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HomeMy WebLinkAbout60A - SENIOR RENTAL DENSITY BONUSREQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: OCTOBER 16, 2018 CLERK OF COUNCIL USE ONLY: TITLE: APPROVED 1-1 APPROVE A DENSITY BONUS AGREEMENT TO ❑❑ ALLOW A 418 UNIT AFFORDABLE SENIOR RENTAL COMMUNITY AT 2222 EAST FIRST ❑ ❑ STREET ❑ {STRATEGIC PLAN NOS. 3,2; 5, 3} r bify MANAGER RECOMMENDED ACTION As Recommended As Amended Ordinance on 1� Reading Ordinance on 20d Reading Implementing Resolution Set Public Hearing For CONTINUED TO FILE NUMBER Authorize the City Manager and Clerk of the Council to execute a Density Bonus Agreement with Santa Ana Senior Associates, a California Limited Partnership, or assigns, for a 55 -year term, for the development of a 418 -unit affordable senior rental residential community at 2222 East First Street, subject to non -substantive changes approved by the City Manager and City Attorney. PLANNING COMMISSION ACTION At its regular meeting on September 11, 2017, the Planning Commission recommended approval of the Density Bonus Agreement No. 2017-01 by City Council as conditioned to allow construction of a 418 -unit affordable senior rental residential community at 2222 East First Street located in the Metro East Mixed Use Overlay District (OZ -1). Planning Commission approved the recommended action on September 11, 2017 by a vote of 5:2 (Contreras -Leo and Nguyen opposed). This item was continued from the Regular City Council meeting of May 1, 2018 with direction for staff to provide additional information on the following issues: The Housing Element prioritizes large family housing due to the larger household size and younger age of the City's population. As an affordable senior housing project the increased density permitted by this agreement will serve a different segment of the population without supportive services tailored to the population. The MEMU is intended to create a unique urban environment that provides a mix of housing in order to encourage a continuum of living and a variety of household types.- There are four affordable housing projects with entitlements in the expanded MEMU area. he Orchard at 60A-1 Density Bonus Agreement for 2222 East First Street October 16, 2018 Page 2 2151 E. First Street has 71 units of permanent supportive housing is fully occupied. First Street Apartments at 1449 E. First St. is under construction and will have 68 units of multi- family housing. Two additional affordable housing projects are entitled on East First Street within 320 feet of each other. The current project under consideration, Villa Court Senior Apartments, includes 91 studio units, 262 one -bedroom units and 65 two-bedroom units. The family housing project, First Point I and ll, includes 27 one -bedroom units, 239 two-bedroom units, 146 three-bedroom units, and 140 four-bedroom units. If the two entitled projects, Villa Court and First Point I and II, are developed, there will be over 1,100 affordable housing projects along the First Street corridor between 1-5 and Grand. The City has not made any commitment in any form to provide funding for the development of this project. The approval of the Density Bonus Agreement shall not be construed as approval of the financing requested by the developer for the project and does not bind the City in any form to provide future funding for the development of the project. The Density Bonus Agreement (DBA) will allow for 418 affordable units on a 3.17 -acre site. The previously approved MEMU Environmental Impact Report (EIR) analyzes the impact of increased density based on a typical density of 90 dwelling units per acre. The proposed Density Bonus exceeds the density analyzed in the EIR. The Traffic Impact Analysis prepared on this project indicates that the project will not generate any new significant traffic impacts. The MEMU requires 15% publically accessible open space for multi -family projects or approximately 1/2 acre for this project. The project was approved with a Housing Density Bonus concession reducing the amount of open space required to less than 1/8 acre. The MEMU requires two parking spaces per unit inclusive of guest parking or 836 spaces for this project. The project was approved with a reduced number of parking spaces pursuant to AB 744. As a result, the required parking for this project is '/z parking space per unit or approximately 213 spaces. In summary, the Density Bonus Agreement as written will facilitate development of an affordable senior rental housing project that serves a group that was not identified as a priority population and locates two affordable housing projects within close proximity of each other contrary to the purpose and intent of the Santa Ana Municipal Code Article XVI.I — Density Bonus for Affordable Housing. DISCUSSION The California Density Bonus Law allows developers to seek increases in allowed zoning density by providing additional affordable housing units on-site. To make development of on-site affordable housing units feasible, the law allows developers to request incentives or waivers, which are essentially variances from development standards. The first version of the Density Bonus Law was 60A-2 Density Bonus Agreement for 2222 East First Street October 16, 2018 Page 3 adopted in 1979 and has been amended from time to time. In early 2017, the law was amended to restrict the ability of local jurisdictions to require studies to justify a density bonus and places the burden on local granting authorities to prove that the requested incentives/waivers are not financially warranted. The California Density Bonus Law applies to projects proposing five or more residential units and grants density bonuses to those projects meeting certain requirements for affordability levels and types of housing (family, veterans, etc.). Pursuant to State law and the City's Housing Opportunity Ordinance, rental units in such developments that are designated "affordable" must remain so for at least 55 years. For affordable housing projects, a developer may seek a density bonus up to 20 percent from base density. In addition, the City's Housing Opportunity Ordinance (HOO), last updated in November 2015, augments the California Density Bonus Law by allowing a developer to seek an additional 35 percent density bonus calculated from base density (SAMC Sect. 41- 1904.1). A summary of the proposed project's density calculation is provided below: Project Density Calculation Density or Bonus Allowed for Project Provided 285 units (3.17 acres x 90 units/acre base density used Base Density as a standard for 285 units developments in areas designated DC by the General Plan Land Use element 20 -Percent Density Bonus for Senior Projects Provided by 285 x 20% = 57 units + 57 units California Density Bonus Law 35 -Percent Density Bonus Provided by the City's Housing Opportunity 285 x 35% = 100 units + 76 units Ordinance Total Units 442 units maximum 418 units pro osed Based on the above calculations, the proposed project complies with both the California Density Bonus Law and the City's Housing Opportunity Ordinance. As such, a Density Bonus Agreement has been prepared (Exhibit 1). The Developer has paid the City's Density Bonus Setup fee in the amount of $58,117.34 to prepare this agreement. Under California Density Bonus Law, a developer may seek incentives or waivers (sometimes called concessions) to increase the viability of the proposed project. The Planning Commission Staff Report from September 11, 2017 provides detailed information regarding the requested incentives/concessions (Exhibit 2). Key Items in the Density Bonus Agreement The following is a list of key items agreed upon in the Density Bonus Agreement: • The Project shall have no less than four -hundred and eighteen (418) units which shall be. comprised of ninety-one (91) studio units, two -hundred and sixty-two (262) one -bedroom 60A-3. Density Bonus Agreement for 2222 East First Street October 16, 2018 Page 4 units, and sixty-five (65) two-bedroom units. 415 affordable units shall be restricted to use and occupancy by eligible households for a total period of no less than fifty-five (55) years including: o No less than forty-two (42) affordable units in the Project shall at all times during the term of the agreement be rented to very low income tenants at 50% Area Median Income (AMI); and o No less than three -hundred and seventy-three (373) affordable units in the Project shall at all times during the term of the agreement be rented to low income tenants at 60% Area Median Income. • The affordable rents shall be determined by the regulatory agreements entered into between the Developer and the California Tax Credit Allocation Committee (CTCAC) and the California Debt Limit Allocation Committee (CDLAC) governing the project. • The Owner shall, at all times during the term of this Agreement, cause the Property and the Project to be maintained in a decent, safe and sanitary manner. If at any time the Developer fails to maintain the Project then the City shall have the right to enter upon the applicable portion of the Project and perform all acts and work necessary to protect, maintain, and preserve the Project, and to attach a lien upon the Property, or to assess the Property, in the amount of the expenditures arising from such work. • Developer shall execute a maintenance agreement with the City which shall be recorded against the property prior to occupancy. • Developer shall prepare and obtain City's approval a marketing program for the leasing of the units at the Project prior to occupancy. • Developer shall submit a "Management Plan" to the City which sets forth in detail Developers property management duties, a tenant selection process in accordance with the Agreement, a security system and crime prevention program, the procedures for the collection of rent, the procedures for eviction of tenants, the rules and regulations for the Property and manner of enforcement, a standard lease form, an operating budget, the identity and emergency contact information of the professional property management company to be contracted with to provide 24-hour onsite property management services at the Property ("Property Manager"), and other matters relevant to the management of the Property. • The Developer shall give preference in leasing units to households that live and/or work in the City of Santa Ana or who have an active Housing Choice Voucher issued by the Housing Authority of the City of Santa Ana or any other Public Housing Authority. Implementation of the preference will be monitored by staff in the Community Development Agency. • Owner agrees to pay a reasonable fee, as set by City resolution, for the City's obligation to monitor Owners compliance with the affordability restrictions contained in the Agreement. • Developer shall submit for review and approval, a booklet to inform interested persons regarding minimum application and eligibility requirements and to assist interested persons with application and financial preparedness and eligibility for residency at the Project at the initial leasing of the units. Developer shall also hold a minimum of two workshops to be coordinated by the Developer at least 12 months prior to the initial leasing of the units. • Throughout the term of the Agreement, Developer shall provide residents of the Project access to discounted or no -cost onsite supportive services, programming, and amenities that promote independent living and include but is not limited to: health and wellness 60A-4 Density Bonus Agreement for 2222 East First Street October 16, 2018 Page 5 services, transportation services, social activities, and physical or recreational amenities. Project Description The project includes demolition of an existing motel and restaurant and construction of an affordable rental senior housing community. The project will contain one structure consisting of a ground -level parking area and five levels of residential above. A total of 415 affordable rental senior units will be provided on the project site, as well as three (3) on-site manager's units. Units will include ninety-one (91) studio units, two -hundred and sixty-two (262) one -bedroom units, and sixty-five (65) two-bedroom units ranging in size from 402 to 899 square feet. All units will contain full kitchens, full bathrooms, storage, and open/common (living) areas. The project will contain 213 guest and resident parking spaces in an at -grade parking area beneath the residential levels. The parking ratio conforms to the provisions in AB 744, which allows affordable rental senior housing projects near major bus lines to provide 0.5 parking spaces per residential unit. Full sized site plans are available for public viewing in the Clerk of the Council Office. The approval of the density bonus agreement is in compliance with Section 41-1600 and Section 41-1904.1, et seq., of the Santa Ana Municipal Code, and Section 65915, et seq., of the California Government Code. However, the approval of the density bonus agreement shall not be construed as approval of the financing requested by the developer for the project and does not bind the city in any form to provide future funding for the development of the project. STRATEGIC PLAN ALIGNMENT Approval of this item supports the City's efforts to meet Goal # 3 - Economic Development, Objective #2 (create new opportunities for business/job growth and encourage private development through new General Plan and Zoning Ordinance policies), Objective # 5 (leverage private investment that results in tax base expansion and job creation citywide) and Goal # 5 - Community Health, Livability, Engagement & Sustainability, Objective # 3 (facilitate diverse housing opportunities and support efforts to preserve and improve the livability of Santa Ana neighborhoods). FISCAL IMPACT There is no fiscal impact associated with this action. l,k_1 =, Steven A. Mendoza Executive Director Community Development Agency Minh Thai Executive Director Planning and Building Agency Exhibits: 1. Density Bonus Agreement 2. Planning Commission Staff Report from September 11, 2017 60A-5 RECORDING REQUESTED BY: AND WHEN RECORDED MAIL TO: City of Santa Ana Clerk of the Council 20 Civic Center Plaza (M-30) P.O. Box 1988 Santa Ana, California 92702 Attention: Clerk of the Council EXHIBIT 1 Free Recording pursuant to Government Code 27383 DENSITY BONUS HOUSING AGREEMENT This DENSITY BONUS HOUSING AGREEMENT ("Agreement"), made and entered into this 16°i day of October, 2018 ("Effective Date"), by and between the City of Santa Ana, a charter city and municipal corporation of the State of California ("City"), and -Santa Ana Senior Associates, a California Limited Partnership ("Developer"). City and Developer are sometimes referred to collectively as the "Parties" and individually as a "Party." RECITALS A. Developer is the owner of certain property located within the City of Santa Ana, County of Orange, State of California, commonly known as 2222 East First Street, Santa