agent
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EXHISIT 1
Property Description
[Exclude the paxcels on which the Podium exists.]
THAT CE.RTAIN REAL PROPERTY SITUATED IN THE CITY OF DUBLIN, COUN'1'Y OF ALAMEDA,
STATE OF CALIFORNIA, BEING A PORTION OF LOT 1, AS SHOWN ON MAP OF TRACT 74~7,
FILED JUNE l3; 2006, IN BOOK 291 OF MAPS, PAGE 29 THKOUGH 37, INCLUSIVE, ALAMEDA
COUNTY RECORDS, FUR.THER DESCRIBED AS FOLLOWS:
UNITS 6526; 6530, 6~34, AND 6538 IN BUILDING NO. 5, AND LTNITS 6517 AND 6529 IN BU1LD]NG
NO. 10, AS DEPICTED ON THAT CERTAIN CONDOMINIUM PLAN FOR LOT I OF TRACT 7=~57, WHICH
IS ATTACHED AS EXHIBIT "A" TO THE 7`RALEE VILLAG~ DECLARATION OF COVENANTS,
CONDIT]ONS, RESTRICTIONS AND EASEMENTS RECORDED ON APR.CL 18, 2008 AS DOCUIVIENT NO.
200813399b, TOGETHER WITH ANY AMENDMENTS, MODIFICATIONS OR ANNEXATIONS AS MAY
OCCU:R FROM: TIME TO TIME, IN THE OFFICIAL RECORDS OF ALANIEDA COUNTY. CALI:FORN[A
(THE "DECLARATION"), AND FURTHEFZ DEFINED IN THE DECLARATION.
UNI:TS 6630, 6634, G638, 6642 OF BiJfLDING 1, UNITS 6608, 6612, 6616, 6620 OF BUiLDING 2, LJNITS
G58G,6590,659~1,6~98 OF BUIL,DING 3, UNITS 6647, 6651., 6655, 6659 OF BCJILDING 6, UNITS 6615,
6619, 6623, 6627, 6631, 6635, 6639 OF BUILDING 7, LJNITS 6589, 6593, 6597., 6601, 6605 OF
BUILDING 8, AS DEPICTED ON THE CONDOMIN.[UM PLAN - PHASES 2& 3, TRACT 7457 RECORDED
ON JLTNE 17, 201 ] AS DOCUMENT NO. 20l 1174652 IN THE OFF.iCIAL RECORDS OF ALAMEDA
COUNTY, CALIFORNIA.
ALL OF FPCP 4, 5 AND 6 AS DEFINED IN THE DECLARATION AND AS SHOWN ON THE P.,HASE 2& 3
• CONDOMINIUM PL-AN.
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4 19 3 1328 3/3 6489 Bantry Say Street Finished Lot Moderate Income
5 2Q 3 1328 3/3 6486 Tralee Village Drive Finished Lot Low Income _.
6 20 3 1328 3/3 6490 Tralee Village Dri~e Finished Lot Moderate Income
7 15 3 1328 3/3 6661 Tralee Village Drive ` Finished Lot Moderate Income
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EXHIBIT 3 ~ ~ (~~~
Guidelines to the Inclusionary Zoning Ordinance Regulations
CITY OF DUBLIN
TABLE OF CONTENTS
1 LIST OF EXHIBITS 4
2 GUIDELTNES TO THE INCLUSIONARY ZONING ORDINANCE
REGULATION 5
3 DEFINITION OF TERMS 6
4 REQUIlZEMENTS FOR DEVELOPERS 12
4.1 Overview of the Inclusionary Zoning Process 12
42 Determining the Number and Size of Units Required 12
4.3 How to Calculate the Inclusionary Obligation 13
4.4 How to Calculate How Many Units Must Be Constructed and How Many
Units of the Obligation May be Satisfied with an In-Lieu Fee 13
4.5 How to Calculate the Amount of the In-Lieu Fee 14
4.6 How to Calculate How Many BMR Units Must Be Provided for Each Income
Level 14
4.7 How to Determine the Size of BMR Units 15
4.8 How to Determine the Location of BMR Units Within the Development 16
49 Housing Agreements 17
4.10 Procedures for Initial Sale of BMR Units 18
4.10.1 The Marketing Plan for Ownership Units 18
4.10.2 Application and Screening Process 19
4.10.3 Sale price of BMR Units 22
4.11 Procedures for Initial Rental of BMR Units 23
4.11.1 The Management Plan for Rental BMR Units 23
4.11.2 Application and Screening Process 24
4.11.3 Calculating Maximum Rent 25
4.11.4 Annual Report 26
4.11.5 Annual Monitoring by City 26
5 BUYER AND RENTER QUALIFICATIONS, FOR BMR UNITS ; 27 ,
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5.1 Buyer Qualifications 27
5.2 Renter Qualifications 28
5.3 Household Size 28
5.4 Total Household Income 29
5.4.1 Gross Household Income 29
5.4.2 Income Calculation 30
5.4.3 Assets 31
5.5 Credit Score 32
5.6 Alternative Credit History Parameters 32
5.7 Preference Points 33
6 REQUIREMENTS FOR BUYERS OF BMR UNITS 36
6.1 Financing Requirements 36
6.1.1 Acceptable Loan Products for Purchase and Refinancing of a BMR Unit36
6.1.2 Prohibited Loan Products 36
6.2 Down Payment 36
6.2.1 Down Payment Assistance 37
6.3 Debt to Income Ratio 37
6.4 First Mortgage Loan Value Ratio 37
6.5 Closing Costs and Deposits 37
6.6 Homebuyer Education Program 37
6.7 Documents that Each Buyer Must Sign 37
6.7.1 Highlights of the Resale Restriction Agreement 37
7 REQUIREMENTS FOR RESALE OF BMR UNITS 40
7.1 Resale Procedure 40
7.2 Calculating Restricted Resale Price 41
7.3 Fees Associated with the Selling of a BMR Unit 41
7.4 CapitalImprovements 41
7.4.1 Procedure for Receiving Approval of Capital Improvements 41
7.4.2 Special Assessments 43
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7.4.3 Capital Improvements Cap 43
7.4.4 List of Eligible and Ineligible Capital Improvements 43
7.4.5 Building' Permits 44
8 REQUIREMENTS FOR OWNER'S OF BMR SECONDARY UNITS 46
8.1 Rental Requirements 46
8.2 Reporting Requirements 46
8.3 Annual Report - Inspections 46
8.4 Management Responsibilities 47
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1 LIST OF EXHIBITS
Exhibit 1 Resale Restriction Agreement and Option to Purchase
Exhibit 2 Performance Deed of Trust
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Exhibit 3 Sample Application for Inclusionary Unit
Exhibit 4 Sample Ownership BMR Unit Application Packet
Exhibit 5 Sample Credit Report Authorization and Release
Exhibit 6 Excel Spreadsheet to Calculate Ownership Sale Prices
Exhibit 7 State of California Housing and Community Development Department Income
for Guidelines (Example 2008)
Exhibit 8 Current Alameda County Housing Authority Utility Allowance Sheet ,
Exhibit 9 Annual Report for Rental Units .
Exhibit 10 Sample Marketing Plan
Exhibit 11 Internal Revenue Service (IRS) Code 26 USC, Section 61
Exhibit 12 Sample Management Plan
Exhibit 13 Reservation Instrument
Exhibit 14 Secondary Unit Regulatory Agreement and Declaration of Restrictive
Covenants
For a copy of the above-referenced Exhibits, please contact the C~ty of Dublin
Community Development Department at (925) 833-6610.
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GUIDELINES TO THE INCLUSIONARY ZONING ORDINANCE
REGULATION
This document is the Guidelines (these "Guidelines") to the City's Inclusionary Zoning Ordinance
Regulations (the "Ordinance") set forth in the City's Municipal Code at Chapter 8.68. The City
Council's purpose in adopting the Ordinance is to increase the diversity of housing prices/rents in the
community and ensure that the range of prices/rents continues over time.
In general, the Ordinance requires that 12.5% of the units constructed in a Residential Development
project of 20 residential units or more be restricted in occupancy and in sale price or rent charged.
Such restricted units are referred to as Below Market Rate (BMR) Units. For for-sale units, 60% must
be affordable to moderate-income households and 40% to low-income households. For rental units,
50% must be affordable to Moderate-Income households, 20% to Low-Income households and 30%
to Very Low-Income households. (Section 8.68.030.B)
The purpose of these Guidelines is to assist the layperson in interpreting the Ordinance. The
Guidelines will assist developers early in the development process so that Residential Development
projects are sensitively designed from the beginning in compliance with the requirements of the
Inclusionary Zoning Ordinance. In addition, the Guidelines will inform developers, management
firms and owners of BMR Secondary Units of the procedures for selling and renting BMR Units and
Secondary Units. Furthermore, the Guidelines will provide households interested in renting or
purchasing a BMR Unit with an overview of the eligibility requirements, the application and
screening process, the restrictions on ownership BMR Units, and the procedures for reselling a BMR
Unit.
These Guidelines should be read in conjunction with the Ordinance. While every effort has been
made to ensure that these Guidelines are consistent with the Ordinance, if there is any conflict with
these Guidelines and the Ordinance, the terms of the Ordinance shall prevaiL In addition, the
provisions of a Housing Agreement or Resale Restriction Agreement (or like Agreement) recorded
against a BMR Unit shall prevail over any general requirements of the Ordinance.
Users of these Guidelines are encouraged to seek their own legal counsel to aid in understanding the
requirements of the City's Inclusionary Program. For any general questions regarding the
Guidelines, users may call 925-833-6610. ~
The effective date of these Guidelines is January 2, 2009. The City will review and to the extent
necessary update these Guidelines annually. The Community Development Director may make
interim revisions, interpretations or clarifications to these Guidelines provided that he or she
considers the revision, interpretation, or clarification to be minor and consistent with the purposes of
the Inclusionary Zoning Regulations and the Guidelines. Any such revision, interpretation, or
clarification shall not become effective until posted on the City's website
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2 DEFINITION OF TERMS
As used in these Guidelines, the following terms shall be defined as follows:
Administration Fees
• A$1,500 fee charged by the City to the BMR Owner for all sales and re-sales of BMR Units,
• A$500 fee charged by the City to the developer/property manager for the annual review of
rental developments
• A$200 fee charged by the City to the BMR Owner for requests to subordinate the Resale
Restriction Agreement and/or Performance Deed of Trust or requests to refinance a BMR unit
Fees may be adjusted from time to time by the City.
Affordable Housing Agreement
An agreement between the developer and the City for an ownership Residential Development project
which is recorded against the property containing the BMR Units; sets forth the developer's
Inclusionary Obligation and the method by which the developer will comply with the requirements of
the Inclusionary Zoning Ordinance; and requires, among other things, that the developer require
purchasers of BMR Units to execute and record a Resale Restriction Agreement and Option to
Purchase and Performance Deed of Trust.
Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants
An agreement between the developer and the City for a rental Residential Development project which
is recorded against the property containing the BMR Units; sets forth the developer's Inclusionary
Obligation and the method by which the developer will comply with the requirements of the
Inclusionary Zoning Ordinance; and requires, among other things, that the BMR Units are reserved
for occupancy by Very-Low, Low-, andlor Moderate-Income households at rents affordable to such
households for a period of not less than 55 years.
AMI or Area Median Income
The area median income adjusted for household size as published annually by the County of
Alameda's Department of Housing and Community Development (HCD).
Approved Capital Improvements
Capital improvements to BMR Units that have been approved by the City pursuant to the procedure
set forth in Section 7.4.1. The cost of such improvements may be added to the resale price of the
BMR Unit.
BMR Owner
A household that owns a BMR Unit.
Below Market Rate (BMR) Units
A Below Market Rate or BMR Unit is a unit that is reserved for rent to Very-Low, Low, or
Moderate-Income households or for-sale to Low or Moderate Income households at a price or rent
that is affordable to such households. BMR Units have restrictions recorded against them to ensure
that they remain affordable for a period as set forth in the Housing Agreement or Resale Restriction
Agreement. '
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• Rental units are deemed affordable if the annual rent does not exceed 30% of the maxim
income level for Very Low-Income, Low-Income, or Moderate-Income households, as
applicable, adjusted for household size.
• Owner-occupied units are deemed affordable if the sales price results in annual Housing
Expenses that do not exceed 35% of the maximum income level for Low- or Moderate-
Income households, as applicable, adjusted for household size.
Ca1HFA
The California Housing Finance Agency
City
The City of Dublin
Consent Agreement
An agreement between the City and a Qualified Household which authorizes the City to access and
review the Qualified Household's credit reports or other personal or financial information to verify a
Qualified Household's compliance with the Resale Restriction Agreement, the Ordinance and these
Guidelines. This agreement must be executed by purchasers of ownership BMR Units prior to the
close of escrow.
Domestic Partner
A legal or personal relationship between individuals who live together and share a common domestic
life, but are not joined in a traditional marriage or a civil union as formalized through a local or state
registry.
Homebuyer
A person who has not owned any interest in real property during the three-year period prior to the
date of the household's application to qualify for purchase of a BMR Unit, including without
limitation, real property in which a household member's name appears on title regardless of whether
the member's interest in such property results in a financial gain, such property is located in another
state or country, or the member has occupied such property as his or her primary residence. If any
person has had his or her name on title of a property, but the property was sold more than three years
ago from the date of application, the person is considered a Homebuyer.
Homebuyer Education Workshop for Below Market Rate Buyers
A HUD approved 8-hour course designed to provide basic education specific to Below Market Rate
Homebuyers. Refer to the City's web site for organizations that may offer this course at
www.ci.dublin.ca.us . The date on the completion certificate for the class must be within 6 months
of the date of application for a Below Market Rate unit.
Gross Household Income
"Gross Household Income" means all income, from whatever source derived, of all adult household
members (18 years of age and older), whether or not such income is exempt from Federal income tax.
Such income includes, but is not limited to, the following:
• Compensation received from an employer
• Compensation includes, but is not limited to salary, overtime pay, and other pay
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• Other pay includes, but is not limited to, compensation for special working conditions or one
time pay-out of unused vacation and sick leave.
• Alimony, spousal and child support
• Cash
• Pensions, if at an age where pension is being received as income
• Public benefits including, but not limited to, CalWorks, SSI, and disability income
• All interest, dividends, and royalties
• Income derived from private businesses
• RentalIncome
• Income from pensions
• Compensation for services rendered including fees, fringe benefits, commissions, tips, and
bonuses
• Stipend received for participation in a mentor, learning or education opportunity
• Gains from dealings in private andlor commercial property
• Gambling Winnings
• Annuities, life insurance, and endowment contracts
• Income from discharge of indebtedness
• Gross partnership contributions or distributions
• Income from an interest in an estate or trust
Exceptions:
1) Gross Household Income does not include income earned by a household member who is between
the ages of 18-26 and meets both of the following criteria:
• Is claimed as a dependent of a household member on such member's federal income
taxes; and
• Is a full time student (12+ units - school transcript must be provided)
2) Gross Household Income does not include payments to a household member from a governmental
fund income if all of the following requirements are satisfied:
• The payments are based on the recipient's or the recipient's family's financial need;
• The payments do not represent compensation for services rendered; and
• The payments are part of a governmental housing subsidy program including, but not
limited to, Section 8 federal housing assistance payments
~ (These) Guidelines
These Guidelines to the Inclusionary Zoning Regulations
HCD
The California Department of Housing and Community Development.
HOA
Homeowner's Association
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Housing Agreement ~ ~/
An Affordable Housing Agreement, an Affordable Housing Regulatory Agreement and Declaration
of Restrictive Covenants or a Secondary Unit Regulatory Agreement and Declaration of Restrictive
Covenants or other Agreement that relates to Housing that may be adopted from time to time by the
City.
Housing Expenses
Principal, interest, taxes, insurances and HOA dues.
HUD
The United States Department of Housing and Urban Development.
Immeciiate Family Member
A mother, father, brother, sister, child, grandparent or grandchild.
Inclusionary Obligation
The number of BMR Units a developer is required to construct (or pay fees in lieu thereo fl in a
Residential Development project to comply with the Inclusionary Zoning Regulations.
Inclusionary Zoning Regulations
Chapter 8.68 of the City of Dublin Municipal Code.
In-Lieu Fee
A fee paid by a developer in lieu of constructing BMR Units to satisfy up to 40% of its inclusionary
obligation.
Legal Resident
A citizen or other national of the United States or a qualified alien as defined by the Fecleral Personal
Responsibility and Work Opportunity Reconciliation Act of 1996 ("PRWORA").
Low Income
Total Household Income that is 50°lo to 80°l0 of AMI, adjusted for actual household size.
Management Plan
A plan required for rental Residential Developments that contains the information set forth in Section
4.11.1 of these Guidelines. •
Marketing Plan
A plan required for ownership Residential Developments that contains the information set forth in
Section 4.10.1 of these Guidelines.
Maximum Income
The maximum income for an income category (Very-Low, Low-, or Moderate-Income) determined
periodically by HCD based on AMI. See Section 5.4 of these Guidelines far Maximum Incomes.
Moderate Income
Total Household Income that is 80% to 120% of AMI, adjusted for actual household size.
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Performance Deed of Trust
A deed of trust recorded against a BMR Unit by the City which secures a BMR Owner's compliance
with the Resale Restriction Agreement and Option to Purchase.
Preference Points
Points assigned to persons employed within the City of Dublin, public service employees working
within the City of Dublin, Dublin residents, Seniors (62+), persons who are permanently disabled
(with written verification from a physician or show receipt of SSI or SSDI), persons who are
immediate family members of a Dublin resident, and persons who are required to relocate from a
Dublin residence due to demolition of the residence or conversion of the residence from a rental to an
ownership unit. Persons with Preference Points are given priority over other Qualified Households in
the rental or purchase of a BMR Unit.
Principal Residence
The place where a person resides on a substantially full-time basis during not less than ten (10)
months per year. Children attending college and not living at home as their principal residence may
not be counted as a household member.
Priority List
A list which ranks Qualified Households based on the number of Preference Points received.
Qualified Household .
A qualified household is defined in terms of financial relationships and can include any group of
persons, so long as such persons, when viewed as a whole, satisfy the eligibility requirements for a
household.
For an ownership BMR Unit or for a rental BMR Unit, a"qualified household" means a household
that satisfies the requirements listed in Section 5 of these Guidelines.
Resale Restriction Agreement and Option to Purchase, also known as "Resale Restriction
Agreement"
An agreement between the City and a BMR Owner that is recorded against the BMR Unit and ,
among other restrictions, requires the unit to remain affordable to Low- or Moderate-Income
households usually for a period of 55 years or as outlined in the Housing Agreement, restricts the
resale price of the BMR Unit, requires the BMR Owner to notify the City upon refinancing, reselling
or changing the title of a BMR Unit, and provides the City with an option to purchase the BMR Unit
upon the occurrence of certain events.
Residential Development
This includes, without limitation, detached single-family dwellings, multiple-dwelling structures,
groups of dwellings, condominium or townhouse developments, condominium conversions,
cooperative developments, mixed use developments that include housing units, and residential land
subdivisions intended to be sold to the general public.
Secondary Unit
A legal secondary dwelling unit that has been approved by the City and that is reserved for
occupancy by Very Low-, Low- or Moderate-Income households at rents affordable to such
households.
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Secondary Unit Regulatory Agreement and Declaration of Restrictive Covenants
An agreement betweeri the City and the owner of a Secondary Unit which is recorded against the
property containing the Secondary Unit and requires, among other things, that the Secondary Unit be
reserved for occupancy by Very-Low, Low-, or Moderate-Income households at rents affordable to
such households for an amount of time specified in the Affordable Housing Agreement or Affordable
Housing Regulatory Agreement and Declaration of Restrictive Covenants.
Senior
A person 62 years of age or older for the purpose of qualifying for preference points
Special Assessment
A proportional fee charged to the BMR Owner by an HOA to cover the cost of physical
improvements to the entire building.
Total Household Income
All Gross Household Income and assets received (as calculated pursuant to Sections 5.4.2 and 5.4.3~.
Very-Low Income
Total Household Income that is fifty percent (50%) or less of AMI, adjusted for actual household
size.
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3 REQUIREMENTS FOR DEVELOPERS
3.1 Overview of the Inclusionary Zonin~ Process
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Residential Developments consisting of 20 residential units or more must comply with the
Inclusionary Zoning Regulations (Section 8.68.030(A)). In general, the Regulations require that
12.5% of the units constructed in a Residential Development be reserved for occupancy by For-Sale
Units to Moderate-Income households and Low-income households or rented at prices affordable to,
Very-Low-, Low-, and Moderate-Income households. Such restricted units are referred to as BMR
Units. (Section 8.68.030.A)
While the Regulations require that 12.5% of the units in the Residential Development be BMR Units,
the Regulations permit the developer to meet 5% of this obligation by paying an In-Lieu Fee. Thus,
there is a"must-build" requirement of 7.5% of the units in the Residential Development, and the
obligation with respect to the remaining 5% of the units may be satisfied by the payment of an In-
Lieu Fee. BMR Units must remain affordable for a period of 55 years, through affordability
restrictions recorded against the property.
In addition, the Inclusionary Zoning Regulations require that BMR Units:
• Be constructed concurrently with the market-rate units in the Residential Development;
• Have a similar range of bedrooms to the market-rate units in the Residential Development;
• Not be distinguished by design or materials from the market-rate units in the Residential
Development; and
• Be reasonably dispersed throughout the Residential Development.
A developer may also satisfy its Inclusionary Obligation by dedicating land or constructing BMR
Units off-site if the City Council makes the required findings. See Section 8.68.040 of the
Inclusionary Zoning Regulations for alternate methods of complying with the requirements of the
Ordinance.
3.2 Determining the Number and Size of Units Required
Prior to submitting an application to the City for a Residential Development that includes 20 or more
residential units, the developer should begin thinking about how to comply with the Inclusionary
Obligation. As part of the initial project review, Housing Staff is available to discuss with the
developer options for meeting the Inclusionary Obligation. For example, if a developer intends to
build only the minimum number of BMR Units and to pay an In-Lieu Fee for the remaining units,
Housing Staff can, for planning purposes, provide the developer with the preliminary number of
BMR Units the developer would be required to build, the income levels and sizes of the required
BMR Units, and the amount of the In-Lieu Fee under the then-current fee schedule.
After a Residential Development application is submitted to the Community Development
Department for review, a Project Review Committee meeting is generally held. In this meeting City
Staff and interested agencies involved in the development process review the Residential
Development and give preliminary comments to the developer.
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Pnor to or followm the Pro ect Review Committee PRC meetin , Housin Staff will send a lett I
g J ~ ) g g
to the developer indicating the developer's Inclusionary Obligation for the Residential Development
as preliminarily proposed. A copy of this letter will also be directed to the City's Project Planner
responsible for the Residential Development. The purpose of this letter is to provide the developer
information on the Inclusionary Obligation as early as possible in the development process. The City
recognizes that the Residential Development is likely to evolve over time and that the Residential
Development will likely change prior to obtaining City entitlements. However, this information is
provided early in the process as a service to the developer for planning purposes.
The developer's final Inclusionary Obligation will be formalized in an Affordable Housing
Agreement between the City and the developer, prior to the recordation of the first final map or the
issuance of the first building permit, whichever occurs first, for the development.
3.3 How to Calculate the Inclusionary Obli~ation
Developers of projects subject to Section 8.68.030.A. of the Inclusionary Zoning Regulations shall
construct 12.5% of the total number of dwelling units within the development as affordable units,
unless subject to an exception approved by the City Council. In making this calculation, any decimal
fraction less than or equal to 0.50 is disregarded, and a decimal fraction greater than 0.50 is construed
as a unit. Two examples of how the Inclusionary Obligation for a particular development is
calculated are shown in Figure 1.
FIGURE 1
Example 1: The developer proposes a 224-unit subdivision. 12.5% percent of 224 is 28.
The Inclusionary Obligation is 28 units of the origina1224 units.
Example 2: The developer proposes a 316-unit subdivision. 12.5% percent of 316 is 39.5.
Rounding the decimal fraction down, the Inclusionary Obligation is 39 units of the original
316 units.
3.4 How to Calculate How Many Units Must Be Constructed and How Many Units of the
Obligation May be Satisfied with an In-Lieu Fee
The Ordinance permits a Developer to pay an In-Lieu Fee for up to 5% of its Inclusionary Obligation.
When the calculation of the fee results in a decimal fraction, the rounding rules contained in Section
8.68.030A are used.
Using the same examples from Figure 1, Figure 2 illustrates the calculation of the number of BMR
Units that may be subject to the In-Lieu Fee.
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FIGURE 2
Example 1: The developer proposes a 224-unit subdivision, for which the Inclusionary
Obligation is 28 units of the 224 units. 40% of 28 units =11.2 units. Disregarding the
fraction, the developer may pay an In-Lieu Fee for the remaining 11 units, and the
developer's "must-build" obligation would be 17 units. 11 + 17 = 28 units.
Example 2: The developer proposes a 316-unit subdivision, for .which the Inclusionary
Obligation is 39 units of the 316 units. 40% of 39 units = 15.6 units. This number is
rounded up to 16 and In-Lieu Fees may be paid for this amount, instead of providing units.
The "must-build" obligation would be 23 units. 16 + 23 = 39 units.
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3.5 How to Calculate the Amount of the In-Lieu Fee
The amount of the In-Lieu Fee is set by Resolution of the City Council. Resolution No. 56-02
provides that the In-Lieu Fee per BMR Unit is adjusted annually on July 1 to reflect the greater of the
percentage change either in a) the Bay Area Urban Consumer Price Index (CPn as of February of
each year, ar b) the United States Department of Housing and Urban Development (HCJD) Fair
Market Rent limits for the Oakland Primary Metropolitan Statistical Area (PMSA) that are in effect at
the time. The fee as of July 1, 2008 is $ 91,916 per BMR Unit.
THE ENTIRE IN-LIEU FEE AMOUNT FOR THE RESIDENTIAL DEVELOPMENT IS DUE
AND PAYABLE UPON ISSUANCE OF THE FIRST BUILDING PERMIT FOR THE
RESIDENTIAL DEVELOPMENT.
Using the examples from Figures 1 and 2, Figure 3 illustrates how to calculate the amount of the In-
Lieu Fee.
FIGURE 3
Example 1: The developer proposes a 224-unit subdivision. In-Lieu Fees may be paid for 11
units. 11 X$91,916 is $1,011,076 which is the amount of the In-Lieu Fee for the Residential
Development. This entire amount would be due prior to issuance of first building permit.
Example 2: The developer proposes a 316-unit subdivision. In-Lieu Fees may be paid for 16
units. 16 X$91,916 =$1,470,656 which is the amount of the In-Lieu Fee for the Residential
Development. This entire amount would be due prior to issuance of first building permit.
3.6 How to Calculate How Many BMR Units Must Be Provided for Each Income Level
Pursuant to Section 8.68.030.B of the Inclusionary Zoning Ordinance, the BMR Units included in
each Residential Development project must be allocated to households in the following manner:
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For-Sale Units . Rental Units.
^ 60% to moderate-income households ^ 50% to moderate-income households
^ 40% to low-income households ^ 20% for low-income households
^ 30% for very-low income households
Once again, if the allocation calculations results in a decimal fraction, the rounding rules contained in
Section 8.68.030.A apply. In addition, if the allocation calculation results in fewer units than would
otherwise be required; one additional unit should be allocated to the lowest income level with the
decimal fraction closest to 0.50. (Section 8.68.030.B)
Figure 4 illustrates how to calculate the number of units that must be provided at each income level
and how the rounding requirement is implemented:
FIGURE 4
FOR RENTAL BELOW MARKET RATE UNIT
The Residential Development includes 200 units. The Inclusionary
Obligation is 25 units. The developer chooses to pay an In-Lieu Fee for
40% of the units, which equals 10 units. The developer's must-build
requirement (7.5%) is 15 units.
• 50% of those 15 units would need to be restricted for Moderate-
Income households, 50% of 15 = 7.5
• 20% of those 15 units would need to be restricted for Low-Income
households, 20% of 15 = 3
• 30% of those 15 units would need to be restricted for Very Low-
Income households, 30% of 15 = 4.5
7.5+3+4.5=15
Since two of these numbers are fractions at exactly .S, the City of Dublin
would require that the unit be provided in the lower income category.
In this example the income- unit mix would be:
• 7 Moderate-Income units
• 3 Low-Income units
• 5 Very Low-Income units
3.7 How to Determine the Size of BMR Units
The Ordinance requires that the same proportion of bedrooms be reflected in the BMR Units as are in
the market rate units. Once again, the rounding conventions in Section 8.68.030.A are used, if the
allocations result in decimal fractions.
Figure 5 illustrates how to determine the number of BMR Units that must be provided at each unit
size:
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FIGURE 5
To determine bedroom requirement:
The developer proposes a 200-unit rental Residential Development and is paying In-
Lieu Fees for 40% of the BMR Units. The must build obligation is 15 units.
The Residential Development includes:
50 one-bedroom units (25 % of total)
100 two-bedroom units (50% of total)
50 three-bedroom units (25% of total)
Therefore:
• 25% of the BMR Units are to be one-bedrooms
• 50% of the BMR Units are to be two-bedrooms
• 25°/o of the BMR Units are to be three-bedrooms
To determine bedroom requirement per income category:
If 5 of the units are Very Low-Income, using the percentages above the requirement
for bedrooms are:
• 25% of 5= 1.25 one-bedroom units
• 50% of 5= 2.5 two-bedroom units
• 25% of 5= 1.25 three-bedroom units
Therefore, the development would be required to provide:
• 1 one-bedroom unit
• 3 two bedroom units
• 1 three bedroom unit
The same calculation is performed to determine the bedroom sizes of the Low-
Income and Moderate-Income units.
3.8 How to Determine the Location of BMR Units Within the Development
The Inclusionary Zoning Ordinance requires that BMR Units be reasonably dispersed throughout the
Residential Development. The purpose of this requirement is to avoid concentration of the BMR
Units in a particular location within a development, effectively segregating them from the rest of the
Residential Development. There are many ways in which to implement this requirement and
consultation with Community Development Department Staff is recommended prior to developing
the final site plan. Ultimately, the Planning Commission or City Council will determine, based on
Staff recommendation, if this requirement has been met.
Per section 8.68.040(E) of the Inclusionary Zoning Regulations, the City Council, at its discretion
may waive, wholly or partially, the requirements of this ordinance and approve alternate methods of
compliance with this Chapter if the developer demonstrates, and the City Council finds, that such
alternate methods meet the purposes of this Chapter.
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3.9 Housing Agreements
Section 8.68.50 of the Inclusionary Zoning Regulations requires the developer to execute one of the
following Housing Agreements with the City:
• Affordable Housing Agreement
An agreement between the develo~er and the Citv for a Residential Development project that
includes ownership BMR units (and potentially Secondary Units). Such Agreements are
recorded against the property on which the Residential Development is being constructed; set
forth the developer's Inclusionary Obligation and the method by which the developer will
comply with the requirements of the Inclusionary Zoning Ordinance; and require, among
other things, that the developer require purchasers of BMR Units to execute a Resale
Restriction Agreement and Option to Purchase with the City.
Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants
An agreement between the develo~er and the City for a Residential Development project that
includes rental BMR units. Such agreements are recorded against the property containing the
BMR Units; set forth the developer's Inclusionary Obligation and the method by which the
developer will comply with the requirements of the Inclusionary Zoning Ordinance; and
requires, among other things, that the BMR Units are reserved for occupancy by Very-Low,
Low-, and/or Moderate-Income households at rents affordable to such households for a period
of not less than 55 years.
Secondary Unit Regulatory Agreement and Declaration of Restrictive Covenants
This Agreement is similar to a Resale Restriction Agreement and is executed after an
Affordable Housing Agreement or Affordable Housing Regulatory Agreement and
Declaration of Restrictive Covenants. This agreement is between the City and the owner of a
Secondary Unit and is recorded against the property containing the Secondary Unit and
requires, among other things, that the Secondary Unit be reserved for occupancy by Very-
Low, Low-, and Moderate-Income households at rents affordable to such households for the
period of time set forth in the agreement.
The Housing Agreements set forth the legal requirements for the Residential Development project for
compliance with the Inclusionary Zoning Ordinance. The Housing Agreements are recorded against
the property on which the Residential Development is being constructed, run with the land, and
survive transfer or sale of the land. The term of the Affordable Housing Regulatory Agreements is a
period of 55 years. The Affordable Housing Agreement is effective until all of the In-Lieu Fees are
paid; the BMR units are constructed, sold, and subject to a Resale Restriction Agreement. If a
developer executes a Housing Agreement for a particular Residential Development project but the
project is not built and new entitlements are sought for the applicable property, the developer must
execute a new Housing Agreement, which would replace the existing Agreement.
Among other things, the Housing Agreements must contain the following information:
1. A description of how the developer will comply with its Inclusionary Obligation (whether
through unit construction andlor payment of an In-Lieu Fee);
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2. Whether the BMR Units will be ownership or rental units;
3. The number of BMR Units the developer will construct for each income category;
4. The size of the BMR Units the developer must construct for each income category;
Depending on the nature of the development, the timing of construction of the units to
ensure that the BMR Units are constructed concurrently with the market-rate units;
6. If the development proposes ownership BMR Units, a requirement that the developer
prepares and obtains City approval of a Marketing Plan, prior to issuance of any building
permits in the Residential Development, indicating how the developer plans to sell the
BMR Units. This requirement is discussed in additional detail in Section 4.10.1 below;
7. If the development proposes ownership BMR Units, there is a requirement that the
developer require the purchasers of such units to execute a Resale Restriction Agreement
or a Secondary Unit Regulatory Agreement and Declaration of Restrictive Covenants and
a Performance Deed of Trust. A sample Resale Restriction Agreement is attached as
Exhibit No. 1. A sample Performance Deed of Trust is attached as Exhibit No. 2. A
sample Secondary Unit Regulatory Agreement and Declaration of Restrictive Covenants
is attached as Exhibit No. 3.
8. If the development proposes rental BMR Units, a requirement that the developer provide a
Management Plan and Marketing Plan as described in Section 4.11.1 to the City for its
approval and prepare the Annual Report described in Section 4.11.4.
3.10 Procedures for Initial Sale of BMR Units
3.10.1 The Marketin~ Plan for Ownership Units
Prior to the issuance of building permits for any ownership BMR Units, the developer shall submit a
Marketing Plan to the City for approval. The Marketing Plan must contain the following:
1. A one-page narrative summary suitable for advertising the availability of the BMR Units
on the City web page and other locations, including a description of the total number of
BMR Units and market-rate units in the Residential Development; the HOA dues for each
BMR Unit; the amenities included in the unit, and a telephone number for interested
applicants to call for additional information;
2. An explanation of the application process and the deadline for submitting applications.
If the development is phased, the developer must establish deadlines for each phase of
the development that includes BMR Units;
3. An explanation of the selection process, including an explanation of the Preference
Point system;
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If dev 1 ment is a hased ro~ect informatioi~.~ V~~
4. Timelines for buyer selection. the e op p p ~ ,
must be provided on the number of phases and the timelines for those phases;
5. Timeline for the developer's sales staff to meet with the City's Housing Staff to
receive training on the sale selection and application process;
6. Marketing materials;
7. An application packet which includes:
• Application for Inclusionary Unit.
- • Disclaimer for BMR Application Qualification Questionnaire
• Credit Authorization and Release
• Signed Sample Resale Disclosure Statement ,
• Required Supporting Documentation Submitted
• Highlights of Dublin Resale Restriction Agreement
• Written confirmation of pre-approval for the home which must be validated
through Developer's preferred lender.
See Exhibit No. 3 for a sample ownership BMR Unit application packet.
No marketing of the BMR Units shall begin until the developer has received written approval of the
Marketing Plan from the City and the developer's sales staff has met with the Housing Staff for
training so that the sales staff understands and can explain the application process.
3.10.2 Application and Screenin~ Process
The developer must require each applicant to complete the application that has been approved by the
City as part of the Marketing Plan and to provide the required supporting documentation by the
deadline set forth in the Marketing Plan. The developer should plan accordingly to assure that
applicants are not qualified more than 6 months before the move-in date of the unit.
Application packets should include at a minimum:
• Complete application;
• Income documentation set forth in Section 5.4.1;
• Reservation instrument showing the address, number of bedrooms and sales price;
• A loan pre-approval letter with Good Faith Estimate and Truth in Lending Statement;
• A signed Disclosure Statement (Exhibit F of the Resale Restriction Agreement);
• A signed credit report authorization and release or other consent and verification letter;
• Copy of tri-merge Credit Report; and
• Evidence of 3% available funds to be used as a down payment.
The developer must comply with the following process to sell the BMR Units:
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i th ~ d et forth in the a roved Marketiif V~""
1. Developer collects applicat ons for e perio of time s pp g
Plan.
2. Developer screens applicants to determine whether they satisfy the requirements for
Qualified Households set forth in Section 5.1.
