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EXHIBIT 1 R8QUEST FOR COUNCIL ACTION I ^Vili':J- CITY COUNCIL MEETING DATE: DECEMBER 4, 2018 TITLE: RECEIVE AND FILE REPORT ON THE EFFECTIVENESS OF THE HOUSING OPPORTUNITY ORDINANCE AND NEXT STEPS IN DEVELOPING POLICY OPTIONS FOR FUTURE CONSIDERATION (STRATEGIC PLAN NO 5, 3) RECOMMENDED ACTION CLERK OF COUNCIL USE ONLY: APPROVED ❑ As Recommended ❑ As Amended ❑ Ordinance on la Reading ❑ Ordinance on 2nd Reading ❑ Implementing Resolution ❑ Set Public Hearing For CONTINUED TO FILE NUMBER Receive and file report on the effectiveness of the Housing Opportunity Ordinance and next steps in developing options for future consideration. DISCUSSION On November 28, 2011, City Council adopted the Housing Opportunity Ordinance (Ordinance) to encourage the development and availability of affordable housing by requiring the inclusion of affordable housing units within new developments or the conversion of rental units to condominium ownership when the number of units exceeds the densities permitted under the General Plan. The Ordinance was amended by the City Council on October 6, 2015 to increase the in -lieu fee among other key changes. (See Exhibit 1 for a more detailed history.) Under the. Ordinance, developers may elect to satisfy their inclusionary unit requirements for a project, in whole or in part, by payment of a fee in -lieu of constructing some or all of the required incluslonary units on -site or off -site. The amount of the in-ileu fee depends on the total number of housing units in the project. In the case of a residential project containing between five (5) and. twenty (20) residential lots or residential units, the fee is five dollars per square foot ($5.00/SF) of the sum total of the number of habitable square feet within the entire project. In the case of a residential project comprised of more than twenty (20) residential lots or residential units, the amount of the fee is fifteen dollars per square foot ($15.00/SF) of the sum total of the number of habitable square feet within the entire project. In accordance with Section 41-1910 of the Ordinance, "Between July 1, 2018 and December 31, 2018, staff shall report' n the effectiveness of the Housing Opportunity Ordinance and provide options for council cons'deration on the components of this ordinance, including, but not limited to, the monetary amount of Inclusionary in-lleu fee per square foot" Staff has prepared the following report on the effectiveness of the Ordinance followed by policy areas staff will evaluate. . L•