Ana, California, and legally described as set forth in Exhibit A attached hereto and incorporated herein by this reference as if set forth in full ("Property"). B. Developer is proposing to develop a four -hundred and eighteen (418) unit affordable senior apartment complex on the Property as more particularly set forth in Density Bonus Application No. 2017-01 and Site Plan Review No. 2017-08 ("Project"). Without the density bonuses, Developer would only be permitted to build two -hundred and eighty-five (285) units on the Property. C. Santa Ana Municipal Code sections 41-1600, et seq. ("City Density Bonus for Affordable Housing"), and California Government Code sections 65915, et seq. ("State Density Bonus Law"), set forth a process to provide increased residential densities to property owners who guarantee that a portion of their residential development will be available to low income, very low- income, or senior (also known as "qualified") households. These regulations are intended to materially assist the housing industry in providing adequate and affordable housing for all economic segments of the community and to provide a balance of housing opportunities for very low-income, low income and senior households throughout the city. D. Additionally, the City's Housing Opportunity Ordinance provides inclusionary housing development incentives for production of affordable units on-site. Specifically, Santa Ana Municipal Code section 41-1904.1 includes a density bonus concession up to a maximum of thirty- five percent (35%) to provide affordable housing options for residents of the City of Santa Ana. 60A-7 E. For the purpose of implementing State Density Bonus Law, City Density Bonus for Affordable Housing, and City Housing Opportunity Ordinance concessions in response to Developer's request for two (2) density bonuses, as well as additional concessions and incentives, Developer has agreed to restrict all Units in the Project, except for three (3) manager's units, to Eligible Households, which includes Very Low Income and Low Income Tenants. F. The Project complies with the affordable housing requirements set forth in the State Density Bonus Law, City Density Bonus for Affordable Housing, and City Housing Opportunity Ordinance. For purposes of this Agreement, the Project shall be the "housing development" as defined in the State Density Bonus Law. G. In light of the purpose of the State Density Bonus Law, City Density Bonus for Affordable Housing, and City Housing Opportunity Ordinance, and the express provisions of Government Code section 65915(n), as well as Santa Ana Municipal Code section 41-1904.1, the City has determined to grant Developer's application for density bonuses and related concessions and incentives. H. This Agreement, and the exhibits attached hereto and incorporated herein by reference, is intended to set forth the terms and conditions for the implementation of the Project's requirement to provide affordable housing units in exchange for receiving the Density Bonus Units and additional concessions and incentives set forth herein. I. The Developer has paid the City's Density Bonus Setup fee in the amount of $58,117.34. NOW, THEREFORE, in consideration of the above recitals, which are incorporated herein by this reference, and of the mutual covenants contained and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: DEFINITIONS AND EXHIBITS 1.1 Definitions. In addition to the terms that may be defined elsewhere in this Agreement, the following terms when used in this Agreement shall be defined as follows: 1.1.1 "Adjusted for family size appropriate to the unit" shall have the meaning set forth by the California Tax Credit Allocation Committee, from time to time, in administering the low income housing tax credit programs. 1.1.2 "Affordable Rent" means the maximum Monthly Rent that may be charged to and paid by an Eligible Household for the Affordable Units, as required by the terms of this Agreement. 1.1.3 "Affordable Rent Schedule" means a rent schedule established as of the date of issuance of an occupancy permit (exclusive of tenant utility payments or security deposits) for the required number/percentage of the total number of units in the Project which are to be .1 m rented or available for rent to very low or low income tenants. Said Affordable Rent Schedule shall be established at the time of the issuance of the occupancy permit ("Initial Rent Schedule") and shall be created in accordance with the Orange County, California Primary Metropolitan Statistical Area ("PMSA") as published by the United States Department of Housing and Urban Development ("HUD"), adjusted for family size. 1.1.4 "Affordable Units" means four -hundred and fifteen (415) units which shall be comprised of ninety-one (91) studio Units, two -hundred and sixty-two (262) one (1) bedroom Units, and sixty-five (65) two (2) bedroom Units of which three (3) Unrestricted Units (i.e. — manager's unit) with unit sizes as may be determined by the Developer. 1.1.5 "Agreement" means this Density Bonus Housing Agreement. 1.1.6 "Base Units" means the two -hundred and eighty-five (285) Units that Developer would be authorized to develop on the Property without application of the State Density Bonus Law and City Housing Opportunity Ordinance density bonus. 1.1.7 "City" means the City of Santa Ana, California 1.1.8 "City Council" means the City Council of the City of Santa Ana. 1.1.9 "City Attorney" means the City Attorney for the City of Santa Ana. 1.1.10 "City Manager" means the City Manager for the City of Santa Ana. 1.1.11 "City's Planning Commission" means the Planning Commission for the City of Santa Ana. 1.1.12 "Density Bonus Housing Agreement Term" means the period during which this Agreement shall be in full force and effect, as provided for in Section 6.1 below. 1.1.13 "Density Bonus Units" means the one -hundred and thirty-three (133) Units in addition to the Base Units that Developer shall develop pursuant to the density allowance in the State Density Bonus Law, the City Housing Opportunity Ordinance density bonus, and the terms and conditions of this Agreement, of which Developer would not be entitled to develop without providing the Affordable Units. 1.1.14 "Developer" means Santa Ana Senior Associates, a California Limited Partnership, and its permitted successors and assigns to all or any part of the Property. 1.1.15 "Effective Date" means the date the City Council of City approves this Agreement and from then on this Agreement shall be in full force and effect. 1.1.16 "Eligible Household" means a Household whose income does not exceed the qualifying limit for a "very low income tenant" or "lower income tenant" as defined herein, 60A-9 which means persons and families whose income does not exceed the qualifying limit for very low income or lower income households. 1.1.17 "Household" means all persons residing in a Unit. 1.1.18 "Low Income Tenant" means persons and families whose income does not exceed eighty percent (80%) area median income for the Orange County, California PMSA, adjusted for household size, as published by the California Tax Credit Allocation Committee. 1.1.19 "Median Income" means the Orange County, California area median income, adjusted for family size appropriate to the unit, as periodically published by the California Tax Credit Allocation Committee. 1.1.20 "Monthly Rent" means the total of monthly payments for (a) use and occupancy of each Affordable Unit and land and facilities associated therewith, (b) any separately charged fees or service charges assessed by Developer which are required of all tenants, other than security deposits, application fees or credit check fees (c) a reasonable allowance for an adequate level of service of utilities not included in (a) or (b) above, including garbage collection, sewer, water, electricity, gas and other heating, cooking and refrigeration fuels, but not including telephone or cable service, and (d) possessory interest, taxes or other fees or charges assessed for use of the land and facilities associated therewith by a public or private entity other than Developer. In the event that certain utility charges are paid by the landlord rather than the tenant, no utility allowance shall be deducted from the rent for that type of utility charge. 1.1.21 "Project" means that certain residential development as more particularly described in Recital B and Section 2 of this Agreement. 1. 1.22 "Property" means that certain real property more particularly described in the legal description in Exhibit A and improvements thereon. 1.1.23 "State Density Bonus Law" means Government Code sections 65915, et seq., as they exist on the Effective Date. 1.1.24 "Unit" means a residential dwelling unit within the Project to be constructed by Developer pursuant to this Agreement. 1.1.25 "Unrestricted Units" means the Units within the Project to be constructed by Developer to a Household without restriction (i.e. — manager's unit). 1.1.26 "Very Low Income Tenant" means persons and families whose income does not exceed fifty (50%) of the area median income for the Orange County, California PMSA, adjusted for household size, as published by the California Tax Credit Allocation Committee. 1.2 Exhibits. The following documents are attached to, and by this reference made a part of, this Agreement: 60A-10 1.2.1 Exhibit A — Legal Description of the Property 1.2.2 Exhibit B — Tenant Verification 2. DEVELOPMENT OF THE PROPERTY 2.1 Project. Developer shall develop, operate, and maintain the Property as a four - hundred and eighteen (418) Unit affordable senior residential rental community, with four -hundred and fifteen (415) Affordable Units and three 3 Unrestricted Units. 2.2 Density Bonus. The Project shall have four -hundred and eighteen (418) Units, to be rented, occupied, operated, and maintained pursuant to the terms and conditions of this Agreement. Developer understands and agrees that Developer is utilizing a twenty percent (20%) density bonus increase provided by the State Density Bonus Law CZ85 Base Units x 20% = 57 State Density Bonus Units), as well as a thirty-five percent (35%) density bonus provided by the City's Housing Opportunity Ordinance 285 Base Units x 35% = 100 City Density Bonus Units). However, Developer is only proposing four -hundred and eighteen (418) Units, so Developer shall not construct or develop, or otherwise claim a right to construct or develop, more than one -hundred and thirty-three (133) State and/or City Density Bonus Units on the Property. 2.3 Development Concessions and Incentives. As set forth in the City entitlements, Developer petitioned for and was granted the following concessions and incentives as part of the approval of Site Plan Review No. 2017-08 for the Project: 2.3.1 TheaP rking requirements for the Project shall be reduced in accordance with Government Code Section 65915(p), such that the total of all parking spaces required for the Project shall not exceed 213 spaces. 2.3.2 The open space requirement calculation shall be reduced from 15% of total lot area to 3.6% of total lot area. 2.3.3 The building side yard setback requirement shall be amended from a maximum of ten (10) feet to a maximum of forty-one (41) feet. The building rear yard setback requirement shall be amended from a minimum of one hundred (100) feet to a minimum of thirty- three 33 feet. 2.3.4 The driveway width requirement shall be increased from a maximum of twenty-four (24) feet to twenty-five to twenty-eight (25-28) feet. 2.4 In exercising the rights granted to the developer under AB 744 the parking requirements for the Project shall be reduced in accordance with Government Code Section 65915(p), such that the total of all parking spaces for required for the Project shall not exceed 213 spaces. 2.5 No Further Concessions or Incentives. Developer acknowledges and agrees that the waivers and incentives set forth in section 2.3 above fully satisfy any duty City may have under 60A-11 the Santa Ana Municipal Code, the Density Bonus Law, or any other law or regulation applicable to the Project, to provide any development incentive or to waive any building, zoning, or other requirement. By this Agreement, Developer releases any and all claims Developer may have against City in any way relating to or arising from City's obligation to waive requirements of or provide development incentives pursuant to any state, federal, or local law, rule, or regulation applicable to the Project. 2.6 Unrestricted Units. The Project, for purposes of this Agreement, may have no more than three 3 Unrestricted Units (i.e. — manager's unit) with unit sizes as may be determined by the Developer. Developer may alter the unit distribution of the Unrestricted Units in Developer's discretion, provided that the Project has the minimum number of Affordable Units and the minimum distribution thereof as specified in this Agreement. 2.7 Affordable Units. The Project, for purposes of this Agreement, shall have no less than four -hundred and fifteen (415) Units designated as Affordable Units pursuant to the terms and conditions of this Agreement. The Affordable Units shall be consistent with all City approvals, and shall be located throughout the Project. 2.8 Minimum Development Standards for Affordable Units. The Affordable Units shall be constructed with the same exterior appearance and interior features, fixtures, and amenities, and shall use the same type and quality of materials as provided for any Unrestricted Units, regardless of whether such Unrestricted Units are in the Project. 2.9 Permits and Processing; Compliance with Laws. Developer at its sole cost and expense shall secure or cause to be secured any and all permits that may be required by City or any other federal, state, or local governmental entity having or claiming jurisdiction over the Property or Project. Upon securing any and all permits, Developer shall carry out and perform the development, operation, and maintenance of the Project in conformity with all applicable federal, state, and local laws and regulations, and all conditions of approval issued by the City Council and City's Planning Commission for the Project. Any changes to the Project shall be reviewed by the City to determine compliance with this Agreement. If any changes to the Project shall materially alter the ability of Developer to comply with any terms of this Agreement in City's sole determination, then City shall have the option to declare this Agreement null and void in its sole discretion. 