HomeMy WebLinkAbout6.4 Inclusionary Zoning Reg Attch 2~- ~~ ~+
RESOLUTION NO. _
A RESOLUTION OF THE CITY COUNCIL
OF THE CITY OF DUBLIN
REPEALING RESOLUTION N0.94-04 AND APPROVING GUIDELINES TO THE
INCLUSIONARYZONING ORDINANCE REGULATIONS; AUTHORIZING THE CITY
MANAGER TO SUBSEQUENTLY AMEND THE GUIDELINES; AND, AUTHORIZING THE
CITY MANAGER TO EXECUTE RESALE RESTRICTION AGREEMENTS THAT ARE
CONSISTENT WITH THE COUNCIL-APPROVED GUIDELINES
WHEREAS, a goal of the Housing Element is to achieve a balanced community with housing
available for households at a range of income levels; and
WHEREAS, accordingly, the City has adopted the Inclusionary Zoning Regulations ("the
Regulations"), set forth at Chapter 8.68 of the Dublin Municipal Code, which Regulations generally
require developers of residential housing in excess of 19 units in the City of Dublin to set aside 12.5% of
such units for very-low-, low-, and moderate-income households, as defined; and
WHEREAS, on June 1, 2004, the City Council by Resolution No. 94-04 adopted the Layperson 's
Guide to the Inclusionary Zoning Ordinance Regulations ("the Guidelines"), which was designed to assist
the public and development community in interpreting and understanding the Regulations (attached hereto
as Exhibit A); and
WHEREAS, City Staff has prepared a revised version of the Guidelines for Council approval
(attached hereto as Exhibit B); and
WHEREAS, presently amendments to the Guidelines and associated legal documents require City
Council approval, and, in the course of its use of the current version of the Guidelines, City Staff has
found that circumstances change quickly in the residential housing and finance marketplace and that it is
therefore necessary that the City Manager have the authority to amend the Guidelines to the extent that
those amendments are consistent with the purposes of the Inclusionary Zoning Regulations.
NOW, THEREFORE, BE IT RESOLVED that the City Council does hereby find that
Resolution No. 94-04 "Approving Guidelines for Implementing the Inclusionary Zoning Ordinance
Regulations" is hereby repealed.
BE IT FURTHER RESOLVED THAT the City Council does hereby approve the Guidelines to
the Inclusionary Zoning Ordinance Regulations (attached. hereto as Exhibit B) and authorizes the City
Manager or designee to amend such Guidelines from time to time, provided that such amendments are
consistent with the Inclusionary Zoning Regulations.. Any such amendments to the Guidelines shall
become effective no sooner than when they are published on the City's website.
BE IT FURTHER RESOLVED THAT the City Manager is hereby authorized to cause the
existing Council-approved form Resale Restriction Agreement and other legal documents to be revised
from time to time to conform to the Guidelines to the Inclusionary Zoning Ordinance Regulations
(attached hereto as Exhibit B).
1 of 2
K:\Staff Reports- PC and CC\2008\CC\IZO\Guidelines Reso 11.18 Final 2.doc ATTACHMENT 2
BE IT FURTHER RESOLVED THAT this Resolution shall not become effective until
Ordinance No. ,which was considered concurrently with this Resolution, becomes effective.
PASSED, APPROVED AND ADOPTED this day of , 2008 by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
Mayor
ATTEST:
City Clerk
2 of 2
K:\Staff Reports- PC and CC\2008\CC\IZO\Guidelines Reso 11.18 Final 2.doc
EXHIBIT A `ISO
ATTACHMENT 2
~ ~
CITY OF DUBLIN
TABLE OF CONTENTS
INTRODUCTION
1
1 THE INCLUSIONARY ZONING PROCESS 2
1.1 Determining the Number and Size of Units Required 2
1.2 How to Calculate the Inclusionary Unit Obligation 2
1.3 How to Calculate How Many Units Must Be Constructed and How Many Units
Will be Subject to the In-Lieu Fee 3
1.4 How to Calculate the Fee That May Be Paid in-lieu of Unit Construction 3
1.5 How to Calculate How Many Inclusionary Units Must Be Provided at Each of the
Three Income Levels 4
1.6 How to Determine the Unit Sizes and bedroom requirements for Inclusionary
Units 5
1.7 How to Determine the Location of Inclusionary Units Within the Development 6
2 AFFORDABLE HOUSING AGREEMENT 7
2.1 What is an Affordable Housing Agreement 7
3 FOR SALE PROJECTS $
3.1 The Marketing Plan 8
3.2 Applications for Ownership Units 8
3.3 Screening Based on Household Size 10
3.4 Screening Based on Priority Preferences 11
3.5 Buyer Selection Process 13
4 ESTABLISHING SALES PRICE AND LOAN REQUIREMENTS FOR
OWNERSHIP UNITS 13
4.1 Sales Price of Affordable Units 13
i
~ ~ ~~~
4.2 Acceptable Home Loan Products for Inclusionary Zoning Units 16
4.3 Closing of Sale and Escrow 16
5 RENTAL PROJECTS 17
5.1 Preparation and Approval of Management Plan 17
5.2 Establishing Unit Rents for Inclusionary Units 17
5.3 Screening Based on Household Size 17
5.4 Screening Based on Priority Preferences 18
5.5 Occupant Selection for Rental Developments 24
5.6 Calculating Affordable Rents 21
5.7 Monitoring Rents 22
ti
e'~ ~`~~
LIST OF EXHIBITS
Exhibit 1 Resale Restriction Agreement and Option to Purchase
Exhibit 2 Sample Inclusionary Unit Application packet
Exhibit 3 Sample Application to Purchase Inclusionary Unit
Exhibit 4 Selection Preference Verification Letter
Exhibit 5 Excel Spreadsheet to Calculate Ownership Sale Prices
Exhibit 6 State of California Housing and Community Development