3. Developer sorts and ranks the Qualified Households based on the Preference Points and
creates a Priority List with those applicants with the most Preference Points at the top
followed by all other applicants in descending order based on the number of Preference
Points received. If more than one qualified applicant receives the same number of
Preference Points or if some applicants receive no Preference Points, the developer shall
rank the Qualified Households based on other objective criteria outlined in its approved
Marketing Plan. For example, the developer may date stamp all applications and, in the
case of a tie, rank the Qualified Households based on who applied first, ar the developer
may choose to hold a lottery to break ties. However, whichever criteria the developer uses
must be set forth in its approved Marketing Plan.
4. Developer completes the Priority List within 30 days of the application deadline and
submits the list to the City.
5. Developer reviews and sorts the application packets in order of the Priority List and
submits complete application packets of Qualified Households, together with supporting
documentation, to the City within forty-five (45) days prior to close of escrow.
6. The City reviews the application packets to verify the applicants are Qualified
Households. The City will make every effort to review the applications within 7 working
days of receiving a complete application packet.
Once the City has verified that the applicant is a Qualified Household, the City will send
the developer a conditional approval letter (or similar document) indicating the applicant's
name, income level and the maximum sale price of the unit (see Section 4.10.3 for more
detail on establishing the sale price) and any requirements that must be met before moving
forward with the applicant. Once all the required information is received, the City will
then send a conditional qualification letter (or similar document) which is valid for 6
months from the date of the letter. A copy of the application packet, along with income
verification for the household will be retained by the City as proof of the buyer's
qualification to purchase the BMR Unit. If the City determines that the applicant is not a
Qualified Household, the City will send the developer an ineligibility letter. An applicant
who has been deemed to be ineligible may not reapply for a period of one year from the
date of the ineligibility letter.
The developer bears the responsibilities of ensuring applicants are not qualified more than
6 months before a unit becomes available and closes escrow. Applicants must be re-
qualified if occupancy is to take place more than 6 months from the date of the conditional
qualification letter. Applicants may or may not qualify to purchase a BMR Unit upon re-
qualification. In addition, the price of the BMR Unit may change upon re-qualification.
If, upon re-qualification, an applicant does not qualify, it is the responsibility of the
developer to notify the applicant.
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Conditional approvals are based on information which was supplied to the City by the
developer, or their agent. If there are any material changes to the financial conditions,
marital status, employment status or other facts or information that is made known to the
City prior to loan closing, the developer, their agent or the lender must notify the City of
Dublin in writing of these changes. The City expressly reserves the right to re-verify the
applicant(s) and may void or cancel this conditional approval or other approval at any
time prior to the loan closing if these material changes affect the qualification status of the
buyer(s).
Qualification determinations may be appealed by the Developer to the Community
Development Director.
THE SALE CANNOT PROCEED UNTIL ALL REQUIIZED DOCUMENTS ARE
PROVIDED TO THE CITY AND THE DEVELOPER RECEIVES A WRITTEN
QUALIFICATION LETTER FROM THE CITY.
7. The developer will offer the unit to Qualified Households based on the Priority List,
offering the BMR Unit first to those applicants with the most Preference Points, then in
descending order.
8. The developer and applicant will enter into a purchasing agreement.
9. The developer will require the selected buyer to execute a Resale Restriction Agreement
and Option to Purchase and a Performance Deed of Trust.
10. The developer will provide the City with the name and address of the title company
closing the sale and the name of the escrow officer.
11. Prior to the City sending escrow instructions the City will review all final loan documents
for compliance to the Section 6.1 Financing Requirements.
12. The City will prepare and send escrow instructions to the Title Company.
13. The Title Company will submit the following documents to the City:
• Completed and Signed Residential Loan Application;
• Completed Truth in Lending Statement, Good Faith Estimate, and a estimated
HUD-1 statement from the Title Company;
• Completed, executed, and notarized Resale Restriction Agreement and Option to
Purchase; and
• Completed, executed, and notarized Performance Deed of Trust.
14. The City will review the above documents for completeness, prepare the Request for
Notice of Default for each of the buyer's loans, secure the signature of the City Manager
or his/her designee on the necessary documents, and return the loan documents to the
lender.
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15. The City will send the original Resale Restnction Agreement, Performance Deed of rus
and Request(s) for Notice of Default to the escrow officer for recording.
If at any time during the application, screening, or sale process, an applicant requires translation
services, the developer shall provide such services at the developer's sole cost and expense.
3.10.3 Sale ~rice of BMR Units
Pursuant to Section 8.68.020A.2 of the Inclusionary Zoning Ordinance, Owner-occupied units are
deemed affordable units if the sales price results in annual housing expenses that do not exceed 35%
of the maximum income level for low-, and moderate-income households, adjusted for household
size.
Below Market Rate For-Sale units are priced based on a designated income point that is affordable to
a greater range of households in each applicable income category.
• For Low-Income Households (household income of between 50% and 80% of Area
Median Income), the sales price would be set at a level so that total monthly housing
payment would not exceed thirty-five percent (35%) of one-twelfth of seventy percent
(70%) of the Area Median Income for Alameda County.
• For Moderate-Income Households (household income of up to 120% of Area Median
Income), the sales price would be set at a level so that total monthly housing payment
would not exceed thirty-five percent (35%) of one-twelfth of one hundred and ten percent
(110%) of the Area Median Income.
In addition, the fixed sales price approach would be based upon the number of bedrooms in the home
instead of the number of persons in the particular household. For example, if a developer is selling a
two-bedroom unit, the sales price would be calculated under the "number of bedrooms, plus one" rule
for the assumed household size. In each case the sales price would be set based upon the following
assumed household sizes for the following sizes of residential units:
No. of Bedrooms Assumed Household Size
1 2
2 3
3 4
4 5
The assumptions below are used to calculate the maximum sale price for BMR Units. However, a
Qualified Household's actual Housing Expenses may differ from these assumptions.
• Interest - Prevailing rate (fixed rate for 30 years), secondary market fixed rate, Fannie
Mae or Freddie Mac, as determined by staff, on the date that is 30 days prior to the
applicable application deadline.
• Mortgage Term - fixed rate for 30-years.
• Taxes - 1.25% of the estimated sale price of the unit.
• Insurance - homeowner's insurance.
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' - t m w er' ur m e cal ~d~ I~
o Homeowner s Insurance The cos of ho eo n s ms ance ay b cu
based on an estimate provided by the developer. (If the homeowner's insurance is
covered by an HOA structure, homeowner's insurance need not be included, but it
must be documented that the HOA will provide adequate insurance.)
• HOA dues, if any.
Figure 6 shows how the sale price is calculated:
FIGURE 6
TABIJLATION OF MAXIMUM SALE PRICE FOR A
MODERATE BMR UNITS
Household size
Max. allowable annual income
Annual hausehold income
Gross monthly income (line 1 divided by 12)
% paid toward housing
Gross monthly housing expense (line 2 multiplied by 35%)
Less Interior Homeowner Insurance
Less Property Taxes (1.25% of line 6)
Less Homeowners Association Dues (HOA)
Net monthly housing expense
MAXlMUM MOiVTHLY MORTGAGE PAYMENT
Interest Rate
Term
Maximum Loan
35%
Enter;
Amounts
2,983.75
'50 00 2,933.75
447.02 2,486.73
11 Z 2,369.73
2,369.73
2,369.73
2,369.73
5.25%
30
429,140.55
3.11 Procedures for Initial Rental of BMR Units
After the Housing Agreement is executed, and prior to the issuance of any building permits, the
developer must prepare and submit a Management Plan to the City of Dublin Housing Division for
approval. After the Management Plan has been approved by the City, and prior to the rental of any
units, the developer must screen, rank and qualify eligible tenants and send a priority list to the City
of Dublin's Housing Division. This should happen within 30 days, if possible. In addition, the rent
for a BMR Unit must be calculated pursuant to Section 4.11.3.
3.1 l.l The Mana~ement Plan for Rental BMR Units,
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Prior to the issuance of building permits, the developer must submit a Management Plan to the City~
for its approval. The Management Plan must contain the following information:
• a Plan outlining how the management firm will market and maintain the rental BMR
Units,
• how the firm will maintain a waiting list for the BMR Units;
• how the management firm will verify applicants' Total Household Income, both initially
and annually;
• information on the units to be made available for the City to use on the City website;
• a contact telephone number;
• and the names of those individuals responsible for contact and communication with the
City.
3.11.2 Application and Screenin~ Process
The management firm (which could be the owner or builder) is the entity that will be responsible for
occupant selection and documentation of rental BMR Units. The management firm's leasing staff
should be trained so the staff understands and can explain the rental application process to applicants.
The management firm must require each applicant to complete and return to the management
company a Rental BMR Unit Application packet. A sample Rental BMR Unit Application packet is
attached as an Exhibit to these Guidelines.
To lease the BMR Units the developer/management company must do the following:
1. Collect applications for a given time period.
2. Screen applicants to determine whether they satisfy the requirements for Qualified
Households set forth in Section 5.2.
3. Sort and rank the applications of Qualified Households based on the Preference Points and
produce a Priority List with those applicants with the most Preference Points at the top
followed by all other applicants in descending order based on number of Preference Points
received. If more than one applicant receives the same number of Preference Points or if
some applicants receive no points the developer shall use other objective criteria set forth
in the approved Management Plan to select occupants. For example, the management firm
may date stamp all applicant applications and, in the event of a tie, offer the unit to that
applicant that applied first, or the management firm may choose to hold a lottery to break
ties. However, whichever criteria the management firm uses must be set forth in the
approved Management Plan.
4. The Priority List must be completed within 30 days of the application deadline and
submitted to the City for approval;
5. Offer the BMR Units to applicants based on the Priority List, offering first to those
applicants with the most points, then in descending order;
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6. Execute a Rental Agreement with the tenant that notifies the tenant that he or she may not
sublease the unit and that annual certification is required.
7. Maintain applications with income verification and re-certification for City to review at
annual onsite monitoring.
Qualification determinations may be appealed by the Developer to the Community Development
Director.
3.11.3 Calculating Maximum Rent
The Inclusionary Zoning Regulations state that maximum rents cannot exceed 30% of the Maximum
Income in a given income category. Affordable rents are calculation formula is listed below for Very
Low, Low and Moderate Income Households:
• Very Low Income Tenants, monthly rent not in excess of thirty percent (30%) of one-
twelfth of fifty percent (50%) of the annual Median Income for the Area; .
• Low Income Tenants, monthly rent not in excess of thirty percent (30%) of one-twelfth of
sixty percent (60%) of the annual Median Income for the Area; and
• Moderate Income Tenants, monthly rent not in excess of thirty percent (30%) of one-
twelfth of one-hundred and ten percent (110%) of the annual Median Income for the Area,
with in each case based upon the following assumed household sizes for the following
sizes of residential units in the Project.
If tenant is required to pay for utilities, the ma~cimum rent must be reduced to account for the cost of
such utilities (a utility allowance). Utilities include gas, electric, water, and trash disposal. In
addition, if tenants are required to provide their own stove, refrigerator, or washer and dryer, these
expenses are considered utilities, and the maximum rent is further reduced. If the tenant is
responsible for any of the above, the maximum rent must be reduced by the amounts listed in the
Utility Allowance Sheet* (See Exhibit No. 8).
/ illustrates the calculation oT maxlmum rent:
FIGURE 7
_. _ .,_ ~. _._ .
2008 Rent limits . _ ._~ . _.. . _ __ _ .___ _ _ __ _._~ ~ __ _r _ ._. ~_ __. __ _;
: ' £
_
. _ .. __ ..~ _. ~.. ..~_~. __
!Bedroom Size Assumpt ..._ ._ _..._
ions ..... .._~ ._~ . ... _.__ . . _ ._~ . _. . ..~,
.. ~ .... _
=0 bdrrn 1 person 1 bdrm - 2 people ;
_
_..._ _._. _.~ _.....
, .. ~. __~._..~ ....._._.
;
_ ~ ...~. .. ..~ .. _. ...._.._.~.,. , _ . ~ .. .~
.
;2 bdrm = 3 people ;3 bdrm - 4 people
50% 60% 110% ; £ ~
.
0 .. . .~. ._ ...
$754
, ... ,..$905 ._.. ~ .;,,. _...___.~._.... . ~
_ ~.._..,. , ;
$-1, 658 ~T.... ' < ;
. _
, .......
1 ;
$861
; $1,034 _ ,
; $1,895 ; ; '
2.___.._~.. .._,
$969
.~9_ $1,163',.~ __. ~;~ .. .,~
~...$2,131__..,_~.._ :
~._~.__ _ 3..__ _.
_
.
...~ _$1,076
__. ~,_ ~$1,292 , $2,368~~-_~.. ..-_W ~ ~ _~._ ~.. ~ _..~_ . ~;
__i
, . ,,,
,.......~,. .
~ _
,_
_.
4 ; ~
_
$1,163 ~ .
` $1 395 $2 558 ~
If a tenants/households income increases to where the tenant/household is no longer income or
household size qualified for the BMR rental unit, the tenant/household will not be required to move;
~ The Utility Allowances. are established by the Housing Authority of Alameda County and revised periodically. The
most current Utility allowances for Alameda County may be accessed at the following web site: http/lwww.haca.net., then
click on statistics.
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however the household will no lon er be considered ualified for a BMR unit and the rent ma be~
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increased to market rate rent. The developer/landlord will then offer the next available unit with the
same specifications (i.e. bathrooms and bedrooms) as a BMR rent restricted unit.
3.11.4 Annual Report
Pursuant to Section 8.68.OSO.B of the Inclusionary Zoning Regulations, the management entity for
the development must provide the City an annual report (See Exhibit No 9). The annual report must
include the following information:
• Total Household Income for the prior year for each BMR Unit;
• Number of people residing in each BMR Unit;
• Monthly rents charged and proposed to be charged for each BMR Unit; and
• Vacancy of BMR Units during the previous year.
The management firm must submit the report annually by October 31 st. The City of Dublin Housing
Staff will send a reminder letter to the management firm, with a copy of the Annual Report form for
completion and certification at least three months prior to the anniversary date. This form must be
completed and returned to the City by the anniversary date.
3.11.5 Annual Monitoring bv City
The City of Dublin may perform an annual site visit to monitor the records of all BMR Units. The
City will provide at least two-week's notice to the developer and/or management firm as to the date
of the site visit. Files for all BMR Units must be made available for review at the request of the City.
The purpose of the monitoring is to ensure compliance with the City's Inclusionary Zoning
Ordinance and these Guidelines.
If a Residential Development is financed through a government program that has stricter occupant
selection or occupant documentation requirements than the City, the City may elect to rely on those
requirements and associated documentation and not require additional documentation. The City will
require tenant income verification and restriction of the BMR units for 55 years; however, the
management firm may send to the City copies of the documentation that is required and produced for
other monitoring agencies.
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4 BUYER AND RENTER UALIFICATIONS FOR BMR UNITS ~
Q
4.1 Buyer Qualifications
A household is qualified to purchase a BMR Unit if it satisfies the following requirements:
1. The household's Total Household Income does not exceed the applicable Maximum
Income set forth in Section 5.4;
2. The household will occupy the unit as its Principal Residence within 30 days of the close
of escrow on the unit;
3. The household is of a size meeting the household size criteria set forth in Section 5.3;
4. All title holders of the property must take an 8-hour Homebuyer Education workshop and
receive a certificate of completion. Certificate of Completion must be dated within 6
months of the date of application;
5. All applicants have a minimum FICO credit score of 620 (See Section 5.5);
6. The City will require all household members to be either a citizen or national of the
United States or a qualified aliens defined by the federal Personal Responsibility and
Work Opportunity Reconciliation Act of 1996(PRWOR.A);
7. All members of the household are either:
a. persons who hold title to the BMR Unit„ appear on the mortgage, and have
executed a Resale Restriction Agreement and Performance Deed of Trust for the
unit; or
b. persons who are claimed as a dependent on the tax returns of a household member
who satisfies the requirements in subsection (a) above; and
8. All members of the household must meet the definition of a qualified homebuyer.
Qualified Households with Preference Points will receive priority over other Qualified Households.
For information on the application and screening process, see Section 4.10.2.
Once the City has verified that the applicant is a Qualified Household, the City will send the
developer a conditional approval letter (or similar document) indicating the applicant's name, income
level and the maximum sale price of the unit (see Section 4.10.3 for more detail on establishing the
sale price) and any requirements that must be met before moving forward with the applicant. Once
all the required information is received, the City will then send a conditional qualification letter (or
similar document) which is valid for 6 months from the date of the letter. A copy of the application
packet, along with income verification
Applicants who are determined ineligible will receive an ineligibility letter. Ineligible applicants may
not reapply to purchase any BMR Unit for a period of one year from the date of the City's
ineligibility letter.
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Qualification determinations may be appealed by the Developer to the Community Development
Director.
4.2 Renter Qualifications
A household is qualified to rent a BMR Unit if it satisfies the following requirements:
1. The household's Total Household Income does not exceed the applicable Maximum
Income (See Section 5.4);
2. All members of the household are Legal Residents;
3. The household will occupy the unit as its Principal Residence within 30 days of executing
the lease; and
4. The household is of a size meeting the household size criteria set forth in Section 5.3).
5. The names of all non-dependent household members must appear on the lease for the
BMR Unit
6. No member of the Qualifying Household must own any interest in ariy real property,
including but not limited to, any dwelling unit, commercial real estate, or land.
Qualified Households with Preference Points will receive priority over other Qualified Households.
For information on the application and screening process, see Section 4.11.2.
Qualification determinations may be appealed by the Developer to , the Community Development
Director. ~
4.3 Household Size
The size of the household is determined by the number of people li•ving in a household at the time of
application. In the case of a pregnant person, the baby may not be included as a member of the
household until the baby is born.
To qualify for a BMR Unit, the size of a household must be compatible with the size of the unit being
rented or purchased.
The household size for each BMR Unit may not exceed two people for each bedroom and may not be
less than one person per bedroom, unless otherwise permitted by special financing sources. Consult
with the City of Dublin for further clarification. The chart below contains the household size
permitted for each BMR Unit based on the number of bedrooms:
Studio
One-bedroom units
Two-bedroom units
Three-bedroom units
Four-bedroom units
1-2 people households
1-2 people households
2-4 people households
3-6 people households
4-8 people households
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4.4 Total Household Income
To be eligible for a BMR Unit, the applicant's Total Household Income must not exceed the
applicable Maximum Income. Total Household Income means the household's Gross Household
Income (see Section 5.4.1 below) plus assets calculated pursuant to Section 5.4.3. Maximum Income
is determined periodically by HCD based on AMI. Below are the Maximum Incomes for Alameda
County for 2008.
Number of Persons in Household
Income Category 1 2 3 4 5 6 7 8
Very Low $ 30,150 $ 34,450 $ 38,750 $ 43,050 $ 46,500 $ 49,950 $ 53,400 $ 56,850
Low $ 46,350 ~ 53,000 $ 59,600 $ 66,250 $ 71,550 $ 76,850 $ 82,150 $ 87,450
Moderate $ 72,300 $ 82,600 $ 93,000 $ 103,300 $ ll1,600 $ 119,800 ~ 128,100 $ 136,400
4.4.1 Gross Household Income
Gross Household Income means all income from all adult household members (18 years of age and
older) derived from all sources as provided in the Internal Revenue Code (Title 26, Subtitle A,
Chapter 1, Subchapter B, Part I, Section 61), whether or not such income is exempt from Federal
income tax. Such income includes, but is not limited to, the following:
• Compensation received from an employer
• Compensation includes, but is not limited to salary, overtime pay, and other pay
• Other pay can include, but is not limited to compensation for special working conditions
or one time pay-out of unused vacation and sick leave.
• Alimony, spousal and child support
• Cash
• Pensions, if at an age where pension is being received as income
• Public benefits including, but not limited to, CalWorks, SSI, and disability income
•. All interest, dividends, and royalties
• Income derived from private businesses
• RentalIncome
• Income from pensions
• Compensation for services rendered including fees, fringe benefits, commissions, tips, and
bonuses
• Stipend received for participation in a mentor, learning or education opportunity
• Gains from dealings in private andlor commercial property
• Gambling Winnings
• Annuities, life insurance, and endowment contracts
• Income from discharge of indebtedness
• Gross partnership contributions or distributions
• Income from an interest in an estate or trust
Exceptions:
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1) Gross Household Income does not include income household earned by a household member who
is between the ages of 18-26 and meets both of the following criteria:
• Is claimed as a dependent of a household member on such member's federal income
taxes; and
• Is a full time student (12+ units - school transcript must be provided)
2) Gross Household Income does not include payments to a household member from a governmental
fund Income if all of the following requirements are satisfied:
• The payments are based on the recipient's or the recipient's family's financial need;
• The payments do not represent compensation for services rendered; and
• The payments are part of a governmental housing subsidy program including, but not
limited to, so-called Section 8 federal housing assistance payrnents.
For purposes of determining Gross Household Income, each person, 18 years of age or older, must
present the following:
• a complete set of Federal and State Income Tax Returns for the past three years, including
all schedules (signed & dated) and W-2 forms; (in the case where taxes have not been
filed for any of the past three years, a letter of verification of non-filing from the Internal
Revenue Service is required);
• four most recent and consecutive pay stubs; and
• three recent and consecutive statements for all financial accounts, including but not
limited to, savings accounts, checking accounts, retirement accounts, 401(K) accounts,
stock accounts and another accounts held in the applicant(s) name(s), whether held
individually or together.
If a household member is self-employed, in addition to the information above, the member must
submit profit and loss statements for the past 3 years (if applicable), and a current profit and loss'
statement for the year.
4.4.2 Income Calculation
a. Wage and Salary
If an applicant is a full time employee (usually 30 to 40 hours) or an employee with consistent
regular hours or income, or income with overtime or adjustments as a regular part of their job,
one of the following formulas listed below in Section "a" will be used to determine the
applicant's salary. Bonuses and commissions may be calculated into the annual income
calculation. In the case of unclear income or income that is somewhat difficult to calculate,
please contact the City of Dublin Housing Division. The City of Dublin will make the final
determination which Income Calculation to use.
Monthly income x 12 months = annual income
Twice monthly x 24 = annual income
Bi-weekly income x 26 = annual income
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Weekly income x 52 = annual income
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Hourly income x 40 (or whatever normal hours per week may be) x 52 = annual income
An employee who works consistent hours, with some overtime, shall be calculated using the
above formula.
b. Variable Income
For applicants who are part-time employees or employees with variable hours every pay
period (or variable hours less than 40 hours per week), inconsistent income or hours,
overtime, bonuses and commissions, etc. their annual salary shall be calculated using year-to-
date income, plus previous year income (from same income source or employer), divided by
the number of months reviewed (UP TO BUT NOT EXCEEDING 12 MONTHS) times 12 to
arrive at their annual income. If there is no previous year income from same employer, or the
job was started mid-year, use current income year to date using the calculation explained in
(a) above shall be used. If an applicant works consistently 40 hours per week and has
occasional or regular overtime, use the calculation listed in "a" above to calculate income.
c. Inconsistent or Temporary change in Income Due to a Temporary Circumstance
If an applicant has a temporary situation (7 months or less) that makes income calculation
difficult, a Verification of Employment may be used to calculate applicant's income based on
a normal annual time period. Or, the income may.be calculated based on the person's hourly
rate times their normal working hours (as shown in item "a" above).
d. Self-Employed or Non-Corporation
A self-employed applicant is also considered to have variable income. Gross annual income
calculations will be based on the previous two year's net income shown on Schedule C of the
federal income tax returns, plus net income before taxes from the applicant's signed, year-to-
date Profit and Loss Statement, divided by the appropriate number of months (NOT TO
EXCEED 12 MONTHS) times 12 to amve at the annual income.
4.4.3 Assets
An asset test will be applied to all applicants to determine whether they satisfy the income
requirements. If an applicant has assets that exceed $30,000, the following amounts will be added to
the applicant's Gross Household Income to determine the household's Total Household Income:
• Ten percent (10%) of all assets between $30,001 and $130,000
• Thirty percent (30%) of all assets over $130,000
The maximum assets allowed are $250,000. Households with assets in excess of $250,000 will be
disqualified. Assets include, but are not limited to, cash, all savings and checking accounts, stocks,
bonds, real estate, gifts and other sources of money. Pensions and federally approved retirement
savings accounts, such as IRA's, Roth IRA's and 401K's, are excluded; however, retired applicants
who receive income from their retirement account must include such income as Gross Household
Income on their application.
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Figure 8 illustrates the calculation for determining income with assets:
Example:
FIGURE 8
Household of 3 earns $50,000 a year and has $150,000 in total household assets
$150,000 (minus) $30,000 = $120,000 (which equals less than $130,000)
10% of $120,000 = $12,000
New total household income: $50,000 + $12,000 = $62,000
Household of 3 earns $50,000 a year and has $200,000 in total household assets
$200,000 (minus) $30,000 = $170,000 (which equals more than $130,000)
10% of $130,000 = $13,000
30% of balance of $40,000 = $12,000
New total household income: $50,000 + $13,000 + $12,000 = $75,000
4.5 Credit Score
For ownership BMR Units, a credit check will be conducted on all adults (other than dependents) in
the household. Applicants must have sufficient creditworthiness to qualify. Creditworthiness means
that:
i) All household individuals shall have a minimum of three years since Chapters 7 or 13
bankruptcy discharge date and/or foreclosure and evidence of reestablished credit is
required; and
ii) All persons appearing on the mortgage shall have a minimum FICO credit rating of 620
points from all three credit agencies. The representative credit score is the middle score of
the three sets of repository scores reported for each household member. If more than one
eligible applicant is applying, all middle scores will be considered and the lowest of the
middle scores shall be the score used in qualifying the household (must be 620 or higher).
Figure 9 shows an example of how to calculate a representative credit score:
; FIGURE 9
~ Lowest Middle Credit Highest Credit :.
Credit Score Score Score
' Borrower 678 706 709
~ Co-Borrower 690 697 703
The Lowest Middle Credit 697
' Score of Borrowers
4.6 Alternative Credit Historv Parameters
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Alternative Credit Histor is ermitted with a minimum of four trade lines and twelve-month o I
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satisfactory payment record. One of the trade lines must be a twelve-month verification of rent
(VOR) history.
4.7 Preference Points
Applicants will be screened by the developer or their designated party, for initial eligibility based on
the requirements set forth in Section 5.1 (for ownership units) or Section 5.2 (for rental units).
Qualified Households will then be ranked based on the number of Preference Points they receive.
The Preference Point system set out in the Inclusionary Zoning Ordinance (see Table 1) provides
priority to those persons who live in Dublin, work in Dublin, are public-service employees in Dublin,
are seniors age 62 and older, are permanently disabled, are an immediate family member of a Dublin
resident, and/or are being required to relocate from their currerit Dublin residence due to demolition
of their dwelling or conversion of their dwelling from rental to ownership. Each household may only
claim Preference Points once for any given category. The Ordinance provides that even if two
persons in the household qualify for Preference Points for the same category, the points are only
awarded for one person. For example, if a husband and wife are both employed in Dublin, the couple
receives only 3 Preference Points for being employed in Dublin, or if the applicant lives with a family
member in Dublin, the applicant will only be entitled to a total of 3 Preference Points. Similarly, if
two seniors make up a household, they would be entitled to only 1 Preference Point.
Table 1: The Preference Point System
Priority
Employed in Dublin for at least 6 months*
Public service employee in Dublin**
Has resided in Dublin for at least one year
Seniors (62 and over)
Permanently disabled
Has an immediate family member who is a Dublin
resident & who has continuously lived in Dublin for
at least one year
Must move because housing is to be demolished or
converted to condo
Points
3 points
1 additional point
3 points
1 point
1 point
1 point
1 point
*Newly hired teacher that will be working in Dublin may waive the six-month employment criteria by submitting a copy
of their employment contract. Teacher must be credentialed and work as a school that is a State accredited school.
* If self-employed in Dublin, then the business must have a current City business license for at least 6 months at the time
of application
** A public service employee is a person who is employed by a public agency such as the City of Dublin, a fire fighter or
police officer assigned to work in Dublin, BART, DSRSD, or USPS working in Dublin.
Figure 10 demonstrates how Preference Points are calculated:
FIGURE 10
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Example 1: An applicant for a BMR Unit both lives in Dublin (for at least one year) and
works in Dublin (for at least 6 months).
This individual will receive the following points:
Lives in Dublin 3 points
Works in Dublin 3 points
Total number of points 6 points
Example 2: An applicant for a BMR Unit works in Dublin and is a schoolteacher.
This individual will receive the following points:
Works in Dublin 3 points
Public Service Employee ~oint
Total number of points 4 points
Example 3: An applicant for a BMR Unit is a senior citizen (62 years old) and lives in
the City of Dublin (for at least one year).
This individual will receive the following points:
Senior citizen 1 point
Lives in Dulilin 3 points
Total number of points 4 points
If the household indicates on its application that it qualifies for Preference Points, the household will
be required to provide the following proof:
If Resident of Dublin:
• Copy of two utility bills (PG&E or water), one from at least one year ago and one most recent
utility bill both showing the applicant with a Dublin address; or ~
• Copy of a current rental agreement.
If Employed in the City of Dublin:
• Copy of first and most recent pay stub establishing length of employnnent; or
Letter from employer, on company letterhead, indicating continuous employment for the past
six months; or
• For a newly hired teacher that will be working in Dublin, a copy of employment contract.
• If self-employed in Dublin, then the business must have a current City business license for at
least 6 months at the time of application
If Public Service Employee working in Dublin:
• Copy of first and most recent pay stub establishing length of employment; or
• Letter from employer, on company letterhead, indicating continuous employment for the past
six months; or
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• For a newly hired teacher, at a State accredited school, that will be working in Dublm, a copy
of employment contract; and
• A letter from employer confirming employment and employer contact information.
If Senior Citizen:
• A valid California (ar other state with photo ID.) driver license; or
• A valid California (or other state with photo ID.) identification card; or
• A valid passport.
If Permanently Disabled Individual:
• Doctor's note confirming that applicant is permanently disabled; or
• Other verification from a State Agency establishing permanent disability status; or
• Verification of receipt of SSI or SSDI.
If Person Who Has an Immediate Family Member(s) That Are Dublin Residents:
• Copy of two utility bills (PG&E or water); one from at least one year ago and one most recent
utility bill both showing the immediate family member with a Dublin address; or
• Copy of the immediate family member's current rental agreement; and
• A copy of birth certificates for self and immediate family member, establishing relationship;
or
• Other legal document establishing relationship.
If Relocated Dublin resident due to Demolition or Condominium Conversion:
• Letter from apartment owner or management firm verifying either the imminent condominium.
conversion or demolition of the unit; and
• Confirmation from the City's Community Development Department.
Where definitions are not explicitly stated in the Regulations, the City has developed these
definitions:
• A senior is defined as a person 62 years of age or older for the purpose of qualifying for
preference points;
• To qualify for the permanently disabled point, the person must be able to provide written
verification from a physician or show receipt of SSI.
• Immediate family is defined as a mother, father, brother, sister, child, grandparent or
grandchild currently living together for 6 months or more.
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5 REQUIREMENTS FOR BUYERS OF BMR UNITS
5.1 Financin~ Requirements
All BMR buyers must be able to secure a loan through a lending institution for a BMR Unit. At the
time of application, the developer may require that all applicants get pre-approval from the
developer's preferred lender. However, once an applicant receives approval to purchase a unit, the
applicant may use a lender of its choice, provided that the lender is able to adhere to the City of
Dublin's Guidelines for acceptable loan products.
5.1.1 Acceptable Loan Products for Purchase and Refinancin~ of a BMR Unit
The City reserves the right to reject loan products if the City believes in its sole discretion that there
is a stronger likelihood that the loan product would potentially result in loss of the BMR Unit due to
the purchasers' inability to comply with the terms of the loan.
Ca1HFA or Ca1VA loan products for first mortgages are not a~ailable to purchase BMR units;
however a number of Ca1HFA loan products are permitted for second and third loans. Other loan
products may be evaluated upon request. From time to time, the City will make available a list of
acceptable loan products.
The following is an example of a non-exclusive list of the loan products that may be acceptable to the
City. The list is not intended to be exhaustive and other loan products may be evaluated upon request.
Acceptable lst Mortgage Loan Products
• Fixed Mortgages up to 40 years
• Maximum 100% combined loan to value
5.1.2 Prohibited Loan Products
• Interest-only loans
• Negative amortizing loans
• Adjustable rate ,loans
• Balloon payment loans
• Some lines of credit that exceed the resale price of the unit
Unacceptable Mortgages Features
• Stated income loans
• Excessive points and fees
5.2 Down Payment
• Applicants must provide a minimum down payment equal to three percent (3%) of the
purchase price from their own funds.
• Funds must be seasoned (on deposit in a financial institution) for a minimum of three
months prior to the initial date of the application with documentation showing these funds
are available for use as down payment.
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Funds must be placed into escrow prior to close of escrow and proof of availability o
funds must be given to the City before close of escrow.
5.2.1 Down Payment Assistance
The City reserves the right to reject down payment assistance products if the City believes in its sole
discretion that there is a stronger likelihood that the down payment assistance product would
potentially result in loss of the BMR Unit due to the purchasers' inability to comply with the terms of
the assistance.
5.3 Debt to Income Ratio
Homebuyer's total debt to income ratio will be set from time to time by the City based on current
financial or real estate market conditions.
5.4 First Mort~a~e Loan Value Ratio
Borrower must provide funds in an amount equal to a minimum of 3% of the purchase price for use
as a down payment. Buyer must deposit 3% of the purchase price of their own money into escrow
prior to the close of escrow. The 3% must be applied to the purchase price so the combined loan
to value does not exceed 100%. The 3% down payment may not be used towards closing costs.
5.5 Closin~ Costs and Deposits
• The buyer is responsible for all closing costs related to the purchase of the BMR Unit,
including but not limited to, title fees, escrow fees, and loan origination fees
(approximately 2-3% percent of the purchase price). Homebuyer may be "gifted" funds to
pay for closing costs.
• The buyer may take advantage of other down payment assistance programs to assist with
closing costs with the approval from the City.
5.6 Homebuyer Education Program
Homebuyer(s) must successfully complete a City approved Below Market Rate 8-hour Homebuyer
Education Class prior to the close of escrow and must provide the City with evidence of completion.
5.7 Documents that Each Buyer Must Sign
The Inclusionary Zoning Ordinance requires that all BMR Units be restricted for a period of 55 years.
As a result, BMR Unit buyers must execute a Resale Restriction Agreement with the City and a
Performance Deed of Trust. These documents must be signed by all titleholders and recorded.
5.7.1 Hi hlights of the Resale Restriction Agreement
The following list highliglits some of the restrictions in the Resale Restriction Agreement. This list is
not intended to be exhaustive.
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Princi al Residence Re uirement ~ I /
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The unit must be owner-occupied and shall not be used as an investment or rental property. BMR
Owners are required to occupy the BMR Unit as their Principal Residence. BMR Owners are
prohibited froin renting their unit without prior written approval from the City. The owner of an
ownership BMR Unit may rent his or her unit for a period not to exceed twelve (12) months upon
demonstration of hardship, as determined in the sole and absolute discretion of the City Manager, and
written approval from the City of Dublin. "Hardship" means circumstances in which a BMR Owner
is required to be absent from the unit for an extended period of time due to either a change in the
location of his or her employment or health problems of the BMR Owner or an Immediate Family
Member of the BMR Owner. Once the BMR Owner obtains written approval from the City to rent
his or her BMR Unit, the BMR Owner shall select a Qualified Household to rent the unit. The
monthly rental payment for the BMR Unit shall be calculated pursuant to Section 4.11.3.
The BMR Owner shall not execute a rental agreement for the BMR Unit without first obtaining the
City's approval of such agreement. The rental agreement shall clearly state (1) the term of the rental
(not to exceed the twelve month period rental is permitted pursuant to these Guidelines), (2) the
monthly rental payment, and (3) that the rental is for a limited period of time.
Any rental agreement in violation of these Guidelines is prohibited, and any BMR Owner who
violates these Guidelines shall be deemed to be in default under his or her Resale Restriction
Agreement.
Resale of BMR Unit
The City of Dublin is not responsible for locating or providing qualified buyers for BMR units;
however, all potential buyers must be qualified by the City before the sale can proceed. BMR owners
may only sell their units to a Qualified Household or to the City for a restricted price calculated
pursuant to Section 7.2. A BMR owner .must follow the requirements set forth in Section 7.1 when
selling his or her unit. The City has the right of first refusal.
Appreciation Share
Upon the first sale of the BMR Unit after the end of the 55-year term of the Resale Restriction
Agreement, the owner must pay to the City an amount equal to 25% of the difference between the
actual sale price and the adjusted resale price calculated pursuant to the formula set forth in Section
7.2. For example, if a unit is originally purchased for $200,000 (actual sale price) and at the end of
55 years sells for $500,000 (adjusted resale price), the equity of the unit is $300,000. The amount
owed to the City would be 25% of the $300,000 or $75,000.
Title Changes
A BMR Owner cannot make changes to the title on a BMR Unit without prior written approval from
the City of Dublin. BMR Owners must request changes to title in writing before making ~ changes
to the title of a BMR Unit and are responsible for all costs associated with adding or removing a
person to or from the title.