2.10 Relocation Prior to Development of Proiect. If relocation is required prior to the completion of development of the Project, Developer shall have the sole and exclusive responsibility for providing relocation assistance and paying all relocation costs as maybe required to comply with applicable federal and state laws and regulations. In addition to any other indemnity provided by Developer under this Agreement, Developer shall indemnify, defend (with counsel of City's choosing and the consent of Developer, which shall not be unreasonably withheld, and which may be joint defense counsel upon City's and Developer's consent), and hold harmless City and all of its officials, officers, employees, representatives, volunteers and agents from any and all alleged or actual claims, causes of action, liabilities, and damages from any third party for relocation assistance, benefits and costs prior to the completion of the development of the Project. ON 60A-12 2.11 Local Sourcing Plan. Developer agrees to make a good faith effort to encourage contractors and suppliers to hire and procure locally, to the extent that it is cost effective and does not delay the overall project development schedule. Prior to issuance of Building Permit, Developer shall develop and submit to the Community Development Agency (the "CDA") a local sourcing plan for the Project targeting, to the extent feasible, the hiring of qualified workers, construction contractors, or the purchasing of goods locally within the City of Santa Ana. The plan must be reviewed and approved by the CDA which if not granted or denied within five (5) Business Days, shall be deemed approved (with such approval not to be unreasonably withheld) and be implemented for the construction of the project prior to issuance of Building Permit. 2.12 Mechanic's Liens, Indemnification. Developer shall take all actions reasonably necessary to remove any future mechanic's liens or other similar liens (including design professional liens) against the Property or Project, or any part thereof, by reason of work, labor, services, or materials supplied or claimed to have been supplied to Developer or anyone holding the Property or Project, or any part thereof, through or under Developer. Prior to the recording of this Agreement (or memorandum thereof) pursuant to Section 4.1 below, Developer shall provide evidence from the Title Company of any new recordings against the Property or Project. City hereby reserves all rights to post notices of non -responsibility and any other notices as may be appropriate upon a filing of a mechanic's lien. In addition to any other indemnity provided by Developer under this Agreement, Developer shall indemnify, defend (with counsel of City's choosing and the consent of Developer, which shall not be unreasonably withheld, and which may be joint defense counsel upon City's and Developer's consent), and hold harmless City and all of its officials, officers, employees, representatives, volunteers and agents from any and all alleged or actual claims, causes of action, liabilities, and damages from any third party by reason of a mechanic's lien or work, labor, services, or materials supplied or claimed to have been supplied to Developer or anyone holding the Property or Project, or any part thereof, through or under Developer. AFFORDABILITY 3.1 Total Affordability Term. Each Affordable Unit shall be restricted to use and occupancy by an Eligible Household for a total period of no less than fifty-five (55) years ("Total Affordability Term"). The Total Affordability Term for an Affordable Unit shall commence on the date that the Affordable Unit receives all required occupancy permits from the City. By way of explanation of the foregoing two sentences, it is possible that the Total Affordability Period for one Affordable Unit will neither commence on the same date nor terminate on the same date as another Affordable Unit, and it is possible that the Total Affordability Terms for all Affordable Units will commence on different days and terminate on different days. 3.2 Memorializing Commencement of Total Affordability Term. Developer shall keep detailed records of the commencement date of the Total Affordability Term for each Affordable Unit. City shall have the right to review and verify said records to ensure that the commencement date specified by Developer for an Affordable Unit coincides with the date that the initial Affordable Unit received all permits from City required for occupancy of the Unit. In the event that a conflict exists between the date specified by Developer for the commencement of the Total Affordability Term for an Affordable Unit and the date specified by City s issuance of all required 60A-13 permits for occupancy of the Unit, the date specified by City's issuance of all required permits for occupancy of the Unit shall control. 3.3 Levels of Affordability. 3.3.1 Very Low Income Tenants. Developer covenants that no less than forty- two 42 Affordable Units in the Project shall at all times during the Density Bonus Housing Agreement Term be rented to, or held vacant and available for immediate occupancy by Very Low Income Tenants, at a rent that does not exceed thirty percent (30%) of fifty percent (50%) of the area median income, as adjusted for household size, including an allowance for utilities. 3.3.2 Low Income Tenants. Developer covenants that no less than three -hundred and seventy-three (373) Affordable Units in the Project shall at all times during the Density Bonus Housing Agreement Term be rented to, or held vacant and available for immediate occupancy by Lower Income Tenants, at a rent that does not exceed thirty percent (30%) of sixty percent (60%) of the area median income, as adjusted for household size, including an allowance for utilities. 3.4 Affordable Rental Schedule. The Affordable Rental Schedule shall be determined by the regulatory agreements entered into between the Developer and the California Tax Credit Allocation Committee (CTCAC) and the California Debt Limit Allocation Committee (CDLAC) governing the project. 4. OWNERSHIP AND OPERATION OF THE PROJECT BY OWNER 4.1 Recording of Documents. No later than issuance of building permits for the Project, Developer and the City shall record or cause to be recorded in the Official Records for Orange County, California, an executed original of this Agreement. City shall cooperate with Developer in promptly executing in recordable form this Agreement. Upon the date of recording, the terms and conditions of this Agreement shall be binding upon and run with the Property and the Project. It is the express intent and agreement between the Parties that this Agreement shall remain binding and enforceable against the Property, the Project, and the Units to ensure compliance with the State Density Bonus Law, City Density Bonus Law, and the City Housing Opportunity Ordinance, and to ensure the continued supply of Affordable Units in the Project. 4.2 Rental of Units. Upon the completion of construction of the Project and receipt by Developer of all required permits for the occupancy of the Units, Developer shall rent or cause to be rented each Affordable Unit for the Total Affordability Term for such Affordable Unit in accordance with the terms and conditions set forth in this Agreement, which provide among other terms and conditions for the rental of each Affordable Unit at an Affordable Rent to an Eligible Household for the Total Affordability Term. 4.3 Location of Affordable Units. During the Density Bonus Housing Agreement Term, the Affordable Units shall be disbursed throughout the Project in accordance with the terms and conditions set forth in this Agreement. 60A-14 4.4 Occupancy Levels. The number of persons permitted to occupy each Affordable Unit shall not exceed the occupancy permitted pursuant to the requirements of the United States Department of Housing and Urban Development. In the event that a household residing in an Affordable Unit exceeds the permitted number of persons, then that household shall be placed on the waiting list for the appropriate -sized unit and be eligible for transfer when that unit becomes available. If the household refuses to transfer to the appropriate -sized unit then the Owner will have grounds to terminate that household's lease. 4.5 Use of the Property. All uses conducted on the Property, including, without limitation, all activities undertaken by the Developer pursuant to this Agreement, shall conform to all applicable provisions of the Santa Ana Municipal Code and other applicable federal, state, and local laws, rules, and regulations. The Project shall at all times during the term of this Agreement be used as an apartment complex and none of the Housing Units in the Project shall at any time be utilized on a transient basis, nor shall the Property or any portion thereof ever be used as a hotel, motel, dormitory, fraternity or sorority house, rooming house, hospital, nursing home, sanitarium or rest home, or be converted to condominium ownership. All of the community facilities and any social programs provided to the Project's residents shall be available on an equal, nondiscriminatory basis to residents of all Housing Units at the Project. 4.6 Maintenance. Owner shall, at all times during the term of this Agreement, cause the Property and the Project to be maintained in a decent, safe and sanitary manner, regardless of cause of the disrepair. Owner shall be fully and solely responsible for costs of maintenance, repair, addition and improvements. City, and any of its employees, agents, contractors or designees shall have the right to enter upon the Property at reasonable times and in a reasonable manner to inspect the Project. If at any time Developer fails to maintain the Project or the Property in accordance with this Agreement and such condition is not corrected within five (5) days after written notice from City with respect to debris and waste material, or thirty (30) days after written notice from City with respect to general maintenance, landscaping and building improvements, then City, in addition to whatever remedy it may have at law or at equity, shall have the right to enter upon the applicable portion of the Project or the Property and perform all acts and work necessary to protect, maintain, and preserve the Project and the Property, and to attach a lien upon the Property, or to assess the Property, in the amount of the expenditures arising from such acts and work of protection, maintenance, and preservation by City and/or costs of such cure, including a reasonable administrative charge, which amount shall be promptly paid by Developer to City upon demand. 4.6.1 Property Maintenance Agreement. Subject to review and applicability by the Planning and Building Agency (the "PBA"), the CDA, the Public Works Agency (the "PWA"), and the City Attorney to ensure that the property and all improvements located thereupon are properly maintained, Developer (and the owner of the property upon which the authorized use and/or authorized improvements are located if different from the applicant) shall execute a maintenance agreement with the City of Santa Ana prior to occupancy which shall be recorded against the property and which shall be in a form reasonably satisfactory to the City Attorney. The maintenance agreement shall contain covenants, conditions and restrictions relating to the following: W 60A-15 (a) Compliance with operational conditions applicable during any period(s) of construction or major repair (e.g., proper screening and securing of the construction site; implementation of proper erosion control, dust control and noise mitigation measure; adherence to approved project phasing etc.); (b) Compliance with ongoing operational conditions, requirement and restrictions as applicable, the proper storage and disposal of trash and debris, and/or restrictions on certain uses; (c) Ongoing compliance with approved design and construction parameters, signage parameters and restrictions as well as landscape designs, as applicable; (d) Ongoing maintenance, repair and upkeep of the property and all improvements located thereupon (including but not limited to controls on the proliferation of trash and debris about the property; the proper and timely removal of graffiti; the timely maintenance, repair and upkeep of damaged, vandalized and/or weathered buildings, structures and/or improvements; the timely maintenance, repair and upkeep of exterior paint, parking striping, lighting and irrigation fixtures, walls and fencing, publicly accessible bathrooms and bathroom fixtures, landscaping and related landscape improvements and the like, as applicable); (e) If Developer and the owner of the property are different (e.g., if the applicant is a tenant or licensee of the property or any portion thereof), both the applicant and the owner of the property shall be signatories to the maintenance agreement and both shall be jointly and severally liable for compliance with its terms; (f) The maintenance agreement shall further provide that any party responsible for complying with its terms shall not assign its ownership interest in the property or any interest in any lease, sublease, license or sublicense, unless the prospective assignee agrees in writing to assume all of the duties and obligations and responsibilities set forth under the maintenance agreement; (g) The maintenance agreement shall contain provisions relating to the enforcement of its conditions by the City and shall also contain provisions authorizing the City to recover costs and expenses which the City may incur arising out of any enforcement and/or remediation efforts which the City may undertake in order to cure any deficiency in maintenance, repair or upkeep or to enforce any restrictions or conditions upon the use of the property. The maintenance agreement shall further provide that any unreimbursed costs and/or expenses incurred by the City to cure a deficiency in maintenance or to enforce use restrictions shall become a lien upon the property in an amount equivalent to the actual costs and/or expense incurred by the City; and, (h) The execution and recordation of the maintenance agreement shall be a condition precedent to the issuance of the Certification of Occupancy. 4.7 Marketing Program. Each Affordable Unit shall be leased to Eligible Households selected by Developer who meet all of the requirements provided herein. Prior to Certificate of 10 Occupancy, Developer shall prepare and obtain City's approval, which approval shall not be unreasonably withheld, of a marketing program for the leasing of the Housing Units at the Project ("Marketing Program"). The leasing of the Housing Units shall thereafter be marketed in accordance with the Marketing Program as the same may be amended from time to time with City's prior written approval, which approval shall not unreasonably be withheld. Upon request, Developer shall provide City with periodic reports with respect to the leasing of the Housing Units. 