Department Income for Guidelines (Example 2004)
Exhibit 7 Current Alameda County Housing Authority Utility Allowance
Sheet
Exhibit 8 Below Market Rate Unit Monitoring Sheet
iii
In ~ ~ : ~~~
LAYPERSON'S GUIDE TO THE INCLUSIONARY ZONING ORDINANCE
REGULATIONS
(Provision of For-Sale and Rental Inclusionary Units (below market rate units)
Introduction
This document is the Layperson's Guide to the City's Inclusionary Zoning Ordinance
Regulations ("the Regulations"), which are set forth in the City's Municipal Code at
Chapter 8.68. The City Council's purpose in adopting these Regulations is to increase
the diversity of housing prices/rents in the community and ensure that the range of
prices/rents continue over time.
The purpose of this Guide is to assist the layperson in interpreting these Regulations early
in the development process so that development projects are sensitively designed from
the beginning.
Development projects of 20 residential units or more must comply with the Regulations.
In general, the Regulations require that 12.5% of the units constructed in a project be
restricted in occupancy and in sale price or rent charged. Such restricted units are referred
to as Inclusionary Units or Below-Market-Rate (BMR) units. (Section 8.68.030.A)
Of these units, 50% must be affordable to moderate-income households, 20% to low-
income households and 30% to very low-income households. (Section 8.68.030.B)
Moderate-income households, low-income households, and very low-income households
are defined as households that have an income level, respectively, of 120% to 80%, 80%
to 50%, and less than 50% of the median income for the County of Alameda adjusted for
household size. (Section 8.68.030.D.) The State of California Housing Community
Development Department (HCD) annually publishes income limits for each County. The
City uses the HCD income limits for Alameda County, which are available on the HCD
website (www.hcd.ca.gov), for setting income limits for the Inclusionary Zoning
Regulations (Section 8.68.030.D).
While the Regulations require that 12.5% of the units in the project be Inclusionary Units,
they permit the developer to meet 40% of this obligation by paying a fee in-lieu of
construction. Thus, there is a "must-build" requirement of 7.5% of the units in the
project, and the obligation with respect to the remaining 5% may be satisfied by the
payment of a fee in-lieu of construction. Inclusionary Units must remain affordable for a
period of 55 years, through affordability restrictions recorded against the property.
In addition, the Inclusionary Zoning Regulations require that Inclusionary Units:
Be constructed concurrently with the market-rate units in the project
Have a similar range of bedrooms to the market-rate units in the project
Not be distinguished by design or materials from the market-rate units in the
project
April 29, 2005
• Be reasonably dispersed throughout the project.
The Regulations also contain other means of complying with the obligations it imposes.
Those alternatives are set forth in Section 8.68.040 of the Dublin Municipal Code.
1 THE INCLUSIONARY ZONING PROCESS
1.1 Determining the Number and Size of Units Required
Prior to submitting a preapplication to the City for projects that include residential units
of 20 or more, the developer should begin thinking about how the Inclusionary Units will
be built into the design of the project. Housing Staff is available to discuss options for
meeting the Inclusionary Requirements with the developer as part of the initial project
review. For example, if a Developer intends to build only the minimum number of
Inclusionary Units that the Regulations require it to build, Housing Staff can
preliminarily indicate for the developer's planning purposes the number of Inclusionary
Units the developer is required to build, the income levels and sizes of the required
Inclusionary Units, and the amount of the in-lieu fee under the then-current fee schedule.
After a project application is submitted to the Community Development Department for
review, a Planning Review Committee Meeting is generally held. In this meeting City
Staff and interested agencies involved in the development process review the project and
give preliminary comments to the developer.
Prior to or following the Project Review Committee (PRC) meeting, Housing Staff will
send a letter to the developer indicating the Inclusionary Zoning Obligations of the
project as preliminarily proposed. A copy of this letter will be directed to the City
Planner responsible for the project as well. The purpose of this letter is to provide the
developer information on inclusionary obligations as early as possible in the development
process. The City recognizes that the project is likely to evolve over time and that the
project will likely change prior to obtaining City entitlements. However, this information
is provided early in the process as a service to the developer for their planning purposes.
The actual Inclusionary Zoning Obligations will be formalized in an Affordable Housing
Agreement (AHA) between the City and the Developer, prior to recordation of a final
map for the development.