In the case of a change in the household makeup, due to either marriage, divorce, legal separation,
death or other occasion that will cause a person to move in or to vacate the BMR Unit, owners should
contact the City to ascertain how to add or remove names from the Resale Restriction Agreement and
Performance Deed of Trust.
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Cit 's O tion to Purchase ~~
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The City has the option to purchase a BMR Owner's unit upon the occurrence of certain events,
including but not limited to, the sale of the BMR Unit, bankruptcy of the BMR Owner, and
foreclosure. A BMR Owner must notify the City when it desires to sell its BMR Unit by submitting a
Notice of Intent to Transfer (Exhibit B to the Resale Restriction Agreement) to the City. If the City
decides not to purchase the unit, the City will send the BMR Owner' a letter, along with a packet of
information that will assist the BMR Owner in finding another Qualified Household to purchase the
unit.
Refinancing BMR Units and Taking Cash Out
In general, BMR Owners may refinance their units only to take advantage of a new loan that benefits
the BMR Owner financially (e.g. a lower interest rate with lower monthly payments). BMR Owners
must contact the City in writing for prior written approval of all refinancing. Taking cash out of the
unit is not allowed unless the cash is going to be used for Approved Capital Improvements as
outlined in Section 7.4.
Annual Survey/Monitoring
Each year, the City of Dublin will monitor and require occupancy certification for all BMR Units.
An annual survey will be mailed to the owner(s) of each BMR Unit, usually around the anniversary
date of the purchase of the unit. Each owner must complete and return the survey along with
qualifying documentation. Failure to return the survey and documentation could place the owner(s)
in default of the Resale Restriction Agreement. In addition, pursuant to the Consent Agreement, the
City may access and review the BMR Owner's credit reports or other financial or personal
information to verify the BMR Owner's compliance with the Resale Restriction Agreement and these
Guidelines.
Estate Planning
Upon the death of a BMR Owner, the inheriting owner must notify the City of the BMR Owner's
death within 30 days of the date of death and must sell the BMR Unit to a Qualified Household at a
restricted resale price within 180 days (or longer if approved by the City of Dublin due to market
conditions) unless (i) the inheriting owner is the legal child or step-child of the BMR Owner; (ii) the
City verifies that legal child or step-child qualifies as a Qualified Household; and (iii) the legal child
or step-child signs a Resale Restriction Agreement and a Performance Deed of Trust.
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6 Requirements for Resale of BMR Units /~ l~~
6.1 Resale Procedure
An owner must comply with the following procedures when reselling an ownership BMR Unit:
1. The owner must inform the City of his or her intent to sell the unit by filling out a Notice
of Intent to Transfer (Exhibit B to the Resale Restriction Agreement) and submitting it,
along with any letters from the City for Approved Capital Improvements, to the City.
(The owner may still decide not to sell their unit after submitting these documents.)
2. The City may exercise its option to purchase the unit. If the City decides not to purchase
the unit, the City will send the BMR Owner a Conditional Consent to Transfer letter and a
packet of information that will assist the BMR Owner in finding another Qualified
Household to purchase the unit. The Conditional Consent to Transfer letter is valid for 90
days from the date of the letter.
3. The City will inform the owner of the permissible sale price of the unit and any other
conditions of sale within thirty (30) days following receipt of the Notice of Intent to
Transfer. The sale price will be calculated pursuant to the formula in Section 7.2.
4. The BMR Owner must market the unit and pay all fees associated with the sale of the unit.
The BMR Owner may resell the BMR Unit through a BMR Resale Program conducted by
a for-profit or non-profit organization, such as the Tri-Valley Housing Opportunity
Center. If the seller uses a Real Estate Agent, the Agent must contact the City to find out
requirements for listing the property, and proper contact information.
5. At least thirty (30) days prior to the anticipated date of the close of escrow, the
prospective buyer must submit the following documentation to the City Housing Staff for
approval: •
a. The income documentation set forth in Section 5.4.1;
b. Evidence of completion of a Below Market Rate Homebuyer Education
Workshop;
c. Completed purchase agreement;
d. ' A loan pre-approval letter with Good Faith Estimate and Truth in Lending
Statement
e. A signed Disclosure Statement (Exhibit F of Resale Agreement)
f. A signed Credit Authorization and Release Form, or similar document
g. Name, address and phone number of Title Company handling the transaction along
with the name of the escrow officer
h. Copy of tri-merge Credit Report; and
i. Evidence of 3% available funds to be used as a down payment.
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6. The City shall notify the owner within seven (7) days of receipt of complete packet of
documentation as listed above of its approval or disapproval of the prospective buyer.
6.2 Calculatin~ Restricted Resale Price
The resale price of a BMR Unit is dependent on AMI at the time of sale and the value of Approved
Capital Improvements.
The resale price is equal to:
1. The lowest of the (i) original price paid by the owner for the BMR Unit, increased by an
amount equal to the original price multiplied by the percentage increase in AMI between
the effective date of the Resale Restriction Agreement and the date the City receives the
owner's Notice of Intent to Transfer. (For instance, if the original price of the unit was
$200,000 and the median income increases 2% between the effective date of the Resale
Restriction Agreement and the date the City receives the owner's Notice of Intent to
Transfer, the unit price will increase by 2%, or $4,000 to 204,000); or (ii) the fair market
value of the BMR Unit as determined by an appraiser approved in writing by the City;
plus
2. The cost of Approved (in writing by the City) Capital Improvements; minus
3. The cost to repair damage to the BMR Unit and to place the unit into saleable condition
(the determination of what is considered damage to a unit will be determined by the City).
Such items may include, but not limited to, ripped or torn carpet, damage to kitchen or
bathroom appliances or fixtures; broken light fixtures, broken or missing tiles and/or grout
around tiles, damage to floor or ways; minus
4. The amount of all costs advanced by the City for the payment of mortgages, taxes,
assessments, insurance premiums HOA dues and/or associated late fess, costs, penalties,
interest, attorneys' fees, pest inspections, resale inspections and other expenses related to
the BMR Unit, which the owner has failed to pay or has permitted to become delinquent.
6.3 Fees Associated with the Selling of a BMR Unit
The BMR Owner is responsible for all fees associated with the sale of the unit including, but not
limited to, any real estate fees, and the City's Administration Fee of $1,500, which may be adjusted
from time to time.
6.4 CapitalImprovements
As discussed in Section 7.2 above, the resale price of the BMR Unit will be increased by the amount
of Approved Capital Improvements. It is the responsibility of the BMR Owner to keep cost and
accounting records of all Approved Capital Improvements.
6.4.1 Procedure for Receivin~Approval of Ca itp al Improvements
In the exercise of reasonable discretion in accordance with regulations adopted by the City from time
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to rime, the City will approve capital improvements that improve the health and safety conditions of a
BMR Unit. To receive such approval, the BMR Owner must:
• submit evidence to the City showing the purpose and estimated cost of the capital
improvements;
• receive written approval from the City prior to commencing any improvements; and
• submit documentation to the City within 30 days of completion of the improvements
verifying that such improvements have been completed.
Upon receipt of the estimate for capital improvements, City Staff will review the request for
compliance with these Guidelines. The City will review all capital improvements claims and
categorize them into three distinct categories: 1) Eligible Capital Improvements; 2) Eligible
Replacement and Repair; and 3) Ineligible Costs. Each category is defined below.
1. Eligible Capital Improvements include major structural system upgrades, Special
Assessments, selected additions to the unit (where the new space is needed to meet the
size of a growing family) and improvements related to increasing the health, safety and
energy efficiency of the BMR Unit. Improvements that meet these criteria will be given
100% credit.
2. Eligible Replacement and Repair includes in-kind replacement of existing
amenities, repairs and general maintenance that keeps the BMR Unit in good
working condition. Costs that meet these criteria will be given 50% credit.
3. Ineligible Costs include cosmetic enhancements, installations with limited useful life
spans and non-permanent fixtures. Homeowners may undertake these projects at their
discretion; however, they will not be given capital improvements credit.
The City will send a letter to the BMR Owner either approving or denying the submitted capital
improvements within 30 days of original receipt. The letter will be maintained in the BMR Unit's file
at the City of Dublin for use when the unit is resold.
Once the City has approved the capital improvements, the BMR Owner may then proceed with the
work, obtaining permits from the Building Division, if applicable. Within 30 days of completion of
the improvements and sign-off by the Building Division, if applicable, the BMR Owner must submit
the following information:
• A copy of the receipt/invoice for each eligible improvement;
• Proof of payment, such as a cancelled check, bank account statement or credit card
bill;
~ A copy of Building Permit, if required; and
• A picture or pictures of completed work.
The City may, at its discretion, visit the job site to visually view the completed work.
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6.4.2 Special Assessments
HOA- initiated Special Assessments are considered capital improvements and will be added to the
resale price of the BMR Unit. In order to receive credit for Special Assessments, homeowners must
submit the following documentation within 3-months of payment:
• Invoice for Special Assessment; and
• Proof of Payment, such as a cancelled check, bank account statement ar credit card
bill.
6.4.3 Capital Improvements Ca~
In order to maintain the affordability of the BMR Unit for subsequent buyers, at the time of sale, the
City of Dublin will cap all Approved Capital Improvements at 5% of the resale price.
6.4.4 List of Eligible and Ineli ib~ le Capital Improvements
Eligible Capital Improvements include major structural system upgrades, some new additions to the
unit and improvements related to increasing the health, safety and energy efficiency of the BMR
Unit. Improvements that meet these criteria will be given 100% credit. Below is a non-exclusive list
of Eligible Capital Improvements:
• Major Electrical Wiring System Upgrade
• Major Plumbing System Upgrade
• Upgrade to Double Paned Windows
• Fireplace Glass Screen
• Room Additions (if room addition meets the criteria for the family size)
• Installation of Additional Closets and Walls
• Alarm System
• Removal of Toxic Substances such as Asbestos; Lead or Mold/Mildew
• Insulation
• Upgrade to Energy Star Built-In Appliances, as follows:
o Furnace
o Water Heater
o Stove/Range
o Dishwasher
o Microwave Hood
Eligible Replacement and Repair includes in-kind replacement of existing amenities, repairs
and general maintenance that keeps the property in good working condition. Costs that meet
these criteria will be given 50% credit for repairs. Below is a non-exclusive list of Eligible
Replacement and Repair:
• Electrical Maintenance and Repair, such as:
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o Switches
o Outlets
• Plumbing Maintenance and Repair, such as:
o Faucets
o Supply Line
o Sinks
• Flooring
• Countertops
• Cabinets
• Bathroom Tile
• Bathroom Vanity
• Replacement of Built-In Appliances, as follows:
o Furnace
o Water Heater
o Stove/Range
o Dishwasher
o Microwave Hood
o Garbage Disposal
• Window Sash
• Fireplace Maintenance or In-kind Replacement (Gas)
• Heating System
• Lighting System (Recessed)
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Ineligible Costs include cosmetic enhancements, installations with limited useful life spans and non-
permanent fixtures. Owners may undertake these projects at their discretion, however they will not
be given capital improvements credit. Below is a non-exclusive list of Ineligible Costs:
• Cosmetic Enhancements, such as:
o Fireplace Tile and Mantel
o Decorative Wall Coverings or Hangings
o Window Treatments (Blinds, Shutters, Curtains, etc.)
o Installed Mirrors
o Shelving
o Refinishing of Existing Surfaces
• Non-Permanent Fixtures, such as:
o Track Lighting
o Door Knobs, Handles and Locks
o Portable Appliances (Refrigerator, Microwave, Stove/Oven, etc.)
~ Installations with Limited Useful Life Spans, such as:
o Carpet
o Painting of Existing Surfaces
o Window Glass
o Light Bulbs
6.4.5 Building Permits
It is the responsibility of the BMR Owner to ascertain (and obtain if necessary) if the work to be
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performed requires a City building permit. Any work that is done without the required permit will
automatically be deemed ineligible as a capital improvement expense whether or not it fits within the
definition of an Eligible Capital Improvement or Eligible Replacement and Repair. BMR Owners
may call (925) 833-6620 to inquire about building permits.
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7 REQUIREMENTS FOR OWNER S OF BMR SECONDARY UNITS
A Secondary Unit is a legal secondary dwelling unit on an owner's property that has been approved
by the City of Dublin as a rental BMR Unit for purposes of compliance with the Inclusionary Zoning
Ordinance and that is reserved for occupancy by, and at rents affordable to, Very-Low, Low-, and
Moderate-Income households. The City Council may approve such units as part of Developer's
proposal for an alternate method of compliance with the Inclusionary Zoning Regulations.
The owner of a Secondary Unit must sign a Secondary Unit Regulatory Agreement and Declaration
of Restrictive Covenants, which is recorded against the property containing the Secondary Unit and
requires, among other things, that the Secondary Unit be reserved for occupancy by, and at rents
affordable to, Very-Low, Low-, and Moderate-Income households for the length of the restrictions.
The Agreement will remain in effect regardless of any sale, assignment, or transfer of the property,
unless the Agreement is terminated by the City in writing.
7.1 Rental Requirements
If the owner rents the Secondary Unit, the owner shall rent the unit to a Qualified Household and
must follow the procedures set forth in Section 4.11. The rent charged to the Qualified Household
must not exceed one twelfth (1/12) of thirty percent (30%) of the applicable Maximum Income,
adjusted for household size, less a utility allowance as specified by the Housing Authority of
Alameda County. Owner shall ensure that all leases and contracts with tenants prohibif subleasing of
the Secondary Unit.
7.2 Reporting Requirements
Prior to a household's initial occupancy of a Secondary Unit, and on every anniversary thereafter,
the owner or its authorized agent shall obtain from each household written documentation verifying
each tenant's eligibility containing all of the following, including additional documentation as City
may reasonably require:
• Number of people in the household; and
• Total household income.
The owner or its authorized agent shall retain this documentation for not less than three (3) years, and
upon City's request, shall make the documentation available for inspection by City and shall provide
copies of the documentation to City. The owner or its authorized agent may require each household
to certify the verifying documentation.
7.3 Annual Report - Inspections
Owner shall submit an annual report to the City in conformity with the requirements of Section
8.68.OSO.B of the Inclusionary Zoning Regulations, together with a certification that the property is in
compliance with the requirements of the Secondary Unit Regulatory Agreement and Declaration of
Restrictive Covenants. The annual report shall, at a minimum, include the following information: (i)
the address of the Secondary Unit; (ii) the monthly rents charged and proposed to be charged; (v) the
number of people residing in the unit; and (vi) the total household income of residents. Upon City's
request, Owner shall include with the annual report, a copy of the verifying documentation described
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in Section 8.3, and such additional information as City may reasonably request from time to time in
order to show compliance with the Secondary Unit Regulatary Agreement and Declaration of
Restrictive Covenants.
Owner shall permit representatives of City to " enter and inspect the property during reasonable
business hours in order to monitor compliance with the Secondary Unit Regulatory Agreement and
Declaration of Restrictive Covenants upon 24 hours advance notice of such visit to Owner.
7.4 Management Responsibilities
Owner shall be responsible for all management functions with respect to the Property, including
without limitation the selection of tenants, certification and recertification of household income and
eligibility, evictions, collection of rents and deposits, maintenance, landscaping, routine and
extraordinary repairs, replacement of capital items, and security. Except as City may otherwise agree
in writing, City shall have no responsibility for management or maintenance of the Property. The
contracting of management services to a management entity shall not relieve owner of its primary
responsibility for proper performance of management duties.
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EXHIBIT 4
Resale Restrictions and Option to Purchase Agreement
Amended and Restated Affordable Housing Agreement
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Recording reqaested by and when
recorded mail to:
City of Dublin
100 Civic Plaza
Dublin,~CA 94568
Attn: City Clerk
EXEMPT FROM RECORDING FEES PER
GOVERNMENT CODE &&6103. 27383
(Space Above This Line For Recorder's Use Only)
RESALE RESTRICTION AGREEMENT
AND OPTION TO PURCHASE
Owner: Nan~e
Property Address: Address
Dublin, CA 94568
Name of Development: Development ~
This RESALE RESTRICTION AGREEMENT AND OPTION TO PURCHASE
("Agreement") is entered into by and between the CITY OF DUBLIN, a California municipal
corporation (the "City") and .Owner Name(s) ("Owner") regarding certain improved real property
which is more particularly described in Exhibit A attached hereto and incorporated herein and
commonly known as Unit Address, Dublin; CA 94568 (the "Property") effective as of Date
("Effective Date"). City and Owner are hereinafter collectively referred to as the "Parties."
RECITALS
A. The City has Inclusionary Zoning Regulations (Dublin Municipal Code Chapter 8.68)
(the "Regulations") that require developers of ownership housing to construct within their projects
units that are affordable to, low-, and moderate-income households ("the Program"). To further its
goal of creating affordable home ownership opportunities for, low-, and moderate-income persons
and families, the City has initiated a program for the sale of some homes at a price below their
market rate ("Program"). Pursuant to the Program, developers of ownership housing developments
agree to set aside a certain number of units for purchase by low- and moderate-income persons and
families, as defined herein.
B. Owner is an eligible low- or moderate-income purchaser under the Program, intends to
live in the Property as an owner occupant, and agrees to maintain the Property as Owner's principal
residence.
C: In order to maintain and preserve the Property as housing affordable to eligible moderate-
income purchasers, it is, necessary to restrict the use and resale of the Properiy through imposition of
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the occupancy and resale restrictions set forth herein. These restrictions are intended to prevent
initial and subsequent purchasers from using the Property for purposes incompatible with the
Program and realizing unwarranted gains from sales of the Property at unrestricted prices. The terms
and conditions of this Agreement are intended to provide the necessary occupancy and resale
restrictions to ensure that the Property is used, maintained, and preserved as housing affordable to
eligible low- and moderate-income purchasers. To further serve the purposes of the Program, it is
necessary that the City be granted an option to purchase the Property so that the Property may be
maintained as affordable housing.
D. The Property constitutes a valuable community resource by providing decent, safe, and
sanitary housing to persons and families of low- and moderate-income who otherwise would be
unable to afford such housing. To protect and preserve this resource it is necessary, proper, and in
the public interest for the City to administer occupancy and resale controls consistent with the
Program and the Regulations by means of this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the substantial economic benefits inuring to
Owner and the public purposes to be achieved under the Program, Owner and City hereby agree
as follows:
1. Definitions.
a. "Affordable Unit Cost" means a sales price that results in annual housing expenses
that do not exceed 35% of the maximum income level for [Low- or Moderate-J Income
households, adjusted for Household Size Appropriate for the Unit. For purposes of this
definition, "annual housing expenses" means principal, insurance, property taxes, property and
mortgage insurance, and homeowner's association dues.
b. "Area Median Income" means the area median income adjusted for household size as
published annually by the California Department of Housing and Community Development
("HCD") far the County of Alameda pursuant to California Health and Safety Code Section
50093 or successor provision.
c. "Eligible Capital Improvements" is defined in Paragraph S.a.
d. "Eligible Households" means a household whose gross annual income does not
exceed [Low- or Moderate-) Income and who otherwise meets the requirements of the Program.
e. "Household Size Appropriate for the Unit" shall mean 1 person for a studio, two
person for a one-bedroom unit, three persons for a two-bedroom unit, four persons for a three-
bedroom unit, and five persons for a four-bedroom unit.
f. "Low-Income" means persons and families whose annual gross income does not
exceed eighty percent (80%) of Area Median Income, as adjusted for household size.
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g. "Moderate-Income" means persons and families whose annual gross income does not
exceed one hundred twenty percent (120%) of the Area Median Income, as adjusted for
household size.
h. "Permitted Encumbrances" means any encumbrances permitted to be recorded against
the Property pursuant to Paragraph 10.
i. "Permitted Exceptions" is defined in Paragraph 3.d.ix.
j. "Transfer" is defined in Paragraph 9.
2. Program Requirements.
a. Affordability Restrictions. Owner hereby covenants and agrees that during the term
of this Agreement all of the requirements and restrictions of this Agreement shall apply, and the
Property shall be sold or otherwise transferred only pursuant to the terms and conditions of this
Agreement and only to (i) Eligible Households at a price not to exceed the Adjusted Resale
Price, as defined in Paragraph 5, (ii) the City pursuant to Paragraph 3, at a price not to exceed the
Adjusted Resale Price or (iii) a permitted transferee pursuant to Paragraph 9.
b. Disclosure. EXCEPT AS PROVIDED IN PARAGRAPHS 9.a AND 9.b BELOW,
DURING THE TERM OF THIS AGREEMENT OWNER SHALL NOT SELL OR
OTHERWISE TRANSFER THE PROPERTY WITHOUT THE WRITTEN CERTIFICATION
BY THE CITY THAT THE TRANSFEREE QUALIFIES AS AN ELIGIBLE HOUSEHOLD
AND THAT THE PROPERTY IS BEING TRANSFERRED AT A PRICE NOT TO EXCEED
THE ADJUSTED RESALE PRICE, WHICH IS CAPPED AT THE AFFORDABLE UNIT
COST AS DEFINED 1N PARAGRAPH l.a. ANY SALE OR OTHER TRANSFER OF THE
PROPERTY IN VIOLATION OF THIS COVENANT SHALL BE VOIDABLE BY THE CITY.
c. Principal Residence Requirement. OWNER COVENANTS AND AGREES
THAT HE/SHELTHEY SHALL OCCUPY THE PROPERTY AS HIS/HER/THEIR
T'RINCIPAL RESIDENCE FOR THE DURATION OF HISIHER/THEIR OWNERSHIP AND
SHALL NOT RENT OR LEASE THE PROPERTY OR PORTION THEREOF DURING THE
TERM OF THIS AGR.EEMENT WITHOUT PRIOR WRITTEN APPROVAL OF CITY.
Owner shall occupy the Properiy as his/her/their principal residence within sixty (60) days of
close of escrow for the Property. Owner sliall be considered as occupying the Property as a
principal residence if the Owner is living in the Property for at least ten (10) months out of each
calendar year. Upon request by the City made from time to time, the Owner of the Property shall
submit an affidavit to the City certifying that the Property is the Owner's principal residence and
provide such documents and other evidence as may be requested to verify Owner's compliance
with this requirement. Abandonment of the Property shall constitute an Option Event (as defined
in Paragraph 3.c below) and shall entitle the City to exercise its Option to purchase the Property.
3. Option to Purchase.
a. Grant of Option to Purchase. Owner hereby grants to the City an option ("Option")
to,purchase the Property at the Adjusted Resale Price subject only to Permitted Exceptions upon
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the occurrence of an Option Event (defined in Paragraph 3.c below), subject to the terms and
conditions contained herein.
b. Assignment of the Option. The City may assign the Option to another government
entity, a non-profit affordable housing provider or a person or family that qualifies as an Eligible
Household. The City's assignment of the Option shall not extend any time limits contained
herein with respect to the exercise period of the Option or the period within which the Property
must be purchased.
c. Events Giving Rise to Right to Exercise of Option: The City shall have the right to
exercise its Option upon the occurrence of any of the following events (each, an "Option
Event"):
i. Receipt of a Notice of Intent to Transfer (defined in Paragraph 3.d.i below);
ii. Any actual, attempted or pending sale, conveyance, transfer, lease or other
attempted disposition of the Property or of any estate or interest therein, except as
provided in Paragraph 9 below;
iii. Any actual, attempted or pending encumbrance of the Property, including
without limitation by way of mortgage or deed of trust, or by judgment, mechanics, t~ or
other lien; except as provided in Paragraph 10 below;
iv. Recordation of a notice of default andlor notice of sale pursuant to California
Civil Code section 2924 (or successor provisions) under any deed of trust or mortgage
with a power of sale encumbering the Property;
v. Commencement of a judicial foreclosure proceeding regaxding the Property;
vi. Execution by Owner of any deed in lieu of foreclosure transferring ownership
of the Property;
vii. Commencement of a proceeding or action in bankniptcy, whether voluntary or
involuntary, pursuant to Title 11 of the United States Code or other bankruptcy statute, or
any other insolvency, reorganization, arrangement, assignment for the benefit of
creditors, receivership or trusteeship, concerning the Owner; or
viii. Any violation by Owner of any pro.vision of this Agreement including,
without limitation, the conditions set forth in Paragraph 2 above.
d. Method of Exercising the Option.
i. Notice of Intent to Transfer. If Owner desires to sell, convey, lease,
encumber (other than pursuant to Paragraph 10 below) or otherwise transfer the Property
or of any estate or interest therein (other than pursuant to Paragraph 9 below), Owner
shall deliver written notice to City of such intent ("Notice of Intent to Transfer") by
certified mail not less than 45 days prior to the date of such proposed sa1e, conveyance,
transfer, lease, encumbrance or disposition. The Notice of Intent to Transfer shall be in
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substantially the form attached hereto as Exhibit B or such substitute form in use by City
at such time. In the case of a proposed sale of the Property to an identified prospective
purchaser, the Owner shall submit to the City; together with the Notice of Intent to
Transfer, a copy of the prospective purchaser's income certification, a list of all assets
owned by the prospective purchaser, and other financial information reasonably
requested by City, in a form approved by the City, along with the income certification to
be provided to any lender making a loan to the prospective purchaser, a copy of the
proposed sales contract and all documents setting forth the terms of sale, the name of the
title company and escrow information. The City may require documentation evidencing
and supporting the income and other financial information contained in the certifications.
ii. Notice of Exercise. Upon the occurrence of any Option Event, the City may
exercise its Option by delivering notice, pursuant to Paragraph 17 and within the time
period specified in Paragraph 3.d.iv, to Owner of City's intent to exercise such Option
pursuant to the terms of this Agreement ("Notice of Exercise"). The Notice of Exercise
may be in the form attached hereto and incorporated herein as Exhibit C, or in such other
form as the City may from time to time adopt. If the Option Event relates to the potential
foreclosure of a mortgage under Paragraphs 3.c.iv, 3.c.v, or 3.c.vi, then (i) the City shall
also deliver the Notice of Exercise to the mortgagee or beneficiary under such mortgage,
at such mortgagee's or beneficiary's address of record in the Office of tfie Recorder of
Alameda County and (ii) the City shall not complete the purchase of the Property if the
default is cured within the time periods permitted by law.
iii. Notice of Consent to Transfer. If the Option Event involves a transfer of the
Property and the City does not exercise the Option, the City may consent to the transfer
("Consent to Transfer") provided that all of the following requirements are satisfied: (i)
the proposed purcha.ser qualifies as an Eligible Household; (ii) the sale of tlie Property is
at a price not to exceed the Adjusted Resale Price; (iii) the proposed purchaser executes a
Disclosure Statement in the form attached hereto as Exhibit F or such other form or forms
as may be promixlgated by the City; (iv) the proposed purchaser and the City execute and
record an agreement substantially similar to this Agreement in a form approved by the
City within the time set forth in the Consent to Transfer; and (v) the proposed purchaser
executes a Performance Deed of Trust substantially in the form attached hereto as Exhibit
G. OWNER SHALL PAY REAL ESTATE COMMISSIONS, IF ANY, WHICH
SHALL NOT EXCEED 6% OF THE ACTUAL SALES PRICE. If any of the foregoing
requirements are not satisfied, then the Consent to Transfer shall expire and the City may,
at its option, either. (i) notify Owner of the disqualification, thereby entitling Owner to
locate another purchaser who qualifies as an Eligible Household, or (ii) exercise the
Option, as if no Consent to Transfer had been delivered.
iv. Time Period for Notice. The City shall deliver a Consent to Transfer, if
applicable, not later than thirty (30) days after the date that it receives notification of an
Option Event. The City shall deliver a Notice of Exercise, if applicable, on or before the
date which is the later to occur of the following: (i) thirty (30) days after the date that the
City receives notification of an Option Event or (ii) fifteen (15) days after a Consent to
Transfer has expired; provided, .however, that if the City delivers a Notice of Exercise to
Owner upon occurrence of an Option Event described in Paragraphs 3.c.iv, 3.c.v, or
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3.c.vi, the City shall deliver the Notice of Exercise on or before sixty (60) days after the
date that the City receives notice of the Option Event, and the City or its assignee shall
close escrow for the purchase of the Property no later than 90 days after the date the City
receives notification of such Option Event, unless extended by mutual agreement of
Owner and the City. For purposes of computing commencement of the delivery periods,
the City shall be deemed to have received notification of an Option Event on the date of
delivery of a Notice of Intent to Transfer, pursuant to the terms of Paragraph 17 below or
on the date it actually receives notice of default, summons and complaint or other
pleading, or other writing specifically stating that an Option Event has occurred. The
City shall have no obligation to deliver a Notice of Exercise or Consent to Transfer, and
the applicable time period for exercise of the Option shall not commence to run, unless
and until the City has received notification of an Option Event in the manner specified in
this subparagraph. If there is a stay or injunction imposed by court order precluding the
City from delivering its Consent to Transfer or Notice of Exercise within the applicable
time period, then the nuuiing of such period sha11 cease until such time as the stay is
lifted or the injunction is dissolved and the City has been given written notice thereof, at
which time the period for delivery of a Consent to Transfer or Notice of Exercise shall
again begin to run.
v. No Waiver. If the City in its sole discretion determines not to exercise the
Option in any particular instance, or fails to deliver a Notice of Exercise or Consent to
Transfer within the time periods set forth in Paragraph 3.d.iv. above, such determination
or failure shall not affect City's rights to exercise the Option upon the occurrence of any
future Option Event.
vi. Right to Reinstatement. If the Option Event is the recordation of a notice of
default, then the City shall be deemed to be Owner's successor in interest under
California Civil Code Section 2924(c) (or successor section) solely for purposes of
reinstatement of any mortgage on the Property that has led to the recordation of the notice
of default. As Owner's deemed successor in interest, the City shall be entitled to pay all
amounts of principal, interest, taxes, assessments, homeowners' association fees,
insurance premiums, advances, costs, attorneys' fees and expenses required to cure the
default. If the City exercises the Option, then any and .all amounts paid by the City
pursuant to this Paragraph shall be treated as Adjustments to the Base Resale Price for the
Property, as defined in Paragraph 5 below.
vii.Inspection of Property. After receiving a Notice of Intent to Transfer or
delivering a Notice of Exercise, the City shall be entitled to inspect the Property one or
more times prior to the close of escrow to determine the amount of any Adjustments to
the Base Resale Price. Before inspecting the Property, the City shall give Owner not less
than forty-eight (48) hours written notice of the date, time and expected duration of the
inspection. The inspection shall be conducted between the hours of 9:00 a.m. and 5:00
p,m., Monday through Friday, excluding court holidays, unless the parties mutually agree
in writing to another date and time. Owner shall make the Property available for
inspection on the date and at the time specified in the City's request for inspection.
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viii. Escrow. Promptly after delivering a Notice of Exercise, the City shall
open an escrow account for its purchase of the Property. Close of escrow shall take place
on such date which is the later to occur of the following, (a) sixty (60) days after a Notice
of Exercise has been delivered, or (b) ten (10) days after Owner has performed all acts
and executed all documents required for close of escrow; provided however, if the City
'exercises the Option upon the occurrence of an Option Event described in Paragraphs
3.c.iv, 3.c.v, or 3.c.vi, close of escrow shall take place no later than ninety (90) days after
the date'the City receives notification of such Option Event. Prior to the close of escrow,
the City shall deposit into escrow with a title company of City's choosing; the Adjusted
Resale Price as defined in Paragraph 5 below and all escrow fees and closing costs to be
paid by City. Commissions (not to exceed 6% of the actual sales price), closing costs and
title insurance shall be paid pursuant to the custom and practice in the County of
Alameda at the time of the opening of escrow, or as may otherwise be provided by
mutual agreement. Owner agre.es to perform all acts and execute all documents
reasonably necessary to effectuate the close of escrow and Transfer of the Property to the
City.
ix. Proceeds of Escrow; Removal of Exceptions to Title. Prior to close of
escrow, Owner shall cause the removal of a11 exceptions to title to the Property that were
recorded after the Effective Date with the exception of (i) taxes for the fiscal year in
which the escrow for this transaction closes, which taxes shall be prorated as between
Owner and City as of the date of close of escrow; (ii) quasi-public utility, public alley,
public street easements, and rights of way of record, and (iii) such other liens,
encumbrances, reservations and restrictions as may be approved in writing by City
("Permitted Exceptions").
The purchase price deposited into escrow by the City sha11 be applied first to the
payment of any and all Permitted Encumbrances recorded against the Property in order of
lien priority, and thereafter to the payment of Owner's share of escrow fees and closing
costs. Any amounts remaining after the purchase price has been so applied, if any, shall
be paid to Owner upori the close of escrow. If the purchase price is insufficient to satisfy
all liens and encumbrances recorded against the Property; the Owner shall deposit into
escrow such additional sums as may be required to remove said liens and encumbrances.
In the event that the City agrees to proceed with close of escrow prior to the date that
Owner has caused all exceptions to title recorded after the Effective Date other than
Permitted Exceptions to be removed, then Owner shall indemnify, defend and hold City
haxmless from any and all costs expenses or liabilities_(including attorneys' fees) incurred
or suffered by City that relate to such exceptions and their removal as exceptions to title
to the Property.
4. Base Resale Price. Prior to adjustment pursuant to Paragraph 5 the base resale price ("Base
Resale Price") of the Property shall be the lowest of:
~ a. Median Income. The original price ("Base Price") paid by Owner for acquisition of
the Property pursuant to the Program, increased (but not decreased) by an amount, if any, equal
to the Base Price multiplied by the percentage increase in the Area Median Income between the
Effective Date, and the date that the City receives notification of an Option Event; or
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b. Fair Market Value. The fair market value of the Property as determined by an
appraiser selected and paid for by Owner and approved in writing by the City.
To compute the Base Resale Price, the City may use the Base Resale Price Worksheet attached
as Exhibit D hereto, or such other form as the City may from time to time adopt.
5. Adjustments to Base Resale Price. Subject to the Affordable Unit Cost restriction
described in subparagraph (d) below, the Base Resale Price shall be increased or decreased, as
applicable, by the following adjustment factors ("Adjustment"): ~
a. Capital Improvements. An increase for Eligible Capital Improvements (defined
below) made to the Property. The amount of the Adjustment shall equal the original cost of any
such capital improvements.
In the exercise of reasonable discretion in accordance with the Guidelines to the
Inclusionary Ordinance Regulations adopted by the City from time to time, the City will approve
capital improvements that will improve the health and safety conditions of the Property. To
receive such approval, the Owner must submit evidence to the City showing the purpose and cost
of the capital improvements. If the City approves the capital improvements, they shall be
deemed "Eligible Capital Improvements."
b. Damages. A decrease by the amount necessary to repair damage to the Property, if
any, and to place the Property into saleable condition as reasonably determined by the City,
including, without limitation, amounts attributed to cleaning; painting; replacing worn carpeting
and draperies; making necessary structural, mechanical, electrical and plumbing repairs; and
repairing or replacing built-in appliances and fixtures. Owner hereby covenants to, at Owner's
expense, maintain the Property in the same condition as in existence on the date of City's Notice
of Exercise, reasonable wear and tear excepted.
c. Advances by the City. A decrease in an amount equal to the sum of all costs
advanced by the City for the payment of mortgages, taxes, assessments, insurance premiums,
homeowner's association fees and/or associated late fees, costs, , penalties, interest, attorneys'
fees, pest inspections, resale inspections and other expenses related to the Property, which Owner
has failed to pay or has permitted to become delinquent.
d. Adjusted Resale Price Not to Exceed Affordable Unit Cost. The Base Resale
Price as adjusted; is hereinafter referred to as the ."Adjusted Resale Price." Notwithstanding any
other provision hereof to the contrary, in no event shall the Adjusted Resale Price exceed the
Affordable Unit Cost.
6. Priority and Effectiveness of the Option.
a. Recordation. This Agreement shall be recorded in the Office of the Recorder of the
County af Alameda on or as soon as practicable after the Effective Date: The Option shall.have
priority over any subsequent sale, conveyance, transfer, lease or other disposition or
encumbrance of the Property, or of any estate or interest therein, and in the event of exercise of
the Option by City, the City shall take the Property subjec# only to Permitted Exceptions.
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Except as otherwise provided in Paragraph 7.a, the exercise of the Option by the City at any time
and from time to time shall not extinguish the Option or cause a merger of the Option into any
estate or other interest in the Property, and the Option shall continue to exist and be effective
with respect to the Property against any and all subsequent owners in accordance with the terms
and conditions hereo£
b. Request for Notice of Default. The City shall file a Request for Notice of Default
for recordation in the Office of the Recorder of the County of Alameda promptly upon execution
of this Agreement (see Exhibit E).
c. Subordination. The City agrees that in order to assist qualified purchasers to secure
purchase money financing for the acquisition of the Property, the City will enter into a
subordination agreement with a senior purchase money lender to subordinate this Agreement
under such terms as the City and the senior purchase money lender shall negotiate.