4.8 Management Plan. Prior to Certificate of Occupancy, Developer shall submit for the reasonable approval of City a "Management Plan" which sets forth in detail Developer's property management duties, a tenant selection process in accordance with this Agreement, a security system and crime prevention program, the procedures for the collection of rent, the procedures for eviction of tenants, the rules and regulations for the Property and manner of enforcement, a standard lease form, an operating budget, the identity and emergency contact information of the professional property management company to be contracted with to provide 24-hour onsite property management services at the Property ("Property Manager"), and other matters relevant to the management of the Property. The Management Plan shall require Developer to adhere to a fair lease and grievance procedure. The management of the Property shall be in compliance with the Management Plan as approved by City. If City determines that the performance of the Property Manager is deficient based upon the standards set forth in the approved Management Plan and in this Agreement, City shall provide notice to Developer of such deficiencies and Developer shall use its best efforts to correct such deficiencies. In the event that such deficiencies have not been cured within thirty (30) days, City shall have the right to require Developer to immediately remove and replace the Property Manager with another property manager or property management company which is reasonably acceptable to the City Manager, which is not related to or affiliated with Developer, and which has not less than five (5) years experience in property management, including significant experience managing housing facilities of the size, quality and scope of the Project. 4.9 Selection of Tenants. 4.9.1 Developer shall be responsible for the selection of tenants for the Housing Units in compliance with lawful and reasonable criteria and the requirements of this Agreement. Developer agrees that all of Affordable Units will be available to senior citizens or qualifying residents as defined under California Civil Code section 51.3. 4.9.2 Local preference for Santa Ana residents and workers in tenant selection shall be a requirement of the Project. Subject to applicable laws and regulations governing nondiscrimination and preferences in housing occupancy required by the State of California, the Developer shall give preference in leasing units to households that live and/or work in the City of Santa Ana or who have an active Housing Choice Voucher issued by the Housing Authority of the City of Santa Ana or any other Public Housing Authority. 4.9.3 Prior to the rental or lease of an Affordable Unit to a tenant(s), Developer shall require the tenant(s) to execute a written lease and to complete a Tenant Income Verification Form (in substantially the form attached hereto as Exhibit B) certifying that the tenant(s) 11 60A-17 occupying the Affordable Unit is/are an Eligible Household and otherwise meet(s) the eligibility requirements established for the Affordable Unit. Developer shall verify the income of the tenant(s) as set forth herein. 4.10 Income Verification and Certification. Owner covenants to City that it will at all times abide by all specific compliance standards set forth in the regulatory agreements entered into between the Owner and the California Tax Credit Allocation Committee (CTCAC) and the California Debt Limit Allocation Committee (CDLAC), including but not limited to such standards as relate to the number of very -low and low income affordable units by number of bedrooms, standards for qualifying household incomes and other qualifying criteria. Owner shall provide City with a certified copy of each of the recorded Regulatory Agreements applicable to the Project. The compliance standards set forth in said Regulatory Agreements are hereby incorporated by reference as fully set forth herein. In the event of a conflict between this Agreement and the Regulatory Agreements: (1) the more stringent requirement shall prevail if such interpretation eliminates the relevant conflict; or (2) the Regulatory Agreements, or any of them, shall prevail. Developer agrees to make a good faith effort to verify that the income and asset statement provided by an applicant in an income certification is accurate by taking at least one of the following steps as apart of the verification process: (1) obtain three months consecutive pay stubs for the most recent pay period, (2) obtain an income tax return for the most recent tax year, (3) obtain an income verification form from the applicant's current employer, (4) obtain an income verification form from the Social Security Administration and/or the California Department of Social Services if the applicant receives assistance from either of such agencies, or (5) if the applicant is unemployed and has no such tax return, obtain another form of independent verification. 4.11 Monitoring and Recordkeening. Throughout the Term of this Agreement, Developer shall annually complete and submit to City a Certification of Continuing Program Compliance in the form provided by City. Owner agrees to pay a reasonable fee, as set by City resolution, for the purpose of paying the actual costs associated with the City's obligation to monitor Owner's compliance with the affordability restrictions contained in this Agreement related to the Density Bonus units, not to exceed monitoring costs for up to 133 units. The City shall first start with the review of all reports and monitoring prepared by Owner for the California Tax Credit Allocation Committee (CTCAC) and the California Debt Limit Allocation Committee (CDLAC) each year. Representatives of City shall be entitled to enter the Property if necessary after review of above documentation, upon at least forty-eight (48) hour notice, to monitor compliance with this Agreement, and shall be entitled to inspect the records of the Project and to conduct an independent audit or inspection of such records at a location within the City that is reasonably acceptable to the City. Developer agrees to cooperate with City in making the Property and the records of the Project available for such inspection or audit. Developer agrees to maintain each record of the Project for no less than five (5) years after creation of each such record. Developer shall allow the City to conduct annual inspections of each of the Affordable Units on the Property after the date of construction completion, with reasonable notice. Developer shall cure any defects or deficiencies found by the City while conducting such inspections within 12 ten (10) Business Days of written notice thereof, or such longer period as is reasonable within the sole discretion of the City. 4.12 Application and Financial Preparedness. Developer shall submit for review and approval by the CDA and the PBA, a booklet completed by the Developer at least 12 months prior to the initial leasing of the units. This booklet can be made available at the Property Manager's office or at another location agreed upon by the Owner, the CDA, and the PBA. The purpose of this booklet is to inform interested persons regarding minimum application and eligibility requirements and to assist interested persons with application and financial preparedness and eligibility for residency at the Project at the initial leasing of the units. Developer shall also work with CDA to hold a minimum of two workshops to be coordinated by the Developer at least 12 months prior to the initial leasing of the units. 4.13 Onsite Supportive Services. Programs and Amenities. Throughout the Term of this Agreement, and to the extent such can be coordinated with and largely supplied by philanthropic and other social welfare providers, Developer shall provide residents of the Project access to discounted or no -cost onsite supportive services, programming, and amenities that promote independent living and include but are not limited to: health and wellness services, transportation services, social activities, and physical or recreational amenities. 4.14 Alternative Transportation and Energy Source, Resource Conservation, and LEED Certification. While not a condition of the project's Density Bonus, in recognition of the City's desire to optimize the energy efficiency of the project, Developer agrees to consult with the project design team, a CABEC certified 2016 Certified Energy Analyst, a LEED AP Homes (low-rise and mid -rise), LEED AP BD+C (high rise), National Green Building Standard (NGBS) Green Verifier, or GreenPoint Rater (one person may meet both of these latter qualifications) early in the project design process to evaluate a building energy model analysis and identify and consider energy efficiency or generation measures beyond those required by the TCAC minimum construction standards. Prior to the meeting, the energy analyst shall complete an initial energy model based on either current T24 standards or, if the project is eligible, the California Utility Allowance Calculator using best available information on the project. To the extent financially feasible for the project, Developer agrees to incorporate and optimize energy efficient building materials, methods, and amenities. 4.15 Emergency Backup Generator. While not a condition of the project's Density Bonus, in recognition of the City's desire to optimize the safety and welfare of residents of the project, Developer agrees to consult with the project design team regarding the appropriateness of the emergency planning, routing, lighting, as well as ingress and egress of elevators, hallways, common corridors, parking areas, and stairways. To the extent financially feasible for the project, Developer agrees to reasonably incorporate and optimize such safety provisions and amenities above applicable building code. 4.16 Onsite Property Manager. The Project shall include the provision to have 24-hour on- site Property Management services and personnel. Up-to-date 24-hour contact information for the on-site personnel shall be provided to the following City Agencies on an ongoing basis: (a) Police Department 13 60A-19 (b) Fire Department (c) Planning and Building Agency (d) Community Development Agency 4.17 Emergency Evacuation Plan. Developer shall submit and obtain approval of an Emergency Evacuation Plan (the EEP) from City Police and Fire Protection agencies prior to issuance of a Certificate of Occupancy. Up-to-date 24-hour emergency contact information for the on-site personnel shall be provided to the City on an ongoing basis and the approved EEP shall be kept onsite and also be submitted to the following City Agencies: (a) Police Department (b) Fire Department (c) Planning and Building Agency (d) Community Development Agency 4.18 Crime Free Housing. Developer shall work with City Staff to develop a crime free housing policy, procedure, and design plan (the "CFH Plan"). Developer shall submit and obtain approval from the PBA the CFH Plan meeting the requirements of this Subsection 4.18 prior to issuance of the Certificate of Occupancy. The approved CFH Plan shall be implemented and administered by Property Management. 4.19 Onsite Parking Management Plan. Developer shall provide onsite parking for residents and visitors of the Project and actively monitor the parking demand of the Project site. Developer shall continually monitor and take appropriate measures to manage the parking demand of the Project site to mitigate the use of offsite parking spaces on private or public properties and/or right-of-way. Prior to issuance of the Certificate of Occupancy, Developer shall submit and obtain approval from the PBA a Parking Management Plan (the "PMP") meeting the requirements of this Subsection 4.21. The approved PMP shall be adhered to and be enforced by the Project at all times. 5. [INTENTIONALLY RESERVED] 6. TERM OF THIS AGREEMENT 6.1 Term. The term of this Agreement ("Density Bonus Housing Agreement Term") shall commence on the Effective Date and shall continue until the date that is fifty-five (55) years after the City issues the last certificate of occupancy for the Project. DEFAULT AND TERMINATION: INDEMNIFICATION 7.1 Default. Failure or delay by any Party to perform any term or provision of this Agreement, which is not cured within thirty (30) days after receipt of notice from the other Party specifying the default (or such other period specifically provided herein), constitutes a default under this Agreement; provided, however, if such default is of the nature requiring more than thirty (30) days to cure, the defaulting Party shall avoid default hereunder by commencing to cure within such thirty (30) day period, and thereafter diligently pursuing such cure to completion within an additional sixty (60) days following the conclusion of such thirty (30) day period (for a 14 60A-20 total of ninety (90) days). Except as required to protect against further damages, the injured Party may not institute proceedings against the Party in default until the time for cure has expired. Failure or delay in giving such notice shall not constitute a waiver of any default, nor shall it change the time of default. 7.2 Rights and Remedies Cumulative. The rights and remedies of the Parties are cumulative, and the exercise by either Party of one or more of its rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other Party. 7.3 Indemnification. In addition to any other indemnity specifically provided in this Agreement, Developer agrees to defend (with counsel of City's choosing and the consent of Developer, which shall not be unreasonably withheld, and which may be joint defense counsel upon City's and Developer's consent) indemnify and hold harmless City and its respective officers, officials, agents, employees, representatives, and volunteers (collectively, "Indemnitees") from and against any loss, liability, claim, or judgment arising from any act or omission of Developer in connection with its obligations under this Agreement, except to the extent caused by the active negligence or willful misconduct of Indemnitees. 8. ASSIGNMENT; COVENANTS RUN WITH THE LAND 8.1 Assignment by Developer. 8.1.1 Prohibited Transfers or Assignments. Except as authorized in Section 8.1.2 below, Developer shall not sell, transfer, or assign the Property or Project in whole or in part, or transfer or assign Developer's rights and obligations in this Agreement, without City's prior written approval, which shall not be -unreasonably withheld. Except for Permitted Transfers set forth in Section 8.1.2 below, Developer shall: (i) notify City in writing of the sale, transfer, or assignment of all or any portion of the Property, and (ii) deliver to City an assignment and assumption agreement (or other agreement) in a form approved by City and executed by Developer, and its transferee/assignee pursuant to which Developer's transferee/assignee assumes all of Developer's covenants and obligations set forth herein with respect to the Property or the portion thereof so transferred. Any request for transfer or assignment of the Agreement by Developer shall require the payment of fees or a deposit to compensate the City for approximate expenses incurred by Developer to City, as applicable, for the City's review of the request. 