1.2 How to Calculate the Inclusionary Unit Obligation
The Regulations state that 12.5% of the total number of units within an applicable
development project be Inclusionary Units (Section 8.68.030.A.). In making this
calculation, any decimal fraction less than or equal to 0.50 is disregarded, and a decimal
fraction greater than 0.50 is construed as a unit. Two examples of how the Inclusionary
Unit Obligation for a particular development are shown in Figure 1.
Apri129, 2005 2
~Z _1.,.
~:
FIGURE 1
Example 1: The developer proposes a 224-unit subdivision. 12.5% percent of 224 is
28. The Inclusionary Obligation is therefore 28 units.
Example 2: The developer proposes a 316-unit subdivision. 12.5% percent of 316 is
39.5. Rounding the decimal fraction down, the Inclusionary Obligation is therefore
39 units.
1.3 How to Calculate How Manv Units Must Be Constructed and How Manv Units
Will be Subiect to the In-Lieu Fee
The Regulations permit the developer to pay a fee in-lieu of constructing up to 40% of
the Inclusionary Unit Obligation. When the calculation of the fee results is a decimal
fraction, the rounding rules contained in Section 8.68.030A are used.
Using the same examples from Figure 1, Figure 2 illustrates the calculation of the number
of Inclusionary Units that will be subject to the fee.
FIGURE 2
Example 1: The developer proposes a 224-unit subdivision, for which the
Inclusionary Obligation is 28 units. 40% of 28 units =11.2 units. Disregarding the
fraction, the developer may pay fees in-lieu of construction on the remaining 11
units, and the developer's "must-build" obligation would be 17 units. 11 + 17 = 28
units.
Example 2: The developer proposes a 316-unit subdivision, for which the
Inclusionary Obligation is 39 units. 40% of 39 units = 15.6 units. This number is
rounded up to 16 and in-lieu fees may be paid for this amount, instead of providing
units. The "must-build" obligation would be 23 units. 16 + 23 = 39 units.
1.4 How to Calculate the Fee That May Be Paid in-lieu of Unit Construction
The amount of the in-lieu fee is set by resolution of the City Council. Resolution No. 56-
02 establishes that the in-lieu fee per unit is adjusted annually on July 1 to reflect the
greater of the percentage change either in a) the Bay Area Urban Consumer Price Index
(CPI) as of March of each year, or b) the United States Department of Housing and
Urban Development (HUD) Fair Market Rent limits for the Oakland Primary
Metropolitan Statistical Area (PMSA) that are in effect at the time. The fee as of July 1,
2004 is $82,466 per Inclusionary Unit.
Apri129, 2005
THE ENTIRE IN-LIEU FEE AMOUNT FOR THE PROJECT IS DUE AND PAYABLE
AT ISSUANCE OF FIRST BUILDING PERMIT IN THE PROJECT.
Using the examples from Figures 1 and 2, Figure 3 illustrates how to calculate the
amount of the in-lieu fee.
FIGURE 3
Example 1: The developer proposes a 224-unit subdivision. Fees may be paid in
lieu of construction on 11 units. 11 X $79,754 = $877,294, which is the amount of
the in-lieu fee for the project. This entire amount would be due prior to issuance of
first building permit.
Example 2: The developer proposes a 316-unit subdivision. Fees may be paid in
lieu of construction on 16 units. 16 X $79,754 = $1,276,064, which is the amount of
the in-lieu fee for the project. This entire amount would be due prior to issuance of
first building permit.
1.5 How to Calculate How Many Inclusionary Units Must Be Provided at Each of
the Three Income Levels
The Regulations (Section 8.68.030.B) state that the Inclusionary Units included in each
development project shall be allocated to households in the following manner.
Very low-income households 30%
Low-income households 20%
Moderate-income households 50%
100%
Once again, when the result of the allocation calculations includes a decimal fraction, the
rounding rules contained in Section 8.68.030.A are used. The Regulations indicate that,
where the allocation results in fewer units than would otherwise be required; one
additional unit should be allocated to the lowest income level with the decimal fraction
closest to 0.50. (Section 8.68.030.B)
Figure 4 illustrates how to calculate the number of units that must be provided at each
income level and how the rounding requirement is implemented.
Apri129, 2005 4
i~ ~-
f
FIGURE 4
The project includes 200 units. The Inclusionary Unit obligation is, therefore, 25
units. The developer chooses to pay the in-lieu fee for 40% of the units, which
equals 10 units. The developer's must-build requirement (7.5%) is, therefore, 15
units.
• 50% of those 15 units would need to be restricted for moderate-income
households, 50% of 15 = 7.5
• 20% of those 15 units would need to be restricted for low-income
households, 20% of 15 = 3
• 30% of those 15 units would need to be restricted for very low-income
households, 30% of 15 = 4.5
7.5+3+4.5=15
Since two of these numbers are fractions at exactly .5, the City of Dublin would require
that the unit be provided in the lower income category.