7. Survival of Option Upon Transfer.
a. In General. The City's right to exercise the Option shall survive any Transfer of the
Property by Owner. Each transferee, assignee or purchaser of the Property during tkie term
hereof shall be required to execute an agreement substantially in the form of this Agreement,
provided that the term of any such agreement shall be for the duration of the term hereof as of
the date of any such transfer, assignment or sale. The Option may be exercised against the
Property throughout the term hereof, regardless of whether the Property is owned, possessed or
occupied by Owner or any successor, transferee, assignee, heir, executor, or administrator of
Owner, regardless of household income (if applicable) including a debtor-in-possession, debtor
or trustee pursuant to Title 11 of the United States Code. Notwithstanding the foregoing, the
Option shall not survive (i) the Transfer of the Property to a third party purchaser pursuant to a
judicial or non judicial foreclosure or a deed-in-lieu of foreclosure under a power of sale
contained in a mortgage or deed of trust held .by an institutional lender, or (ii) the recording of an
instrument conveying Owner's interest in the Property to the City, or its assignee, provided the
conveyance is in accordance with the terms of this Agreement.
b. HUD Insured Mortgage. If Owner has acquired the Property by a mortgage insured
by the Secretary of the United States Department of Housing and Urban Development, and a
notice of default has been recorded pursuant to California Civil Code Section 2924 (or successor
provisions), then this Option shall automatically terminate if title to the Property is transferred by
foreclosure or deed-in-lieu of foreclosure, or if the insured mortgage is assigned to the Secretary.
8. Voidable Transfers. Any actual or attempted sale, conveyance, Transfer or other
disposition of the Property, or of any estate or interest therein, in violation of the terms and
conditions of this Agreement, shall be voidable at the election of the City. Notwithstanding the
foregoing, if the Property is financed with an FHA-backed mortgage, this Section S does not
apply and will not be operative.
9. Permitted Transfers. Except as provided in Paragraphs 9.a and 9.b below, throughout the
term of this Agreement, the Property may only be sold or otherwise conveyed only to Eligible
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Households at a price not to exceed the Adjusted Resale Price. As more particularly described in
Paragraph 5, the Adjusted Resale Price may not exceed the Affordable Unit Cost. There shall be
no Transfer of the Property without City's certification that the transferee is an Eligible
Household and that the Property is being transferred at a price not to exceed the Adjusted Resale
Price. "Transfer" means any sale, assignment or transfer, voluntary or involuntary, of any
interest in the Property, including, but not limited to, a fee simple interest, a joint tenancy
interest, a life estate, a leasehold interest, an interest evidenced by a land contract by which
possession of the Property is transfened and Owner retains title, or a deed of trust. Any Transfer
of the Property in violation of the requirements of this Paragraph is prohibited and shall
constitute an Event of Default and an Option Event entitling City to exercise its Option to
purchase the Property.
a. Permitted Transfers. Provided that the transferee and the City executes and records
an agreement substantially similar to this Agreement in a form approved by the City, the
following Transfers ("Permitted Transfers") of title to the Property, or of any estate or interest
therein, shall not trigger the exercise of the Option, and shall not be considered Option Events:
(a) a good-faith Transfer by gift, devise or inheritance to Owner's spouse or issue; (b) a taking of
title by a surviving joint tenant; (c) a court-ordered Transfer of title to a spouse as part of a
divorce or dissolution proceeding; (d) a Transfer by Owner into an inter vivos trust in which the
Owner is a beneficiary and the Owner cantinues to occupy the property as his/her primary
residence; or (e) an acquisition of title, or of any interest therein, in conjunction with marriage.
Notwithstanding any Permitted Transfer, the Option shall remain effective with respect to the
Property for the duration of the term hereof.
b. Inheritance. In the event a Transfer occurs by devise or inheritance due to death of
the Owner, the administrator of the Owner's estate or the person inheriting the Property shall
provide written notice to the City of the Owner's death within thirty (30) days of the date of
death, and the following procedures shall apply:
(i) If the person inheriting the Property (the "Inheriting Owner") is the child or
stepchild of the deceased Owner (an "Inheriting Child"), he or she shall provide the City
with documentation that he or she is the child or stepchild of the deceased Owner
together with income information, to be verified by the City, so that the City may
determine if the Inheriting Child is an Eligible Household. If the Inheriting Child fails to
provide required documentation of his or her relationship to the Owner or financial
information, he or she shall be deemed not to qualify as an Inheriting Child and/or
Eligible Household, as applicable. If the Inheriting Child qualifies as an Eligible
Household, he or she shall succeed to the Owner's interest and obligations under this
Agreement and new documents shall be executed between the Inheriting Child and the
City and recorded against the Property. If the Inheriting Child fails to qualify as an
Eligible Household, he or she shall be required to Transfer the Property to an Eligible
Household at a price not exceeding the Adjusted Resale Price, pursuant to the procedures
set forth in this Agreement and the City may exercise its Option; provided however, the
Inheriting Child may occupy the Property for up to twelve (12) months from the date of
the death of Owner provided that the Inheriting Child remains in compliance with the
requirements of this Agreement and the Deed of Trust.
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(ii) If the Inheriting Owner is not the child or stepchild of the deceased Owner, he
or she shall Transfer the Property to an Eligible Purchaser at a price not exceeding the
Adjusted Resale Price, pursuant to the procedures set forth in this Agreement, and the
City may exercise its Option. In this event, the Inheriting Owner shall provide the City
with a Notice of Intent to Transfer within sixty (60) days of the date of death of the
Owner.
(iii) Failure of an Inheriting Owner to follow the procedures and file the notices
described in this Paragraph 9.b shall constitute an Event of Default under this Agreement,
and the City may then exercise any of the remedies set forth in this Agreement or
available to City under law or equity, including, without limitation, exercise of the City
Option.
c. Changes to Title. Notwithstanding paragraphs 9.a and 9.b above, Owner shall obtain
City's written approval prior to making any changes to the title of the Property, including but not
limited to, the addition or deletion of the names of any person to or from title to the Property.
10. Restrictions on Financing Secured by Property. Owner sha11 permit no mortgage, deed
of trust or other security instrument to be recorded against the Property other than the following:
(i) a fixed rate conventional mortgage with a term of up to 40 years; (ii) this Agreement; (iii)
other loan products approved by the City; and (iv) encumbrances permitted pursuant to
Paragraph 11 below. Owner hereby covenants and agrees that he/she/they shall use his/her/their
best efforts to ensure that any deed of trust or other agreement encumbering the property shall
include provisions providing for notice to be delivered to City of any default thereunder and for
City's right to cure such default at City's election.
11. Initial Financing; Refinancing; Junior Loans.
a. Initial Financing. Owner's aggregate purchase money financing for the Property
("Initial Financing") shall not exceed an amount equal to one hundred percent (100%) of the
Base Resale Price calculated as provided in Paragraph 4.
b. Refinancing. Any prepayment and refinance of the Initial Financing shall not be
permitted unless expressly approved by the City in writing, and the City may approve such
refinancing only if all of the following conditions are met:
i. the refinance reduces Owner's interest rate and monthly payments of principal
and interest on the Initial Financing or shall be used to finance Eligible Capital
Improvements;
ii. the refinance does not cause the principal amount of all debt secured by the
Property to exceed the then outstanding balance (plus refinancing and closing costs) of
the Initial Financing plus the cost of any Eligible Capital Improvements that shall be
made by Owner;
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iii. the refinance does not result in Owner receiving any cash from the refinance
except for Eligible Capital Improvements;
iv. the refinance does not cause the Property's loan to value ratio (calculated by
comparing the total debt secured by the Property to the Adjusted Resale Price of the
Home) to exceed 100% if the Owner does not receive any cash from the refinance or 97%
if the Owner receives cash from the refinance for Eligible Capital Improvements.
v. the total outstanding balance of principal and any accrued interest on all loans
secured by the Property does not exceed the Adjusted Resale Price, calculated by the City
pursuant to Paragraph 5 of this Agreement.
c. Junior Loans. Mortgage loans or equity lines of credit junior in lien priority to the
Performance Deed of Trust are not permitted, except when expressly approved by the City in
writing. The City shall only approve junior mortgage loans or equity lines of credit as follows:
i. the loan or equity line of credit does not cause the Property's loan to value
ratio (calculated by comparing the total debt secured by the Property to the Adjusted
Resale Price of the Property ) to exceed 100%.
ii. the proceeds of such loan or equity line of credit are used only for Eligible
Capital Improvements; and
iii. the total outstanding balance of principal and any accrued interest on all loans
secured by the Property does not exceed the Adjusted Resale Price, calculated by the City
pursuant to Paragraph 5 of this Agreement. ~
For purposes of this Paragraph 11, the Adjusted Resale Price shall be calculated by the City
pursuant to Paragraph 5 of this Agreement as of the earlier of (a) the date on which the deed of
trust or mortgage securing the new mortgage is filed for recordation in the Off'icial Records of
the County of Alameda, or (b) the date the City receives Notice of Intent to Transfer pursuant to
Paragraph 3.d.i.
iv. Eligible Capital Improvements. In the event (i) the Owner refinances the Initial
Financing in accordance with Paragraph l l.b, or (ii) the Owner borrows a junior loan or takes an
equity line of credit in accordance with Paragraph l l.c, and the funds from such refinance, loan,
or line of credit shall be used for Eligible Capital Improvements, Owner shall provide evidence
to City, in a form acceptable to City in its sole and absolute discretion, that any amount of funds
received by Owner for such Eligible Capita.l Improvements shall be and are used for the
construction of such Eligible Capital Improvements.
v. Affordable Housing Cost; Subordination. The Ciiy and the Owner agree that the
requirements of this Paragraph 11 are necessary to ensure the continued affordability of the
Property to Owner and to minimize the risk of loss of the Property by Owner through default and
foreclosure of mortgage loans. Owner further acknowledges that violation of the provisions of
this Paragraph 11 shall constitute a Default under this Agreement. In no case shall this
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Agreement and the Performance Deed of Trust be in lower than third lien position on the
Property. Any subordination agreement to be executed by City shall include notice and cure
rights for City regarding any defaults in the mortgage to which the City is subordinating.
12. Payment of Excess Sale Proceeds.
a. Upon Sale in Violation of Agreement. If Owner sells or otherwise transfers the
Property in violation of the price restrictions set forth herein, and if City chooses not to exercise
its Option, or exercises its Option but is unable to close escrow due to Owner's failure to remove
liens and encumbrances recorded against the Property, then City shall be entitled to receive from
Owner without any deduction, offset or recoupment, one hundred percent (100%) of the
difference (the "Excess Sale Proceeds") between (a) the actual sales price net of reasonable and
customary real estate commissions paid (such commissions not to exceed six percent (6%) of the
actual sales price), and (b) the Adjusted Resale Price, calculated as of the earlier of (i) the date of
close of escrow for the sale of the Property to the third party, or (ii) the date the City receives
Notice of Intent to Transfer pursuant to Paragraph 3.d.i. This amount shall be a debt of Owner to
City and sha11 be secured by the Performance Deed of Trust. Owner acknowledges that City
shall have no obligation to reconvey the Performance Deed of Trust or this Agreement unless
and until the Excess Sale Proceeds are paid to City. City sha11 use. the Excess Sale Proceeds for
affordable housing programs. The Owner acknowledges that the formula used to determine the
amount of the Excess Sale Proceeds is intended to cause Owner to receive the same or less net
sale proceeds from the unrestricted sale of the Property as Owner would have received if the
Properiy had been sold to an Eligible Household at the Adjusted Resale Price.
b. Upon Foreclosure. If the Property is sold at a foreclosure sale and the proceeds of
such sale are distributed to Owner, any surplus of proceeds remaining after payment of the senior
liens and encumbrances on the Property shall be distributed as follows: (i) where the City did not
exercise its Option, that portion of the surplus up to, but not to exceed, the net amount Owner
would have received pursuant to Paragraph 3.d.ix had the City exercised its Option on the date of
such sale shall be distributed to Owner, and the balance of such surplus, if ariy, shall be
distributed to the City for deposit in the City's Inclusionary Zoning In Lieu Fee Fund; or (ii)
where the City exercised its Option but was unable to close escrow due to Owner's failure to
remove liens and encumbrances recorded against the Property, that portion of to, but not to
exceed, the net amount Owner would have received pursuant to Paragraph 3.d.ix as of the date of
exercise of City's Option shall be distributed to Owner, and the balance of sucli surplus, if any,
shall be distributed to City for deposit in the City's Inclusionary Zoning In Lieu Fee Fund .
13. Limits on Liability. In no event shall the City become liable or obligated in any manner to
Owner by reason of the assignment of this Agreement or the Option, nor shall City be in any way
liable or obligated to Owner for any failure of the City's assignee to consttmmate a purchase of
the Property or to comply with the terms of this Agreement or the Option, or any escrow
instructions or agreement for the purchase of the Property.
14. Insurance Proceeds and Condemnation Award._ In the event the Property is destroyed
and insurance proceeds are distributed to Owner instead of being used to rebuild the Property, or,
in the event of condemnation, if the proceeds thereof are distributed to Owner, any surplus of
proceeds remaining after payment of the senior liens and encumbrances on the Property shall be
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distributed as follows: that portion of the surplus up to, but not to exceed, the net amount Owner
would have received pursuant to Paragraph 3.d.ix had the City exercised its Option on the date of
the destruction or condemnation valuation date shall be distributed to Owner, and the balance of
such surplus, if any, shall be distributed to the City.
15. Effective Date. The rights and obligations of the City and Owner set forth in this
Agreement shall be effective as of the Effective Date.
16. Term of Agreement and Option. The restrictions contained herein and the City's option
to purchase the Property shall continue for a period of fifty-five (55) years commencing on
Original Date of Sale. Notwithstanding anything to the contrary in the foregoing, the Agreement
shall remain in efFect until the first Transfer on or after the termination of the restrictions and
option to puxchase pursuant to this Paragraph. Upon such sale, Owner shall pay to City an
amount ("City's Share") equal to twenty-five percent (25%) of the difference between (a) the
actual sales price net of reasonable and customary real estate commissions paid (such
commissions not to exceed six percent (6%) of the actual sales price), and (b) the Adjusted
Resale Price on the date of the termination of the restrictions and o.ption to purchase pursuant to
this Paragraph. The City's Share shall be paid to the City concurrently with close of escrow on
the sale of the Property, ar upon receipt by Owner of the sale price for the Property, whichever
sha11 first occur. Following completion of a sale in compliance with this provision, this
Agreement shall terminate.
17. Notices. Except as otherwise specified in this Agreement, all notices to be sent pursuant to
this Agreement shall be made in writing, and sent to the Parties at their respective addresses
specified below or to such other address as a Party may designate by written notice delivered to
the other Party in accordance with this Paragraph. All such notices~ sha11 be sent by:
a. personal delivery, in which case notice shall be deemed delivered upon receipt;
b. certified or registered mail, return receipt requested, in which case notice sha.il be
deemed delivered two (2) business days after deposit, postage prepaid in the United States mail;
c. nationally recognized overnight courier, in which case notice shall be deemed
delivered one (1) day after deposit with such courier; or
d. facsimile transmission, in which case norice shall be deemed delivered on transmittal,
provided that a transmission report is generated reflecting the accurate transmission thereof.
City: City of Dublin
Attn: City Manager
100 Civic Plaza
Dublin, California 94568
Qwner: Owner
Address
Dublin, CA 94568
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18. Defaults and Remedies.
a. Events of Default. The following shall constitute the occurrence of an Event of
Default hereunder, and shall entitle City to exercise the Option or to pursue any other remedy
provided herein or at law or in equity:
i. Owner's failure to use the Property as Owner's principal residence;
ii. The sale, conveyance, or other transfer of the Property (including a
foreclosure sale) if the remaining ownership interest of the Owner in the Property is less
than fifty percent (50°l0), except as provided in Paragraph 9.a. or 9.b.
iii. A default occurs under the terms of a deed of trust secured by the Property
and such default is not cured prior to the expiratiori of any applicable cure period.
iv. Owner encuznbers the Property in violation of this Agreement.
v. Owner fails to observe or perform any other covenant, condition, or
agreement to be observed or performed by Owner pursuant to this Agreement, and such
breach remains uncured beyond the expiration of any applicable cure period.
b. Specific Performance. Owner acknowledges that any breach in the performance of
its obligations under this Agreement shall cause irreparable harm to the City. Owner agrees that
the City is entitled to equitable relief in the form of specific performance upon its exercise of the
Option, and that an award of damages shall not be adequate to compensate the City for Owner's
failure to perform according to the terms of this Agreement.
c. Other Remedies. City shall have all of the remedies provided for at law or equity, all
of which shall be cumulative.
19. General Provisions.
a. Attorneys' Fees. If either party initiates legal proceedings to interpret or enforce its .
rights under this Agreement, the prevailing party in such action shall be entitled to an award of
reasonable attorneys' fees and costs in additions to any other recovery to which it is entitled
under this Agreement.
b. No Joint Venture; No Third-Party Beneficiary. No joint venture or other
partnership exists or is created between the Parties by virtue of. this Agreement. Except as
expressly stated herein, this Agreement does not benefit any third party.
c. Successors; Assignment. This Agreement sha11 inure to the benefit of and shall be
binding upon the Parties to this Agreement and their respective heirs, executors, administrators,
successors and assigns. City shall have the right to assign all of its rights and obligations under
this Agreement without the consent of Owner.
,.
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d. Entire Agreement; Amendment. This Agreement constitutes the entire agreement
of the Parties with respect to the subject matter hereof, and supersedes any and all other prior
negotiations, correspondence, understandings and agreements with respect thereto. There are no
representations, promises, agreements or other understandings between the Parties relating to the
subject matter of this Agreement that are not expressed herein. This Agreement may be
modified only by an instrument in writing executed by the Parties or their respective successors
in interest.
e. Survival; No Merger. All of the terms, provisions, representations, warranties and
covenants of the Parties under this Agreement shall survive the close of escrow of any sale of the
Property and shall not be merged in any deed transferring the Property.
f. Authority And Execution. Each Party represents and warrants that it has full power
and authority to enter into this Agreement and to undertake all of its obligations hereunder, that
each person executing this Agreement on its behalf is duly and validly authorized to do so.
g. Severability. The invalidity or unenforceability of any term or provision of this
Agreement shall not impair or affect the remainder of this Agreement, and the remaining terms
and provisions hereof shall not be invalidated but shall remain in full force and effect.
h. Waiver; Modification. No waiver or modification of this Agreement or any
covenant, condition, or limitation herein contained sfiall be valid unless in writing and duly
executed by tlie Party to be charged therewith. No evidence of any waiver or modification sha11
be offered or received in evidence in any proceeding, arbitration, or litigation between the Parties
arising out of or afFecting this Agreement or the rights or obligations of any Party hereunder,
unless such waiver or modification is in writirig and duly executed as aforesaid. The provisions
of this section may not be waived except as herein set forth. A waiver or breach of any
covenant, condition or provision of this Agreement shall not be deemed a waiver of any other
covenant, condition or provision hereof.
i. Construction. The section headings and captions used in this Agreement. are for
convenierice of reference only and shall not modify, define, limit or amplify any of the terms or
provisions hereof. This Agreement shall not be construed as if it had been prepared by one of
the Parties, but rather as if both Parties have prepaxed it.
j. Governing Law. This Agreement shall in all respects be governed by and construed
in accordance with the laws of the State of California.
k. Time of the Essence. Time is of the essence in this Agreement as to each provision
in which time is an element of performance.
l. Further Assurances. Each Party will, upon reasonable request of the other Party,
execute, acknowledge, and deliver, or cause to be executed, acknowledged, and delivered, such
further instruments and documents as may be reasonably necessary in order to fulfill the intents
and purposes of this Agreement.
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m. Counterparts. This Agreement may be executed in counterparts, each of which shall
be deemed an original, and all which together shall constitute one and the same instrument.
SIGNATURES ON FOLLOWING PAGE; SIGNATURES MUST BE NOTARIZED.
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IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
executed as of the date first written above.
OWNER(S):
Owner
Owner
CITY:
City of Dublin, a California municipal
corporation
City Manager
ATTEST:
Deputy City Clerk
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NOTARY ACKNOWLEDGMENT
[Insert Here]
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CERTIFICATE OF ACCEPTANCE
(Pursuant to Government Code §27281)
This is to certify that the interest in real properly conveyed by the Resale Restriction Agreement
and Option to Purchase dated DATE from Owner(s) to the City of Dublin, a California
municipal corporation, is hereby accepted by the undersigned office or agent on behalf of the
City of Dublin pursuant to authority conferred by the Resolution No. 24-87 dated April 13, 1987;
and the grantee consents to recordation thereof by its duly authorized officer.
Dated:
City Manager
Attest:
Deputy City Clerk
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EXHIBIT A: LEGAL DESCRIPTION
[Tnsert Here)
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EXHIBIT B
FORM OF NOTICE OF TNTENT TO TRANSFER
To: City of Dublin
100 Civic Plaza
Dublin, CA 94568
Attn: City Clerk
Date:
Re: Notice of Intent to Transfer
Pursuant to the terms of the Resale Restriction Agreement and Option to Purchase, dated Date, the
undersigned Owner(s), Owner Name(s), hereby give(s) notice of his/her/their intent to transfer the
property located at Unit Address, Dublin, California 94568 (the "Properiy"). Owner may be contacted
at the Property or at the following address:
Email:
If applicable: The proposed transfer of the Property is to the following person(s):
Name:
Address:
Telephone:
The proposed transfer is (check one):
^ Sale
^ Other Specify:
Owner(s) signature(s):
Signature
Print Name
Signature
Print Name
Telephone:_
a
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C
EXHIBIT C
FORM OF NOTICE OF EXERCISE
Date:
To (Owner/Transferee):
Address:
Re: Notice of Exercise
The City of Dublin (" City") hereby gives notice that it is exercising its option to purchase the real
property located at Unit Address, Dublin, California 94568. The option has been granted to the City
pursuant to the Loan, Occupancy, Refinancing and Resale Reslxiction Agreement with Option to Purchase
executed by and between Owner and the City dated as of Date and recorded on Date as Instrument No.
2017~:~~:X~-XXX (the City has assigned its option to purchase the real property to
~'
An escrow for the purchase will be opened with Title Company.
Dated:
CITY OF DUBLIN
City Manager
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1NCLUSIONARY ZONING BASE RESALE PRICE WORKSHEET
Date:
Owner(s):
Address: Dublin, CA 94568
Purchase Price: $
Daie of Purchase:
Years Owned: years
CALCULATION BASED ON INCREASE IN MEDIAN INCOME***
,
Present Median Income: $ Effective Date:
Family of four, County of Alameda
(at time of sale of unit) Effective Date:
Original Median Income: $
Famity of four, County of Alameda
(at time of purchase of unit)
Amount of Increase:
Family of four, County of Alameda
(Present median income minus original median income)
Increase in Price:
! Method #1 Resale Price:
x x =
+ _
Based on the above, the base resale rice as of this date, , is:
By:
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EXHIBIT E
FORM OF REQUEST FOR NOTICE OF DEFAULT
Recording requested by and when
recorded mail to:
City of Dublin
100 Civic Plaza
Dublin, CA 94568
Attn: City CIerk
EXEMPT FROM RECORDING FEBS PER
GOVERNMENT CODE §§6t03, 27383
Escrow Number:
Loan Number:
Lme ror Kecortler's Use
In accordance with Section 2924b, Civil Code, request is hereby made that a copy of any
Notice of Default and a copy of any Notice of Sale under the Deed of Trust recorded as
Instrument No. 2010XXXXXX recorded concurrent herewith in the Official Records of Alameda
County, California, and describing land therein as Address, Dnblin, California 94568:
(See attached legal description)
Executed by Owner(s), as Trustor, in which Bank is named as Lender, with Trustee as Trustee,
and Beneficiary as Beneficiary, be mailed to the City of Dublin, 100 ~Civic Plaza, Dublin,
California 94568, Attn.: City Manager
By:
City Manager
NOTICE: A COPY OF ANY NOTICE OF DEFAULT AND OF ANY NOTICE OF SALE WILL
BE SENT ONLY TO THE ADDRESS CONTAINED IN THIS RECORDED REQUEST. IF
YOUR ADDRESS CHANGES, A NEW REQUEST MUST BE RECORDED.
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EXHIBIT F
DISCL;OSURE STATEMENT
THERE ARE RESTRICTIONS ON THE SALE OF THE PROPERTY YOU ARE BUYING.
EXCEPT FOR A TRANSFER TO THE CITY FOLLOWING CITY'S EXERCISE OF ITS OPTION
TO PURCHASE, THIS PROPERTY MAY ONLY BE SOLD TO AN "ELIGIBLE HOUSEHOLD"
AT A PRICE NOT TO EXCEED THE ADJUSTED RESALE PRICE WFiICH IS CAPPED AT AN
"AFFORDABLE UNIT COST."
THIS MEANS THAT YOU MAY NOT SELL THE PROPERTY FOR MARKET VALUE TO
WHOMEVER YOU LIKE.
THESE RESTRICTIONS WILL BE IN EFFECT LTNTII.. 55 years from original date of sale. ANY
~ SALE OF THE PROPERTY IN VIOLATION OF THE RESTRICTIONS SHALL BE VOIDABLE AT
THE ELECTION OF THE CITY. .
TO DETERMINE WHO AN ELIGIBLE HOUSEHOLD IS, AND WHAT THE ADJUSTED RESALE
PRICE AND AFFORDABLE HOUSING COST ARE, YOU SHOULD CONTACT THE HOUSING
SPECIALIST OF THE CITY OF DUBLIN.
YOU SHOULD READ THE RESALE RESTRICTION AGREEMENT AND OPTION TO PURCHASE
RECORDED AGAINST THE PROPERTY. YOU MAY OBTAIN A COPY FROM THE CITY OF
DUBLIN OR FROM THE ESCROW COMPANY.
YOU SHOULD ALSO BE AWARE THAT A PERFORM~INCE DEED OF TRUST WILL BE
RECORDED AGAINST THE PROPERTY TO ENSURE COMPLIANCE WITH THE RESALE
RESTRICTION AGREEMENT AND OPTION TO PURCHASE. YOU MAY OBTAIN A COPY
FROM THE CITY OF DUBLIN OR FROM THE ESCROW COMPANY.
I HAVE READ THE FOREGOING AND I UNDERSTAND WHAT IT MEANS.
Owner
Owner
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EXHIBIT G
PERFORMANCE DEED OF TRUST
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RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
CITY OF DUBLIN,
100 Civic Plaza
Dublin, California 94568
Attn: City Clerk
To be recorded without fee.
(Gov. Code, §§ 6103 and 27383.)
(Space Above This Line For Recorder's Use Only)
G`~.~ OF DpB~y
~
19/~(~',~,~ PERFORMANCE DEED OF TRUST
``` ~~I~~~s~ (Option to Cure and Purchase Agreement)
THERE ARE RESTRICTIONS ON TI~E SALE OF THE PROPERTY ENCUMBERED
BY THIS DEED OF TRUST. EXCEPT FOR A TRANSFER TO THE CITY OF DUBLIN
(THE "CITY") OR CITY'S ASSIGNEE FOLLOWING CITY'S EXERCISE OF ITS
OPTION TO PURCHASE, THIS PROPERTY MAY ONLY BE SOLD TO AN
"ELIGIBLE HOUSEHOLD" AT A PRICE NOT TO EXCEED THE ADJ[JSTED
RESALE PRICE WHICH IS CAPPED AT AN "AFFORDABLE UNIT COST." THE
RESALE RESTRICTION AGREEMENT ALSO RESTRICTS THE EXTENT TO
WHICH THIS PROPERTY MAY BE ENCUMBERED BY JUNIOR FINANCING AND
LIMITS TRUSTOR'S RIGHTS TO REFINANCE EXISTING MORTGAGES.
This PERFORMANCE DEED OF TRUST ("Deed of Trust") is made as of
("Effective Date") by ("Trustor") whose
address is Dublin, CA 94568 in favor of
("Trustee"), for the benefit of the CITY OF DUBLIN
(referred to variously as "City" or "Beneficiary") whose address is 100 Civic Piaza, Dublin, CA
94568, as Beneficiary.
RECITALS
A. Trustor is the own.er of the real property located at Dublin,
California and more particularly described in the attached E~ibit A, (the "Property).
B. The Trustor's predecessor in interest developed the Property pursuant to the
City's Inclusionary Zoning Regulations, which regulations require developers of rental and
ownership housing to construct within their projects units that are affordable to very low-, low-,
and moderate-income households and which regulations require the Property to be subjected to
restrictions on resale that ensure that the Property remairis affordable.
C. In connection with the Inclusionaxy Zoning Regulations, Beneficiary and Trustor
entered into a Resale Restriction Agreement and Option to Purchase dated as of the Effective
Date and recorded in the Official Records of Alameda County substantially concurrently
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herewith (the "Resale Restriction Agreement") (capitalized terms used without definition
herein have the meaning ascribed to such terms in the Resale Restriction Agreement); and
D. Pursuant to the Resale Restriction Agreement, Trustor is obligated, among other
requirements, to sell the Property onl.y to Eligible Purchasers at a price not in excess of the
Adjusted Resale Price, which is capped at the Affordable Unit Cost; and
E. The Resale Restriction Agreement also provides (among other provisions) that:
(i) Trustor is obligated to notify Beneficiary of Trustor's intent to sell the Property in order to
enable Beneficiary to exercise its option to purchase the Property at a restricted price; (ii)
Beneficiary has an option to purchase the Property if Trustor defaults under the Resale
Restriction Agreement; and (iii) there are restrictions on Trustor's ability to encumber the
Property and to refinance the existing loans secured by the Property.
AGREEMENT
NOW, THEREFORE, to secure the full and timely performance by Trustor of the
Secured Obligation, it is agreed as follows:
1. Grant in Trust. Trustor, in consideration of the promises herein recited and the trust herein
created, hereby irrevocably and unconditionally grants, transfers, conveys and assigns to Trustee,
in trust for the benefit of Beneficiary, with power of saie, all estate, right title and interest which
Trustor now has or may later acquire in and to that certain real property located in the City of
Dublin; County of Alameda, State of California, described in the attached Exhibit A and
commonly known as: ~Dublin, California (the "Property") together
with all of the following:
(i) all improvements now or hereafter located or constructed on the Property and all
replacements and additions thereto ("Improvements");
(ii) all easements, rights of way, appurtenances and other rights used in connection
with the Property or as a means of access thereto ("Appurtenances");
(iii) all fixtures now or hereafter attached to or used in and about the Property or the
improvements located thereon or hereafter located or constructed on the Property, and all
renewals or replacements thereof or articles in substitution therefor, whether or not the same are,
or shall be attached to the improvements in any manner ("Fixtures and Equipment"); and
(iv) all leases, subleases, licenses and other agreements relating to use or occupancy of.
the Property ("Leases") and all rents or other payments which may now or hereafter accrue or
otherwise become payable to or for the benefit of Trustor ("Rents") (whether or not such Leases
and Rents are permitted by the Resale Restriction Agreement).
All . of the above-referenced Property, Improvements, Appurtenance, Fixtures and Equipment,
Leases and Rents are herein referred to collectively as the "Security".
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2. Obligations Secured. This Deed of Trust is given for the purpose of securing payment and/or
performance of the following (the "Secured Obligations"): (i) all present and future
obligations of Trustor set forth in this Deed of Trust or in the Resale Restriction Agreement
(including without limitation, Trustor's obligation to convey the Property only to Eligible
Purchasers at no more than the Adjusted Resale Price, which is capped at an Affordable Unit
Cost (as such terms are defined in the Resale Restriction Agreement); (ii) a11 additional present
and future obligations of Trustor, to Beneficiary under any other agreement or instrument
acknowledged by Trustor (whether existing now or in the future) which states that it is or such
obligations are, secured by this Deed of Trust; (iii) all modifications, supplements, amendments,
renewals, and extensions of any of the foregoing, whether evidenced by new or additional
documents; and (iv) reimbursement of all amounts advanced by or on behalf of Beneficiary to
protect Beneficiary's interests under this Deed of Trust.
3. Assi~nment of Rents, Issues, and Profits. Trustor hereby irrevocably, absolutely,
presently and unconditionally assigns to Beneficiary the rents, royalties, issues, profits, revenue,
income and proceeds of the Property. This is an absolute assignment and not an assignment for
security only. Except to the extent that the lease or rental of the Property is prohibited by the
Resale Restriction Agreement, Beneficiary hereby confers upon Trustor a license to collect and
retain such. rents, royalties, issues, profits, revenue, income and proceeds as they become due and
payable prior to any Event of Default hereunder. Upon the occurrence of any such Event of
Default, Beneficiary may terminate such license without notice to or demand upon Tzustor and
without regard to the adequacy of any security for the indebtedness hereby secured, and may
either in person, by agent, or by a receiver to be appointed by a court, enter upon and ta.ke
possession of the Property or any part thereof, and sue for or otherwise collect such rents, issues,
and profits, including those past due and unpaid, and apply the same, less costs and expenses of
operation and collection, including reasonable attorneys' fees, to any indebtedness secured
hereby, and in such order as Beneficiary may determine. Beneficiary's right to the rents,
royalties, issues, profits, revenue, income and proceeds of the Property does not depend upon
whether or not Beneficiary takes possession of the Property. The entering upon and taking
possession of the Property, the collection of such rents, issues, and profits, and the application
thereof as aforesaid, shall not cure or waive any default or notice of default hereunder or
invalidate any act done pursuant to such notice. If an Event of Default occurs while Beneficiary
is in possession of all or part of the Property and/or is collecting and applying Rents as permitted
under this Deed of Trust, Beneficiary, Trustee and any receiver shall nevertheless be entitled to
exercise and invoke every right and remedy afforded any of them under this Deed of Trust and at
law or in equity, including the right to exercise the power of sale granted hereunder. Regardless
of whether or not Beneficiary, in person or by agent, takes actual possession of the Land and
Improvements, Beneficiary shall not be deemed to be a"mortgagee in possession," shall not be
responsible for performing any obligation of the lessor under any Lease, shall not be liable in any
manner for the Property, or the use, occupancy, enjoyment or operation of any part of it , and
unless due solely to the willful misconduct or gross negligence of Beneficiary, shall not be
responsible for any dangerous or defective condition of the Pr.operty or any negligence in the
management, repair or control of the Property.
4. Fixture Filin~. This Deed of Trust is intended to be and constitutes a fixture filing
pursuant to the provisions of the UCC with respect to all of the Property constituting fixtures, is
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being recorded as a fixture financing statement and filing under the UCC, and covers property,
goods and equipment which are or are to become fixtures related to the Land and the
Improvements. Trustor covenants and agrees that this Deed of Trust is to be filed in the real
estate records of Alameda County and shall also operate from the date of such filing as a fixture
filing in accordance with Section 9502 and other applicable provisions of the UCC. This Deed of
Trust shall also be effective as a financing statement covering minerals or the like (including oil
and gas) and accounts subject to the UCC, as amended. Trustor shall be deemed to be the
"debtor" and Beneficiary shall be deemed to be the "secured party" for all purposes under the
UCC. The full name of Trustor and the mailing address of Trustor are set forth in Section 102 of
this Deed of Trust.
Trustor's Representations, Warranties and Covenants.
5.1 Trustor's Estate. Trustor represents and warrants that Trustor is lawfully seized
of the estate hereby conveyed and has the right to grant and convey the Security, that other than
this Deed of Trust, the Security is encumbered only by: .(a) that deed of trust executed by
Trustor in connection with a loan made to Trustor by (the "First Lender"),
securing a promissory note executed by Trustor in favor of the First Lender ("First Lender
Note"), to assist in the purchase of the Property (the "First Lender Deed of Trust") and (b) the
Resale Restriction Agreement. Trustor agrees to warrant and defend generally the title to the
Security against all claims and demands, subject to any declarations, easements or restrictions
listed in a schedule of exceptions to coverage in any title insurance policy insuring the City's
interest in the Security. (As used in this Deed of Trust, the term- "First Lender" shall include all
successors and assigns of the First Lender.)
5.2 Repayment of Sums Owed under Resale Restriction Agreement. Trustor will
promptly pay to the City all sums due under the Resale Restriction Agreement, including all
principal and interest.
5.3 Resale Restriction Agreement. Trustor will observe and perform a11 of the
covenants and agreements of the Resale Restriction Agreement.
5.4 First Lender Loan. Trusior will observe and perform all of the covenants and
agreements of the First Lender Note, First Lender Deed of Trust, and related First Lender loan
documents.
5.5 Charges; Liens. Trustor will pay prior to delinquency, all taxes, assessments and
other charges, fines and impositions affecting the Security directly to the payee thereof. Upon
request by the City, Trustor will promptly furnish to the City all notices of such amounts due.
Trustor sha11 pay when due each obligation secured by or reducible to a lien, charge or
encumbrance which now does or later may encumber or appear to encumber all or part of the
Property or any interest in it, whether or not such lien, charge or encumbrance is or would be
senior or subordinate to this Deed of Trust. Trustor shall not be required to pay any tax, levy,
charge or assessment so long as its validity is being actively contested in good faith and by
appropriate actions and/or proceedings which will operate to prevent the enforcement of the lien
or forfeiture of the Security or any part thereof.
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5.6 Hazard Insurance. Trustor will keep the Security insured by a standard all risk
property insurance policy equal to the replacement value of the Security (adjusted every five (5)
years by appraisal, if requested by the City). If the Security is located in a flood plain, Trustor
shall also obtain flood insurance. In no event shall the amount of insuranee be less than the
amount necessary to prevent Trustor from becoming a co-insurer under the terms of the policy.