8.1.2 Sale of Property/Change of Use: Owner agrees and declares that the Property and the Project shall be held, conveyed, mortgaged, encumbered, leased, rented, used, occupied, operated, sold, and approved subject to all obligations set forth or incorporated in this Agreement, all of which are for the purpose of enhancing and protecting the value and attractiveness of the Property and the Project. All of the obligations set forth or incorporated in this Agreement shall constitute covenants which run with the land and shall be binding on Owner and its successors and assigns, and all parties having or acquiring any right, title or interest in, or to any part of the Property or Project. Owner further understands and agrees that the Density Bonus permit approvals received for this Project have been made on the condition that Owner and all subsequent owners, or other successors and assigns of the Property and/or Project lease and 15 60A-21 rent the Units in accordance with the terms and conditions stipulated in Sections 4, 5 and 6 of this Agreement for a term of 55 consecutive years commencing upon the date that the Project is fust occupied. 8.1.4 Subsequent Assignment. As used in this Agreement, the term "Developer" shall be deemed to include any such transferee or assignee after the date such sale, transfer, or assignment occurs in compliance with this Agreement. 8.1.5 Unpermitted Assignments Void. Any sale, transfer, or assignment made in violation of this Agreement shall be null and void, and City shall have the right to pursue any right or remedy at law or in equity to enforce the provisions of the restriction against unpermitted sales, transfers, or assignments. 8.2 Covenants Run with the Land. The Property shall be held, sold, conveyed, hypothecated, encumbered, used, occupied and improved subject to the covenants, conditions, and restrictions set forth herein. The covenants, conditions, restrictions, reservations, equitable servitudes, liens and charges set forth in this Agreement shall run with the Property and shall be binding upon Developer and all persons having any right, title or interest in the Property, or any part thereof, their heirs, and successive owners and assigns, shall inure to the benefit of City and its successors and assigns, and may be enforced by City and its successors and assigns. The covenants established in this Agreement shall, without regard to technical classification and designation, be binding for the benefit and in favor of City and its successors and assigns, and the parties hereto expressly agree that this Agreement and the covenants herein shall run in favor of City, without regard to whether City is or remains an owner of any land or interest therein to which such covenants relate. However, all such covenants and restrictions shall be deemed to run in favor of all real property owned by City which real property shall be deemed the benefited property of such covenants and this Agreement shall create equitable servitudes and covenants appurtenant to all real property owned by City and running with the Property in accordance with the provisions of Civil Code Section 1468. Furthermore, all of the covenants, conditions, and restrictions contained herein shall also constitute easements in gross running in favor of City. City is deemed the beneficiary of the terms and provisions of this Agreement and of the covenants running with the land, for and in its own right and for the purposes of protecting the interests of the community and other parties, public or private, in whose favor and for whose benefit this Agreement and the covenants running with the land have been provided. Developer hereby declares its understanding and intent that the burden of the covenants set forth herein touch and concern the land and that the Developer's interest in the Property is rendered less valuable thereby. Developer hereby further declares its understanding and intent that the benefit of such covenants touch and concern the land by enhancing and increasing the enjoyment and use of the Property by the citizens of City and by furthering the health, safety, and welfare of the residents of City. 9. MISCELLANEOUS 9.1 Entire Agreement. This Agreement and all of its exhibits and attachments set forth and contain the entire understanding and agreement of the parties, and there are no oral or written representations, understandings or ancillary covenants, undertakings or agreements which are not contained or expressly referred to herein. No testimony or evidence of any such representations, LL1' 60A-22 understandings or covenants shall be admissible in any proceeding of any kind or nature to interpret or determine the terms or conditions of this Agreement. 9.2 Amendment. Any alteration, change or modification of or to this Agreement, in order to become effective, shall be made in writing and in each instance approved by the City Council and signed on behalf of each party. Any requested alteration, change or modification of the Agreement by Developer shall require the payment of fees or deposit by Developer to City, as applicable, for the City's review of the request. Each alteration, change, or modification to this Agreement shall be recorded against the Site in the Official Records of Orange County, California. 9.3 Notices. 9.3.1 Deliverv. As used in this Agreement, "notice" includes, but is not limited to, the communication of notice, request, demand, approval, statement, report, acceptance, consent, waiver, appointment or other communication required or permitted hereunder. All notices shall be in writing and shall be considered given either: (i) when delivered in person to the recipient named below; or (ii) on the date of delivery shown on the return receipt, after deposit in the United States mail in a sealed envelope as either registered or certified mail with return receipt requested, and postage and postal charges prepaid, and addressed to the recipient named below; or (iii) two (2) days after.deposit in the United States mail in a sealed envelope, first class mail and postage prepaid, and addressed to the recipient named below; or (iv) one (1) day after deposit with a known and reliable next -day document delivery service (such as Federal Express), charges prepaid and delivery scheduled next -day to the recipient named below, provided that the sending party receives a confirmation of delivery from the delivery service provider; or (v) the first business day following the date of transmittal of any facsimile, provided confirmation of successful transmittal is retained by the sending Party. All notices shall be addressed as follows: If to City: City of Santa Ana Community Development Agency 20 Civic Center Plaza (M-26) P.O. Box 1988 Santa Ana, California 92702 Attention: Housing Manager With a copy to: Office of the City Attorney City of Santa Ana 20 Civic Center Plaza, 7th Floor (M-29) Santa Ana, California 92702 If to Developer: Santa Ana Senior Associates, a California Limited Partnership 430 E. State Street, Suite 100 Eagle, Idaho 83616 9.3.2 Change of Address. Either Party may, by notice given at any time, require subsequent notices to be given to another person or entity, whether a party or an officer or 17 60A-23 representative of a party, or to a different address, or both. Notices given before actual receipt of notice of change shall not be invalidated by the change. 9.4 Severability. If any term, provision, covenant or condition of this Agreement shall be determined invalid, void or unenforceable, the remainder of this Agreement shall not be affected thereby to the extent such remaining provisions are not rendered impractical to perform, taking into consideration the purposes of this Agreement. 9.5 Interpretation and Governing Law. This Agreement and any dispute hereunder shall be governed and interpreted in accordance with the laws of the State of Califomia without regard to conflict of law principles. This Agreement shall be construed as a whole according to its fair language and common meaning to achieve the objectives and purposes of the Parties hereto, and the rule of construction to the effect that ambiguities are to be resolved against the drafting Party shall not be employed in interpreting this Agreement, all Parties having been represented by counsel in the negotiation and preparation hereof. 9.6 Section Headings. All section headings and subheadings are inserted for convenience only and shall not affect any construction or interpretation of this Agreement. 9.7 Singular and Plural. As used herein, the singular of any word includes the plural, and vice versa, as context so dictates. Masculine, feminine, and neuter forms of any word include the other as context so dictates. 9.8 Joint and Several Obligations. If at any time during the term of this Agreement the Property and/or Project is owned, in whole or in part, by more than one Developer, all obligations of such Developer under this Agreement shall be joint and several, and the default of any such Developer shall be the default of all such Developers. 9.9 Time of Essence. Time is of the essence in the performance of the provisions of this Agreement as to which time is an element. 9.10 Computation of Days. Unless otherwise specified in this Agreement or any Exhibit attached hereto, use of the term "days" shall mean calendar days. For purposes of this Agreement and all Exhibits attached hereto, "business days" shall mean every day of the week except Saturdays, Sundays, official State holidays as recognized in Government Code Section 19853(a) or successor statute, and any days in which Santa Ana City Hall is closed for business. 9.11 Waiver. Failure by a Party to insist upon the strict performance of any of the provisions of this Agreement by the other Party, or the failure by a Party to exercise its rights upon the default of the other Party, shall not constitute a waiver of such Party's right to insist and demand strict compliance by the other Party with the terms of this Agreement thereafter. 9.12 Non -Discrimination. In performing its obligations under this Agreement, Developer shall not discriminate because of race, color, creed, religion, sex, marital status, sexual orientation, age, national origin, ancestry, or disability, as defined and prohibited by applicable law, in the recruitment, selection, training, utilization, promotion, termination or other related I3 60A-24 activities. Developer affirms that it is an equal opportunity employer and shall comply with all applicable federal, state and local laws and regulations. 9.13 Third Party Beneficiaries. No person or entity, other than City and Developer shall have any right of action based upon any provision of this Agreement. 9.14 Force Maieure. Neither Party shall be deemed to be in default where failure or delay in performance of any of its obligations under this Agreement is caused by floods, earthquakes, other Acts of God, fires, wars, riots or similar hostilities, strikes and other labor difficulties beyond the Party's control (including the Party's employment force), court actions (such as restraining orders or injunctions), or other causes beyond the Party's control, including delays by any governmental entity (although the City may not benefit from this provision for a delay that results from City's failure to perform its obligations under this Agreement), or an insurance company of either party. If any such events shall occur, the term of this Agreement and the time for performance by either Party of any of its obligations hereunder may be extended by the written agreement of the Parties for the period of time that such events prevented such performance. 9.15 Mutual Covenants. The covenants contained herein are mutual covenants and also constitute conditions to the concurrent or subsequent performance by the Party benefited thereby of the covenants to be performed hereunder by such benefited Party. 9.16 Successors in Interest. The burdens of this Agreement shall be binding upon, and the benefits of this Agreement shall inure to, all permitted successors in interest to the Parties to this Agreement. All provisions of this Agreement shall be enforceable as equitable servitudes and constitute covenants running with the land. Each covenant to do or refrain from doing some act hereunder with regard to development of the Property: (a) is for the benefit of and is a burden upon every portion of the Property; (b) runs with the Property and each portion thereof, and (c) is binding upon each Party and each successor in interest approved pursuant to this Agreement during ownership of the Property or any portion thereof. 9.17 Counterparts. This Agreement may be executed by the Parties in counterparts, which counterparts shall be construed together and have the same effect as if all of the Parties had executed the same instrument. 9.18 Jurisdiction and Venue. Any action at law or in equity under this Agreement or brought by a Party hereto for the purpose of enforcing, construing or determining the validity of any provision of this Agreement shall be filed and tried in the Superior Court of the County of Orange, State of California, and the Parties hereto waive all provisions of law providing for the filing, removal or change of venue to any other court. 9.19 Proiect as a Private Undertaking. It is specifically understood and agreed by and between the Parties hereto that the development of the Project is a private development, that neither Party is acting as the agent of the other in any respect hereunder, and that each Party is an independent contracting entity with respect to the terms, covenants and conditions contained in this Agreement. No partnership, joint venture or other association of any kind is formed by this 19 60A-25 Agreement. The only relationship between City and Developer is that of a government entity regulating the development of private property and the Developer of such property. 9.20 Further Actions and Instruments. Each of the Parties shall cooperate with and provide reasonable assistance to the other to the extent contemplated hereunder in the performance of all obligations under this Agreement and the satisfaction of the conditions of this Agreement. Upon the request of either Party at any time, the other Party shall promptly execute, with acknowledgment or affidavit if reasonably required, and file or record such required instruments and writings and take any actions as may be reasonably necessary under the terms of this Agreement to cavy out the intent and to fulfill the provisions of this Agreement or to evidence or consummate the transactions contemplated by this Agreement. City hereby authorizes City Manager to take such other actions and negotiate and execute any additional agreements as may be necessary or proper to fulfill the City's obligations under this Agreement. The City Manager may delegate her or his powers and duties under this Agreement to an authorized management level employee of the City. 9.21 Estoppel Certificate. Within ten (10) business days following a written request by any of the Parties, the other Party shall execute and deliver to the requesting Party a statement certifying that (i) either this Agreement is unmodified and in full force and effect or there have been specified (date and nature) modifications to the Agreement, but it remains in full force and effect as modified; and (ii) either there are no known current uncured defaults under this Agreement or that the responding Party alleges that specified (date and nature) defaults exist. The statement shall also provide any other reasonable information requested. The failure to timely deliver this statement shall constitute a conclusive presumption that this Agreement is in full force and effect without modification, except as may be represented by the requesting Party, and that there are no uncured defaults in the performance of the requesting Party, except as may be represented by the requesting Party. 