In this example the income- unit mix would be:
• 7moderate-income units
• 3 low-income units
• 5 very low-income units
1.6 How to Determine the Unit Sizes and bedroom requirements for Inclusionary
Units
The Regulations require that the same proportion of bedrooms be reflected in the
Inclusionary units as are in the market rate units. Once again, the rounding conventions in
Section 8.68.030.A are used, if the allocations result in decimal fractions.
Figure 5 illustrates how to determine the number of Inclusionary Units that must be
provided at each unit size.
Apri129, 2005 5
l ~ ::~~.,
.~
FIGURE 5
To determine bedroom requirement:
The developer proposes a 200-unit condominium project and is paying in-lieu
fees for 40%. The must build obligation is 15 units.
The project includes:
• 50 one-bedroom units (25 % of total)
• 100 two-bedroom units (50% of total)
• SOthree-bedroom units (25% of total)
Therefore:
• 25% of the Inclusionary Units are to be one-bedrooms
• 50% of the Inclusionary Units are to be two-bedrooms
• 25% of the Inclusionary Units are to be three-bedrooms
To determine bedroom requirement per income category:
If 5 of the units are very low-income, using the percentages above the
requirement for bedrooms are:
• 25% of 5 = 1.25 one-bedroom units
• 50% of 5 = 2.5 two-bedroom units
• 25% of 5 = 1.25 three-bedroom units
Therefore, the development would be required to provide:
• lone-bedroom unit
• 3 two bedroom units
• 1 three bedroom unit
The same calculation is performed to determine the bedroom sizes of the low-
income and moderate-income units.
1.7 How to Determine the Location of Inclusionary Units Within the Development
Section 8.68.030.E states that "All affordable units shall be reasonably dispersed
throughout the project." The purpose of this provision is to avoid concentration of the
Inclusionary Units in a particular location within a development, effectively segregating
them from the rest of the development project. There are many ways in which to
implement this requirement and consultation with Community Development Department
Staff is recommended prior to developing the final site plan. Ultimately, the Planning
Commission or City Council will make a determination based on Staff recommendation
if this requirement has been met.
Apri129, 2005 6
. ;.~ .~ -
2 AFFORDABLE HOUSING_ AGREEMENT
The execution of an Affordable Housing Agreement ("Agreement") is required under
Section 8.68.50 of the Dublin Municipal Code. This requirement is generally repeated in
the Conditions of Approval for the Site Development Review or Tentative Map for the
development project for the developer's convenience.
2.1 What is an Affordable Housing Agreement
This agreement contains the legal requirements of the residential project for compliance
with the Inclusionary Zoning Ordinance regulations. This Agreement runs with the land
and survives transfer or sale of the land to another developer. The Agreement is for a
period of 55 years. If a project is not built and new entitlements are sought for a
property, a new Affordable Housing Agreement would be required, which would replace
the existing Agreement.
Among other things, the Agreement must contain the following items:
1. A description of how the developer will comply with its Inclusionary Obligation
(whether through unit construction and/or partial payment);
2. An indication of whether the Inclusionary Units will be for-sale or rental units;
3. A requirement that the developer construct the number of Inclusionary Units
required to be constructed in each income category;
4. A requirement that the developer construct Inclusionary Units at particular unit
sizes (i.e., number of bedrooms) in each income category;
5. Depending on the nature of the development, requirements regarding the timing
of construction of the units to ensure that the units are constructed concurrently
with the development of the project as a whole;
6. If the development proposes for-sale units, a requirement that the developer
prepare and obtain City approval of a Marketing Plan, prior to issuance of any
building permits in the project, indicating efforts to be made by the developer to
sell or rent the Inclusionary Units. This requirement is discussed in additional
detail in Section 2.2 below;
7. If the development proposes for-sale units, it is required that the developer ensure
that the purchaser of an Inclusionary Unit execute a resale agreement. A copy of
the form resale agreement is attached as Exhibit No. l; and
8. If the development proposes rental units, the owner shall provide a Management
Plan and prepare the Annual Report required by Section 8.68.OSOB. The
Management Plan documents how the management firm markets the Inclusionary
Units, how the firm maintains a waiting list for the Inclusionary units, how the
management firm verifies the household income of applicants for the Inclusionary
Units, both initially and annually, provides information on the units to be made
available for the City of Dublin to use on the City website, provides a contact
telephone number and also identifies those responsible for contact and
communication with the City of Dublin. Upon approval of the City Staff, the
April 29, 2005
''~ ~~~~.
Management Plan may be produced and submitted after the Affordable Housing
Agreement is executed, but prior to the issuance of building permits.
3 FOR SALE PROJECTS
After the Affordable Housing Agreement is executed, and prior to the sale of any
affordable units in the project there is a process that must be followed that includes
preparation of a Marketing Plan, screening, ranking, qualifying and providing
documentation to Housing Staff for final verification of eligibility for an Inclusionary
Unit.