The insurance carrier providing this insurance shall be licensed to do business in the State of
California and be chosen by Trustor subject to approval by the City.
All insurance policies and renewals thereof will be in a form acceptable to the City, and will
include a standard mortgagee clause with standard lender's endorsement in favor of the holder of
the First Lender Note and the City as their interests may appear and in a form acceptable to the
City. T'he City shall have the right to hold, or cause its designated agent to hold, the policies and
renewals thereof, and Trustor shall promptly furnish to the City, or its designated agent, the
original insurance policies or certificates of insurance, a11 renewal notices and all receipts of paid
premiums. In the event of loss, Trustor will give prompt notice to the insurance carrier and the
City or its designated agent. The City, or its designated agent, may make proof of loss if not
made promptly by Trustor. The City shall receive thirty (30) days advance notice of cancellation
of any insurance policies required under this section.
Unless otherwise permitted by the City in writing, insurance proceeds, subject to the rights of the
First Lender, will be applied to restoration or repair of the Security damaged. If permitted by
City, and subject to the rights of the First Lender, the insurance proceeds shall be used to repay
any amounts due under Section 13 of the Resale Restriction Agreement, with the excess, if any,
paid to Trustor. If the Security is abandoned by Trustor, or if Trustor fails to respond to the City,
or its designated agent, within thirty (30) days from the date notice is mailed by either of them to
Trustor that the insurance carrier offers to settle a claim for insurance benefits, the City, or its
designated agent, is authorized to collect and apply the insurance proceeds at the City's option
either to restoration or repair of the Security or to pay amounts due under the Resale Restriction
Agreement.
If the Security is acquired by the City, all right, title and interest of Trustor in and to any
insuranee policy and in and to the proceeds thereof resulting from damage to the Security prior to
the sale or acquisition will pass to the City to the extent of the sums secured by this Deed of
Trust immediate prior to such sale or acquisition, subject to the rights of the First Lender.
During the course of any rehabilitation of the improvements located on the
Property, Trustor shall hire only licensed contractors who maintain the following forms of
insurance:
Liability Insurance. Comprehensive general liability insurance against
liability for bodily injury to or death of any person or property damage arising out of an
occurrence on or about the Property. The limits of such insurance shall be not less than One
Million Dollars ($1,000,000) combined single limit for bodily injury and property damage.
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Worker's Compensation Insurance. Worker's compensation insurance
covering all persons employed in connection with any work on the Property.
5.7 Preservation and Maintenance of Security. Trustor will keep the Security in good
repair and in a neat, clean, and orderly condition and will not commit waste or permit
impairment or deterioration af the Security. If there arises a condition in contravention of this
Section, and if the Trustor has not cured such condition within thirty (30) days after receiving a
City notice of such a condition, then in addition to any other rights available to the City, the City
shall have the right (but not the obligation) to perform all acts necessary to cure such condition,
and to establish or enforce a lien or other encumbrance against the Security to recover its cost of
curing.
5.8 Protection of the City's Security. If Trustor fails to perform the covenants and
agreements contained in this Deed of Trust or if any action or proceeding is commenced which
materially affects the City's interest in the Security, including, but not limited to, default under
the First Lender Deed of Trust, eminent domain, insolvency, code enforcement, or arrangements
or proceedings involving a bankrupt or decedent, then the City, at the City's option, without
releasing Trustor from any obligation hereunder, may make such appearances, disburse such
sums and take such action as it determines necessary to protect the City's interest, including but
not limited to, disbursement of reasonable attorneys' fees. for any lawful purpose, including,
without limitation, attorneys' fees incurred in ~monitoring pending First Lender defaults,
foreclosure proceedings, short sales or other third-party sales in order to ensure the protection of
City's Security interest, and entry upon the Security to make repairs. Any amounts disbursed by
the City pursuant to this paragraph, with interest thereon, will become an indebtedness of Trustor
secured by this Deed of Trust and recoverable to City from proceeds of any City, First Lender or
other foreclosure, or otherwise. Unless Trustor and City agree to other terms of payment, such
amount will be payable upon notice from the City to Trustor requesting payment thereof, and
will bear interest from the date of disbursement at the lesser of (i) ten percent (10%); or (ii) the
highest rate permissible under applicable law. Nothing contained in this paragraph will require
the City to incur any expense or ta.ke any action hereunder.
5.9 Inspection. . The City may make or cause to be made reasonable entries upon and
inspections of the Security; provided that the City will give Trustor reasonable notice of
inspection.
5.10 Hazardous Substances. Trustor sha11 not cause or permit the presence, use,
disposal, storage, or release of any Hazardous Substances in, on, under, about, or from the
Property. Trustor sha11 not do, nor allow anyone else to do, anything affecting the Property that
is in violation of any Environmenta.l Law. The preceding two sentences shall not apply to the
presence, use, or storage on the Property of small quantities of Hazardous Substances that are
generally recognized to be appropriate to normal residential uses and to maintenance of the
Property when used and disposed of in accordance with Environmental Law.
"Hazardous Substances" means any substance defined as toxic or hazardous substances
or hazardous waste or regulated under any Environmental Law, and the _ following substances:
Amended and Restated Affordabie I-Iousing Agreement
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gasoline, kerosene, other flammable or toxic petroleum products, toxic pesticides and herbicides,
volatile solvents, materials containing asbestos or formaldehyde, and radioactive materials.
"Environmental Law" means all federal, state or local statutes, ordinances, regulations,
orders, decrees and judgments that relate to health, safety or environmental protection including
without limitation the regulation of the use, disposal, znanufacture, or release of Hazardous
Substances.
Trustor shall promptly give City written notice of any investigation, claim, demand, lawsuit or
other action by any governmental or regulatory agency or private party involving the Property
and. any Hazardous Substance or Environmental Law of which Trustor has actual knowledge. If
Trustor learns, or is notified by any governmental or regulatory authority, that any removal or
other remediation of any Hazardous Substance affecting the Property is necessary, Trustor shall
promptly take all necessary remedial actions in accordance with Environmental Law.
6. Nonliabili for Ne~li~ence, Loss, or Damage• No Joint Venture. Trustor acknowledges,
understands and agrees that the relationship between Trustor and the City is solely that of a
borrower and lender, and that the City does not undertalce or assume any responsibility for or
duty to Trustor to select, review, inspect, supervise, pass judgment on, or inform Trustor of the
quality, adequacy or suitability of the Security or any other matter. The City owes no duty of
care to protect Trustor against negligent, faulty, inadequate or defective building or construction
or any condition of the Security and Trustor agrees that neither Trustor, or Trustor's heirs,
successors or assigns shall ever claim, have or assert any right or action against the City for any
loss, damage or other matter arising out of or resulting from any condition of the Security and
will hold City harmless from any liability, loss or damage for these things. Nothing contained
herein or in Note or the Resale Restriction Agreement shall be deemed to create or construed to
create a partnership, joint venture or any relationship other than that of a borrower and lender.
7. Indemnitv. Trustor agrees to defend, indemnify, and hold the City of Dublin and its
elected and appointed officials, officers, employees, and agents ("Indemnitees") harmless from
and against all losses, damages, liabilities, claims, actions, judgments, costs, and reasonable
attorneys' fees that the Indemnitees may incur as a direct or indirect consequence of:
(i) Trustor's failure to perform any obligations as and when required by the
Resale Restriction Agreement and this Deed of Trust; or
(ii) the failure at any time of any of Trustor's representations or warranties to
be true and correct.
8. Acceleration; Remedies. Upon Trustor's breach of any covenant or agreement of Trustor
in Resale Restriction Agreement or this Deed of Trust, including, but not limited to, the
covenants to pay, when due, any sums secured by this Deed of Trust, the City, prior to
acceleration, will mail by express delivery with delivery receipt, notice to Trustor specifying; (1)
the breach; (2) the action required to cure such breach; (3) a date, not less tfian thirty (30) days
from the date the notice is received by Trustor as shown on the retum receipt, by which such
breach is to be cured; and (4) if the breach is curable, that failure to cure such breach on or
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before the date specified in the notice may result in acceleration of the sums secured by this
Deed of Trust and sale of the Security. The notice will also inform Trustor of Trustor's right to
reinstate after acceleration and the right to bring a court action to assert the nonexistence of
default or any other defense of Trustor to acceleration and sale. If the breach is not cured on or
before the date specified in the notice, the City, at the City's option, may:
(a) declare all of the sums secured by this Deed of Trust to be immediately due and
payable without further demand and may invoke the power of sale and any other remedies
permitted by California law;
(b) either in person or by agent, with or without bringing any action or proceeding, or by
a receiver appointed by a court, and without regard to the adequacy of its security, enter upon the
Security and take possession thereof (or any part thereo fl and of any of the Security, in its own
name or in the name of Trustee, and do any acts which it deems necessary or desirable to
preserve the value or marketability of the Property, or part thereof or interest therein, increase the
income therefrom or protect the security thereof. The entering upon and taking possession of the
Security shall not cure or waive any breach hereunder or invalidate any act done in response to
such breach and, notwithstanding the continuance in possession of the Security, the City shall be
entitled to exercise every right provided for in this Deed of Trust, or by law upon occurrence of
any uncured breach, including the right to exercise the power of sale;
~
(c) commence an action to foreclose this Deed of Trust as a mortgage, appoint a receiver,
or specifically enforce any of the covenants hereof;
(d) deliver to Trustee a written declaration of default and demand for sale, pursuant to the
provisions for notice of sale found at California Civil Code Sections 2924 et seq., as amerided
from time to time; or
(e) exercise all other rights and remedies provided herein, in the instruments by which the
Trustor acquires title to any Security, or in any other document or agreement now or hereafter
evidencing, creating or securing all or any portion of the obligations secured hereby, or provided
by law.
The City shall be entitled to collect all reasonable costs and expenses incurred in pursuing
the remedies provided in this paragraph, including, but not limited to, reasonable attorneys' fees.
9. Trustor's Right to Reinstate. Notwithstanding the City's acceleration of the sums secured
by this Deed of Trust, Trustor will have the right to have any proceedings begun by the City to
enforce this Deed of Trust discontinued at any time prior to five (5) days before sale of the
Security pursuant to the power of sale contained in this Deed of Trust or at any time prior to
entry of a judgment enforcing this Deed of Trust i£ (a) Trustor pays City all sums which would
be then due under this Deed of Trust if there were no acceleration under this Deed of Trust or the
Resale Restriction Agreement; (b) Trustor cures all breaches of any other covenants or
agreements of Trustor contained in the Resale Restriction Agreement or this Deed of Trust; (c)
Trustor pays all reasonable expenses incurred by City and Trustee in enforcing the covenants and
agreements of Trustor contained in the Resale Restriction Agreement or this Deed of Trust, and
Amended and Restated Affordable Housing Agreement
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(
in enforcing the City's and Trustee's remedies, including, but not limited to, reasonable
attorney's fees; and (d) Trustor takes such action as City may reasonably require to assure that
the lien of this Deed of Trust, City's interest in the Security and Trustor's obligation to pay the
sums secured by this Deed of Trust shall continue unimpaired. Upon such payment and cure by
Trustor, this Deed of Trust and the obligations secured hereby will remain in full force and effect
as if no acceleration had occurred.
10. Deleted.
11. Reconveyance. Upon the expiration of the term of the Resale Restriction Agreement if
the Trustor owns and occupies the Property and is not in violation of any provisions of this Deed
of Trust or the Resale Restriction Agreement, the City will reconvey the Security and will
surrender this Deed of Trust and the Resale Restriction Agreement to Trustee. Trustee will
reconvey the Security without warranty and without charge to the person or persons legally
entitled thereto. Such person or persons will pay all costs of recordation, if any.
12. Substitute Trustee. The City, at the City's option, may from time to time remove Trustee
and appoint a successor trustee to any Trustee appointed hereunder. The successor trustee will
succeed to all the title, power and duties conferred upon the Trustee herein and by applicable
law.
13. Superiority of First Lender pocuments. Notwithstanding any provision herein, this Deed
of Trust shall not diminish or affect the rights of the First Lender under the First Lender Deed of
Trust or any subsequent First Lender deeds of trust hereafter recorded against the Security in
compliance with the requirements of Section 25 of the Resale Restriction Agreement. '
Notwithstanding any other provision hereof, the provisions of this Deed of Trust shall be
subordinate to the lien of the First Lender Deed of Tzust and shall not impair the rights of the
First Lender, or such lender's assignee or successor in interest, to exercise its remedies under the
First Lender Deed of Trust in the event of default under the First Lender Deed of Trust by the
Trustor. Such remedies under the First Lender Deed of Trust include the right of foreclosure or
acceptance of a deed or assignment in lieu of foreclosure. After such foreclosure or acceptance
of a deed in lieu of foreclosure, this Deed of Trust shall be forever terminated and shall have no
further effect as to the Property or any transferee thereafter; provided, however, if the holder of
such First Lender Deed of Trust acquired title to the Property pursuant to a deecl or assignment in
lieu of foreclosure, this Deed of Trust shall automatically terminate upon such acquisitiori of
title, provided that (i) the City has been given written notice of default under such First Lender
Deed of Trust with a sixty (60)-day cure period and (ii) the City shall not have cured or
commenced to cure the default within such sixty (60)-day period or commenced to cure and
given its firm commitment to complete the cure in form and suhstance acceptable to the First
Lender.
14. Request for Notice. City requests that copies of:the notice of default and notice of sale be
sent to City at the address set forth in Section 15.5.
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15. Miscellaneous.
15.1 Forbearance by the City Not a Waiver. Any forbearance by the City in exercising
any right or remedy will not be a waiver of the exercise of any such right or remedy. The
procurement of insurance or the payment of taxes or other liens or charges by the City will not be
a waiver of the City's right to require satisfaction of any obligations secured by this Deed of
Trust.
15.2 Remedies Cumulative. All remedies provided in this Deed of Trust are distinct
and cumulative to any other right or remedy under this Deed of Trust or any other document, or
afforded by law or equity, and may be exercised concurrently, independently or successively.
15.3 Successors and Assigns Bound. The covenants and agreements herein contained
shall bind, and the rights hereunder shall inure to, the respective successors and assigns of the
City and Trustor subject to the provisions of this Deed of Trust.
15.4 Joint and Several Liability. If this Deed of Trust is executed by more than one
person as Trustor, the obligations of each shall be joint and several.
15.5 Notices. Except for any notice required under applicable law to be given in
another manner, (a) any notice to Trustor provided for in this Deed of Trust will be giyen by
certified mail, return receipt requested, express delivery with delivery receipt or personal
delivery with delivery receipt, addressed to Trustor at the address shown in the first paragraph of
this Deed of Trust or such other address as Trustor may designate by notice to the City as
provided herein, and (b) any notice to the City will be given by certified mail, return receipt
requested, express delivery with delivery receipt or personal delivery with delivery receipt, to the
City of Dublin, 100 Civic Plaza, Dublin, CA 94568 Attn: City Manager, or to such other address
as the City may designate by notice to Trustor as provided above. Notice shall be effective as of
the date received by City as shown on the return receipt.
15.6 Governing Law. This Deed of Trust shall be governed by the laws of the State of
California.
15.7 Severability. In the event that any provision or clause of this Deed of Trust or the
Resale Restriction Agreement conflicts with applicable law, such conflict will not affect other
provisions of this Deed of Trust or the Resale Restriction Agreement which can be given effect
without the conflicting provision, and to this end the provisions of the Deed of Trust and the
Resale Restriction Agreement are declared to be severable.
15.8 Captions. The captions and headings in this Deed of Trust are for convenience
only and are not to be used to interpret or define the provisions hereof.
15.9 Nondiscrimination. Trustor covenants by and far itself and its successors and
assigns that there shall be no discrimination against or segregation of a person or of a group of
persons on account of race, color, religion, creed, age, disability, sex, sexual orientation, marital
status, ancestry or national origin in the sale, transfer, use, occupancy, tenure or enjoyment of the
Amended and Restated Affordable Housing Agreement
PA 02-062 Dulilin Tralee II, LLC
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Property, nor shall Trustor or any person claiming under or through Trustor establish or permit
any such practice or practices of discrimination or segregation with reference to the use,
occupancy, or transfer of the Property. The foregoing covenant shall run with the land.
[EXECUTION PAGE FOLLOWS; SIGNATURES MUST BE NOTARIZED]
Amended and Restated Affordable Housing Agreement
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G ~
I~~
1N WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the date first
written above.
Trustor
Trustor
1681143.1
.
Amended and Restated Affordable Housing Agreement
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EXHIBIT A
LEGAL DESCRIPTION
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G
EXHIBIT 5
Memorandum of Affordable Housing Agreement
for the Construction of Inclusionary Units and the Payment of Fees In-Lieu of Constructing
Certain Affordable Ownership Units
Amended and Restated Affordable Housing Agreement
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Recording requested by and when
recorded mail to:
City of Dublin
100 Civic Plaza
Dublin, CA 94568
Attn: City Clerk
LXEMP'i' FROM RECORDING FEES PGR
GOVERNMENT CODE ~27383
Space above this line for Recorder's use
MEMORANDUM OF AMENDED AND RESTATED AFFORDABLE HOUSING
AGREEMENT FOR THE CONSTRUCTION OF INCLUSIONARY UNITS AND THE
PAYMENT OF FEES IN-LIEU OF CONSTRUCTING CERTAIN AFFORDABLE
OWNERSHIP UNITS
This Memorandum (this "Memorandum") of Amended and Restated Affordable
Housing Agreement for the Construction of Inclusionary Units and the Payment of Fees In-Lieu
of Constructing Certain Affordable Ownership Units (the "Agreement") is entered into on this
_ day of , 201 l, by and between the City of Dublin, a municipal corporation (hereafter
"Ciiy") and Dublin Tralee II, LLC, a Delaware limited liability company (the "Developer").
This Memorandum supersedes a similar Memorandum recorded on October 21, 2005 in the
Official Records of Alameda County as Instrument No. 2005455428.
1. Pursuant to the Agreement, dated as of , 2011 by and between City and
Developer, the Parties have set forth their respective obligations with respect to the provision of
affordable units on lands presently owned by Developer known generally as the Tralee project
and more specifically described in Exhibit A(the "Property"). These obligations run with the
land.
2. Developer and City have executed and recorded this instrument to give notice of the
Agreement, and the respective rights and obligations of Developer and City. The unrecorded
Amended and Restated Affordable Housing Agreement for the Construction of Inclusionary ~
Units and the Payment of Fees In-Lieu of Constructing Certain Affordable Ownership Units is
incorporated by reference in its entirety in this Memorandum.
3. This Memorandum shall bind and inure to the benefit of the parties and their
respective heirs, successors and assigns, subject however to restrictions set forth in the
Agreement regarding assignment.
[EXECUTION PAGE FOLLOWS; SIGNATURES MUST BE NOTARIZEDJ
Amended and Restated Affordable Housing Agreement
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date and year first above written.
CITY OF DUBLIN.
a municipal corporation
By:
Joni Patillo, City Manager
Attest:
City Clerk
Dublin Tralee II, LLC
a Delaware limited liability company
By:
Authorized Agent
** Applicant's Signature shall be notarized prior to returning signed agreement to the City
of Dublin Community Development Department.
1686180
Amended and Restated Affordable Housing Agreement
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1, ~~~
EXHIBIT A
Property Description
THAT CERTAIN REAL PROPT-,'RTY SiTUATTD IN THE CITY OF Dt7BLIN, COUNTY OF ALAME.DA,
STATE OF CALIFORNIA, I3E1NG A PORTI~N OF LOT 1, AS SHOWN ON MAP OF TRACT 7457,
PILED JUNE 13, 2006, IN BOOK 291 OF MAPS, PAG~ 29 THROUGH 37, INCLUSIVE, ALAMEDA
COUNTY RECORDS, FURTHER DESCRIBED AS FOLLOWS: •
UN1:TS 6526, b530, 6~34, AND 65381N BUILDING NO. 5, AND UN:ITS 6517 AND 65291N BUILDING
NO. 10, AS DEPICTED ON THAT CERTAIN CONDOMINIUM PLAN FOR LOT 1 OF TRACT 7457, WHICH
IS ATTACHED AS EXHIBIT "A" TO THE TRALEE VILLAGE DECLARATION OF COVENANTS,
CONDIT[ONS, RESTRI:CT:[ONS AND EASEMENTS RECORDED ON APR1L 18, 2008 AS DOCUMENT NO
2008133996, TOGETHER WITH ANY AMENDMENTS, MODIFICATIONS OR ANNEXATIONS AS MAY
OCCUR FROM TIME TO TIME, IN THE OFFICIAL RECORDS OF ALAMEDA COUNTY, CALIFORNIA
(THE "DECLARATION"), AND FURTHER DEFINED IN THE DECLAFtATtON.
UNITS 6630, 6634, 6638, 6642 OF BUTLDING l, UN:('TS 6608, 6612, 6616, 6620 OF BUILDING 2, iJNITS
6~56,6590,6594,6598 OF BUILDING 3, UNITS 6647, 6651, 6655, 6659 OF BUI:LDFNG 6, UNITS 6615,
6619, 6623, 6627, 6631, 6635, 6639 OF BUILDING 7, LJNITS 6589, 6593, 6597, 6601, 6605 OF
BUILDING 8, AS DEPICTED ON THE CONDOMINIUM PLAN - PHASES 2& 3, TRACT 7457 RECORDED
ON JUNE 17, 2011. AS DOCUMENT NO. 2011174652 IN TH~ OFFICIAI, RECORDS OF ALAMEDA
COUNTY, CALIFORNIA.
A:LL OF FPCP 4, 5 AN:D 6 AS D:EFINED IN THE DECLARAT.[ON AND AS SHOWN ON THE PHASE 2 ce. 3
CUN.DOMINIUM PLAN.
Amended and Restated Affordable Housing Agreement
PA 02-062 Dublin Tralee II, LLC
5-4
r
RESOLUTION NO. XX - 11 ~ I ~~ ~
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
***~*~*~*~~*****~~*:~*
APPROVING AN AFFORDABLE HOUSING REGULATORY AGREEMENT AND
DECLARATION OF RESTRICTIVE COVENANTS BETWEEN THE CITY OF DUBLIN AND
PCCP CS II TRALEE VILLAGE, LLC, AND AUTHORIZING THE CITY MANAGER TO
EXECUTE THE AGREEMENT AND TAKE OTHER NECESSARY AND APPROPRIATE
ACTIONS
WHEREAS, pursuant to the requirements of the Inclusionary Zoning Regulations of the City of
Dublin Zoning Ordinance (the "Ordinance"), on October 19, 2005, the City of Dublin (the "City") and
Pfeiffer Ranch Investors, Inc. ("Pfeiffer"), entered into an Affordable Housing Agreement for the
Construction of Inclusionary Units (the "Original Agreement") for the construction of 233 residential
units known as the Tralee project, including the construction of 13 Inclusionary Units on certain property
it owned ("Phase I") and 16 Inclusionary Units in mixed use buildings to be developed on adjacent
property ("Phase II"); and
WHEREAS, subsequent to execution of the Original Agreement, PCCP CS II Tralee Village,
LLC, a Delaware limited liability company (the "Developer"), acquired the Phase II property from
Pfeiffer, and intends to complete the development of Phase II as a residential rental project (the
"Project"); and
WHEREAS, the Developer and the City have proposed to enter into an Affordable Housing
Regulatory Agreement and Declaration of Restrictive Covenants (the "Regulatory Agreement'), to
supersede and replace the Original Agreement with respect to satisfying Developer's obligation, pursuant
to the Ordinance, for the 16 Restricted Units to be constructed in the Project;
WHEREAS, pursuant to the Ordinance, the Developer has•proposed to provide sixteen (16) rental
Restricted Units, allocated as follows: construction of five (5) very low-income units, three (3) low-
income units, and eight (8) moderate-income Restricted Units; and
WHEREAS, the Developer shall rent the Restricted Units at rents that are affordable to persons
with very low-, low- or moderate-incomes, as applicable, as defined in the Ordinance; and
WHEREAS, the Project has been found to be Categorically Exempt from the California
Environmental Quality Act (CEQA); and
WHEREAS, a Staff Report setting forth in further detail the background and terms of the
proposed Regulatory Agreement has been submitted to the City Council for consideration of this request.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Dublin does
hereby approve the Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants,
as described in Exhibit A.
BE IT FURTHER RESOLVED that the City Manager is authorized and directed to execute the
Regulatory Agreement and such other documents, and to take such other and further action, as necessary
and appropriate to carry out the Intent of this Resolution. .
Attachment 3
~b~~~~
PASSED, APPROVED AND ADOPTED this 16th day of August 2011 by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST: ,
City Clerk
Exhibit A - Regulatory Agreement
Mayor
K:IStnJjReports- PC nnd CCI201/IAmen~lment to the AHA TrnleelCCresRentalRegulatoryAgmt8-16-1 /.DOC
Page 2 of 2
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'
AFFORDABLE HOUSING REGULATORY AGREEMENT AND
DECLARATION OF RESTRICTIVE COVENANTS
Tralee Apartment Project
This Affordable Housing Regulatory Agreement and Declaration of Restrictive
Covenants (this "Agreement") is entered into this day of , 2011 ("Effective
Date") by and between the City of Dublin, a municipal corporation ("City") and PCCP CS
II Tralee Village, LLC, a Delaware limited liability company (the "Developer"). City and
Developer are hereinafter collectively referred to as the "Parties."
Recitals
A. Developer is the owner of real properiy located in the City of Dublin, County
of Alameda, State of California generally located at 6601 and 6599 Dublin Boulevard, and
more particularly described in E~ibit A attached hereto and incorporated into this .
Agreemerit by reference (the "Property").
B. Chapter $.68 of the Dublin Zoning Ordinance ("Ordinance") requires
developers of residential projects consisting of 20 units or more to set aside 12.5% of the
units in the project as Inclusionary Units (defined below) and to execute and record an
affordable housing agreement against the project property prior to the issuance of building
permits
C. The City of Dublin adopted the Ordinance pursuant to Strategy I.B. of the
City's General Plan Housing Element, recognizing that the cost of new housing is so high
that persons with very low-, low- and moderate-incomes are increasingly unable to locate
affordable housing in the City. The purpose of the Ordinance is to achieve a balanced
community with housing available at all income levels.
D. The original developer of the Property, Bancor Properties, proposed the
development of 233 residential units in a residential and retail development on land
consisting of the Properiy and other real property located immediately adjacent thereto.
E. In order to induce the City Council to approve the General Plan Amendment
that was necessary to approve the project, Bancor committed to construct all 29 Inclusionary
Units required by the Ordinance. On July 20, 2004, the City Council approved Site
Development Review (Reso. No. 143-04) and a tentative subdivision map (Reso. No.143 -
04) (the "Development Approvals") for the project. Based on 233 units and in accordance
with the Ordinance, the Development Approvals for the project require the developer to
construct 29 Inclusionary Units (12.5% of 233 = 29).
F. Subsequently, Pfeiffer Ranch Investors, Inc. obtained the project from Bancor.
Pfeiffer and the City entered into that certain "Affordable Housing Agreement for the
Construction of Inclusionary Units," dated October 19, 2005 (the "Original AgreemenY'):
The Original Agreement requires the construction of 13 Inclusionary Units on the adjacent
Affordable Housing Regulatory Agreement between
City of Dublin and PCCP CS II Tralee Village, LLC Page 1 of 15
EXHIBIT. A TO
ATTACHMENT 3
! ~~ ~
property (referenced in the Original Agreement as "Phase I"), and 16 Inclusionary Units in
the mixed use buildings to be.developed on the Property (referenced in the Original
Agreement as "Phase II"). The Original Agreement provided that a1129 units were
designated as affordable ownership units, including the 16 Inclusionary Units within Phase
II.
G. Developer has now acquired the Property and intends to complete the
development of Phase II as a residential rental project, hereinafter referred to as the
"Project." Another developer, Dublin Tralee II, LLC ("Dublin Tralee II"), has acquired the
Phase I property and intends to complete the development of Phase I.
H. City and Developer are entering into this Agreement to govern the 16
Inclusionary Units required by the Development Approvals to be constructed in Phase II.
Dublin Tralee II and City have or will enter into a separate agreement governing the
construction of the 13 Inclusionary Units (defined below) required by the Development
Approvals to be constructed in Phase I.
I. City and Developer enter into this Agreement to satisfy the conditions
described in the foregoing Recitals. The purpose of this Agreement is to regulate and restrict
the sale, occupancy and rents of the Project's Restricted Units (defined below) for the benefit
of the Project occupants. The covenants in this Agreement are intended to run with the land
and be binding on Developer and its successors and assigns for the full term of this
Agreement. As to the Property, the parties intend that this Agreement shall supersede and
replace the Original Agreement.
NOW, THEREFORE, in consideration of the foregoing and other good and valuable
consideration, the Parties hereby agree as follows:
1. Definitions. The following terms have the meanings set forth in this Section
wherever used in this Agreement or the attached e~ibits.
"Area 1Vledian Income" or "AMI" means the area median income for Alameda
County, California, adjusted for household size, determined periodically by the California
Department of Housing and Community Development ("HCD") as published in Section
6932 of Title 25 of the California Code of Regulations ("Regulations") or successor
provision published pursuant to California Health and Safety Code Section 50093(c). If
HCD ceases to make such determination, Area Median Income shall be the median income
applicable to Alameda County, with adjustments for household size, as determined from time
to time by tYie U.S. Department of Housing and Urban Development ("HUD") pursuant to
the United States Housing Act of 1937 as amended, or such other method of inedian income
calculation applicable to the City of Dublin that HUD may hereafter adopt in connection with
such Act.
"Eligible Household" means a household whose income upon initial occupancy does
not exceed the maximum income level for Very-Low Income, Low-Income or Moderate-
Affordable Housing Regulatory Agreement between
City of Dublin and PCCP CS II Tralee Village, LLC Page 2 of 15
I! f~~
income, as applicable, as specified in Section 2 and Exhibit B and who is otherwise eligible
to rent a Restricted Unit.
"Inclusionary Ordinance" means Chapter 8.68 of the Dublin Municipal Code, as it
existed on the Effective Date.
"Low-Income" means an annual gross income that is 51% to 80% of AMI, adjusted for
actual household size.
"Moderate-Income" means an annual gross income that is 81% to 120% of AMI,
adjusted for actual household size.
"Project" means the development and construction of 130 residential units on the
Property, which consists of 114 market-rate units and 16 Restricted Units, as defined below.
"Property" means that certain real property located at 6601 Dublin Boulevard and
6599 Dublin Boulevard in the City of Dublin and more particularly described in Exhibit A
attached hereto and incorporated by this reference. ,
"Qualifying Rent" means a monthly rent, less a utility allowance as specified by the
Housing Authority of Alameda County, that shall not exceed: (i) for units that are restricted
for rental to Very Low-Income households, one-twelfth of thirty percent (30%) of fifty
percent (50%) of AMI, (ii) for units that are restricted for rental to Low-Income households,
one-twelfth of thirty percent (30°l0) of sixty percent (60%) of AMI and (iii) for units that are
restricted for rental to Moderate-Income households, a monthly rent which does not exceed
one-twelfth of thirty percent (30%) of one hundred ten percent (110%) of AMI, adjusted for
household size.
"Restricted Unit" means a one- or two-bedroom dwelling unit that is reserved for
occupancy at a Qualifying Rent by an Eligible Household in accordance with and as set forth
in Section 2 and Exhibit B.
"Transfer" means any sale, agreement to sell, assignment, encumbrance,
hypothecation, conveyance, license, lease (other than the leasing of commercial space or
individual residential units within the Project) or transfer of the whole or any part of
Developer's interest in the Properiy or the Project to any person or entity that is not an
Affiliate. For the purposes hereof, an "Affiliate" shall mean, with respect to any person, any
other person controlled by, controlling or urider common control with such person. The term
"person" as used herein will be interpreted broadly to include, without limitation, any
individual, corporation, company, partnership, limited liability company or any other type of
entity. The term "control" (including all inflected forms thereof~ means the possession,
directly or indirectly, of the power to direct or cause the direction of the management and
policies of any person, whether through ownership of voting securities or otherwise.
"Very Low-Income" means an annual gross income that is 50% or less of AMI,
adjusted for actual household size.
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2. Use and Affordabilitv Restrictions. Except as provided in Sections 2.4 and
2.6, Developer hereby covenants and agrees, for itself and its successors and assigns, that the
Property shall be used solely for the construction and operation of a 130-unit multi-family
rental housing development in compliance with the Development Approvals and the
requirements set forth herein. Developer represents and warrants that it has not entered into
any agreement that would restrict or compromise its ability to comply with the occupancy
and affordability restrictions set forth in this Agreement, and Developer covenants that it
shall not enter into any agreement that is inconsistent with such restrictions without the
express written consent of City.
2.1 Affordability Requirements. For a term of fifty-five (55) years
commencing upon the Effective Date, occupancy of the Restricted Units shall be limited to
Eligible Households in the number and in accordance with the income limitations set forth in
Exhibit B attached hereto and incorporated by this reference. The income levels and other
qualifications of applicants for Restricted Units shall be certified pursuant to Section 3 of
this Agreement. In the event that recertification of a tenant's household income indicates
that the number of Restricted Units actually occupied by Eligible Households falls below the
number reserved for each respective income group as specified in Exhibit B, Developer shall
rectify the condition by renting the next available Restricted Unit to an Eligible Household(s)
from that income group until the required income mix is achieved.
2.2 Effect of Changes in Tenant Income. Notwithstanding the foregoing,
no tenant qualifying for a Restricted Unit shall be denied continued occupancy of a unit in
the Project because, after admission, such tenant's adjusted household income increases to
exceed the qualifying limit for such tenant. If a tenant who at initial occupancy qualified as
Very Low-, Low- or Moderate-Income, such tenant shall be treated as continuing to be of
Very-Low, Low- or Moderate-Income, as applicable, so long as the tenant's household
income does not~exceed 140% of the applicable income limit. A tenant shall be deemed a
"Disqualified Tenant" when the tenant's household income exceeds 140% of the applicable
income limit. A Disqualified Tenant shall continue to qualify as a Very Low-, Low-, or
Moderate-Income tenant, as applicable, until Developer has notified the City of its
designation of another unit of comparable size within the Project as a Restricted Unit. Upon
such notification, the unit so designated shall immediately (or at a subsequent time specified
in the notification) become a Restricted Unit, and the unit occupied by the Disqualified
Tenant shall no longer be a Restricted Unit.
2.3 Rents for Restricted Units. Rent charged to, and paid by, a tenant for
Restricted Units shall be not more than Qualifying Rent.
2.4 Restricted Unit Desi~n, Location, and Size. The Restricted Units shall
be of the same general design and appearance as the other market-rate units in the Project
approved by the City. Section 8.68.030.E of the Inclusionary Ordinance provides that the
Restricted Units shall be reasonably dispersed within the Project. The Diagram of Location of
Inclusionary Units, attached hereto as Exhibit C, shows the location of the Restricted Units
as proposed by the Developer, and the City hereby finds that the Restricted Units are
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reasonably dispersed within the Project. Developer may change the location of Restricted
Units either with the approval of the City's Community Development Director or pursuant to
the terms of Section 2.2. If as a result of such changes the City finds that the Restricted
Units are not reasonably dispersed throughout the Project, Developer shall promptly change
the location of the Restricted Units upon City's request.
2.5 Equal Access to Facilities and Services. Tenants of Restricted Units
shall have equal access to all services and facilities offered to tenants of dwelling units in the
Project that are not Restricted Units.
2.6 Sale of Units. Developer shall not convert the Property or the Project
to condominium or cooperative ownership or sell condominium or cooperative conversion
rights to the Properly or the Project during the term of this Agreement, other than in
conformity with the City's Condominium Conversion Regulations set forth in Chapter 8.54
of the Dublin Zoning Ordinance. In the event the Project is converted to condominium
ownership, this Agreement shall terminate and the Inclusionary Ordinance's requirements
applicable to ownership units shall apply for the full term specified in the Inclusionary
Ordinance.
2.7 Non-Discrimination; Compliance with Fair Housin~ L~ aws. There shall
be no discrimination against or segregation of a person or of a group of persons on account
of race, color, religion, creed, sex, sexual orientation, marital status, familial status, ancestry
or national origin in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of
the Property or the Project, nor shall Developer or any person claiming under or through
Developer establish or permit any such practice or practices of'discrimination or segregation
with reference to the selection, location, number, use or occupancy of tenants, lessees,
subtenants, sublessees or vendees in the Project. Developer shall ensure that language
prohibiting such discrimination shall be included in all deeds, leases and contracts executed
by Developer or its successors and assigns with respect to the Project and the Property.
Developer shall comply with state and federal fair housing laws in the marketing and rental
of the units in the Project.
3. Reportin~Requirements.
3.1 Tenant Verification. Developer or its authorized agent shall obtain
from each household prior to initial occupancy of each Restricted Unit, and on every
anniversary thereafter, written documentation verifying each tenant's eligibility containing
all of the following, including additional documentation as City may reasonably require
(collectively hereinafter "Written Verification"):
a. Number of people in the household; and
b. Total household income.
Developer or its authorized agent shall retain Written Verification for not less than
three (3) years, and upon City's request, shall make the Written Verification available for
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inspection by City and shall provide copies of the Written Verification to City. Developer or
its authorized agent may require each Eligible Household to verify the Written Verification.