9.22 No Subordination. City's approval of the necessary land use entitlements that authorize Developer to develop, operate, and maintain the Project was based upon Developer's obligation to provide the Affordable Units pursuant to the State Density Bonus Law, City Density Bonus Law, City Housing Opportunity Ordinance, and the terms and conditions of this Agreement. For the Term of the Density Bonus Housing Agreement, this Agreement shall have priority over any and all mortgages, deeds of trust, and other similar forms of secured financing recorded against the Property or any portion thereof. Developer expressly understands and acknowledges that state law requires preservation of affordability covenants in connection with the approval of this density bonus project. 9.23 Attorneys' Fees and Costs. If either Party to this Agreement commences an action against the other Party to this Agreement arising out of or in connection with this Agreement, the prevailing Party shall be entitled to recover reasonable attorneys' fees, expert witness fees, costs of investigation, and costs of suit from the losing Parry. 9.24 Authority to Execute. The person or persons executing this Agreement on behalf of each Party warrants and represents that he or she/they have the authority to execute this Agreement on behalf of his or her/their corporation, partnership or business entity and warrants FIE �• •. and represents that he or she/they has/have the authority to bind the Party to the performance of its obligations hereunder. (Signatures on following page) 21 60A-27 IN WITNESS WHEREOF, the parties hereto have caused this Density Bonus Housing Agreement to be executed on the date set forth at the beginning of this Agreement. ATTEST: Maria D. Huizar Clerk of the Council APPROVED AS TO FORM Sonia R. Carvalho City Attorney By: an Hodge Assistant City Attorney FOR APPROVAL: Steven A. Mendoza Executive Director Community Development Agency CITY OF SANTA ANA Raul Godinez II City Manager SANTA ANA SENIOR ASSOCIATES, A CALIFORNIA LIMITED PARTNERSHIP & V. Ckr96 Roope TPC Holdings V, LLC General Partner 22 A notary public or other officer completing this certificate verifies only the Identity of the individual who signed the document to which this certificate Is attached, and not the truthfulness, accuracy, or validity of that document. State of Idaho County of Ada On October 11. 2018 before me, Peter Van Dome, Notary Public, personally appeared Caleb R000e, who proved to me on the basis of satisfactory evidence to -be the person(s) whose name(s) is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity, and that by his signature on the Instrument the person, or the entity upon behalf of which the person acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of Idaho that the foregoing paragraph is true and correct. WITNESS m%Ahand d ficial seal. Signature (Seal) PETER VAN DORNE COMMISSION 032357 NOTARY PUBLIC STATE OF IDAHO IM-V COMMISSION EXPIRES 08/012023 60A-29 EXHIBIT A LEGAL DESCRIPTION OF THE PROPERTY 23 60A-30 EXHIBIT "A" All that certain real property situated in the County of Orange, State of California, described as follows PARCEL 1: THE EAST HALF OF THE NORTH HALF OF LOT "E" OF THE STAFFORD AND TUSTIN TRACT, IN THE CITY OF SANTA ANA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 2, PAGES 618 AND 619 OF MISCELLANEOUS MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF LOS ANGELES COUNTY, CALIFORNIA. EXCEPT THAT PORTION THEREOF DESCRIBED AS FOLLOWS BEGINNING AT A POINT ON THE EAST LINE OF SAID LOT "E", DISTANT THEREOF NORTH 0° 17' 30" WEST, 288.75 FEET FROM THE SOUTHEAST CORNER OF SAID NORTH HALF OF LOT "E", SAID EAST LINE ALSO BEING THE WESTERLY LINE OF TUSTIN AVENUE, 66.00 FEET WIDE; THENCE SOUTH 890 28' 10" WEST, 170.98 FEET, PARALLEL WITH THE NORTH LINE THEREOF; THENCE NORTH 00 09'00" WEST, 330.50 FEET TO SAID NORTH LINE; THENCE NORTH 890 28' 10" EAST, 170.17 FEET ALONG SAID NORTH LINE TO THE NORTHEAST CORNER THEREOF; THENCE SOUTH 00 17'30" EAST, 330.50 FEET TO THE POINT OF BEGINNING. ALSO EXCEPT THAT PORTION THEREOF, DESCRIBED AS FOLLOWS: BEGINNING AT THE SOUTHEAST CORNER OF SAID NORTH HALF; THENCE NORTH 890 33'25" WEST, 73.40 FEET ALONG THE SOUTH LINE OF SAID NORTH HALF TO A CURVE CONCAVE EASTERLY AND HAVING A RADIUS OF 4125.00 FEET FROM WHICH POINT TO A TANGENT BEARS NORTH 90 53'34" EAST; THENCE NORTH 294.78 FEET ALONG SAID CURVE, THROUGH A CENTRAL ANGLE OF 4° 05'40" TO A LINE PARALLEL WITH THE NORTH LINE OF SAID LOT, WHICH PASSES THROUGH A POINT ON THE EAST LINE OF SAID LOT, NORTH 0° 33'32" EAST, 288.75 FEET FROM SAID POINT OF BEGINNING; THENCE SOUTH 890 22'45" EAST, 15.24 FEET ALONG SAID PARALLEL LINE TO THE EAST LINE OF SAID LOT; THENCE SOUTH 00 33'32" WEST, 288.75 FEET TO THE POINT OF BEGINNING. ALSO EXCEPT THAT PORTION DESCRIBED AS FOLLOWS: COMMENCING AT THE SOUTHEAST CORNER OF SAID NORTH HALF OF LOT E; THENCE WESTERLY ALONG THE SOUTH LINE OF SAID NORTH HALF OF LOT E NORTH 890 34'01 " WEST 73.40 FEET TO A POINT ON A CURVE CONCAVED EASTERLY HAVING A RADIUS OF 4125.00 FEET, THE CENTER OF WHICH BEARS SOUTH 800 07'25" EAST; THENCE NORTHERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 020 46' 12" AN ARC LENGTH OF 199.43 FEET TO THE POINT OF BEGINNING; THENCE CONTINUING ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 010 19'28" AN ARC LENGTH OF 95.34 FEET; THENCE NORTH 890 23'21" WEST 6.43 FEET TO A POINT ON THE ARC OF A CURVE CONCAVE EASTERLY HAVING A RADIUS OF 10039.00 FEET THE CENTER OF WHICH BEARS SOUTH 80014'36" EAST; THENCE SOUTHERLY ALONG THE ARC OF SAID CURVE THROUGH A CENTRAL ANGLE OF 000 32' 14" AN ARC LENGTH OF 94.13 FEET TO THE POINT OF BEGINNING. PARCEL 2: THAT EAST 6.00 FEET OF THE WEST HALF OF THE NORTH HALF OF LOT "E" OF THE STAFFORD AND TUSTIN TRACT, IN THE CITY OF SANTA ANA, COUNTY OF ORANGE, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 2, PAGES 618 AND 619 OF MISCELLANEOUS MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF LOS ANGELES COUNTY, CALIFORNIA. Assessor's Parcel Number: 402-181-11 60A-31 EXHIBIT B TENANT VERIFICATION 24 60A-32 EXHIBIT B INCOME COMPUTATION AND CERTIFICATION NOTE TO APARTMENT OWNER: This form is designed to assist you in computing Annual Income in accordance with the method set forth in the Department of Housing and Urban Project ("HUD") Regulations (24 CFR 813). You should make certain that this form is ate all times up to date with the HUD Regulations. Re: Santa Ana, California I/We, the undersigned state that I/we have read and answered fully, frankly and personally each of the following questions for all persons who are to occupy the unit being applied for in the above apartment project. Listed below are the names of all persons who intend to reside in the unit: 1. 2. 3. 4. Name of Members Relationship of the to Head of Social Security Household Household Age Number HEAD SPOUSE Income Computation 5. Place of Employment 6. The total anticipated income, calculated in accordance with the provisions of this Certification, of all persons over the age of 18 years listed above for the 12 -month period beginning the date that I/we plan to move into a unit is $ Included in the total anticipated income listed above are: (a) all wages and salaries, overtime pay, commissions, fees, tips and bonuses and other compensation for personal services, before payroll deductions; (b) the net income from the operation of a business or profession or from the rental of real or personal property (without deducting expenditures for business expansion or amortization of capital indebtedness or any allowance for depreciation of capital assets), (c) interest and dividends (including income from assets excluded below); (d) the full amount of periodic payments received from social security, annuities, insurance policies, retirement funds, pensions, disability or death benefits and other similar types of periodic receipts, including any lump sum payment for the delayed start of a periodic payment; B-1 60A-33 (e) payments in lieu of earnings, such as unemployment and disability compensation, workmen's compensation and severance pay; (f) the maximum amount of public assistance available to the above persons other than the amount of any assistance specifically designated for shelter and utilities; (g) periodic and determinable allowances, such as alimony and child support payments and regular contributions and gifts received from persons not residing in the dwelling; (h) all regular pay, special pay and allowances of a member of the Armed Forces (whether or not living in the dwelling) who is the head of the household or spouse; and (i) any earned income tax credit to the extent that it exceeds income tax liability. Excluded from such anticipated income are: (a) casual, sporadic or irregular gifts; (b) amounts which are specifically for or in reimbursement of medical expenses; (c) lump sum additions to family assets, such as inheritances, insurance payments (including payments under health and accident insurance and workmen s compensation), capital gains and settlement for personal or property losses; (d) amounts of educational scholarships paid directly to the student or the educational institution, and amounts paid by the government to a veteran for use in meeting the costs of tuition, fees, books and equipment. Any amounts of such scholarships or payments to veterans not used for the above purposes are to be included in income; (e) special pay to a household member who is away from home and exposed to hostile fire; (f) relocation payments under Title II of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970; (g) foster child care payments; (h) the value of coupon allotments for the purchase of food pursuant to the Food Stamp Act of 1977; (i) payments to volunteers under the Domestic Volunteer Service Act of 1973; 0) payments received under the Alaska Native Claims Settlement Act; (k) income derived from certain submarginal land of the United States that is held in trust for certain Indian tribes; (1) payments or allowances made under the Department of Health and Human Services' Low - Income Home Energy Assistance Program; B- 2 60A-34 (m) payments received from the Job Training Partnership Act; (n) income derived from the disposition of funds of the Grand River Band of Ottawa Indians; (o) the first $2,000.00 of per capita shares received from judgment funds awarded by the Indian Claims Commission or the Court of Claims; and (p) at the discretion of Housing Authority of the City of Santa Ana all other income exclusions recognized by the HUD Section 8 Certificate and Voucher Programs. 7. Do the persons whose income or contributions are included in item 6 above: (a) have savings, stocks, bonds, equity in real property or other form of capital investment (excluding the values of necessary items of personal property such as furniture and automobiles and interests in Indian trust land)? No Yes (b) have they disposed of any assets (other than at a foreclosure or Credit Bankruptcy sale) during the last two years at less than fair market value? No Yes (c) If the answer to (a) or (b) above is yes, does the combined total value of all such assets owned or disposed of by all such persons total more than $5,000? No Yes (d) If the answer to (c) above is yes, state: (1) the amount of income expected to be derived from such assets in the 12 -month period beginning on the date of initial occupancy in the unit that you propose to rent: (2) the amount of such income, if any, that was included in item 6 above: 8. (a) Are all of the individuals who propose to reside in the unit full-time students*? No Yes *A full-time student is an individual enrolled as a full-time student during each of 5 calendar months during the calendar year in which occupancy of the unit begins at an educational organization which normally maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance and is not an individual pursuing a full-time course of institutional or farm training under the supervision of an accredited agent of such an educational organization or of a state or political subdivision thereof. M 60A-35 (b) If the answer to 8(a) is yes, is at least 1 of the proposed occupants of the unit a husband and wife entitled to file a joint federal income tax return? No Yes 9. Neither myself nor any other occupant of the unit I/we propose to rent is the owner of the rental housing project in which the unit is located (hereinafter the "Owner"), has any family relationship to the Owner; or owns directly or indirectly any interest in the Owner. For purposes of this paragraph, indirect ownership by an individual shall mean ownership by a family member, ownership by a corporation, partnership, estate or trust in proportion to the ownership or beneficial interest in such corporation, partnership, estate or trustee held by the individual or a family member; and ownership, direct or indirect by a partner of the individual. 10. This certificate is made with the knowledge that it will be relied upon by the Borrower to determine maximum income for eligibility to occupy the unit, and I/we declare that all information set forth herein is true, correct and complete and based upon information I/we deem reliable and that the statement of total anticipated income contained in paragraph 6 is reasonable and based upon such investigation as the undersigned deemed necessary. 11. I/we will assist the Owner in obtaining any information or documents required to verify the statements made herein, including either an income verification from my/our present employer(s) or copies of federal tax returns for the immediately preceding calendar year. 12. I/we acknowledge that I/we have been advised that the making of any misrepresentation or misstatement in this declaration will constitute a material breach of my/our agreement with the Owner to lease the unit and will entitle the Owner to prevent or terminate my/ our occupancy of the unit by institution of an action for ejection or other appropriate proceedings. I/we declare under penalty of perjury that the foregoing is true and correct. Executed this day of in the City of California. Applicant Applicant [Signature of all persons over the age of 18 years listed in number 2 above required] HM �• •. FOR COMPLETION BY APARTMENT OWNER ONLY: 1. calculation of eligible income: a. Enter amount entered for entire household in 6 above: $ b. (1) If answer to 7(c) above is yes, enter the total amount entered in 7(d)(1), subtract from that figure the amount entered in 7(d)(2) and enter the remaining balance ($ ); (2) Multiply the amount entered in 7(c) times the current passbook savings rate to determine what the total annual earnings on the amount in 7(c) would be if invested in passbook savings ($ ), subtract from that figure the amount entered in 7(d)(2) and enter the remaining balance (3) Enter at right the greater of the amount calculated under (1) or (2) above: $ C. TOTAL ELIGIBLE INCOME Line 1.a plus line 1.b(3)): $ 2. The amount entered in 1.c: Qualifies the applicant(s) as a Low Income Tenant(s). Does not qualify the applicant(s) as a Low Income Tenant(s). 