3.1 The Marketing Plan
Prior to the issuance of building permits for any for-sale Inclusionary Units, the
developer shall submit a Marketing Plan for the City's approval. The Marketing Plan
must contain the. following:
A one-page narrative summary suitable for advertising the availability of the
Inclusionary Units on the City web page and other locations, including a
telephone number for interested applicants to call for additional information;
2. An explanation of the application process to be used. The Regulations require
that applicants be ranked based on preferences set forth in the ordinance (Section
8.68.OSO.D);
3. The developer must indicate the process by which it intends to accept applications
and rank applicant households. In order to establish an eligibility list, it will be
necessary that application deadlines be established for each phase of a
development that includes Inclusionary Units;
4. Timelines for buyer selection. If the development is a phased project, information
must be provided on the number of phases and the timelines for those phases; and
A requirement that the developer's sales staff meet with the City's Housing Staff
to receive training on the sale selection process and application. (See Exhibit
No. 2)
3.2 Applications for Ownership Units.
Each applicant. shall be required to complete an application. Exhibit No 3 is a sample
application for the purchase of an Inclusionary Unit.
An applicant receives:
• Explanation of the process used in occupant selection;
• Eligibility requirements for interested buyers;
Apri129, 2005
~,, d,.. ~~ c \r , £'.
tr :i
• The income levels for the various units;
• The City preferences in occupant selection as established in the Regulations
(Section 8.68.OSO.D);
• Any floor plans for the offered units;
• The City's "Application for Inclusionary Unit"; and
• The Disclosure Statement from the Resale Agreement.
It is important that the developer's sales staff be able to understand the application
process. Pursuant to the Marketing Plan, the Housing Staff will have provided the
developer's sales staff with training so that they understand and can explain the
application process. The developer's sales staff should be able to explain the resale
restrictions that are contained in the Resale Agreement that each buyer would need to
execute.
The developer may rank applicants based on the criteria that are set forth in their
Marketing Plan. For example, the developer might only accept those applicants that are
mortgage pre-qualified by a lender or other methods. Once the applicants are ranked, the
developer must use this list and offer the units to the highest ranked household as long as
these households are able to verify that they are in the correct income category and are
able to obtain a loan for the unit. (Acceptable Home Loan Products are discussed in
Section 4.2). The sale~rices of the units will vary depending on the income of each
prospective household offered a unit.
Figure 6 illustrates how the selection process works. (See following page)
Apri129, 2005 9
~~ ~~~:
FIGURE 6
Step 1. A developer decides to accept Inclusionary Unit applications for a
particular period of time and advertises, as set forth in the Marketing Plan.
Step 2. The developer makes application packets available to all who request them.
The developer will also provide application packets to the City for distribution at
City Hall and the Library.
Step 3. The applicant response period ends. The developer will sort and establish
a list of all qualified applicants within one month followin cg losing of applicant
list.
This initial screening will qualify applicants based on low, very low or
moderate income as the case may be for the particular unit) and whether
the household is the appropriate size for the particular unit. If the developer
has established in the Marketing Plan that they will accept only mortgage
pre-qualified applicants, this will be .reflected in the list as well.
Step 4. All qualified applicants within each income category will be ranked by the
preference categories in the Regulations. Those applicants with the highest number
of points are at the top of the list and others follow in descending order based on
the number of points given.
Step S. Units are offered to applicants beginning at the top of the list.
The developer may not pass over an applicant higher on a list in favor of
another because of a higher income. Applicants are to be taken in the order
ranked. The developer may only exclude ranked applicants because the
applicants were not successful in obtaining financing or were not able to
demonstrate their qualifying household income.
Step 6. If the applicant accepts the unit, the applicant's file, ready to enter into
escrow, is delivered to the City of Dublin Housing Staff for review and
confirmation.
Step 7. Applicant's files are returned to developer and escrow may begin for each
qualified applicant for the unit.
3.3 Screening Based on Household Size
For both rental and for-sale units, household size for each Inclusionary Unit may not
exceed two people for each bedroom and may not be less than one person per bedroom,
unless otherwise prohibited by special financing sources such as the California
Multifamily Housing Program. Selection of applicants will be limited to those
households that match the number of bedrooms in the units being constructed for sale.
The following household sizes for various units sizes are used:
April 29, 2005 10
//~~ ~
` _.,
One-bedroom units 1-2 people households
Two-bedroom units 2-4 people households
Three-bedroom units 3-6 people households
Four-bedroom units 4-8 people households
3.4 Screening Based on Priority Preferences
After being screened for initial eligibility based on household income and household size,
applicant households shall be ranked and sorted based on the number of points the
applicant receives under the priorities set forth in the Regulations at Section 8.68.OSO.D.
If priority categories are checked on the application form, the developer will be required
to request verification of that claimed preference from the applicant and the form letter
requesting verification attached as Exhibit No 4 may be used for this purpose. This
verification may be requested at the initial application or at a later date, after the
developer has performed a preliminary review of all applicants.
The point system set out in the Regulations (see Table 1) provides preferences to those
persons who live in Dublin, work in Dublin, are public-service employees in Dublin, are
seniors, are permanently disabled, are an immediate family member of a Dublin resident,
and/or are being required to relocate from current Dublin residence due to demolition of
dwelling or conversion of dwelling from rental to for-sale (lpoint, one per household).