Absent manifest error by the tenant, Developer shall be entitled to rely upon the information
contained in a Written Verification and shall not be responsible for any factual inaccuracy
contained therein or in any other materials submitted to Developer by an Eligible Household.
3.2 Annual Report; Inspections. Developer shall submit an annual report
("Annual Report") to the City in conformity with the requirements of Section 8.68.OSOB of
the Inclusionary Ordinance, together with a verification that the Project is in compliance with
the requirements of this Agreement. The Annual Report shall, at a minimum, include the
following information for each Restricted Unit in the Project: (i) unit number; (ii) number of
bedrooms; (iii) current rent and other charges; (iv) dates of any vacancies in a Restricted Unit
for a period of more than 30 consecutive days during the previous year; (v) number of people
residing in the unit as determined through the written verification; (vi) total household
income of residents as determined through the written verification; and (vii) documentation
of source of household income. Upon City's request, Developer shall include with the
Annual Report, copies of the Written Verification for each household Developer obtained
pursuant to Section 3.1 above, and such additional information as City may reasonably
request from time to time in order to show compliance with this Agreement. The Annual
Report shall conform to the format described in Exhibit 9 of the City's Guidelines to the
Inclusionary Zoning Ordinance Regulations, more particularly described in Exhibit D
attached hereto and incorporated herein by reference ("Guidelines"). Developer shall permit
representatives of City to enter and inspect the Restricted Unit, or Units, as the case may be,
during reasonable business hours in order to monitor compliance with this Agreement upon
24 hours advance notice of such visit to Developer or to Developer's management agent.
4. Term of A~reement.
4.1 Term of Restrictions. This Agreement shall remain in effect through
the SSth anniversary of the Effective Date.
4.2 Effectiveness Succeeds Conveyance of Propertv. This Agreement shall
remain effective and fully binding for the full term hereof regardless of any sa1e, assignment,
transfer, or conveyance of the Property or the Project, unless this Agreement is terminated
earlier by City in a recorded writing.
4.3 Reconvevance. Upon the termination of this Agreement, the Parties
agree to execute and record appropriate instruments to release and discharge the terms of this
Agreement; provided, however, the execution and recordation of such instruments shall not
be necessary or a prerequisite to the termination of this Agreement in accordance with its
terms.
5. Bindin~Upon Successors; Covenants to Run with the Land. Developer
hereby subjects its interest in the Property and the Project to the covenants and restrictions
set forth in this Agreement. The City and Developer hereby declare their express intent that
the covenants and restrictions set forth herein shall be deemed covenants running with the
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land and shall be binding upon and inure to the benefit of the heirs, administrators, executors,
successors in interest, transferees, and assigns of Developer and City, regardless of any sale,
assignment, conveyance or transfer of the Property, the Project or any part thereof or interest
therein. Each reference in this Agreement to a specifically named party shall be deemed to
mean a reference to the successor of each such Party. Any successor-in-interest to
Developer, including without limitation any purchaser, transferee or lessee of the Property or
the Project (other than the tenants of the individual dwelling units within the Project) shall be
subject to all of the duties and obligations imposed hereby for the full term of this
Agreement. Each and every contract, deed, ground lease or other instrument affecting or
conveying the Property or the Project or any part thereof, shall conclusively be held to have
been executed, delivered and accepted subject to the covenants, restrictions, duties and
obligations set forth herein, regardless of whether such covenants, restrictions, duties and
obligations are set forth in such contract, deed, ground lease or other instrument. If any such
contract, deed, ground lease or other instrument has been executed prior to the date hereof,
Developer hereby covenants to obtain and deliver to City an instrument in recordable form
signed by the parties to such contract, deed, ground lease ar other instrument pursuant to
which such parties acknowledge and accept this Agreement and agree to be bound hereby.
Developer agrees for itself and for its successors that in the event that a court of
competent jurisdiction determines that the covenants herein do not run with the land, such
covenants shall be enforced as equitable servitudes against the Property and the Proj ect in
favor of City.
The Parties hereby declare that it is their understanding and intent that the burden of
the covenants set forth herein touch and concern the land in that they restrict the use of the
Property. The Parties further declare that it is their understanding that the benefit of such
covenants touch and concern the land by enhancing and increasing the enjoyment and use of
the Project by Eligible Households. The covenants, conditions and restrictions hereof shall
apply uniformly to the Property in order to establish and carry out a common plan for the
use, development and improvement of the Property.
6. Propertv Mana~ement• Repair and Maintenance; Marketing.
6.1 Mana~ement Responsibilities. Developer shall be responsible for all
management functions with respect to the Property and the Project, including without
limitation, the selection of tenants, verification and reverification of household income and
eligibility, evictions, collection of rents and deposits, maintenance, landscaping, routine and
extraordinary repairs, replacement of capital items, and security; subject to the Easement,
Joint Maintenance and Use Agreement dated July 3, 2008, executed by Pfeiffer Ranch
Investors, Inc. and recorded in the Official Records of Alameda County on July 10, 2008 as
Instrument No. 2008211866, as amended from time to time. Except as City may otherwise
agree in writing, City shall have no responsibility for management or maintenance of the
Properry or the Project. The contracting of management services to a management entity
shall not relieve Developer of its primary responsibility for proper performance of
management duties.
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6.2 Mana~ement EntitX. City shall have the right to review and approve
the qualifications of the management entity proposed by Developer for the Project. The
contracting of management services to a management entity shall not relieve Developer
of its primary responsibility for proper performance of management duties. The City
approves Apartment Management Consultants as the initial management entity.
6.3 Repair and Maintenance. Throughout the term of this Agreement,
Developer shall at its own expense, maintain the Property and the Project in good physical
condition and repair, in conformity with all applicable state, federal, and local laws,
ordinances, codes, and regulations, and shall not commit waste with respect to the Project.
6.4 Ins~ection. Developer shall permit representatives of City to enter
upon and inspect the Property and the Project during reaso~nable business hours upon tweniy-
four (24) hours advance notice to Developer or Developer's management agent.
6.5 Intentionally Omitted.
6.6 Marketin~; Marketin~ and Mana~ement Plan; Approval and .
Amendments. As soon as practicable following completion of Project construction,
Developer shall rent the Restricted Units to Eligible Households. Developer shall give
priority for Restricted Units to Eligible Households in accordance with the Marketing and
Management Plan described below and the selection criteria specified in Paragraph D of
Section 8.68.050 of the City's Inclusionary Ordina.nce, unless compliance with such criteria
is prohibited by state or federal sources of financing for the Project or state or federal law.
Within thirty (30) calendar days of Developer's first rental of a Restricted Unit,
Developer shall sutimit for City review and approval, a plan for marketing and managing the
Restricted Units ("Marketing and Management Plan") in accordance with Section 4.11 of
the Guidelines, which approval shall not be unreasonably withheld, conditioned or delayed.
The Marketing and Management Plan shall address in deta.il how Developer plans to market
the Restricted Units to Eligible Households in accordance with fair housing laws and the
tenant selection criteria specified in the Inclusionary Ordinance, and how Developer plans to
verify the eligibility of Eligible Households. The Plan shall also describe the management
team and shall address how the Developer and the management entity plan to manage and
maintain the Restricted Units. The Plan shall include the proposed management agreement
and the form of rental agreement that Developer proposes to enter into with tenants of
Restricted Units. Developer shall abide by the terms of the Marketing and Management Plan
in marketing, managing, and maintaining the Property and the Project and throughout the
term of this Agreement, and shall submit proposed modifications to City for its review and
approval.
If City has not responded to any submission of the Management and Marketing Plan,
the proposed management entity, or a proposed amendment or change to any of the
foregoing within 30 days following City's receipt of such plan, proposal or amendment, the
plan, proposal or amendment shall be deemed approved by City.
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6.7 Fees, Taxes, and Other Levies. Developer shall be responsible for
payment of all fees, assessments, taxes, charges, liens and levies, including without
limitation possessory interest taxes, if applicable, imposed by any public authority or utility
company with respect to the Property or the Project, and shall pay such charges prior to
delinquency. However, Developer shall not be required to pay any such charge so long as (a)
Developer is contesting such charge in good faith and by appropriate proceedings, (b)
Developer maintains reserves adequate to pay any contested liabilities, and (c) on final
detertnination of the proceeding or contest, Developer immediately pays or discharges any
decision or judgment rendered against it, together with all costs, charges and interest.
6.8 Insurance Covera~e. Throughout the term of this Agreement
Developer shall maintain at Developer's expense comprehensive general liability insurance
issued by a carrier licensed by the State of California with a Best's rating of not less than
A:VII providing aggregate limits of not less than Two Million Dollars ($2,000,000),
providing coverage for bodily injury, death and property damage, naming the Indemnified
Parties (as defined in Section 10) as additional insureds and providing for notice to City prior
to cancellation or reduction in coverage. Prior to first occupancy of the Project, Developer
shall provide City with evidence of such coverage in such form as City may reasonably
request.
6.9 Prope .rt~Dama~e or Destruction. If any part of the Project is damaged~
or destroyed, to the extent that the Developer repairs or restores damaged or destroyed
market-rate units, Developer shall similarly repair or restore damaged or destroyed Restricted
Units substantially concurrently therewith, consistent with the occupancy and rent
restriction requirements set forth in this Agreement.
6.10 Intentionally Omitted.
6.11 Intentionally Omitted.
7. Recordation of Memorandum of A~reement; No Subordination. Developer
and City shall execute and acknowledge a memorandum of this Agreement
("Memorandum") substantially in the form attached.hereto as E~ibit E. The City shall
record the Memorandum in the Official Records of Alameda County. Developer hereby .
represents, warrants and covenants that this Agreement shall not be subordinated in priority
to any lien (other than those pertaining to taxes or assessments), encumbrance, or other
interest in the Property or the Project, other than those liens, encumbrances or other interests
of record on the date of this Agreement. If at the time the Memorandum is recorded, a lien
securing Project financing has been recorded against the Project in position superior to this
Agreement, upon the request of City, Developer hereby covenants and agrees to promptly
use all commercially reasonable efforts to obtain the lender's agreement to subordinate such
interest to this Agreement consistent with the intent of and in accordance with this Section,
and to provide such evidence thereof as City may reasonably request.
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Transfer and Encumbrance.
8.1 Restrictions on Transfer. During the term of this Agreement, except as
permitted pursuant to this Agreement, Developer shall not make or permit the occurrence of
any conveyance, sale or lease (except as to individual dwelling units) of the Project or the
Property without the prior written cansent of the City; provided, however, City shall not
withhold its consent to the sale, transfer or other disposition of the Project, in whole or iri
part, provided that (i) the Project is and shall continue to be operated in compliance with this
Agreement; and (ii) the transferee expressly assumes, in writing, all obligations of
Developer imposed by this Agreement. After any sale, transfer or other disposition of the
Project, or porEion thereof, in which the transferee executes all documents reasonably
requested by the City with respect to the assumption of the Developer's obligations under
this Agreement with respect thereto, Developer shall be released from any obligations
hereunder with respect to the portion of the Project transferred.
8.2 Encumbrances. Developer agrees to use commercially reasonable
efforts to ensure that any deed of trust secured by the Proj ect shall contain each of the
following provisions: (i) the holder of such deed of trust shall use commercially reasonable
efforts to provide to City a copy of any notice of default issued to Developer concurrently
with provision of such notice to Developer (provided however, the failure to do so shall not
impair such holder's rights and remedies); and (ii) City shall have the reasonable right, but
not the obligation, to cure any default by Developer within the same period of time provided
to-Developer for such cure, extended by an additional thirty (30) days.
8.3 Mort~a~ee Protection. No violation of any provision contained herein
shall defeat or render invalid the lien of any mortgage or deed of trust made in good faith and
for value upon all or any portion of the Project or the Property, and the purchaser at any
trustee's sale, foreclosure sale, or deed in lieu thereof, shall not be liable for any violation of
any provision hereof occurring prior to the acquisition of title by such purchaser. Such
purchaser shall be bound by and subject to this Agreement from and after such trustee's sale
foreclosure sale, or deed in lieu thereof. Promptly upon determining that a violation of this
Agreement has occurred, City shall give written notice to the holders of record of any
mortgages or deeds of trust encumbering the Project or the Property that such violation has
occurred.
9. Default and Remedies.
9.1 Events of Default. Developer's failure to cure any default in
performance of Developer's obligations under this Agreement within thirty (30) days
following City's delivery of a notice of default shall constitute an Event of Default hereunder
and shall entitle the City to proceed with any of the remedies described below.
Notwithstanding the foregoing, if the default is such that it is not reasonably capable of being
cured within thirty (30} days, an Event of Default shall not arise hereunder if Developer
commences to cure the default within 30 days and thereafter prosecutes the curing of such
default to completian with due diligence and in good faith, but in no event later than ninety
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(90) days after receipt of City's notice of default or such longer period as City may agree to
in writing.
a. Bring an action for equitable relief seeking the specific
performance of the terms and conditions of this Agreement, and/or enjoining, abating, or
preventing any violation of such terms and conditions, and/or seeking declaratory relief;
b. For violations of obligations with respect to rents for Restricted
Units, impose as liquidated damages a charge in an amount equal to the actual amount
collected in excess of the Qualifying Rent;
c. Pursue any other remedy allowed at law or in equity.
9.2 Remedies Cumulative. Each of the remedies provided herein is
cumulative and not exclusive. The City may exercise from time to time any rights and
remedies available to it under applicable law or in equity, in addition to, and not in lieu of,
any rights and remedies expressly provided in this Agreement.
10. Indemnification. Notwithstanding the insurance coverage required hereunder,
Developer shall defend (with counsel approved by City), indemnify and hold the City and its
officials, officers, directors, employees, and agents (collectively, the "Indemnified Parties")
harmless from and against any and all losses, damages, liabilities, claims, demands,
judgments, actions, court costs, and legal or other expenses (including reasonable attorneys'
fees) arising from or in connection with or in any way related to: (i) Developer's
performance or failure to perform any obligation required by this Agreement; or (ii) any act
or omission by Developer, or any of Developer's contractors, subcontractors, agents,
employees, licensees or suppliers related to the Project or the Property, except to the extent
arising from the gross negligence or willful misconduct of an Indemnified Party. The
provisions of this Section shall survive the expiration or earlier termination of this
Agreement.
11. Miscellaneous.
11.1 Amendments. This Agreement may be amended or modified only by a
written instrument signed by both Parties.
11.2 No Waiver. Any waiver by City of any term or provision of this
Agreement must be in writing. No waiver shall be implied from any delay or failure by City
to take action on any breach or default hereunder or to pursue any remedy allowed under this
Agreement or applicable law. No failure or delay by City at any time to require strict
performance by Developer of any provision of this Agreement or to exercise any election
contained herein or any right, power or remedy hereunder shall be construed as a waiver of
any other provision or any succeeding breach of the same or any other provision hereof or a
relinquishment for the future of such election.
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11.3 Notices. Except as a~herwise specif ed herein, alI no~ices to be sent
gursuant to this Agreernent shall be ma.dc in vvriting, and sent ta the I'azties at thei£ resgeetive
addr~sses spec~ec~ b~tavv ar t~ sucl~ a~h~r a.dd~~ss as a I'a.~ty rna~ c~esig~at~: by wri~~~ ~o~ce
delivered to the ather- ~arti~s in acc~rtlance wit~ this Section. Ail such notices shall be sent
by.
a. personat delivery, in which case notice is effective upon
delivery;
b. certified or registered mail, return receipt requested, in which
case notice shall b~ d~med delivered upon ~~c~ipt if deliv~ry is confirmed by a return
receipt;
c. nationally recognized overnight courier, with charges prepaid or
charged to the sender's accc>unt, in ~vhieh case natiee is effective an delivery if c~elivery is
confirmed hy the delivery s~rviee;
d. facsimile transmission, in which case notice shall be deemed
delivered upon transmil#al, provided that (a) a duplica#e cap3~ of the notice is promptly
delivered by first-~lass or certified ~nail or by overnight delivery, or {b) a transmission report
is generated reflecting the accurate transmission thereof. Any notice given by facsimile shall
be considered ta have been received an the next bttsiness day if it is received ~~~er 5:00 p.m.
recipient's time ar as~ a nant~usiness day.
City: City of Dublin
100 Civic Pl~za
D~blin, CA 94558
Attention: City Manager
Facsimi}e: (925} 833-6651
Developer: PCCP C5 II Tralee Village, LLC
cJo Signature Deveiopment Group, Inc.
220i Brr~adway, Suite 604
Oakland, CA 94612
Attention: 1b1i-. Patrick Van Ness
Facsimile: (Sl.a) 832-2638
11.4 Furt~er A~surances. The Parties shall use commercially reasonable
efforts to execute, acknowledge and deliver to the other such other documents and
instruments, and shali use commercialiy reasonabie efforts to take sucfi ather actions, as
either shail reasonably request as may be neeessary tQ earry out t~te intent af this Agreement.
11.5 Parties Not Co-Venturers. Nothing in this Agreement is intended to ar
shall establish ~t~e Pai°~ies as ~arirlei•s, co-veti~urei°s, oi- pt•incipal ar~d agent with or~e another.
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11.6 Action bv the City. Except as may be otherwise specifically provided
herein, whenever any approval, notice, direction, consent or request by the City is required or
permitted under this Agreement, such action shall be in writing, and such action may be
given, made or taken by the City Manager or by any person who shall have been designated
by the City Manager, without further approval by the City Council.
11.7 Non-Liabili of Cit~and City Officials, Employees and A~ents. No
member, official, employee or agent of the City shall be personally liable to Developer or
any successor in interest, in the event of any default or breach by the City, or for any amount
of money which may become due to Developer or its successor or for any obligation of City
under this Agreement.
11.8 Non-Liabilitv of Developer, Employees and A~ents. No owner,
member, official, officer, director, employee or agent of the Developer shall be personally
liable to the City or any successor in interest, in the event of any default or breach by the
Developer, or for any amount of money which may become due to City or its successor or
for any obligation of Developer under this Agreement.
11.9 Headings; Construction. The headings of the sections and paragraphs
of this Agreement are for convenience only and shall not be used to interpret this Agreement.
The language of this Agreement shall be construed as a whole according to its fair meaning
and not strictly for or against any Party.
11.10 Time is of the Essence. Time is of the essence in the performance of
this Agreement.
11.11 Governin~Law. T'his Agreement shall be construed in accordance with
the laws of the State of California without regard to principles of conflicts of law.
11.12 Attornevs' Fees and Costs. If any legal or administrative action is
brought between the parties to interpret or enforce the terms of this Agreement, the
prevailing party shall be entitled to recover all reasonable attorneys' fees and costs incurred
in such action.
11.13 Severabilitv. If any provision of this Agreement is held invalid, illegal,
or unenforceable by a court of competent jurisdiction, the validity, legality, and
enforceability of the remaining provisions shall not be affected or impaired thereby.
11.14 Entire A~reement; Exhibits. This Agreement, together with Exhibits A
throu~ and the Development Approvals issued by the City for the Project contains the
entire agreement of Parties with respect to the subject matter hereof, and supersedes all prior
oral or written agreements between the Parties with respect thereto. The exhibits attached
hereto are incorporated herein by this reference.
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11.15 Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be an original and all of which together shall constitute one
agreement.
SIGNATURES ON FOLLOWING PAGE.
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IN WITNESS WF~REOF, the Parties have executed this Agreement effective as of
the date first written above.
CITY OF DUBLIN,
a municipal corporation
By:
Joni Pattillo, City Manager
Attest:
Caroline Soto, City Clerk
Approved as to form
John Bakker, City Attorney
PCCP CS II TRALEE VILLAGE, LLC,
a Delaware limited liability company
By:_
Name:
Its:
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Exhibit A
PROPERTY DESCRIPTION
Real property in the County of Alameda, State of California, described as follows:
Lot 4 of Tract 7457, Filed June 13, 2006, Book 291, Pages 29
through 37, inclusive, Alameda County Records.
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Exhibit B
a. OCCUPANCYAND RENT RESTRICTIONS
Restricted Unit Type Number of Maximum Initial Maximum
Required Income Limit* Affordable Rent
Restricted Units
1-Bedroom 3 VLI 50% of AMI 30% x 50% of ANII
2 LI 80% of AMI 30% x 60% of AMI
5 MOD 120% of AMI 30% x 110% of AMI
2-Bedroom 2 VLI 50% of AMI 30% x 50% of AMI
1 LI 80% of AlVII 30% x 60% of AMI
3 MOD 124% of ANII 30% x 110% of AMT
Total Restricted Units 16
Total Unrestricted 114
Units ~ ~
Total Units 130
AMI =Area Median Income
VLI = Very Low-Income
LI = Low Income
MOD = Moderate-Income
*Maximum Initial Income Limit: Maximum income for a household to qualify for initial
occupancy.in the specified Restricted L1nit is established annually by HCD in the Regulations
(Section 6932 of Title 25 of the California Code of Regulations) and may differ from the stated
percentage of AMI. ~
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E~ibit C
DIAGRAM OF LOCATION OF INCLUSIONARY UNITS
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Affordable Housing Exhibit
6601 Dublin Boulevard
Building A
Floor 2
BULDNG A
SECOND FLOOR PLAN
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BtJLDNG A
11-~D FLOOR PLAN
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BI~DNG A
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Tf-~D FLt~t~R PLAN
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EXHIBIT D 1 /
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GUIDELINES TO THE INCLUSIONARY ZONING ORDINANCE REGULATIONS
CITY OF DUBLIN
TABLE OF CONTENTS
1 LIST OF EXHIBITS 4
2 GUIDELINES TO THE INCLUSIONARY ZONING ORDINANCE
REGULATION 5
3 DEFINITION OF TERMS 6
4 REQUIREMENTS FOR DEVELOPERS 12
4.1 Overview of the Inclusionary Zoning Process 12
42 Determining the Number and Size of Units Required l2
4.3 How to Calculate the Inclusionary Obligation 13
4.4 How to Calculate How Many Units Must Be Constructed and How Many
Units of the Obligation May be Satisfied with an In-Lieu Fee 13
4.5 How to Calculate the Amount of the In-Lieu Fee 14
4.6 How to Calculate How Many BMR Units Must Be Provided for Each
Income Level 14
4.7 How to Determine the Size of BMR Units 15
4.8 How to Determine the Location of BMR Units Within the Development 16
4.9 Housing Agreements 17
4.10 Procedures for Initial Sale of BMR Units 18
4.10.1 The Marketing Plan for Ownership Units 18
4.102 Application and Screening Process 19~
4.10.3 Sale price of BMR Units 22
4.11 Procedures for Initial Rental of BMR Units 23
4.11.1 The Management Plan for Rental BMR Units 23
4.11.2 Application and Screening Process 24
4.11.3 Calculating Maximum Rent 25
4.11.4 Annual Report 25
4.11.5 Annual Monitoring by City 26
5 BUYER AND RENTER QUALIFICATIONS FOR BMR UNITS 27
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GUIDELINES TO THE 1NCLUSIONARY ZONING ORDINANCE REGULATIONS
5.1 Buyer Qualifications 27
5.2 Renter Qualifications 28
5.3 Household Size 28
5.4 Total Household Income 29
5.4.1 , Gross Household Income 29
5.4.2 Income Calculation 30
5.4.3 Assets 31
5.5 Credit Score 32
5.6 Alternative Credit History Paramefers 32
5.7 Preference Points 33
6 REQUIREMENTS FOR BUYERS OF BMR UNITS 36
6.1 Financing Requirements 36
6.1.1 Acceptable Loan Products for Purchase and Refinancing of a BMR Unit36
6.1.2 Prohibited Loan Products 36
6.2 Down Payrnent 36
6.2.1 Down Payment Assistance 37
6.3 Debt to Income Ratio 37
6.4 First Mortgage Loan Value Ratio 37
6.5 Closing Costs and Deposits 37
6.6 Homebuyer Education Program ~ 37
6.7 Documents that Each Buyer Must Sign 37
6.7.1 Highlights of the Resale Restriction Agreement 37
7 REQUIREMENTS FOR RESALE OF BMR LTNITS 40
7.1 Resale Procedure 40
7.2 Calculating Restricted Resale Price 41
7.3 Fees Associated with the Selling of a BMR Unit 41
7.4 CapitalImprovements 41
7.4.1 Procedure for Receiving Approval of Capital Improvements 41
7.4.2 Special Assessments 43
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8 REQUIREMENTS FOR OWNER' S OF BMR SECONDARY UNITS ~ 46
8.1 Rental Requirements 46
8.2 Reporting Requirements 46
8.3 Annual Report - Inspections 46
8.4 Management Responsibilities 47
GUIDELINES TO THE INCLUSIONARY ZONING ORDINANCE REGULATIONS
7.4.3 Capital Improvements Cap 43
7.4.4 List of Eligible and Ineligible Capital Improvements 43
7.4.5 Building Permits 44
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1 LIST OF EXHIBITS
Exhibit 1 Resale Restriction Agreement and Option to Purchase
Exhibit 2 Performance Deed of Trust
Exhibit 3 Sample Application for Inclusionary Unit
Exhibit 4 Sample Ownership BMR Unit Application Packet
Exhibit 5 Sample Credit Report Authorization and Release
Exhibit 6 Excel Spreadsheet to Calculate Ownership Sale Prices
Exhibit 7 State of California Housing and Community Development Department Income
for Guidelines (Example 2008)
Exhibit 8 Current Alameda County Housing Authority Utility Allowance Sheet
Exhibit 9 Annual Report for Rental Units
Exhibit 10 Sample Marketing Plan
Exhibit 11 Internal Revenue Service (IRS) Code 26 USC, Section 61
Exhibit 12 Sample Management Plan
Exhibit 13 Reservation Instrument
Exhibit 14 Secondary Unit Regulatory Ageement and Declaration of Restrictive
Covenants
For a copy of the above-referenced Exhibits, please contact the City of Dublin
Community Development Department at (925) 833-6610.
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GUIDELINES TO THE INCLUSIONARY ZONING ORDINANCE
REGULATION
This document is the Guidelines (these "Guidelines") to the City's Inclusionary Zoning Ordinance
Regulations (the "Ordinance") set forth in the City's Municipal Code at Chapter 8.68. The City
Council's purpose in adopting the Ordinance is to increase the diversity of housing prices/rents in the
community and ensure that the range of prices/rents continues over time.
In general, the Ordinance requires that 12.5% of the units constructed in a Residential Development
project of 20 residential units or more be restricted in occupancy and in sale price or rent charged.
Such restricted units are referred to as Below Market Rate (BMR) Units. For for-sale units, 60% must
be affordable to moderate-income households and 40% to low-income households. For rental units,
50% must be affordable to Moderate-Income households, 20% to Low-Income households and 30%
to Very Low-Income households. (Section 8.68.030.B)
The purpose of these Guidelines is to assist the layperson in interpreting the Ordinance. The
Guidelines will assist developers early in the development process so that Residential Development
projects are sensitively designed from the beginning in compliance with the requirements of the
Inclusionary Zoning Ordinance. In addition, the Guidelines will inform developers, management
firms and owners of BMR Secondary Units of the procedures for selling and renting BMR Units and
Secondary Units. Furthermore, the Guidelines will provide households interested in renting or
purchasing a BMR Unit with an overview of the eligibility requirements, the application and
screening process, the restrictions on ownership BMR Units, and the procedures for reselling a BMR
Unit.
These Guidelines should be read in conjunction with the Ordinance. While every effort has been
made to ensure that these Guidelines are consistent with the Ordinance, if there is any conflict with
these Guidelines and the Ordinance, the terms of the Ordinance shall prevail. In addition, the
provisions of a Housing Agreement or Resale Restriction Agreement (or like Agreement) recorded
against a BMR Unit shall prevail over any general requirements of the Ordinance.
Users of these Guidelines are encouraged to seek their own legal counsel to aid in understanding the
requirements of the City's Inclusionary Program. For any general questions regarding the
Guidelines, users may ca11925-833-6610.
The effective date of these Guidelines is January 2, 2009. The City will review and to the extent
necessary update these Guidelines annually. The Community Development Director may make
interim revisions, interpretations or clarifications to these Guidelines provided that he or she
considers the revision, interpretation, or clarification to be minor and consistent with the purposes of
the Inclusionary Zoning Regulations and the Guidelines. Any such revision, interpretation, or
clarification shall not become effective until posted on the City's website
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2 DEFINITION OF TERMS ~ ~
As used in these Guidelines, the following terms shall be defined as follows:
Administration Fees
• A$1,500 fee charged by the City to the BMR Owner for all sales and re-sales of BMR Units,
• A$500 fee charged by the City to the developer/property manager for the annual review of
rental developments
• A$200 fee charged by the City to the BMR Owner for requests to subordinate the Resale
Restriction Agreement and/or Performance Deed of Trust or requests to refinance a BMR unit
Fees may be adjusted from time to time by the City.
Affordable Housing Agreement
An agreement between the developer and the City for an ownership Residential Development project
which is recorded against the property containing the BMR Units; sets forth the developer's
Inclusionary Obligation and the method by which the developer will comply with the requirements of
the Inclusionary Zoning Ordinance; and requires, among other things, that the developer require
purchasers of BMR Units to execute and record a Resale Restriction Agreement and Option to
Purchase and Performance Deed of Trust.
Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants
An agreement between the developer and the City for a rental Residential Development project which
is recorded against the property containing the BMR Units; sets forth the developer's Inclusionary
Obligation and the method by which the developer will comply with the requirements of the
Inclusionary Zoning Ordinance; and requires, among other things, that the BMR Units are reserved
for occupancy by Very-Low, Low-, and/or Moderate-Income households at rents affordable to such
households for a period of not less than 55 years.
AMI or Area Median Income
The area median income adjusted for household size as published annually by the County of
Alameda's Department of Housing and Community Development (HCD).
Approved Capital Improvements
Capital improvements to BMR Units that have been approved by the City pursuant to the procedure
set forth in Section 7.4.1. The cost of such improvements may be added to the resale price of the
BMR Unit.
BMR Owner .
A household that owns a BMR Unit.
Below Market Rate (BMR) Units
A Below Market Rate or BMR Unit is a unit that is reserved for rent to Very-Low, Low, or
Moderate-Income households or for-sale to Low or Moderate Income households at a price or rent
that is affordable to such households. BMR Units have restrictions recorded against them to ensure
that they remain affordable for a period as set forth in the Housing Agreement or Resale Restriction
Agreement.
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• Rental units are deemed affordable if the annual rent does not exceed 30 /o of the maximum
income level for Very Low-Income, Low-Income, or Moderate-Income households, as
applicable, adjusted for household size.
• Owner-occupied units are deemed affordable if the sales price results in annual Housing
Expenses that do not exceed 35% of the maximum income level for Low- or Moderate-
Income households, as applicable, adjusted for household size.
Ca1HFA
The California Housing Finance Agency
City
The City of Dublin
Consent Agreement
An agreement between the City and a Qualified Household which authorizes the City to access and
review the Qualified Household's credit reports or other personal or financial information to verify a
Qualified Household's compliance with the Resale Restriction Agreement, the Ordinance and these
Guidelines. This agreement must be executed by purchasers of ownership BMR Units prior to the
close of escrow.
Domestic Partner
A legal or personal relationship between individuals who live together and share a common domestic
life, but are not joined in a traditional marriage or a civil union as formalized through a local or state
registry.
Homebuyer
A person who has not owned any interest in real property during the three-year period prior to the
date of the household's application to qualify for purchase of a BMR Unit, including without
limitation, real property in which a household member's name appears on title regardless of whether
the member's interest in such property results in a financial gain, such property is located in another
state or country, or the member has occupied such property as his or her primary residence. If any
person has had his or her name on title of a property, but the property was sold more than three years
ago from the date of application, the person is considered a Homebuyer.
Homebuyer Education Workshop for Below Market Rate Buyers
A HUD approved 8-hour course designed to provide basic education specific to Below Market Rate
Homebuyers. Refer to the City's web site for organizations that may offer this course at
www.ci.dublin.ca.us . The date on the completion certificate for the class must be within 6 months
of the date of application for a Below Market Rate unit.
Gross Household Income
"Gross Household Income" means all income, from whatever source derived, of all adult household
members (18 years of age and older), whether or not such income is exempt from Federal income tax.
Such income includes, but is not limited to, the following:
• Compensation received from an employer
• Compensation includes, but is not limited to salary, overtime pay, and other pay
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• Other pay includes, but is not limited to, compensation for special working conditions or one
time pay-out of unused vacation and sick leave.
• Alimony, spousal and child support
• Cash
• Pensions, if at an age where pension is being received as income
• Public benefits including, but not limited to, CalWorks, SSI, and disability income
• All interest, dividends, and royalties
• Income derived from private businesses
• Rentallncome
• Income from pensions
• Compensation for services rendered including fees, fringe benefits, commissions, tips, and
bonuses
• Stipend received for participation in a mentor, learning or education opportunity
• Gains from dealings in private andlor commercial property
• Gambling Winnings
• Annuities, life insurance, and endowment contracts
• Income from discharge of indebtedness
• Gross partnership contributions or distributions
• Income from an interest in an estate or trust
Exceptions:
1) Gross Household Income does not include income earned by a household member who is between
the ages of 18-26 and meets both of the following criteria:
• Is claimed as a dependent of a household member on such member's federal income
taxes; and
• Is a full time student (12+ units - school transcript must be provided)
2) Gross Household Income does not include payments to a household member from a governmental
fund income if all of the following requirements are satisfied:
• The payments are based on the recipient's or the recipient's family's financial need;
• The payments do not represent compensation for services rendered; and
• The payments are part of a governmental housing subsidy program including, but not
limited to, Section 8 federal housing assistance payments
(These) Guidelines
These Guidelines to. the Inclusionary Zoning Regulations
HCD
The California Department of Housing and Community Development.
HOA
Homeowner's Association
Housing Agreement
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An Affordable Housing Agreement, an Affordable Housing Regulatory Agreement and Dec arati n
of Restrictive Covenants or a Secondary Unit Regulatory Agreement and Declaration of Restrictive
Covenants or other Agreement that relates to Housing that may be adopted from time to time by the
City.
Housing Expenses
Principal, interest, taxes, insurances and HOA dues.
HUD
The United States Department of Housing and Urban Development.
Immediate Family Member
A mother, father, brother, sister, child, grandparent or grandchild.
Inclusionary Obligation
The number of BMR Units a developer is required to construct (or pay fees in lieu thereo fl in a
Residential Development project to~comply with the Inclusionary Zoning Regulations.
Inclusionary Zoning Regulations
Chapter 8.68 of the City of Dublin Municipal Code.
In-Lieu Fee
A fee paid by a developer in lieu of constructing BMR Units to satisfy up to 40% of its inclusionary
obligation.
Legal Resident
A citizen or other national of the United 5tates or a qualified alien as defined by the Federal Personal
Responsibility and Work Opportunity Reconciliation Act of 1996 ("PRWORA").
Low Income
Total Household Income that is 50% to 80% of AMI, adjusted for actual household size.
Management Plan
A plan required for rental Residential Developments that contains the information set forth in Section
4.11.1 of these Guidelines.
Marketing Plan
A plan required for ownership Residential Developments that contains the information set forth in
Section 4.10.1 of these Guidelines.
Maximum Income
The maximum income for an income category (Very-Low, Low-, or Moderate-Income) determined
periodically by HCD based on AMI: See Section 5.4 of these Guidelines for Maximum Incomes.
Moderate Income
Total Household Income that is 80% to 120% of AMI, adjusted for actual household size.
Performance Deed of Trust
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A deed of trust recorded against a BMR Unit by the City which secures a BMR Owner's complia e
with the Resale Restriction Agreement and Option to Purchase.
Preference Points
Points assigned to persons employed within the City of Dublin, public service employees working
within the City of Dublin, Dublin residents, Seniors (62+), persons who are permanently disabled
(with written verification from a physician or show receipt of SSI or SSDI), persons who are
immediate family members of a Dublin resident, and persons who are required to relocate from a
Dublin residence due to demolition of the residence or conversion of the residence from a rental to an
ownership unit. Persons with Preference Points are given priority over other Qualified Households in
the rental or purchase of a BMR Unit.
Principal Residence
The place where a person resides on a substantially full-time basis during not less than ten (10)
months per year. Children attending college and not living at home as their principal residence may
not be counted as a household member.
Priority List
A list which ranks Qualified Households based on the number of Preference Points received.
Qualified Household
A qualified household is defined in terms of financial relationships and can include any group of
persons, so long as such persons, when viewed as a whole, satisfy the eligibility requirements for a
household.
For an ownership BMR Unit or for a rental BMR Unit, a"qualified household" means a household
that satisfies the requirements listed in Section 5 of these Guidelines.
Resale Restriction Agreement and Option to Purchase, also known as "Resale Restriction
Agreement" .
An agreement between the City and a BMR Owner that is recorded against the BMR Unit and ,
among other restrictions, requires the unit to remain affordable to Low- or Moderate-Income
households usually for a period of 55 years or as outlined in the Housing Agreement, restricts the
resale price of the BMR Unit, requires the BMR Owner to notify the City upon refinancing, reselling
or changing the title of a BMR Unit, and provides the City with an option to purchase the BMR Unit
upon the occurrence of certain events.