3. Number of apartment unit assigned: Bedroom Size: Rent: $ 4. This apartment unit [was/was not] last occupied for a period of 31 consecutive days by persons whose aggregate anticipated annual income as certified in the above manner upon their initial occupancy of the apartment unit qualified them as Low Income Tenants. 5. Method used to verify applicants) income: Employer income verification. Copies of tax returns. Other Manager 60A-37 INCOME VERIFICATION (for employed persons) The undersigned employee has applied for a rental unit located in a project financed under the Housing Authority of the City of Santa Ana Multifamily Housing Revenue Bond Program for persons of low income. Every income statement of a prospective tenant must be stringently verified. Please indicate below the employee's current annual income from wages, overtime, bonuses, commissions or any other form of compensation received on a regular basis. Annual wages Commissions Total current income Overtime Bonuses I hereby certify that the statements above are true and complete to the best of my knowledge. Signature Date Title I hereby grant you permission to disclose my income to in order that they may determine my income eligibility for rental of an apartment located in their project which has been financed under the Housing Authority of the City of Santa Ana Multifamily Revenue Bonds. Signature Date Please sent to: �• • INCOME VERIFICATION (for self-employed persons) I hereby attache copies of my individual federal and state income tax returns for the immediately preceding calendar year and certify that the information shown in such income tax returns is true and complete to the best of my knowledge. Signature FOR 60A-39 Date REQUEST FOR Planning Commission Action PLANNING COMMISSION MEETING DATE: SEPTEMBER 11, 2017 TITLE. PUBLIC HEARING — SITE PLAN REVIEW NO. 2017-08 AND DENSITY BONUS AGREEMENT NO. 2017-01 TO ALLOW CONSTRUCTION OF AN AFFORDABLE RENTAL SENIOR RESIDENTIAL COMMUNITY WITHIN THE METRO EAST MIXED USE OVERLAY DISTRICT AT 2222 EAST FIRST STREET (STRATEGIC PLAN NOS. 3, 2; 5, 3) Prepared by Ali Pezeshkpour_ ---- __ Acting Executive Diredtor RECOMMENDED ACTION EXHIBIT 2 PLANNING COMMISSION SECRETARY APPROVED ❑ As Recommended ❑ As Amended ❑ Set Public Hearing For DENIED Zoning Designation ❑ Applicant's Request ❑ Staff ReCOMMondation CONTINUED TO Acting Plannil nager 1. Adopt a resolution approving Site Plan Review No. 2017-08 as conditioned. 2. Adopt a resolution approving Density Bonus Agreement No. 2017-01 as conditioned. Executive Summary Charles Addington with Architects Orange, representing Affordable Housing Land Consultants, Inc. ("AMG & Associates"), is requesting approval of a site plan review (SPR) and a density bonus agreement (DBA) to allow the construction of an affordable 419 -unit rental senior residential community. As proposed, the project requires approval of several waivers from the Metro East Mixed Use (MEMU) overlay district's development standards and/or development concessions through 4he density bonus agreement. Staff is recommending approval of the applicant's request due to the project's satisfaction of meeting the intent of the MEMU overlay district to promote a pedestrian - oriented environment with a mix of land uses and because the project will provide additional affordable rental housing stock to an underserved segment of the region's population. Table 1: Proiect and Location Information Item I Information Project Address 1 2222 East First Street Nearest Intersection I First Street and Tustin Avenue General Plan Designation District Center (DC) Zoning Designation Arterial Commercial (C-5) with the Metro East Mixed Use overlay district (OZ -1), Active Urban district Surrounding Land Uses Commercial North Commercial East Multiple -Fatuity Residential South Rehabilitation Facility (West) 11 EXHIBIT 2 60A-41 EXHIBIT 2 SPR No. 2017-081DBA No. 2017-01 September 11, 2017 Page 2 Item Information Property Size 3.17 acres Existinp_Site Development The site contains an existing motel and restaurant. 1 Use Permissions Mixed-use projects permitted by the OZ -1 designation; i deviationslconcessions will address proposed deficiencies Zoning Code Sections Affected Uses OZ -1, Section No. 4 Develo rnenl Standards OZ -1, Section Nos. 4 through 7 _ Proiect Description i The project includes demolition of an existing motel and restaurant and construction.of an affordable rental senior housing community. The project will contain one structure consistinigof a ground -level parking area and five levels of residential above. A total of 418 affordable rental senior units -will be provided on the project site, as well as one on-site manager's unit. Moreover; a total 213 guest and resident parking spaces will be provided in an at -grade parking area beneath the residential levels. Units will include studios (92), one -bedroom (277), and two-bedroom (49) units ranging in size from 402 to 797 square feet. All units will contain full kitchens, bedrooms, full bathrooms, storage, and open/common (living) areas. Open space will be provided through publically-accessible plazas, private courtyards, or amenity areas. A public plaza with open seating will front First Street and will also contain an alcove programmable with community or commercial activities, such as kiosks or temporary events. The project's leasing office will also front First Street, enhancing its commercial presence. Five courtyards with distinct themes and amenities will be located throughout the interior of the site. Interior common rooms such as recreation areas, fitness centers, and laundry rooms will provide additional amenities to residents and visitors. A common open space "view room" on the top (sixth) level will face southeast toward the interchange between the Costa Mesa (SR-55)/Santa Ana (1-5) freeways. The project will feature a contemporary architectural style common of many multiple -family or mixed-use residential communities under construction in Santa Ana and the region. Ceramic tile, fiber cement board and siding, smooth stucco finishes, and metal railings will contribute to this theme. These solid materials will ensure that the project ages well for the duration of the building's lifetime. Finally, a large public art piece will be featured on the east elevation of the building at the First Street frontage; this piece will welcome those entering Santa Ana from the east. Background The Metro East Mixed Use overlay district was adopted in 2007 as a result of interest in developing mixed-use residential and commercial projects in its project area. The regulating plan, which establishes land uses and development standards, allows a variety of housing and commercial 1A2EXHIBIT 2 6042 EXHIBIT 2 SPR No. 2017-08IDBA No. 2017-01 September 11, 20117 Page 3 projects, including mixed-use residential communities, livetwork units, hotels, and offices. "Since: its adoption, one mixed-use project at 1901 East First Street has been constructed "and is occupied. Another, located at 200 North Cabrillo Park Drive, is currently entitled but is .undergoing review for proposed_ revisions. The California Density Bonus lagv allows developers to seek increases in base density for providing on- site housing units in exchange for providing affordable units on site. To help make constructing on -'Site affordable units feasible, the law allows developers to seek incentives or waivers, which are essentially variances from development standards that would help the project be built without significant burden and without detriment to public health. The first version of the Density Bonus Law was adopted in 1979 and has since been amended at various times; In early 2017, the law was amended to restrict the ability of local jurisdictions to require studies to "justify" the density bonus and requested incentives/waivers and places the onus on local jurisdictions to prove that the incentives/waivers are not financially warranted. Recent court interpretations of the law have granted unlimited numbers of waivers to projects that meet -or exceed the maximum interpretations, nt density bonus of base density. Analysis of the Issues Section 8 of the MEMU regulating plan, Implementation, requires the Planning Commission to review an application for development subject to the provisions of the overlay district. Upon review, the Planning Commission may take the following actions: 1. Approve the development plan, 2. Approve the development plan with conditions, or 3. Deny the development plan. Should the Planning Commission approve the Site Plan Review application, it must make four findings of fact relating to furthering the goals of the MEMU overlay district, consistency with the regulating plan, compatibility with the surrounding community, and planning a compatible and harmonious project. In addition, Section 41- 1607 requires an application for a density bonus agreement containing "deviations" (incentiveslwaivers) to be approved by the Planning Commission. The following subsections analyze the applicant's request for both the Site Plan Review and the Density Bonus,Agreement applications. Site Plan Review The applicant is requesting site plan approval for a proposed residential community that requires approval of incentives or waivers from the development standards contained with the MEMU overlay district regulating plan. These standards ;are outlined in Table 2: Conformance to Development Standards. Table 2: Conformance to Development Standards Standard. Required by the MEMU Provided Stories Minimum 3, no maximum 6 Minimum Site Area 1 acre 3.17 acres Permitted Frontage Forecourt, shopfront, gallery, or arcade Shopfront, with plaza on First Street as permitted W MEh4U 1A343 EXHIBIT 2 60 EXHIBIT 2 SPR No. 2017-08/DBA No. 2017-01 September 11, 2017 Page 4 Standard Required by the MEMU Provided Publicly Accessible Open Space 15 percent of total lot area 3.6 percent - Requires _ environment for residents, Incentive/Waiver PrivatefCommon Open Space 100 square feet per unit 112 square feel per unit Building Setbacks 0-20 feel (front), 0-10 feet (side), 100 20 (front), 28-41 (side), 33 (rear) - street activation, stimulate feel rear Requires Incentive/Waiver _ Parking 2 spaces per unit overall -,every unit 0.51 spaces per unit (permitted by must be allocaled at least 1 space AB 744 Courtyard height -to -width ratios 2 to 1 (enclosed on four sides), 3 to 1 Complies; various ratios in excess of _(9 -pen on one or more sides) 2 to 1 and 3 to 1 grovided Driveway width 24 feet maximum 25-28 feet - Requires fncentive4aiver Building Massing A variety of massing, volume, and Complies; the building features a step -backs are required to increase step -back along First Street and building articulation breaks in volume to reduce massin As noted in Table 2, the project conforms to the MEMU regulating plan's requirements for height/stories, minimum site area, courtyard design, and building massing but requires approval of incentivestwaivers through the Density Bonus Agreement application to allow deviation's from the required public open space areas, building setback requirements, and driveway widths. Table 3: Analysis of the Issues breaks down the project by issue or topic. Table 3: Analysis of the Issues consistency with and will the proposed project furthering the contribute to creating a objectives of the mixed-use, walkable MEMU overlay environment for residents, district daytime employees, and Visitors, and does it provide high-quality architecture and street activation, stimulate private investment, and implement the General Plan? The proposed project will contain 419 residential units (including one manager's unit) without a commercial component. However, It has been designed to feature a large public plaza at Its frontage on First Street, an alcove for temporary activities or kiosks, and a large public art piece. Constructing 419 units in the project area will add to the residential population in the area, stimulating demand for community -serving commercial uses such as restaurants, retail stores, dry cleaning services, and other similar uses. Finally, the project meets several General Plan goals and policies, including the Land Use Element's Goal 2 (to encourage diversity of quality housing, affordability levels, and living experiences), Goal 4 (to provide adequate rental and ownership housing and supportive services), and the Housing Element's policies HE -2.3 and 2.4 (lo encourage construction of rental housing, facilitate .diverse types of EXHIBIT 2 60X444 roll IMM : 11W% SPR No. 2017-081DBA No: 2017=01 September 11, 2017 Page 5 Issue or Topic Question Analysis Consistency with the Does the project meet the Although the project complies with many development MEMU development_ ME44U regulating plans standards enumerated in the MEMU regulating plan, if does standards development standards, or not meet the requirements for publicly -accessible .open does it require approval of space, building setbacks, and driveway widths. These deviations? standards require approval of incenliveslwaivers through the Density Bonus AbreemenI.application. Moreover, although slated as a guideline.in the regulating plan, the unit sizes are well below the,1,200-square-foot average unit size objective:. The applicant has considered this,gtd ueline and. proposes to. conipensale through a greater average privatelcommon open' space area of 112 square feet per unit instead of the 100 - square -foot minimum. In addition, the proposed parking, rate of 0.5 spaces per unit is well below the required 2.0spaces per unit; however, the applicant is exercising his ability under AB 744 to provide 0.5 spaces per unit due to the project site's proximity to two bus stops with frequent service. Theso'stops are on lines that connect the project site to points west (central Santa Ana, Garden Grove, and Westminster), north (Tustin, Orange, and Placentia), and east (central Tustin). Compatibility with Will the project be well- The proposed development consists of a single six -level adjacent integrated into the existing project surrounded by single -story structures to the east and development in terms MEMO area and surrounding west. A tbvo-story multiple -family residential community abuts of similarity in