The Regulations provide that even if two persons in the household may be eligible to
receive priority points, the points are only awarded for one person. For example, if a
husband and wife are both employed in Dublin, the couple receives only 3 points for
being employed in Dublin. Similarly, if two seniors make up a household, they would be
entitled to only 1 point.
Table 1: The Priority Point System
Priority Points
Employed in Dublin 3 points
Public service employee in Dublin 1 additional
point
Resides in Dublin 3 points
Seniors (62 and over) 1 point
Permanently disabled 1 point
Have an immediate family who is a Dublin resident 1 point
& has continuously lived in Dublin the past year
Must move because housing is to be demolished or 1 point
converted to condo
Definitions of the various priority categories are set forth in the Regulations, Section
8.68.OSO.D as follows:
• To qualify as employed in Dublin the person shall have been employed within the
City of Dublin for at least six months.
• To qualify as a public service employee the person shall be employed by a public
agency.
• To qualify as a Dublin resident, the person shall have been a resident of the City
of Dublin for at least aone-year period prior to the eligibility determination.
Apri129, 2005 11
z~ ,~~
• To qualify as a relocated Dublin resident, the person shall have been relocated
from the current Dublin residence due to demolition of dwelling or conversion of
dwelling from rental to for-sale unit.
Where definitions are not explicitly stated in the Regulations, the City has developed
definitions:
A senior is defined as a person 62 years or older for the purpose of qualifying for
preference points.
To qualify for the permanently disabled point, the person must be able to provide
written verification from a physician or show receipt of SSI.
Immediate family is defined as a mother, father, brother, sister, child, grandparent
or grandchild.
Figure 7 demonstrates how the preference points are calculated.
FIGURE 7
Example 1: An applicant for an Inclusionary Unit both lives in Dublin (for at least
one year) and works in Dublin (for at least 6 months).
This individual will receive the following points:
Lives in Dublin 3 points
Works in Dublin 3 yoints
Total number of points 6 points
Example 2: An applicant for an Inclusionary Unit works in Dublin and is a
schoolteacher.
This individual will receive the following points:
Works in Dublin 3 points
Public Service Employee 1 point
Total number of points 4 points
Example 3: An applicant for an Inclusionary Unit is a senior citizen (62 years old)
and lives in the City of Dublin (for at least one year).
This individual will receive the following points:
Senior citizen 1 point
Lives in Dublin 3 points
Total number of points 4 points
Apri129, 2005 12
~~ ~a~a ~
f
3.5 Buyer Selection Process
The developer locates and finally selects purchasers pursuant to the Inclusionary Zoning
Regulations. The restricted units are to be made available to very low, low, and moderate
income households. The developer must verify that the prospective occupants' income
is/are appropriate for those categories. This verification must consist of evidence based
on some third party source such as income tax returns or W-2 statements. Proof that the
developer has requested and obtained this verification from prospective occupants will be
requested by the City Housing Staff prior to final approval of occupancy in any
Inclusionary unit.
The selection process requires the developer to use the following process:
Collect applications for a given time period. An initial qualification is made
based on household size (See Section 3.1) and household income (see Section
4.1).
Sort and rank the applications based on the Inclusionary Zoning Regulations'
preferences for occupant selection. Complete the ranking process and produce a
list with those applicants with the most City of Dublin preference points at the top
followed by all other applicants in descending order based on number of points
received. If more than one applicant receives the same number of City preference
points or if some applicants receive no points, the developer shall use other
objective criteria in occupant selection. The criteria that the developer proposes to
use shall be submitted to City Staff ahead of time in the Marketing Plan. For
example, the developer may date stamp all applicant applications and, in the case
of a tie, will offer the unit to that applicant that applied first, or the developer may
choose to hold a lottery to break ties.
• The ranked list must be completed within 30 days of the application deadline.
• Offer the units to applicants based on the list established above, offering first to
those applicants with the most points, then in descending order.
• Provide application with income verification, executed Resale Agreement and
final sale price offered as well as loan product to be used to City for final
determination of eligibility. If all needed documents are included, the City will
return to developer or agent within a week if possible.
4 ESTABLISHING SALES PRICE AND LOAN REQUIREMENTS FOR
OWNERSHIP UNITS
4.1 Sales Price of Affordable Units
The Inclusionary Ordinance (Section 8.68.020A.2) states that the price at which the
Inclusionary Units are to be offered is the price that would allow an applicant in the
April 29, 2005 13
r`
pertinent category to pay no more than 35% of their income toward housing expenses.
This requires that each and every qualified buyer pay no more than 35% of his or her
individual household income toward housing expenses. The only exception is very-low
income applicants. Units for very-low income applicants will be priced using the
maximum in the low income level adjusted for household size as total housing
expenditures.
As described below, a number of assumptions are used to calculate the maximum sale
price for inclusionary units. An individual homebuyer's actual expenses may differ from
the assumptions. For example, the actual interest rate may be lower if the homebuyer
obtains a variable interest rate mortgage. In addition, the actual downpayment may be
more or less than the assumed 5%, and the mortgage term may be less than 30 years.