Residential Development
This includes, without limitation, detached single-family dwellings, multiple-dwelling structures,
groups of dwellings, condominium or townhouse developments, condominium conversions,
cooperative developments, mixed use developments that include housing units, and residential land
subdivisions intended to be sold to the general public.
Secondary Unit
A legal secondary dwelling unit that has been approved by the City and that is reserved for
occupancy by Very Low-; Low- or Moderate-Income households at rents affordable to such
households.
Secondary Unit Regulatory Agreement and Declaration of Restrictive Covenants
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An a reement between the Cit and the owner of a Secondar Unit which is recarded a ainst t e~~~
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property containing the Secondary Unit and requires, among other things, that the Secondary Unit be
reserved for occupancy by Very-Low, Low-, or Moderate-Income households at rents affordable to
such households for an amount of time specified in the Affordable Housing Agreement or Affordable
Housing Regulatory Agreement and Declaration of Restrictive Covenants.
Senior
A person 62 years of age or older for the purpose of qualifying for preference points
Special Assessment
A proportional fee charged to the BMR Owner by an HOA to cover the cost of physical
improvements to the entire building.
Total Household Income
All Gross Household Income and assets received (as calculated pursuant to Sections 5.4.2 and 5.4.3).
Very-Low Income
Total Household Income that is fifty percent (50%) or less of AMI, adjusted for actual household
size.
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3 REQUIREMENTS FOR DEVELOPERS
3.1 Overview of the Inclusionary Zoning Process
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Residential Developments consisting of 20 residential units or more must comply with the
Inclusionary Zoning Regulations (Section 8.68.030(A)). In general, the Regulations require that
12.5% of the units constructed in a Residential Development be reserved for occupancy by For-Sale
Units to Moderate-Income households and Low-income households or rented at prices affordable to,
Very-Low=, Low-, and Moderate-Income households. Such restricted units are referred to as BMR
Units. (Section 8.68.030.A)
While the Regulations require that 12.5% of the units in the Residential Development be BMR Units,
the Regulations permit the developer to meet 5% of this obligation by paying an In-Lieu Fee. Thus,
there is a"must-build" requirement of 7.5% of the units in the Residential Development, and the
obligation with respect to the remaining 5% of the units may be satisfied by the payment of an In-
Lieu Fee. BMR Units must remain affordable for a period of 55 years, through affordability
restrictions recorded against the property.
In addition, the Inclusionary Zoning Regulations require that BMR Units:
• Be constructed concurrently with the market-rate units in the Residential Development;
• Have a similar range of bedrooms to the market-rate units in the Residential Development;
• Not be distinguished by design or materials from the market-rate units in the Residential
Development; and
• Be reasonably dispersed throughout the Residential Development.
A developer may also satisfy its Inclusionary Obligation by dedicating land or constructing BMR
Units off-site if the City Council makes the required findings. See Section 8.68.040 of the
Inclusionary Zoning Regulations for alternate methods of complying with the requirements of the
Ordinance.
3.2 Determinin~ the Number and Size of Units Required
Prior to submitting an application to the City for a Residential Development that includes 20 or more
residential units, the developer should begin thinking about how to comply with the Inclusionary
Obligation. As part of the initial project review, Housing Staff is available to discuss with the
developer options for meeting the Inclusionary Obligation. For example, if a developer intends to
build only the minimum number of BMR Units and to pay an In-Lieu Fee for the remaining units,
Housing Staff can, for planning purposes, provide the developer with the preliminary number of
BMR Units the developer would be required to build, the income levels and sizes of the required
BMR Units, and the amount of the In-Lieu Fee under the then-current fee schedule.
After a Residential Development application is submitted to the Community Development
Department for review, a Project Review Committee meeting is generally held. In this meeting City
Staff and interested agencies involved in the development process review the Residential
Development and give preliminary comments to the developer.
Prior to or following the Project Review Committee (PRC) meeting, Housing Staff will send a letter
to the developer indicating the developer's Inclusionary Obligation for the Residential Development
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as preliminarily proposed. A copy of this letter will also be directed to the City s Pro~ect P a er
responsible for the Residential Development. The purpose of this letter is to provide the developer
information on the Inclusionary Obligation as early as possible in the development process. The City
recognizes that the Residential Development is likely to evolve over time and that the Residential
Development will likely change prior to obtaining City entitlements. However, this information is
provided early in the process as a service to the developer for planning purposes.
The developer's final Inclusionary Obligation will be formalized in an Affordable Housing
Agreement between the City and the developer, prior to the recordation of the first final map or the
issuance of the first building permit, whichever occurs first, for the development.
3.3 How to Calculate the Inclusionary Obli~ation
Developers of projects subject to Section 8.68.030.A of the Inclusionary Zoning Regulations shall
construct 12.5% of the total number of dwelling units within the development as affordable units,
unless subject to an exception approved by the City Council. In making this calculation, any decimal
fraction less than or equal to 0.50 is disregarded, and a decimal fraction greater than 0.50 is construed
as a unit. Two examples of how the Inclusionary Obligation for a particular development is
calculated are shown in Figure 1.
FIGURE 1
Example 1: The developer proposes a 224-unit subdivision. 12.5% percent of 224 is 28.
The Inclusionary Obligation is 28 units of the original 224 units.
Example 2: The developer proposes a 316-unit subdivision. 12.5% percent of 316 is 39.5.
Rounding the decimal fraction down, the Inclusionary Obligation is 39 units of the original
316 units.
3.4 How to Calculate How Many Units Must Be Constructed and How Many Units of the
Obligation Mav be Satisfied with an In-Lieu Fee
The Ordinance permits a Developer to pay an In-Lieu Fee for up to 5% of its Inclusionary Obligation.
When the calculation of the fee results in a decimal fraction, the rounding rules contained in Section
8.68.030A are used.
Using the same examples from Figure 1, Figure 2 illustrates the calculation of the number of BMR
Units that may be subject to the In-Lieu Fee.
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FIGURE 2
Example 1: The developer proposes a 224-unit subdivision, for which the Inclusionary
Obligation is 28 units of the 224 units. 40% of 28 units =11.2 units. Disregarding the
fraction, the developer may pay an In-Lieu Fee far the remaining 11 units, and the
developer's "must-build" obligation would be 17 units. 11 + 17 = 28 units.
Example 2: The developer proposes a 316-unit subdivision, for which the Inclusionary
Obligation is 39 units of the 316 units. 40% of 39 units = 15.6 units. This number is
rounded up to 16 and In-Lieu Fees may be paid for this amount, instead of providing units.
The "must-build" obligation would be 23 units. 16 + 23 = 39 units.
3.5 How to Calculate the Amount of the In-Lieu Fee
The amount of the In-Lieu Fee is set by Resolution of the City Council. Resolution No. 56-02
provides that the In-Lieu Fee per BMR Unit is adjusted annuallyon July 1 to reflect the greater of the
percentage change either in a) the Bay Area Urban Consumer Price Index (CPI) as of February of
each year, or b) the United States Department of Housing and Urban Development (HUD) Fair
Market Rent limits for the Oakland Primary Metropolitan Statistical Area (PMSA) that are in effect at
the time. The fee as of July 1, 2008 is $ 91,916 per BMR Unit.
THE ENTIRE IN-LIEU FEE AMOUNT FOR THE RESIDENTIAL DEVELOPMENT IS DUE
AND PAYABLE UPON ISSUANCE OF THE FIRST BUILDING PERMIT FOR THE
RESIDENTIAL DEVELOPMENT.
Using the examples from Figures 1 and 2, Figure 3 illustrates how to calculate the amount of the In-
Lieu Fee.
FIGURE 3
Example L• The developer proposes a 224-unit subdivision. In-Lieu Fees may be paid for 11
units. 11 X$91,916 is $1,011,076 which is the amount of the In-Lieu Fee for the Residential
Development. This entire amount would be due prior to issuance of first building permit.
Example 2: The developer proposes a 316-unit subdivision. In-Lieu Fees may be paid for 16
units. 16 X$91,916 =$1,470,656 which is the amount of the In-Lieu Fee for the Residential
Development. This entire amount would be due prior to issuance of first building permit.
3.6 How to Calculate How Many BMR Units Must Be Provided for Each Income Level
Pursuant to Section 8.68.030.B of the Inclusionary Zoning Ordinance, the BMR Units included in
each Residential Development project must be allocated to households in the following manner:
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For-Salc Units :
^ 60% to moderate-income households
^ 40% to low-income households
~~~~ /
Rcntal Units: ~ -
^ 50% to moderate-income households
^ 20% for low-income households
^ 30% for very-low income households
Once again, if the allocation calculations results in a decimal fraction, the rounding rules contained in
Section 8.68.030.A apply. In addition, if the allocation calculation results in fewer units than would
otherwise be required; one additional unit should be allocated to the lowest income level with the
decimal fraction closest to 0.50. (Section 8.68.030.B)
Figure 4 illustrates how to calculate the number of units that must be provided at each income level
and how the rounding requirement is implemented:
FIGURE 4
FOR RENTAL BELOW MARKET RATE UNIT
The Residential Development includes 200 units. The Inclusionary
Obligation is 25 units. The developer chooses to pay an In-Lieu Fee for
40% of the units, which equals 10 units. The developer's must-build
requirement (7.5%) is 15 units.
• 50%0 of those 15 units would need to be restricted for Moderate-
Income households, 50% of 15 = 7.5
• 20% of those 15 units would need to be restricted for Low-Income
households, 20% of 15 = 3
• 30% of those 15 units would need to be restricted for Very Low-
Income households, 30% of 15 = 4.5
7.5+3+4.5=15
Since two of these numbers are fractions at exactly .5, the City of Dublin
would require that the unit be provided in the lower income category.
In this example the income- unit mix would be:
• 7 Moderate-Income units
• 3 Low-Income units
• 5 Very Low-Income units
3.7 How to Determine the Size of BMR Units
The Ordinance requires that the same proportion of bedrooms be reflected in the BMR Units as are in
the market rate units. Once again, the rounding conventions in Section 8.68.030.A are used, if the
allocations result in decimal fractions.
Figure 5 illustrates how to determine the number of BMR Units that must be provided at each unit
size:
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I
FIGURE 5
To determine bedroom requirement:
The developer proposes a 200-unit rental Residential Development and is paying In-
Lieu Fees for 40% of the BMR Units. The must build obligation is 15 units.
The Residential Development includes:
• 50 one-bedroom units (25 % of total)
• 100 two-bedroom units (50% of total)
• 50 three-bedroom units (25% of total)
Therefore:
• 25% of the BMR Units are to be one-bedrooms
• 50% of the BMR Units are to be two-bedrooms
• 25% of the BMR Units are to be three-bedrooms
To determine bedroom requirement per income category:
If 5 of the units are Very Low-Income, using the percentages above the requirement
for bedrooms are:
• 25% of 5= 125 one-bedroom units
• 50% of 5= 2.5 two-bedroom units
• 25% of 5= 1.25 three-bedroom units
Therefore, the development would be required to provide:
• 1 one-bedroom unit
• 3 two bedroom units
• 1 three bedroom unit
~
The same calculation is performed to determine the bedroom sizes of the Low-
Income and Moderate-Income units.
3.8 How to Determine the Location of BMR Units Within the Development
The Inclusionary Zoning Ordinance requires that BMR Units be reasonably dispersed throughout the
Residential Development. The purpose of this requirement is to avoid concentration of the BMR
Units in a particular location within a development, effectively segregating them from the resf of the
Residential Development. There are many ways in which to implement this requirement and
consultation with Community Development Department Staff is recommended prior to developing
the final site plan. Ultimately, the Planning Commission or City Council will determine, based on
Staff recommendation, if this requirement has been met.
Per section 8.68.040(E) of the Inclusionary Zoning Regulations, the City Council, at its discretion
may waive, wholly or partially, the requirements of this ordinance and approve alternate methods of
compliance with this Chapter if the developer demonstrates, and the City Council finds, that such
alternate methods meet the purposes of this Chapter.
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39 Housmg A~reements
Section 8.68.50 of the Inclusionary Zoning Regulations requires the developer to execute one of the
following Housing Agreements with the City:
Affordable Housing Agreement
An agreement between the developer and the Citv for a Residential Development project that
includes ownership BMR units (and potentially Secondary Units). Such Agreements are
recorded against the property on which the Residential Development is being constructed; set
forth the developer's Inclusionary Obligation and the method by which the developer will
comply with the requirements of the Inclusionary Zoning Ordinance; and require, among
other things, that the developer require purchasers of BMR Units to execute a Resale
Restriction Agreement and Option to Purchase with the City.
Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants
An agreement between the developer and the Citv for a Residential Development project that
includes rental BMR units. Such agreements are recorded against the property containing the
BMR Units; set forth the developer's Inclusionary Obligation and the method by which the
developer will comply with the requirements of the Inclusionary Zoning Ordinance; and
requires, among other things, that the BMR Units are reserved for occupancy by Very-Low,
Low-, and/or Moderate-Income households at rents affordable to such households for a period
of not less than 55 years.
• Secondary Unit Regulatory Agreement and Declaration of Restrictive Covenants
This Agreement is similar to a Resale Restriction Agreement and is executed after an
Affordable Housing Agreement or Affordable Housing Regulatory Agreement and
Declaration of Restrictive Covenants. This agreement is between the Citv and the owner of a
Secondary Unit and is recorded against the property containing the Secondary Unit and
requires, among other things, that the Secondary Unit be reserved for occupancy by Very-
Low, Low-, and Moderate-Income households at rents affordable to such households for the
period of time set forth in the agreement. -
The Housing Agreements set forth the legal requirements for the Residential Development project for
compliance with the Inclusionary Zoning Ordinance. The Housing Agreements are recorded against
the property on which the Residential Development is being constructed, run with the land, and
survive transfer or sale of the land. The term of the Affordable Housing Regulatory Agreements is a
period of 55 years. The Affordable Housing Agreement is effective until all of the In-Lieu Fees are
paid; the BMR units are constructed, sold, and subject to a Resale Restriction Agreement. If a
developer executes a Housing Agreement for a particular Residential Development project but the
project is not built and new entitlements are sought for the applicable property, the developer must
execute a new Housing Agreement, which would replace the existing Agreement.
Among other things, the Housing Agreements must contain the following information:
1. A description of how the developer will comply with its Inclusionary Obligation (whether
through unit construction and/or payment of an In-Lieu Fee);
2. Whether the BMR Units will be ownership or rental units;
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3. The number of BMR Units the developer will construct for each income category;
4. The size of the BMR Units the developer must construct for each income category;
5. Depending on the nature of the development, the timing of construction of the units to
ensure that the BMR Units are constructed concurrently with the market-rate units;
6. If the development proposes ownership BMR Units, a requirement that the developer
prepares and obtains City approval of a Marketing Plan, prior to issuance of any building
permits in the Residential Development, indicating how the developer plans to sell the
BMR Units. This requirement is discussed in additional detail in Section 4.10.1 below;
7. If the development proposes ownership BMR Units, there is a requirement that the
developer require the purchasers of such units to execute a Resale Restriction Agreement
or a Secondary Unit Regulatory Agreement and Declaration of Restrictive Covenants and
a Performance Deed of Trust. A sample Resale Restriction Agreement is attached as
Exhibit No. 1. A sample Performance Deed of Trust is attached as Exhibit No. 2. A
sample Secondary Unit Regulatory Agreement and Declaration of Restrictive Covenants
is attached as Exhibit No. 3.
8. If the development proposes rental BMR Units, a requirement that the developer provide a
Management Plan and Marketing Plan as described in Section 4.l l.l to the City for its
approval and prepare the Annual Report described in Section 4.11.4.
3.10 Procedures for Initial Sale of BMR Units
3.10.1 The Marketing Plan for Ownersliip Units
Prior to the issuance of building permits for any ownership BMR Units, the developer shall submit a
Marketing Plan to the City for approval. The Marketing Plan must contain the following:
A one-page narrative summary suitable for advertising the availability of the BMR Units
on the City web page and other locations, including a description of the total number of
BMR Units and market-rate units in the Residential Development; the HOA dues for each
BMR Unit; the amenities included in the unit, and a telephone number for interested
applicants to call for additional information;
2. An explanation of the application process and the deadline for submitting applications.
If the development is phased, the developer must establish deadlines for each phase of
the development that includes BMR Units;
3. An explanation of the selection process, including an explanation of the Preference
Point system;
4. Timelines for buyer selection. If the development is a phased project, information
must be provided on the number of phases and the timelines for those phases;
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5. Timeline for the developer s sales staff to meet with the City s Housing Staff to
receive training on the sale selection and application process;
6. Marketing materials;
7. An application packet which includes:
• Application for Inclusionary Unit
• Disclaimer for BMR Application Qualification Questionnaire
• Credit Authorization and Release
• Signed Sample Resale Disclosure Statement
• Required Supporting Documentation Submitted
• Highlights of Dublin Resale Restriction Agreement
• Written confirmation of pre-approval for the home which must be validated
through Developer's preferred lender.
See Exhibit No. 3 for a sample ownership BMR Unit application packet.
No marketing of the BMR Units shall begin until the developer has received written approval of the
Marketing Plan from the City and the developer's sales staff has met with the Housing Staff for
training so that the sales staff understands and can explain the application process.
3.10.2 Application and Screenin~ Process
The developer must require each applicant to complete the application that has been approved by the
City as part of the Marketing Plan and to provide the required supporting documentation by the
deadline set forth in the Marketir~g Plan. The developer should plan accordingly to assure that
applicants are not qualified more than 6 months before the move-in date of the unit.
Application packets should include at a minimum:
• Complete application;
• Income documentation set forth in Section 5.4.1;
• Reservation instrument showing the address, number of bedrooms and sales price;
• A loan pre-approval letter with Good Faith Estimate and Truth in Lending Statement;
• A signed Disclosure Statement (Exhibit F of the Resale Restriction Agreement);
• A signed credit report authorization and release or other consent and verification letter;
~ Copy of tri-merge Credit Report; and
• Evidence of 3% available funds to be used as a down payment.
The developer must comply with the following process to sell the BMR Units:
1. Developer collects applications for the period of time set forth in the approved Marketing
Plan.
2. Developer screens applicants to determine whether they satisfy the requirements for
Qualified Households set forth in Section 5.1.
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3. Developer sorts and ranks the Qualified Households based on the Preference Points and
creates a Priority List with those applicants with the most Preference Points at the top
followed by all other applicants in descending order based on the number of Preference
Points received. If more than one qualified applicant receives the same number of
Preference Points or if some applicants receive no Preference Points, the developer shall
rank the Qualified Households based on other objective criteria outlined in its approved
Marketing Plan. For example, the developer may date stamp all applications and, in the
case of a tie, rank the Qualified Households based on who applied first, or the developer
may choose to hold a lottery to break ties. However, whichever criteria the developer uses
must be set forth in its approved Marketing Plan.
4. Developer completes the Priority List within 30 days of the application deadline and
submits the list to the City.
5. Developer reviews and sorts the application packets in order of the Priority List and
submits complete application packets of Qualified Households, together with supporting
documentation, to the City within forty-five (45) days prior to close of escrow.
6. The City reviews the application packets to verify the applicants are Qualified
Households. The City will make every effort to review the applications within 7 working
days of receiving a complete application packet.
Once the City has verified that the applicant is a Qualified Household, the City will send
the developer a conditional approval letter (or similar document) indicating the applicant's
name, income level and the maximum sale price of the unit (see Section 4.10.3 for more
detail on establishing the sale price) and any requirements that must be met before moving
forward with the applicant. Once all the required information is received, the City will
then send a conditional qualification letter (or similar document) which is valid for 6
months from the date of the letter. A copy of the application packet, along with income
verification for the household will be retained by the City as proof of the buyer's
qualification to purchase the BMR Unit. If the City determines that the applicant is not a
Qualified Household, the City will send the developer an ineligibility letter. An applicant
who has been deemed to be ineligible may not reapply for a period of one year from the
date of the ineligibility letter.
The developer bears the responsibilities of ensuring applicants are not qualified more than
6 months before a unit becomes available and closes escrow. Applicants must be re-
qualified if occupancy is to take place more than 6 months from the date of the conditional
qualification letter. Applicants may or may not qualify to purchase a BMR Unit upon re-
qualification. In addition, the price of the BMR Unit may change upon re-qualification.
If, upon re-qualification, an applicant does not qualify, it is the responsibility of the
developer to notify the applicant.
Conditional approvals are based on information which was supplied to the City by the
developer, or their agent. If there are any material changes to the financial conditions,
marital status, employment status or other facts or information that is made known to the
City prior to loan closing, the developer, their agent or the lender must notify the City of
Dublin in writing of these changes. The City expressly reserves the right to re-verify the
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applicant(s) and may void or cancel this conditional approval or other approval at an
time prior to the loan closing if these material changes affect the qualification status of the
buyer(s). ,.
Qualification determinations may be appealed by the Developer to the Community
Development Director. '
THE SALE CANNOT PROCEED UNTIL ALL REQUIRED DOCUMENTS ARE
PROVIDED TO THE CITY AND THE DEVELOPER RECEIVES A WRITTEN
QUALIFICATION LETTER FROM THE CITY.
7. The developer will offer the unit to Qualified Households based on the Priority List,
offering the BMR Unit first to those applicants with the most Preference Points, then in
descending order.
8. The developer and applicant will enter into a purchasing agreement.
9. The developer will require the selected buyer to execute a Resale Restriction Agreement
and Option to Purchase and a Performance Deed of Trust.
10. The developer will provide the City with the name and address of the title company
closing the sale and the name of the escrow officer.
11. Prior to the City sending escrow instructions the City will review all final loan documents
for compliance to the Section 6.1 Financing Requirements.
12. The City will prepare and send escrow instructions to the Title Company.
13. The Title Company will submit the following documents to the City:
• Completed and Signed Residential Loan Application;
~ Completed Truth in Lending Statement, Good Faith Estimate, and a estimated
HUD-1 statement from the Title Company;
• Completed, executed, and notarized Resale Restriction Agreement and Option to
Purchase; and
• Completed, executed, and notarized Performance Deed of Trust.
14. The City will review the above documents for completeness, prepare the Request for
Notice of Default for each of the buyer's loans, secure the signature of the City Manager
or his/her designee on the necessary documents, and return the loan documents to the
lender.
15. The City will send the original Resale Restriction Agreement, Performance Deed of Trust
and Request(s) for Notice of Default to the escrow officer for recording.
If at any time during the application, screening, or sale process, an applicant requires translation
services, the developer shall provide such services at the developer's sole cost and expense.
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3.10.3 Sale price of BMR Units
~ ~ ~
~~
Pursuant to Section 8.68.020A.2 of the Inclusionary Zoning Ordinance, Owner-occupied units are
deemed affordable units if the sales price results in annual housing expenses that do not exceed 35%
of the maximum income level for low-, and moderate-income households, adjusted for household
size.
Below Market Rate For-Sale units are priced based on a designated income point that is affordable to
a greater range of households in each applicable income category.
• For Low-Income Households (household income of between 50% and 80% of Area
Median Income), the sales price would be set at a level so that total monthly housing
payment would not exceed thirty-five percent (35%) of one-twelfth of seventy percent
(70%) of the Area Median Income for Alameda County.
• For Moderate-Income Households (household income of up to 120% of Area Median
Income), the sales price would be set at a level so that total monthly housing payment
would not exceed thirty-five percent (35%) of one-twelfth of one hundred and ten percent
(110%) of the Area Median Income.
In addition, the fixed sales price approach would be based upon the number of bedrooms in the home
instead of the number of persons in the particular household. For example, if a developer is selling a
two-bedroom unit, the sales price would be calculated under the "number of bedrooms, plus one" rule
for the assumed household size. In each case the sales price would be set based upon the following
assumed household sizes for the following sizes of residential units:
No. of Bedrooms Assumed Household Size
1 2
2 3
3 4
4 5
The assumptions below are used to calculate the maximum sale price for BMR Units. However, a
Qualified Household's actual Housing Expenses may differ from these assumptions.
• Interest - Prevailing rate (fixed rate far 30 years), secondary market fixed rate, Fannie
Mae or Freddie Mac, as determined by staff, on the date that is 30 days prior to the
applicable application deadline.
• Mortgage Term - fixed rate for 30-years.
• Taxes - 1.25% of the estimated sale price of the unit.
• Insurance - homeowner's insurance
o Homeowner's Insurance - The cost of homeowner's insurance may be calculated
based on an estimate provided by the developer. (If the homeowner's insurance is
covered by an HOA structure, homeowner's insurance need not be included, but it
must be documented that the HOA will provide adequate insurance.)
• HOA dues, if any.
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Figure 6 shows how the sale price is calculated:
f5~~~
~
FIGURE 6
TABULATION OF MAXIMUM SALE PRICE FOR A
MODERATE BMR UNITS
Household size
Max. allowable annual income
Annual household income
Gross monthly income (line 1 divided by 12)
% paid toward housing
Gross monthly housing expense (line 2 multiplied by 35%)
Less Interior Homeowner Insurance
Less Property Taxes (1.25% of line 6)
Less Homeowners Association Dues (HOA)
Net monthly housing expense
MAXiMUM MONTHLY ~ORTGAGE PAYMENT
Interest Rate
Term
Maximum Loan
~~g~.;~ ~1~~~ ;~~~:~:~~~
~~~~~~
5
102,300.00
102,3Q0.00
8, 525.00
35%
Enter
Amounts
2,983.75
50:00 2,933.75
447.02 2,486.73
11'4 2,369.73
2,369.73
2,369.73
2,369.73
5.25%
30
429,140.55
3.11 Procedures for Initial Rental of BMR Units
After the Housing Agreement is executed, and prior to the issuance of any building permits, the
developer must prepare and submit a Management Plan to the City of Dublin Housing Division for
approval. After the Management Plan has been approved by the City, and prior to the rental of any
units, the developer must screen, rank and qualify eligible tenants and send a priority list to the City
of Dublin's Housing Division. This should happen within 30 days, if possible. In addition, the rent
for a BMR Unit must be calculated pursuant to Section 4.11.3.
3.11.1 The Management Plan for Rental BMR Units
Prior to the issuance of building permits, the developer must submit a Management Plan to the City
for its approval. The Management Plan must contain the following information:
• a Plan outlining how the management firm will market and maintain the rental BMR
Units,
• how the firm will maintain a waiting list for the BMR Units;
• how the management firm will verify applicants' Total Household Income, both initially
and annually;
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• information on the units to be made available for the City to use on the City website;
• a contact telephone number;
• and the names of those individuals responsible for contact and communication with the
City.
3.11.2 Application and Screenin~ Process
The management firm (which could be the owner or builder) is the entity that will be responsible for
occupant selection and documentation of rental BMR Units. The management firm's leasing staff
should be trained so the staff understands and can explain the rental application process to applicants.
The management firm must require each applicant to complete and return to the management
company a Rental BMR Unit Application packet. A sample Rental BMR Unit Application packet is
attached as an Exhibit to these Guidelines.
To lease the BMR Units the developer/management company must do the following:
l. Collect applications for a given time period.
2. Screen applicants to determine whether they satisfy the requirements for Qualified
Households set forth in Section 5.2.
3. Sort and rank the applications of Qualified Households based on the Preference Points and
produce a Priority List with those applicants with the most Preference Points at the top
followed by all other applicants in descending order based on number of Preference Points
received. If more than one applicant receives the same number of Preference Points or if
some applicants receive no points the developer shall use other objective criteria set forth
in the approved Management Plan to select occupants. For example, the management firm
may date stamp all applicant applications and, in the event of a tie, offer the unit to that
applicant that applied first, or the management firm may choose to hold a lottery to break
ties. However, whichever criteria the management firm uses must be set forth in the
approved Management Plan.
4. The Priority List must be completed within 30 days of the application deadline and
submitted to the City for approval; .
5. Offer the BMR Units to applicants based on the Priority List, offering first to those
applicants with the most points, then in descending order;
6. Execute a Rental Agreement with the tenant that notifies the tenant that he or she may not
sublease the unit and that annual certification is required.
7. Maintain applications with income verification and re-certification for City to review at
annual onsite monitoring.
Qualification determinations may be appealed by the Developer to the Community Development
Director.
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3.11.3 Calculatin~ Maximum Rent
~~~ ~ ~
~
The Inclusionary Zoning Regulations state that maximum rents cannot exceed 30% of the Maximum
Income in a given income category. Affordable rents are calculation formula is listed below for Very
Low, Low and Moderate Income Households:
Very Low Income Tenants, monthly rent not in excess of thirty percent (30%) of one-
twelfth of fifty percent (50%) of the annual Median Income for the Area;
Low Income Tenants, monthly rent not in excess of thirty percent (30%) of one-twelfth of
sixty percent (60%) of the annual Median Income for the Area; and
Moderate Income Tenants, monthly rent not in excess of thirty percent (30%) of one-
twelfth of one-hundred and ten percent (110%) of the annual Median Income for the Area,
with in each case based upon the following assumed household sizes for the following
sizes of residential units in the Project.
If tenant is required to pay for utilities, the maximum rent must be reduced to account for the cost of
such utilities (a utility allowance). Utilities include gas, electric, water, and trash disposal. In
addition, if tenants are required to provide their own stove, refrigerator, or washer and dryer, these
expenses are considered utilities, and the maximum rent is further reduced. If the tenant is
responsible for any of the above, the maximum rent must be reduced by the amounts listed in the
Utility Allowance Sheet* (See Exhibit No. 8).
Fi
~„ ,, , ,
/ 111UJ110.LGJ L11G V0.1liU1Ql1V11 Vl LL1QAl111U111 1Glll.
FIGURE 7
_ _,~_...__ .... _. .
2008 Rent limits ~_.. __ _ .. ; ,__. _ __. ._.__. . . _~. _r
~
:
, _ . _ v. ,
Bedroom Size Assumpti ~__.._ __ ~..
ons . _,_. _ ____. .__
~_ ~ . _ _
._. .... . _~_
0 bdrm = 1~person ~ 1 bdrm = 2 people
;~_,,.. __. _.... _ . .. ...~.... __~ ~...,...,. . . . __ ..... ... .. . .. ..... .....~._
___ .._. _ .. ..._. ~.. .,._. ,
2 bdrm = 3 people 3 bdrm 4 people
_
50% 60% ~ 110% ~
~
._.,, ~...~._....
0 .~,.. ~
$754 _.?_. _
$905 .,. ._~..._.M .. ....~. _
$1,658 j ~_
, .....
~ $861 ~$1 034 $1,895
~
~
'
_.,..~
2
...~
$969
.,,,
! $1,163
:_.... .. .__.. . ~ ~,.,.... ....
. ... .~.. .........
.
...
$2,131 ~ ~ _
;:
~.
3 $1 076 :..
: $1 292 . _...._..~. __. ...~ . .
$2 368 ~ ~ '
:
_~.....,.... 4._...._.~__..
$1,163
_$1,395_. ..... .... ..
~. ._..._.. . __. .. ~ .
$2,558 ; , ,
If a tenants/households income increases to where the tenant/household is no longer income or
household size qualified for the BMR rental unit, the tenant/household will not be required to move;
however, the household will no longer be considered qualified for a BMR unit and the rent may be
increased to market rate rent. The developer/landlord will then offer the next available unit with the
same specifications (i.e. bathrooms and bedrooms) as a BMR rent restricted unit.
3.11.4 Annual Report
Pursuant to Section 8.68.OSO.B of the Inclusionary Zoning Regulations, the management entity for
the development must provide the City an annual report (See Exhibit No 9). The annual report must
include the following information:
~ The Utility Allowances are established by the Housing Authority of Alameda County and revised periodically. The
most current Utility allowances for Alameda County may be accessed at the following web site: httpUwww.haca.net., then
click on statistics.
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• Total Household Income for the prior year for each BMR Unit; ~ ~ I~, ~
• Number of people residing in each BMR Unit;
• Monthly rents charged and proposed to be charged for each BMR Unit; and
• Vacancy of BMR Units during the previous year.
The management firm must submit the report annually by October 31 st. The City of Dublin Housing
Staff will send a reminder letter to the management firm, with a copy of the Annual Report form for
completion and certification at least three months prior to the anniversary date. This form must be
completed and returned to the City by the anniversary date.
3.11.5 Annual Monitoring b~City
The City of Dublin may perform an annual site visit to monitor the records of all BMR Units. The
City will provide at least two-week's notice to the developer and/or management firm as to the date
of the site visit. Files for all BMR Units must be made available for review at the request of the City.
The purpose of the monitoring is to ensure compliance with the City's Inclusionary Zoning
Ordinance and these Guidelines.
If a Residential Development is financed through a government program that has stricter occupant
selection or occupant documentation requirements than the City, the City may elect to rely on those
requirements and associated documentation and not require additional documentation. The City will
require tenant income verification and restriction of the BMR units for 55 years; however, the
management firm may send to the City copies of the documentation that is required and produced for
other monitoring agencies.
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City of Dublin and PCCP CS II Tralee Village, LLC
4 BUYER AND RENTER QUALIFICATIONS FOR BMR UNITS ~,~ D ~
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4.1 Buver Quali~cations
A household is qualified to purchase a BMR Unit if it satisfies the following requirements:
l. The household's Total Household Income does not exceed the applicable Maximum
Income set forth in Section 5.4;
2. The household will occupy the unit as its Principal Residence within 30 days of the close
of escrow on the unit;
3. The household is of a size meeting the household size criteria set forth in Section 5.3;
4. All title holders of the property must take an 8-hour Homebuyer Education workshop and
receive a certificate of completion. Certificate of Completion must be dated within 6
months of the date of application;
5. All applicants have a minimum FICO credit score of 620 (See Section 5.5);
6. The City will require all household members to be either a citizen or national of the
United States or a qualified aliens defined by the federal Personal Responsibility and
Work Opportunity Reconciliation Act of 1996(PRWORA);
7. All members of the household are either: -
a. persons who hold title to the BMR Unit„ appear ori the mortgage, and have
executed a Resale Restriction Agreement and Performance Deed of Trust far the
unit; or
b. persons who are claimed as a dependent on the tax returns of a household member
who satisfies the requirements in subsection (a) above; and
8. All members of the household must meet the definition of a qualified homebuyer.
Qualified Households with Preference Points will receive priority over other QuaTified Households.
For information on the application and screening process, see Section 4.10.2.
Once the City has verified that the applicant is a Qualified Household, the City will send the
developer a conditional approval letter (or similar document) indicating the applicant's name, income
level and the maximum sale price of the unit (see Section 4.10.3 for more detail on establishing the
sale price) and any requirements that must be met before moving forward with the applicant. Once
all the required information is received, the City will then send a conditional qualification letter (or
similar document) which is valid for 6 months from the date of the letter. A copy of the application
packet, along with income verification
Applicants, who are determined ineligible will receive an ineligibility letter. Ineligible applicants may
not reapply to purchase any BMR Unit for a period of one year from the date of the City's
ineligibility letter.
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Qualification determinations may be appealed by the Developer to the Community Dev opment
Director.
4.2 Renter Qualifications
A household is qualified to rent a BMR Unit if it satisfies the following requirements:
1. The household's Total Household Income does not exceed the applicable Maximum
Income (See Section 5.4);
2. All members of the household are Legal Residents;
3. The household will occupy the unit as its Principal Residence within 30 days of executing
the lease; and
4. The household is of a size meeting the household size criteria set forth in Section 5.3).
5. The names of all non-dependent household members must appear on the lease for the
BMR Unit
6. No member of the Qualifying Household must own any interest in. any real property,
including but not limited to, any dwelling unit, commercial real estate, or land.
Qualified Households with Preference Points will receive priority over other Qualified Households.
For information on the application and screening process, see Section 4.11.2.
Qualification determinations may be appealed by the Developer to the Community Development
Director.
4.3 Household Size
The size of the household is determined by the number of people livin in a household at the time of
application. In the case of a pregnant person, the baby may not be included as a member of the
household until the baby is born. •
To qualify for a BMR Unit, the size of a household must be compatible with the size of the unit being
rented or purchased.
The household size for each BMR Unit may not exceed two people for each bedroom and may not be
less than one person per bedroom, unless otherwise permitted by special financing sources. Consult
with the City of Dublin for further clarification. The chart below contains the household size
permitted far each BMR Unit based on the number of bedrooms:
Studio
One-bedroom units
Two-bedroom units
Three-bedroom units
Four-bedroom units
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1-2 people households
1-2 people households
2-4 people households
3-6 people households
4-8 people households
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4.4 Total Household Income
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To be eligible far a BMR Unit, the applicant's Total Household Income must not exceed the
applicable Maximum Income. Total Household Income means the household's Gross Household
Income (see Section 5.4.1 below) plus assets calculated pursuant to Section 5.4.3. Maximum Income
is determined periodically by HCD based on AMI. Below are the Maximum Incomes for Alameda
County for 2008.