scale. development patterns, the site to the south, and a ,single -story commercial height, and site including those in the city of development is to the north across First Street. Although the configuration Tustin? MEMU anticipates developments of this scale or larger In the "Active Urban" land use district, this development would be the first of its size in its immediate vicinity. Several design features have been incorporated Into the project to break up its massing and to lessen its impacts on adjacent properties. These include breaking up the building's west "elevation through courtyards, setting back the building from the oast, south, and west through a minimum 20400t wide fire lane, and the planting of rapidly -greying eucalyptus trees with minimum 20 -foot brown trunk height throughout. Finally, the proposal to construct a'single structure instead of several Is the result of the site's odd shape. Development on the site is further complicated and constrained because the neighboring parcel, although underutilized, is located in the jurisdiction of the City of Tustin. Compatible and _ Does the project, as The proposed project Is intended to be a low -impact use. No harmonious land proposed, contribute negative impacts from noise, air quality, aesthetics, or traffic use(s), site design, "positively to the area in which are expected exceptfor temporary impacts arising during and operational it is located? construction of the project. The site's design is intended to standards activate its frontage on First Street by providing flexible community areas that can be programmed with activities or temporary uses, and the landscape palette has been carefully selected to minimize the site's Impact on the surrounding low-rise land uses. EXHIBIT 2 60A-45 EXHIBIT 2 SPR No. 2017-08/DBA No. 2017-01 September 11, 2017 Page 6 Reduction of onsite Will the reduction In required AB 744 allows senior affordable residential projects whose parking proposed on-site parking, as permitted residents are aged 62 or older to provide a parking rate of 0.5 through AB 744 by AB 744, affect the success spaces per residential unit. Staff has analyzed the proposed of the project or impact the project, which exercises its right under AB 744, and finds that surrounding community? there is potential that the project and neighborhood may be impacted by the reduced parking. The City has identified the MEMU area for high-intensity, mixed use development in order to reduce demands for parking and traffic impacts. However, the MEMU area is still in transition, and portions including the project site have yet to redevelop and produce the pedestrian -scale environment envisioned by the document. To mitigate these impacts, staff has added a condition of approval requiring the developer to enter into an agreement with a property within 500 feet of the project site to provide additional guest and/or resident parking during off- peak limes. Density Bonus Agreement The California Density Bonus Law applies to projects proposing five or more residential units and grants density bonuses to those meeting certain requirements for affordability levels and types of housing (family, veterans, etc.). Rental units in such developments that are designated "affordable" must remain so for at least 55 years. For affordable senior housing projects, a developer may seek a density bonus up to 20 percent from base density. The City's Housing Opportunity Ordinance (HOO), last updated in 2015, augments the density bonus concept by allowing a developer to seek an additional 35 percent density bonus calculated from base density (SAMC Sec. 41-1904.1). A summary of the proposed project's density calculation is provided in Table 4: Project Density Calculation. Table 4: Project Density Calculation Density orBonus Allowed for Project Provided Base Density 285 units (3.17 acres x 90 unitslacre _ 285 units base density used as a standard for developments in areas designated DC by the General Pian Land Use element) 3 20 -Percent Bonus for Senior Projects 1 +57 units 285 x 0.20 +57 units l 35 -Percent Bonus Provided by the +100 units (285 x 0.35) +77 units HOO Total Units 442 units maximum "419 units proposed Under the state's Density Bonus Law, a developer may seek incentives or waivers (sometimes called concessions) to increase the viability of the proposed project. Revisions to the Density Bonus Law, as recent as January 2017, allow developers to seek an unlimited number of waivers from development standards insofar as such waivers are not detrimental to public health or safety, do not negatively 1 a EXHIBIT 2 6dK46 EXHIBIT 2 SPR No. 2017-081DRA No. 2017-01 September 11, 2017 Page 7 impact historic resources, or have no feasible mitigation. Further, cities cannot require preparation of additional reports or studies not required by State law to 'justify" a developer's request for waivers or incentives. Table 5: Requested Incentives/Concessions analyzes the. applicant's request for deviations from the development standards contained in the MEMU regulating plan. Table 5: Requested Incentives/Concessions Standard Question Analysis Publicly Accessible Would requiring the 15 The MEMU. regulating plan requires that publicly -accessible Open Space percent of total lot area open space be provided along main street -facing fagades, mandated by the MEMU Because the project has such a'limited. frontage on First render the project Infeasible? Street, meeting this requirement would result in the building being pushed back significantly from. First Street and would render almost the first 113 of the depth'unusable for building area, resulting in a significanf toss of units and parking area. Pushing the building back would also reduce the contribution to creating a more urban, walkable environment. The applicant intends to compensate for this reduction by providing a greater average "square footage of _ rivatelcommon open sace per unit on the project site. Building Setbacks Would requiring the MEMU's For a project of this size and construction type, OCFA side and rear setback requires 360 -degree circulation on the project site with standards render the project minimum 20 -foot fire lanes. The addition of landscaping and infeasible? walkways around the project perimeter results In the project not being able to meet the maximum 10 -foot side yard requirement. Further, for a project of this height, the MEMU requires a 100 -foot rear yard setback. Implementing this standard would result in the building being set back an additional 67 feet from the rear lot line, resulting in a si nificant loss of units and parking area. Driveway width Could the project be If the project were designed with narrower driveways, the redesigned with narrower driveways would not conform to minimum standards driveways to meet MEMU established for fire ingresslegress by OCFA and for trash requirements? truck ingresslegress established by the Public Works Agency and Waste Management, the current waste collector contracted by the 'City. In reviewing the applicant's request, staff has found that the project may impact the surrounding community; however, conditions of approval are intended to mitigate these impacts. Staff has also reviewed the requested incentives/concessions and found that two of the incentives/concessions, publicly -accessible open space and building setbacks, would not be required_ if the project did .not propose its double-density unit total. The first incentivelconcession, a reduction of,publicly-accessible open space, would not be required if the project were constructed with only the 20 -percent State or the 35 -percent local density bonus provisions. A reduction in the overall unit total would allow additional areas on the project site in which 1A747 EXHIBIT 2 60 EXHIBIT 2 SPR No. 2017-08/DBA No. 2017-01 September 11, 2017 Page 8 additional publicly -accessible open space could be constructed. The second Incentivelconcession,a reduction in building setbacks, would be partially negated if the project did not take advantage of the double-density. The project could meet the required 100 -foot rear -yard setback if fewer units were proposed. The side -yard setback would continue .to be an issue as the required fire lane would force the project to exceed the maximum setback allowed for side yards. Despite these concerns, recent revisions to the State Density Bonus Law require local jurisdictions to grant any incentives/concessions requested by the applicant in order to facilitate construction of the project while maximizing the requested density bonuses. Finally, staff analyzed additional considerations as required by the Density Bonus Law. There are no historic resources in the immediate vicinity that would be impacted by the proposed development. The project's design and operations, with the requested incentives/waivers, will not be detrimental to public health or safety as the project was reviewed by the City's Development Review Committee, which consists of representatives from Planning, Building Safety, Public Works, Housing, the City Attorney's Office, and the Orange County Fire Authority (OCFA). Should the Density Bonus Agreement application be approved, the agreement will be authorized by the City Council after the Planning Commission considers the application for the project as a whole, including the Site Plan Review application. Additional Considerations While reductions in required on-site parking for proje traditionally considered an incentive or waiver, AB 7 residential projects located within a half -mile distance i provide as little as 0.5 parking spaces per unit. AMG proposed project as two bus lines with frequent service project site. 1s subject to the Density Bonus Law were 44, enacted in late 2015, allows affordable f major transit lines or major transit stops to K Associates is exercising this option for the- intervals heintervals are located in close proximity to the In May 2017, the City received initial conceptual plans from the Orange County Transportation Authority (OCTA) and the California Department of Transportation (Caltrans) indicating that the two agencies are studying proposed improvements to the SR -5511-5 interchange that could impact the project site. One improvement under study, an entrance ramp to 1-5 south from First Street, would cut through the project site and would render the project impossible to build as proposed. The ramp is in the early stages of review; no environmental analysis has been conducted and no funds have been allocated for its construction. 1A8EXHIBIT 2 6048 EXHIBIT 2 SPR No. 2017-08]DBA No. 2017-01 September 11, 2017 Page 9 Table 6: CEQA. Strategic Plan Alianmerit and Public Notification & Community Outreach CEQA, Strategic Plan Alignment, and Public Notification &Community Outreach _ _ . CEQA CEQA T e Class 32 Categorical Exemplion/Sec. 1533 — In -Fill Development Projects Reason(s) The Class 32 exemption applies to projects characterized as infill development meeting Exempt or Analysis the following conditions: 1. The project is consistent with the applicable general plan designation and all applicable general plan policies as well as with applicable. zoning designation and regulation; 2. The proposed development occurs within city limits on 'a project site of no more than five acres substantially surrounded by urban uses; 3. The project site has no value. as habitat for endangered, rare or threatened species; A. Approval of the project would not result in any significant effects relating to traffic, noise, air quality, or water quality; and 5. The site can be adequately served by all required utilities and public services. As outlined in this staff report, the project is consistent with the City's General Plan and the MEMU regulating plan. Further, it is consistent with the density bonus provisions outlined in the City's Housing Opportunity Ordinance. The project site is located within city limits and is less than five acres in size. It is already in an urbanized setting surrounded by urban uses, and the project has not been identified as habitat for endangered, rare or threatened species. The project site and type of development proposed are already addressed in the previously approved environmental impact report (EIR) for the IVIEMU overlay district (EIR No. 2006-01). However, a Class 32 exemption Is required for the project because the original EIR did not require a greenhouse gas study. The applicant. submitted a greenhouse gas study to indicate that the project will not negatively impact greenhouse gas reduction goals. In addition. a health risk assessment (HRA) was prepared to identify any impacts from developing a residential community adjacent to a freeway. The HRA recommends that the project incorporate certain window design features on freeway - facing elevations for all units adjacent to the SR -55 freeway, and that the project install air filtrations stems throughout. _ Strategic Plan Alignment Goal(s) and Policy(s) _ Approval of this item supports the City's efforts to meet Goal No. 3 (Economic Development) Objective No. 2 or creating new opportunities for businesstjob growth ,and encourage private development through new General Plan and Zoning Or policies. The item also supports Goal 5 (Community Health, Livability, Engagement & Sustainability) Objective No. 3 to facilitate diverse housing opportunities and support' efforts to preserve and improve the livability of Santa Ana neighborhoods_ Public Notification.& Community Outreach Required Measures A public noticed was posted on the project site on September 1, 2017. Notificationby mail eras mailed to all property owners and occupants within 500 feet of the ro'ecl site on Se tember 1, 2017. _ Newspaper posting was published in the Orange County Reporter on September 1, 2017. The applicant held a Sunshine Ordinance: community meeting on May 25; 2016 at the" Saint Jeanne de Lestonnac School. Two members of the public attended: a schoolteacher from the facility and a representative from the City of Tustin. Both voiced their support,for the project. No additional communications regarding the meeting were received after. i The Lyon Streel Neighborhood Association was contacted by phone to identify any areas I Additional Measures of concern. At the time this report was printed, no issues of concern were raised regarding IN application, 60W-49 EXHIBIT 2 EXHIBIT 2 SPR No: 2017-08/DBA No. 2017-01 September 11, 2017 Page 10 Conclusion Based on the analysis provided within this report, staff recommends that the Planning Commission adopt a resolution approving Site Plan Review No. 2017-08 and Density Bonus Agreement No. 2017-01 as conditioned. Alz7��' All Pezeshkpou , AICP Senior Planner AP:jm SAPlaimna C=rffs$on1201YSFRI UIS DBA17-1 APJGA-cso 2222 F-Firtpc Exhibits 1. Resolution 2. Vicinity Zoning and Aerial Map 3. Site Photo 4. Site Plan 5. Unit Floor Plans 6. Building Elevations 7. Building Perspectives 8. Landscape Plans 9. Air Quality and Greenhouse Gas Technical Report 10. Health Risk Assessment 66d% -o EXHIBIT 2