The assumptions are used for the purpose of establishing a standardized method of
arriving at a sales price, and are not intended to limit the choices that a buyer may utilize
or to limit the mortgage products or downpayments that a developer may accept.
Following lending industry standards, housing expenses consist of "PITI," or principal,
interest, taxes and insurance. The City of Dublin also includes Homeowner Association
dues as a housing expense.
The maximum sale price is the price that will allow the homebuyer to purchase an
inclusionary unit by paying no more than 35% of their household income for PITI and
Homeowners Association dues, based upon the following assumptions. The only
exception is very-low income applicants. Units for very-low income applicants will be
priced using the maximum in the low income level adjusted for household size as total
housing expenditures.
• Downpayment (For the purpose of calculating the sale price of a home or
condominium, it is assumed that the prospective buyer will make a 5%
downpayment. The developer may accept alternate amounts for actual
downpayments.)
• Interest (Based on the weekly 30-year fixed rate published by the Federal Home
Loan Mortgage Corporation, (703) 903-2446. The actual interest rate may vary.)
• Mortgage Term (A 30-year term is assumed. The actual term may differ.)
• Taxes (Calculated using 1.25% of the estimated sale price of the unit.)
• Insurance (Includes Private Mortgage Insurance (PMI), if any, and homeowners
hazard insurance.
PMI -For the purposes of calculating sale price, PMI may be calculated at 2% of the
estimated loan, or the amount actually required by a given loan product being offered.
o Homeowner's Insurance -The cost of homeowner's insurance may be
calculated based on information researched by each developer, as to what an
Apri129, 2005 14
~~ ~
actual policy may cost a new homeowner. (If the homeowner insurance is
covered by a homeowner association structure, homeowners insurance need
not be included, but it must be documented that the HOA will provide
adequate insurance.)
Homeowners' association dues, if any.
The City has an Excel spreadsheet, available for public use, which can assist in the
calculation of the final sales price, based on the listed criteria and housing expenses
(Exhibit No 5). Each Inclusionary Unit may sell at a different sale price, depending on
the household income of the selected household.
Figure 8 shows how the sales price is calculated (see following page).
FIGURE 8
This example is of afour-person household qualifying to purchase atwo-bedroom unit. This
household's gross income is $89,000.
The maximum income for afour-person $98,650
moderate income household (using State HCD
2004 income limits)
Household's annual income (hypothetical) $89,000
Monthly income available for housing $2,595.83
expenses:
(35% of $89,000 = $31,150; $31,150 divided
by 12 = $2,595.83)
Developer wishes to sell home at: $300,000
Down Payment (for calculation of sales price $ 15,000
only - 5%)
Mortgage Required $ 285,000
Calculation
Monthly mortgage payment (based on $1,708.72
$285,000, 30-year fixed at 6% interest)
Other Monthly Housing Expenses:
• Private Mortgage Insurance $ 191.43
• Property Tax (1.25% of sales price) $ 312.50
• Homeowners Insurance (based on $ 166.67
demonstrated market rates)
• Homeowners Association Dues $ 200.00
Total monthly expenses: $2,589.75
$2,589.75 is less than the buyer's monthly income available for housing expenses of $2,595.83, .
therefore, the sales price is in accordance with the Inclusionary Zoning Ordinance requirements.
Apri129, 2005 15
~-~ ~~a~~
~~ 1
4.2 Acceptable Home Loan Products for Inclusionary Zoning Units
The City reserves the right to reject certain mortgage products because of the stronger
likelihood that some products could result in loss of the Inclusionary Unit due to a
foreclosure.
The following is anon-exclusive list of the loan products that are acceptable to the City.
The list is not intended to be exhaustive and other loan products may be evaluated upon
request.
1. 97-100% Loan to Value Loans
2. 90-97% Loan to Value Loans
3. Up to 95% Loan to Value Loans
4. Adjustable Rate Mortgages
• Two-Step Mortgage (adjusts only once -depends on rate adjustment)
• Six Month ARM (Depending on initial interest rate, adjustment caps and
lifetime caps)
• One Year ARM (Depending on initial interest rate, adjustment caps and
lifetime caps)
• Fixed-Period Adjustment Rate Mortgages (Depending on adjustment rates,
caps and lifetime caps). In evaluating ARMS the City will consider the
effect of the mortgage provisions on the ability of the buyer to make
payments
• Pledged-Assets Mortgages
• Virtually all Ca1HFA products available to First Time Homebuyers in
California
4.3 Closing of Sale and Escrow
Once the Inclusionary Unit buyer has been selected and price calculated, the necessary
documents must be completed and buyer fully qualified for the mortgage. When the
buyer is fully qualified and ready to enter into an agreement to purchase, the qualifying
packet is sent to the City of Dublin Housing Staff for review. The documents necessary
for Housing Staff review are the following:
1. Completed and Signed Application for Inclusionary Unit;
2. Completed and signed loan application;
3. Completed Truth in Lending Statement;
4. Complete Income Verification information on household;
5. Complete information on unit offered to prospective buyer, including unit size,
number of bedrooms and additional amenities;
6. Completed, executed, and notarized City of Dublin Resale Restriction Agreement
and Option to Purchase; and
7. If claiming an Inclusionary Preference, verification of that preference (covered in
Section 3.0).