Number of Persons in Household
Income Category 1 2 3 4 5 6 7 8
Very Low ~ 30,150 $ 34,450 $ 38,750 ~ 43,050 $ 46,500 $ 49,950 $ 53,400 $ 56,850
Low $ 46,350 $ 53,000 $ 59,600 $ 66,250 $ 71,550 $ 76,850 $ 82,150 $ 87,450
Moderate ~ 72,300 $ 82,600 $ 93,000 $ 103,300 $ 111,600 $ 119,800 $ ]28,100 $ 136,400
4.4.1 Gross Household Income
Gross Household Income means all income from all adult household members (18 years of age and
older) derived from all sources as provided in the Internal Revenue Code (Title 26, Subtitle A,
Chapter 1, Subchapter B, Part I, Section 61), whether or not such income is exempt from Federal
income tax. Such income includes, but is not limited to, the following:
• Compensation received from an employer
• Compensation includes, but is not limited to salary, overtime pay, and other pay
• Other pay can include, but is not limited to compensation for special working conditions
or one time pay-out of unused vacation and sick leave.
• Alimony, spousal and child support
• Cash
• Pensions, if at an age where pension is being received as income
• Public benefits including, but not limited to, CalWorks, SSI, and disability income
• All interest, dividends, and royalties
• Income derived from private businesses
• RentalIncome
• Income from pensions
• Compensation far services rendered including fees, fringe benefits, commissions, tips, and
bonuses
• Stipend received for participation in a mentor, learning or education opportunity
• Gains from dealings in private and/or commercial property
• Gambling Winnings
• Annuities, life insurance, and endowment contracts
• Income from discharge of indebtedness
• Gross partnership contributions or distributions
• Income from an interest in an estate or trust
Exceptions:
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1) Gross Household Income does not include income household earned by a household member o~
is between the ages of 18-26 and meets both of the following criteria:
• Is claimed as a dependent of a household member on such member's federal income
taxes; and
• Is a full time student (12+ units - school transcript must be provided)
2) Gross Household Income does not include payments to a household member from a governmental
fund Income if all of the following requirements are satisfied:
• The payments are based on the recipient's or the recipient's family's financial need;
• The payments do not represent compensation for services rendered; and
• The payments are part of a governmental housing subsidy program including, but not
limited to, so-called Section 8 federal housing assistance payments.
For purposes of determining Gross Household Income; each person, 18 years of age or older, must
present the following:
• a complete set of Federal and State Income Tax Returns for the past three years, including
all schedules (signed & dated) and W-2 forms; (in the case where taxes have not been
filed for any of the past three years, a letter of verification of non-filing from the Internal
Revenue Service is required);
• four most recent and consecutive pay stubs; and
• three recent and consecutive statements for all financial accounts, including but not
limited to, savings accounts, checking accounts, retirement accounts, 401(K) accounts,
stock accounts and another accounts held in the applicant(s) name(s), whether held
individually or together.
If a household member is self-employed, in addition to the information above, the member must
submit profit and loss statements for the past 3 years (if applicable), and a current profit and loss
statement for the year.
4.4.2 Income Calculation
a. Wage and Salary
If an applicant is a full time employee (usually 30 to 40 hours) or an employee with consistent
regular hours or income, or income with overtime or adjustments as a regular part of their job,
one of the following formulas listed below in Section "a" will be used to determine the
applicant's salary. Bonuses and commissions may be calculated into the annual income
calculation. In the case of unclear income or income that is somewhat difficult to calculate,
please contact the City of Dublin Housing Division. The City of Dublin will make the final
determination which Income Calculation to use.
Monthly income x 12 months = annual income
Twice monthly x 24 = annual income
Bi-weekly income x 26 = annual income
Weekly income x 52 = annual income
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Hourly income x 40 (or whatcvcr normal hours pcr wcck may bc) x 52 - annual incomc
An employee who works consistent hours, with some overtime, shall be calculated using the
above formiila.
b. Variable Income
For applicants who are part-time employees or employees with variable hours every pay
period (or variable hours less than 40 hours per week), inconsistent income or hours,
overtime, bonuses and commissions, etc. their annual salary shall be calculated using year-to-
date income, plus previous year income (from same income source or employer), divided by
the number of months reviewed (UP TO BUT NOT EXCEEDING 12 MONTHS) times 12 to
amve at their annual income. If there is no previous year income from same employer, or the
job was started mid-year, use current income year to date using the calculation explained in
(a) above shall be used. If an applicant works consistently 40 hours per week and has
occasional or regular overtime, use the calculation listed in "a" above to calculate income.
c. Inconsistent ar Temporary change in Income Due to a Temporary Circumstance
If an applicant has a temporary situation (7 months or less) that makes income calculation
difficult, a Verification of Employment may be used to calculate applicant's income based on
a normal annual time period. Or, the income may be calculated based on the person's hourly
rate times their normal working hours (as shown in item "a" above).
d. Self-Employed or Non-Corporation
A self-employed applicant is also considered to have variable income. Gross annual income
calculations will be based on the previous two year's net income shown on Schedule C of the
federal income tax returns, plus net income before taxes from the applicant's signed, year-to-
date Profit and Loss Statement, divided by the appropriate number of months (NOT TO
EXCEED 12 MONTHS) times 12 to arrive at the annual income.
4.4.3 Assets
An asset test will be applied to all applicants to determine whether they satisfy the income
requirements. If an applicant has assets that exceed $30,000, the following amounts will be added to
the applicant's Gross Household Income to determine the household's Total Household Income:
~ Ten percent (10%) of all assets between $30,001 and $130,000
• Thirty percent (30%) of all assets over $130,000
The maximum assets allowed are $250,000. Households with assets in excess of $250,000 will be
disqualified. Assets include, but are not limited to, cash, all savings and checking accounts, stocks,
bonds, real estate, gifts and other sources of money. Pensions and federally approved retirement
savings accounts, such as IRA's, Roth IRA's and 401 K's, are excluded; however, retired applicants
who receive income from their retirement account must include such income as Gross Household
Income on their application.
Figure 8 illustrates the calculation for determining income with assets:
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Example:
FIGURE 8
Household of 3 earns $50,000 a year and has $150,000 in total household assets
$150,000 (minus) $30,000 = $120,000 (which equals less than $130,000)
10% of $120,000 = $12,000
New total household income: $50,000 + $12,000 = $62,000
Household of 3 earns $50,000 a year and has $200,000 in total household assets
$200,000 (minus)~ $30,000 = $170,000 (which equals more than $130,000)
10% of $130,000 = $13,000
30% of balance of $40,000 = $12,000
New total household income: $50,000 + $13,000 + $12,000 = $75,000
4.5 Credit Score
For ownership BMR Units, a credit check will be conducted on all adults (other than dependents) in
the household. Applicants must have sufficient creditworthiness to qualify. Creditworthiness means
that:
i) All household individuals shall have a minimum of three years since Chapters 7 or 13
bankruptcy discharge date and/or foreclosure and evidence of reestablished credit is
required; and
ii) All persons appearing on the mortgage shall have a minimum FICO credit rating of 620
points from all three credit agencies. The representative credit score is the middle score of
the three sets of repository scores reported for each household member. If more than one
eligible applicant is applying, all middle scores will be considered and the lowest of the
middle scores shall be the score used in qualifying the household (must be 620 or higher).
Figure 9 shows an example of how to calculate a representative credit score:
FIGURE 9
Lowest Middle Credit Highest Credit
Credit Score Score Score
Borrower 678 706 709
Co-Borrower 690 697 703
The Lowest Middle Credit 697
Score of Borrowers
4.6 Alternative Credit Historv Parameters
Alternative Credit History is permitted with a minimum of four trade lines and twelve-month of
satisfactory payment record. One of the trade lines must be a twelve-month verification of rent
(VOl~) history.
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4.7 Preference Points
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Applicants will be screened by the developer or their designated party, for initial eligibility based on
the requirements set forth in Section 5.1 (for ownership units) or Section 5.2 (for rental units).
Qualified Households will then be ranked based on the number of Preference Points they receive.
The Preference Point system set out in the Inclusionary Zoning Ordinance (see Table 1) provides
priority to those persons who live in Dublin, work in Dublin, are public-service employees in Dublin,
are seniors age 62 and older, are permanently disabled, are an immediate family member of a Dublin
resident, and/or are being required to relocate from their current Dublin residence due to demolition
of their dwelling or conversion of their dwelling from rental to ownership. Each household may only
claim Preference Points once for any given category. The Ordinance provides that even if two
persons in the household qualify for Preference Points for the same category, the points are only
awarded for one person. For example, if a husband and wife are both employed in Dublin, the couple
receives only 3 Preference Points for being employed in Dublin, or if the applicant lives with a family
member in Dublin, the applicant will only be entitled to a total of 3 Preference Points. Similarly, if
two seniors make up a household, they would be entitled to only 1 Preference Point.
Table 1: The Preference Point System
Priority
Employed in Dublin for at least 6 months*
Public service employee in Dublin**
Has resided in Dublin for at least one year
Seniors (62 and over)
Permanently disabled
Has an immediate family member who is a Dublin
resident & who has continuously lived in Dublin for
at least one year
Must move because housing is to be demolished or
converted to condo
Points
3 points
1 additional point
3 points
1 point
1 point
1 point
1 point
*Newly hired teacher that will be working, in Dublin may waive the six-month employment criteria by submitting a copy
of their employment contract. Teacher must be credentialed and work as a school that is a State accredited school.
* If self-employed in Dublin, then the business must have a current City business license for at least 6 months at the time
of application
** A public service employee is a person who is employed by a public agency such as the City of Dublin, a fire fighter or
police officer assigned to work in Dublin, BART, DSRSD, or USPS working in Dublin.
Figure 10 demonstrates how Preference Points are calculated:
FIGURE 10
Example 1: An applicant for a BMR Unit both lives in Dublin (for at least one year) and
works in Dublin (for at least 6 months).
This individual will receive the
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Lives in Dublin 3 points
Works in Dublin 3 points
Total number of points 6 points
Example 2: An applicant for a BMR Unit works in Dublin and is a schoolteacher.
This individual will receive the following points:
Works in Dublin 3 points
Public Service Employee 1 point
Total number of points 4 points
Example 3: An applicant for a BMR Unit is a seniar citizen (62 years old) and lives in
the City of Dublin (for at least one year).
This individual will receive the following points:
Senior citizen 1 point
Lives in Dublin 3 points
Total number of points 4 points
If the household indicates on its application that it qualifies for Preference Points, the household will
be required to provide the following proo£
If Resident of Dublin:
• Copy of two utility bills (PG&E or water), one from at least one year ago and one most recent
utility bill both showing the applicant with a Dublin address; or
• Copy of a current rental agreement.
If Employed in the City of Dublin:
• Copy of first and most recent pay stub establishing length of employment; or
• Letter from employer, on company letterhead, indicating continuous employment for the past
six months; or
• For a newly hired teacher that will be working in Dublin, a copy of employment contract.
• If self-employed in Dublin, then the business must have a current City business license for at
least 6 months at the time of application
If Public Service Emplovee working in Dublin:
• Copy of first and most recent pay stub establishing length of employment; or
Letter from employer, on company letterhead, indicating continuous employment for the past
six months; or
• For a newly hired teacher, at a State accredited school, that will be working in Dublin, a copy
of employment contract; and
• A letter from employer confirming employment and employer contact information.
If Senior Citizen:
• A valid California (or other state with photo ID.) driver license; or
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• A valid California (ar other state with photo ID.) identification card; or
• A valid passport.
If Permanently Disabled Individual:
• Doctor's note confirming that applicant is permanently disabled; or
• Other verification from a State Agency establishing permanent disability status; or
• Verification of receipt of SSI or SSDI.
If Person Who Has an Immediate Familv Member(s) That Are Dublin Residents:
• Copy of two utility bills (PG&E or water), one from at least one year ago and one most recent
utility bill both showing the immediate family member with a Dublin address; or
• Copy of the immediate family member's current rental agreement; and
• A copy of birth certificates for self and immediate family member, establishing relationship;
or
~ Other legal document establishing relationship.
If Relocated Dublin resident due to Demolition or Condominium Conversion:
• Letter from apartment owner or management firm verifying either the imminent condominium
conversion or demolition of the unit; and
• Confirmation from the City's Community Development Department.
Where definitions are not explicitly stated in the Regulations, the City has developed these
definitions:
• A senior is defined as a person 62 years of age or older for the purpose of qualifying for
preference points;
• To qualify for the permanently disabled point, the person must be able to provide written
verification from a physician or show receipt of SSI.
• Immediate family is defined as a mother, father, brother, sister, child, grandparent or
grandchild currently living together for 6 months or more. ,
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5 REQUIREMENTS FOR BUYERS OF BMR UNITS
5.1 Financing Requirements
All BMR buyers must be able to secure a loan through a lending institution for a BMR Unit. At the
time of application, the developer may require that all applicants get pre-approval from the
developer's preferred lender. However, once an applicant receives approval to purchase a unit, the
applicant may use a lender of its choice, provided that the lender is able to adhere to the City of
Dublin's Guidelines for acceptable loan products.
5.1.1 Acce~table Loan Products for Purchase and Refinancing of a BMR Unit
The City reserves the right to reject loan products if the City believes in its sole discretion that there
is a stronger likelihood that the loan product would potentially result in loss of the BMR Unit due to
the purchasers' inability to comply with the terms of the loan.
CaIHFA or Ca1VA loan products for first mortgages are not available to purchase BMR units;
however a number of Ca1HFA loan products are permitted for second and third loans. Other loan
products may be evaluated upon request. From time to time, the City will make available a list of
acceptable loan products.
The following is an example of a non-exclusive list of the loan products that may be acceptable to the
City. The list is not intended to be exhaustive and other loan products may be evaluated upon request.
Acceptable lst Mortgage Loan Products
• Fixed Mortgages up to 40 years
• Maximum 100% combined loan to value
5.1.2 Prohibited Loan Products
• Interest-only loans ,
• Negative amortizing loans
• Adjustable rate loans
• Balloon payment loans
• Some lines of credit that exceed the resale price of the unit
Unacceptable Mortgages Features
• Stated income loans
• Excessive points and fees
5.2 Down Payment
• Applicants must provide a minimum down payment equal to three percent (3%) of the
purchase price from their own funds.
• Funds must be seasoned (on deposit in a financial institution) for a minimum of three
months prior to the initial date of the application with documentation showing these funds
are available for use as down payment.
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• Funds must be placed into escrow prior to close of escrow and proof of availability of
funds must be given to the City before close of escrow.
5.2.1 Down Payment Assistance
The City reserves the right to reject down payment assistance products if the City believes in its sole
discretion that there is a stronger likelihood that the down payment assistance product would
potentially result in loss of the BMR Unit due to the purchasers' inability to comply with the terms of
the assistance.
5.3 Debt to Income Ratio
Homebuyer's total debt to income ratio will be set from time to time by the City based on current
financial or real estate market conditions.
5.4 First Mortgage Loan Value Ratio
Borrower must provide funds in an amount equal to a minimum of 3% of the purchase price for use
as a down payment. Buyer must deposit 3% of the purchase price of their own money into escrow
prior to the close of escrow. The 3% must be applied to the purchase price so the combined loan
to value does not exceed 100%. The 3% down payment may not be used towards closing costs.
5.5 Closing Costs and Deposits
The buyer is responsible for all closing costs related to the purchase of the BMR Unit,
including but not limited to, title fees, escrow fees, and loan origination fees
(approximately 2-3% percent of the purchase price). Homebuyer may be "gifted" funds to
pay for closing costs.
The buyer may take advantage of other down payment assistance programs to assist with
closing costs with the approval from the City.
5.6 Homebuver Education Program
Homebuyer(s} must successfully complete a City approved Below Market Rate 8-hour Homebuyer
Education Class prior to the close of escrow and must provide the City with evidence of completion.
5.7 Documents that Each Buyer Must Sign
The Inclusionary Zoning Ordinance requires that all BMR Units be restricted for a period of 55 years.
As a result, BMR Unit buyers must execute a Resale Restriction Agreement with the City and a
Performance Deed of Trust. These documents must be signed by all titleholders and recorded.
5.7.1 Hi~~hts of the Resale Restriction Agreement
The following list highlights some of the restrictions in the Resale Restriction Agreement. This list is
not intended to be exhaustive.
Principal Residence Requirement
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The unit must be owner-occupied and shall not be used as an investment or rental property. BMR
Owners are required to occupy the BMR Unit as their Principal Residence. BMR Owners are
prohibited from renting their unit without prior written approval from the City. The owner of an
ownership BMR Unit may rent his or her unit for a period not to exceed twelve (12) months upon
demonstration of hardship, as determined in the sole and absolute discretion of the City Manager, and
written approval from the City of Dublin. "Hardship" means circumstances in which a BMR Owner
is required to be absent from the unit for an extended period of time due to either a change in the
location of his or her employment or health problems of the BMR Owner or an Immediate Family
Member of the BMR Owner. Once the BMR Owner obtains written approval from the City to rent
his or her BMR Unit, the BMR Owner shall select a Qualified Household to rent the unit. The
monthly rental payment for the BMR Unit shall be calculated pursuant to Section 4.11.3.
The BMR Owner shall not execute a rental agreement for the BMR Unit without first obtaining the
City's approval of such agreement. The rental agreement shall clearly state (1) the term of the rental
(not to exceed the twelve month period rental is permitted pursuant to these Guidelines), (2) the
monthly rental payment, and (3) that the rental is for a limited period of time.
Any rental agreement in violation of these Guidelines is prohibited, and any BMR Owner who
violates these Guidelines shall be deemed to be in default under his or her Resale Restriction
Agreement.
Resale of BMR Unit
The City of Dublin is not responsible for locating or providing qualified buyers for BMR units;
however, all potential buyers must be qualified by the City before the sale can proceed. BMR owners
may only sell their units to a Qualified Household or to the City for a restricted price calculated
pursuant to Section 7.2. A BMR owner must follow the requirements set forth in Section 7.1 when
selling his or her unit. The City has the right of first refusal.
Appreciation Share
Upon the first sale of the BMR Unit after the end of the 55-year term of the Resale Restriction
Agreement,. the owner must pay to the City an amount equal to 25% of the difference between the
actual sale price and the adjusted resale price calculated pursuant to the formula set forth in Section
7.2. For example, if a unit is originally purchased for $200,000 (actual sale price) and at the end of
55 years sells for $500,000 (adjusted resale price), the equity of the unit is $300,000. The amount
owed to the City would be 25% of the $300,000 or $75,000.
Title Changes
A BMR Owner cannot make changes to the title on a BMR Unit without prior written approval from
the City of Dublin. BMR Owners must request changes to title in writing before making ~ changes
to the title of a BMR Unit and are responsible for all costs associated with adding or removing a
person to or from the title. ~
In the case of a change in the household makeup, due to either marriage, divorce, legal separation,
death or other occasion that will cause a person to move in or to vacate the BMR Unit, owners should
contact the City to ascertain how to add or remove names from the Resale Restriction Agreement and
Performance Deed of Trust.
City's Option to Purchase
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The City has the option to purchase a BMR Owner s unit upon the occurrence of certain events,
including but not limited to, the sale of the BMR Unit, bankruptcy of the BMR Owner, and
foreclosure. A BMR Owner must notify the City when it desires to sell its BMR Unit by submitting a
Notice of Intent to Transfer (Exhibit B to the Resale Restriction Agreement) to the City. If the City
decides not to purchase the unit, the City will send the BMR Owner a letter, along with a packet of
information that will assist the BMR Owner in finding another Qualified Household to purchase the
unit.
Refinancing BMR Units and Taking Cash Out
In general, BMR Owners may refinance their units only to take advantage of a new loan that benefits
the BMR Owner financially (e.g. a lower interest rate with lower monthly payments). BMR Owners
must contact the City in writing for prior written approval of all refinancing. Taking cash out of the
unit is not allowed unless the cash is going to be used for Approved Capital Improvements as
outlined in Section 7.4.
Annual Survey/Monitoring
Each year, the City of Dublin will monitor and require occupancy certification for all BMR Units.
An annual survey will be mailed to the owner(s) of each BMR Unit, usually around the anniversary
date of the purchase of the unit. Each owner must complete and return the survey along with
qualifying documentation. Failure to return the survey and documentation could place the owner(s)
in default of the Resale Restriction Agreement. In addition, pursuant to the Consent Agreement, the
City may access and review the BMR Owner's credit reports or other financial or personal
information to verify the BMR Owner's compliance with the Resale Restriction Agreement and these
Guidelines.
Estate Planning
Upon the death of a BMR Owner, the inheriting owner must notify the City of the BMR Owner's
death within 30 days of the date of death and must sell the BMR Unit to a Qualified Household at a
restricted resale price within 180 days (or longer if approved by the City of Dublin due to market
conditions) unless (i) the inheriting owner is the legal child or step-child of the BMR Owner; (ii) the
City verifies that legal child or step-child qualifies as a Qualified Household; and (iii) the legal child
or step-child signs a Resale Restriction Agreement and a Performance Deed of Trust.
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6 Requirements for Resale of BMR Un ts
6.1 Resale Procedure
An owner must comply with the following procedures when reselling an ownership BMR Unit:
1. The owner must inform the City of his or her intent to sell the unit by filling out a Notice
of Intent to Transfer (Exhibit B to the Resale Restriction Agreement) and submitting it,
along with any letters from the City for Approved Capital Improvements, to the City.
(The owner may still decide not to sell their unit after submitting these documents.)
2. The City may exercise its option to purchase the unit. If the City decides not to purchase
the unit, the City will send the BMR Owner a Conditional Consent to Transfer letter and a
packet of information that will assist the BMR Owner in finding another Qualified
Household to purchase the unit. The Conditional Consent to Transfer letter is valid for 90
days from the date of the letter.
3. The City will inform the owner of the permissible sale price of the unit and any other
conditions of sale within thirty (30) days following receipt of the Notice of Intent to
Transfer. The sale price will be calculated pursuant to the formula in Section 7.2.
4. The BMR Owner must market the unit and pay all fees associated with the sale of the unit.
The BMR Owner may resell the BMR Unit through a BMR Resale Program conducted by
a for-profit or non-profit organization, such as the Tri-Valley Housing Opportunity
Center. If the seller uses a Real Estate Agent, the Agent must contact the City to find out
requirements for listing the property, and proper contact information.
5. At least thirty (30) days prior to the anticipated date of the close of escrow, the
prospective buyer must submit the following documentation to the City Housing Staff for
approval: ~
a. The income documentation set forth in Section 5.4.1;
b. Evidence of completion of a Below Market Rate Homebuyer Education
Workshop;
c. Completed purchase agreement;
d. A loan pre-approval letter with Good Faith Estimate and Truth in Lending
Statement
e. A signed Disclosure Statement (Exhibit F of Resale Agreement)
f. A signed Credit Authorization and Release Form, or. similar document
g. Name, address and phone number of Title Company handling the transaction along
with the name of the escrow officer
h. Copy of tri-merge Credit Report; and
i. Evidence of 3% available funds to be used as a down payment.
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6. The it shall notif the w er within seven 7 da s of recei t of com lete acket of~
C Y Y o~ ~) Y P p P
documentation as listed above of its approval or disapproval of the prospective buyer.
6.2 Calculatin~ Restricted Resale Price
The resale price of a BMR Unit is dependent on AMI at the time of sale and the value of A~proved
Capital Improvements.
The resale price is equal to:
The lowest of the (i) original price paid by the owner for the BMR Unit, increased by an
amount equal to the original price multiplied by the percentage increase in AMI between
the effective date of the Resale Restriction Agreement and the date the City receives the
owner's Notice of Intent to Transfer. (For instance, if the original price of the unit was
$200,000 and the median income increases 2% between the effective date of the Resale
Restriction Agreement and the date the City receives the owner's Notice of Intent to
Transfer, the unit price will increase by 2%, or $4,000 to 204,000); or (ii) the fair market
value of the BMR Unit as determined by an appraiser approved in writing by the City;
plus
2. The cost of Approved (in writing by the City) Capital Improvements; minus
3. The cost to repair damage to the BMR Unit and to place the unit into saleable condition
(the determination of what is considered damage to a unit will be determined by the City).
Such items may include, but not limited to, ripped or torn carpet, damage to kitchen or
bathroom appliances or fixtures; broken light fixtures, broken or missing tiles and/or grout
around tiles, damage to floor or ways; minus
4. The amount of all costs advanced by the City for the payment of mortgages, taxes,
assessments, insurance premiums HOA dues and/or associated late fess, costs, penalties,
interest, attorneys' fees, pest inspections, resale inspections and other expenses related to
the BMR Unit, which the owner has failed to pay or has permitted to become delinquent.
6.3 Fees Associate~d with the Selling of a BMR Unit
The BMR Owner is responsible for all fees associated with the sale of the unit including, but not
limited to, any real estate fees, and the City's Administration Fee of $1,500, which may be adjusted
from time to time.
6.4 CapitalImprovements
As discussed in Section 7.2 above, the resale price of the BMR Unit will be increased by the amount
of Approved Capital Improvements. It is the responsibility of the BMR Owner to keep cost and
accounting records of all Approved Capital Improvements.
6.4.1 Procedure far Receiving A~roval of Capital Improvements
In the exercise of reasonable discretion in accordance with regulations adopted by the City from time
to time, the City will approve capital improvements that improve the health and safety conditions of a
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BMR Unit. To receive such approval, the BMR Owner must:
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• submit evidence to the City showing the purpose and estimated cost of the capital
improvements;
• receive written approval from the City prior to commencing any improvements; and
• submit documentation to the City within 30 days of completion of the improvements
verifying that such improvements have been completed.
Upon receipt of the estimate for capital improvements, City Staff will review the request for
compliance with these Guidelines. The City will review all capital improvements claims and
categorize them into three distinct categories: 1) Eligible Capital Improvements; 2) Eligible
Replacement and Repair; and 3) Ineligible Costs. Each category is defined below.
1. Eligible Capital Improvements include majar structural system upgrades, Special
Assessments, selected additions to the unit (where the new space is needed to meet the
size of a growing family) and improvements related to increasing the health, safety and
energy efficiency of the BMR Unit. Improvements that meet these criteria will be given
100% credit.
2. Eligible Replacement and Repair includes in-kind replacement of existing
amenities, repairs and general maintenance that keeps the BMR Unit in good
working condition. Costs that meet these criteria will be given 50% credit.
3. Ineligible Costs include cosmetic enhancements, installations with limited useful life
spans and non-permanent fixtures. Homeowners may undertake these projects at their
discretion; however, they will not be given capital improvements credit.
The City will send a letter to the BMR Owner either approving or denying the submitted capital
improvements within 30 days of original receipt. The letter will be maintained in the BMR Unit's file
at the City of Dublin for use when the unit is resold.
Once the City has approved the capital improvements, the BMR Owner may then proceed with the
work, obtaining permits from the Building Division, if applicable. Within 30 days of completion of
the improvements and sign-off by the Building Division, if applicable, the BMR Owner must submit
the following information: '
• A copy of the receipt/invoice for each eligible improvement;
• Proof of payment, such as a cancelled check, bank account statement or credit card
bill;
• A copy of Building Permit, if required; and
• A picture or pictures of completed work.
The City may, at its discretion, visit the job site to visually view the completed work.
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6.4.2 Special Assessments
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HOA- initiated Special Assessments are considered capital improvements and will be added to the
resale price of the BMR Unit. In order to receive credit for Special Assessments, homeowners must
submit the following documentation within 3-months of payment:
• Invoice for Special Assessment; and
• Proof of Payrrient, such as a cancelled check, bank account statement or credit card
bill.
6.4.3 Capital Improvements Ca~
In order to maintain the affordability of the BMR Unit for subsequent buyers, at the time of sale, the
City of Dublin will cap all Approved Capital Improvements at 5% of the resale price.
6.4.4 List of Eligible and Ineli ibg le Capital Improvements
Eligible Capital Improvements include major structural system upgrades, some new additions to the
unit and improvements related to increasing the health, safety and energy efficiency of the BMR
Unit. Improvements that meet these criteria will be given 100% credit. Below is a non-exclusive list
of Eligible Capital Improvements:
• Major Electrical Wiring System Upgrade
• Major Plumbing System Upgrade
• Upgrade to Double Paned Windows
• Fireplace Glass Screen
• Room Additions (if room addition meets the criteria for the family size)
• Installation of Additional Closets and Walls
• Alarm System
• Removal of Toxic Substances such as Asbestos; Lead or Mo1dlMildew
• Insulation
• Upgrade to Energy Star Built-In Appliances, as follows:
o Furnace
o Water Heater
o Stove/Range
o Dishwasher
o Microwave Hood
Eligible Replacement and Repair includes in-kind replacement of existing amenities, repairs
and general maintenance that keeps the property in good working condition. Costs that meet
these criteria will be given 50% credit for repairs. Below is a non-exclusive list of Eligible
Replacement and Repair:
• Electrical Maintenance and Repair, such as:
o Switches
o Outlets
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• Plumbing Maintenance and Repair, such as:
o Faucets
o Supply Line
o Sinks
• Flooring
• Countertops
~ Cabinets
• Bathroom Tile
• Bathroom Vanity
• Replacement of Built-In Appliances, as follows:
o Furnace
o Water Heater ~
o Stove/Range
o Dishwasher
o Microwave Hood
o Garbage Disposal
• Window Sash
• Fireplace Maintenance or In-kind Replacement (Gas)
• Heating System
• Lighting System (Recessed)
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Ineligible Costs include cosmetic enhancements, installations with limited useful life spans and non-
permanent fixtures. Owners may undertake these projects at their discretion, however they will not
be given capital improvements credit. Below is a non-exclusive list of Ineligible Costs:
• Cosmetic Enhancements, such as:
o Fireplace Tile and Mantel
o Decorative Wall Coverings or Hangings
o Window Treatments (Blinds, Shutters, Curtains, etc.) ,
o Installed Mirrors
o Shelving
o Refinishing of Existing Surfaces
• Non-Permanent Fixtures, such as:
o Track Lighting
o Door Knobs, Handles and Locks
o Portable Appliances (Refrigerator, Microwave, Stove/Oven, etc.)
• Installations with Limited Useful Life Spans, such as:
o Carpet
o Painting of Existing Surfaces
o Window Glass
o Light Bulbs
6.4.5 Building Permits
It is the responsibility of the BMR Owner to ascertain (and obtain if necessary) if the work to be
performed requires a City building permit. Any work that is done without the required permit will
automatically be deemed ineligible as a capital improvement expense whether or not it fits within the
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definition of an Eligible Capital Improvement or Eligible Replacement and Repair. BMR Owners
may call (925) 833-6620 to inquire about building permits. ~
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7 REQUIREIVIENTS FOR OWNER S OF BMR SECONDARY UNITS
A Secondary Unit is a legal secondary dwelling unit on an owner's property that has been approved
by the City of Dublin as a rental BMR Unit for purposes of compliance with the Inclusionary Zoning
Ordinance and that is reserved for occupancy by, and at rents affordable to, Very-Low, Low-, and
Moderate-Income households. The City Council may approve such units as part of Developer's
proposal for an alternate method of compliance with the Inclusionary Zoning Regulations.
The owner of a Secondary Unit must sign a Secondary Unit Regulatory Agreement and Declaration
of Restrictive Covenants, which is recorded against the property containing the Secondary Unit and
requires, among other things, that the Secondary Unit be reserved for occupancy by, and at rents
affordable to, Very-Low, Low-, and Moderate-Income households for the length of the restrictions.
The Agreement will remain in effect regardless of any sale, assignment, or transfer of the property,
unless the Agreement is terminated by the City in writing.
7.1 Rental Requirements
If the owner rents the Secondary Unit, the owner shall rent the unit to a Qualified Household and
must follow the procedures set forth in Section 4.11. The rent charged to the Qualified Household
must not exceed one twelfth (1/12) of thirty percent (30%) of the applicable Maximum Income,
adjusted for household size, less a utility allowance as specified by the Housing Authority of
Alameda County. Owner shall ensure that all leases and contracts with tenants prohibit subleasing of
the Secondary Unit.
7.2 Reporting Requirements
Prior to a household's initial occupancy of a Secondary Unit, and on every anniversary thereafter,
the owner or its authorized agent shall obtain from each household written documentation verifying
each tenant's eligibility containing all of the following, including additional documentation as City
may reasonably require:
• Number of people in the household; and
• Total household income.
The owner or its authorized agent shall retain this documentation for not less than three (3) years, and
upon City's request, shall make the documentation available for inspection by City and shall provide
copies of the documentation to City. The owner or its authorized agent may require each household
to certify the verifying documentation.
7.3 Annual Report - Inspections
Owner shall submit an annual report to the City in conformity with the requirements of Section
8.68.OSO.B of the Inclusionary Zoning Regulations, together with a certification that the property is in
compliance with the requirements of the Secondary Unit Regulatory Agreement and Declaration of
Restrictive Covenants. The annual report shall, at a minimum, include the following information: (i)
the address of the Secondary Unit; (ii) the monthly rents charged and proposed to be charged; (v) the
number of people residing in the unit; and (vi) the total household income of residents. Upon City's
request, Owner shall include with the annual report, a copy of the verifying documentation described
in Section 8.3, and such additional information as City may reasonably request from time to time in
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order to show compliance with the Secondary Unit Regulatory Agreement and Declaration of
Restrictive Covenants.
Owner shall permit representatives of City to enter and inspect the property during reasonable
business hours in order to monitor compliance with the Secondary Unit Regulatory Agreement and
Declaration of Restrictive Covenants upon 24 hours advance notice of such visit to Owner.
7.4 Management Responsibilities
Owner shall be responsible for all management functions with respect to the Property, including
without limitation the selection of tenants, certification and recertification of household income and
eligibility, evictions, collection of rents and deposits, maintenance, landscaping, routine and
extraordinary repairs, replacement of capital items, and security. Except as City may otherwise agree
in writing, City shall have no responsibility for management or maintenance of the Property. ~The
contracting of management services to a management entity shall not relieve owner of its primary
responsibility for proper performance of management duties.
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Exhibit E
MEMORANDUM OF AFFORDABLE HOUSING REGULATORY AGREEMENT
AND DECLARATION OF RESTRICTIVE COVENANTS
Affordable Housing Regulatory Agreement between -
City of Dubiin and PCCP CS II Tralee Village, LLC Page E-1
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Recording requested by and when
recorded mail to:
City of Dublin
100 Civic Plaza
Dublin, CA 94568
Attn: City Clerk
EXEMPT FROM RECORDING FEES PER
GOVERNMENT CODE 627383
Space above this line for Recorder's use
MEMORANDUM OF AFFORDABLE HOUSING REGULATORYAGREEMENT
AND DECLARATION OF RESTRICTIVE COVENANTS
This Memorandum of Affordable Housing Regulatory Agreement and Declaration of
Restrictive Covenants (the "Memorandum") is entered into on this day of , 201 l,
by and between the City of Dublin; a municipal corporation (the "City") and PCCP CS II
Tralee Village, LLC, a Delaware limited liability company (the "Developer").
1. Pursuant to the Affordable Housing Regulatory Agreement and Declaration of
Restrictive Covenants dated as of , 2011 by and between City and
Developer (the "Agreement"}, the Parties have set forth their respective obligations with .
respect to the provision of affordable rental units on lands presently owned by Developer
known generally as the Tralee Apartment Project and more specifically described in Exhibit
A attached hereto and incorporated herein by this reference (the "Property''). These
obligations run with the land.
2. With respect to the Property, the Agreement evidenced by this Memorandum
supersedes the prior Affordable Housing Agreement, dated October 19, 2005 between
Pfeiffer Ranch Investors, Inc., and City, a memorandum of which was recorded in the
Official Records of Alameda County on October 21, 2005 as Instrument No. 2005455428.
3. Developer and City have executed and recorded this instrument to give notice
of the Agreement, and the respective rights and obligations of Developer and Gity
thereunder. The unrecorded Affordable Housing Agreement and Declaration of Restrictive
Covenants is incorporated by reference in its entirety in this Memorandum.
4. This Memorandum shall bind and inure to the benefit of the parties and their
respective heirs, successors and assigns, subject however to restrictions set forth in the
Agreement regarding assignment.
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IN WITNESS WHEREOF, the parties hereto have caused this Memorandum to be
executed as of the date and year first above written.
CITY OF DUBLIN,
a municipal corporation
By:
Joni Patillo, City Manager
Attest:
Caroline Soto, City Clerk
Approved as to form:
John Bakker, City Attorney
PCCP CS II TR.ALEE VILLAGE, LLC,
a Delaware limited liability company
By:
Its:
SIGNATURES MUST BE NOTARIZED.
1687044
Affordabie Housing Regulatory Agreement between
City of Dublin and PCCP CS 11 Tralee Village, LLC Page E-3
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Exhibit A to Memorandum of Agreement
PROPERTY DESCRIPTION
Real property in the County of Alameda, State of California, described as follows:
Lot 4 of Tract 7457, Filed June 13, 2006, Book 291, Pages 29 Through 37, inclusive,
Alameda County Records.
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STATE OF CALIFORNIA
COUNTY OF ALAMEDA
On , 20_, before me, ,(here insert name and title
of the officer), personally appeared , who proved to me on
the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in. his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
STATE OF CALIFORNIA
COUNTY OF ALAMEDA
On , 20_, before me, ,(here insert name and title
of the officer), personally appeared , who proved to me on
the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the
within instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERNRY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature
(Seal)
Affordable Housing Regulatory Agreement between
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