Apri129, 2005 16
'~~~
City Staff will review the packet for completeness and compliance with the Inclusionary
Zoning Ordinance. The Application for Inclusionary Unit will be removed from the
packet and retained as part of City records. A copy of the income verification for the
household will be made and retained by the City as proof of the buyer's qualification to
purchase the Inclusionary Unit. The original signed Resale Agreement will also be
retained by the City and a copy returned to the lender. If the City receives a completed
packet, the review will be completed and file returned to developer within one week of
the submittal if possible. The Resale Agreement along with a Request for Notice of
Default will be recorded on closing of each sale.
IF THE PACKET IS INCOMPLETE, THE SALE CANNOT PROCEED UNTIL
ALL NEEDED DOCUMENTS ARE PROVIDED.
The documents will be returned to the lender, with a copy of the City's Escrow
Instructions for the recording of the Resale Agreement. City Staff will contact the lender
to establish whom the escrow and/or title firm is that will be in charge of closing the sale.
City Staff will send the original Resale Agreement to that firm with the Escrow
Instructions for recordation on closing of the sale.
5 RENTAL PROJECTS
After the Affordable Housing Agreement is executed, and prior to the rental of any units
in the project there is a process that must be followed that includes preparation of a
Management Plan, screening, ranking and qualifying of eligible tenants..
5.1 Preparation and Approval of Management Plan
The Management Plan will outline for the City how the management entity plans to
recruit and maintain occupancy of the Inclusionary Units. The document will also
provide a brief history of the management entity and previous experience as well as list
other rental complexes that are under their management.
5.2 Establishing Unit Rents for Inclusionary Units
The Inclusionary Ordinance (8.68.020A.1) states that rents for Inclusionary Units may
not exceed 30% of the maximum income level for very low, low and moderate income.
The City of Dublin uses the State of California Housing and Community Development
Income Guidelines by County. The Income Guidelines for 2005 are attached as Exhibit
No 6.
5.3 Screening Based on Household Size
For both rental and for-sale units, household size for each Inclusionary Unit may not
exceed two people for each bedroom and may not be less than one person per bedroom,
Apri129, 2005 17
Z1 ~ X61
unless otherwise prohibited by special financing sources such as the California
Multifamily Housing Program. Selection of applicants will be limited to those
households that match the number of bedrooms in the units being constructed for sale.
The following units household sizes for various units sizes are used:
One-bedroom units 1-2 people households
Two-bedroom units 2-4 people households
Three-bedroom units 3-6 people households
Four-bedroom units 4-8 people households
5.4 Screening Based on Priority Preferences
After being screened for initial eligibility based on household income and household size,
applicant households shall be ranked and sorted based on the number of points the
applicant receives under the priorities set forth in the Regulations at Section 8.68.OSOD.
If priority categories are checked on the application form, the developer will be required
to request verification of that claimed preference from the applicant and the form letter
requesting verification attached as Exhibit No. 4 may be used for this purpose. This
verification may be requested at the initial application or at a later date, after the
developer has performed a preliminary review of all applicants.
The point system set out in the Regulations (see Table 1) provides preferences to those
that live in Dublin, that work in Dublin, that are public-service employees in Dublin, that
are seniors, and that are permanently disabled. The Regulations provide that even if two
persons in the household may be eligible to receive priority points, the points are only
awarded for one person. For example, if a husband and wife are both employed in
Dublin, the couple receives only 3 points for being employed in Dublin. Similarly, if two
seniors make up a household, they would be entitled to only 1 point.
Table 2: The Priority Point System
Priority Points
Employed in Dublin 3 points
Public service employee in Dublin 1 additional point
Resides in Dublin 3 points
Seniors (62 and over) 1 point
Permanently disabled 1 point
Have an immediate family who is a Dublin 1 point
resident and has continuously lived in Dublin the
past year
Must move because housing is to be demolished or 1 point
converted to condo
Definitions of the various priority categories are set forth in the Regulations, Section
8.68.OSO.D.
• To qualify as employed in Dublin the person shall have been employed within the
City of Dublin for at least six months.
• To qualify as a public service employee the person shall be employed by a public
agency.
Apri129, 2005 18
~ ~ ~~
~~,.
• To qualify as a Dublin resident, the person shall have been a resident of the City
of Dublin for at least cone-year period prior to the eligibility determination.
• To qualify as a relocated Dublin resident, the person shall have been relocated
from the current Dublin residence due to demolition of dwelling or conversion of
dwelling from rental to for-sale unit.
Where definitions are not explicitly stated in the Regulations, the City has developed
definitions:
A senior is defined as a person 62 years or older for the purpose of qualifying for
preference points.
To qualify for the permanently disabled point, the person must be able to provide
written verification from a physician or show receipt of SSI.
Immediate family is defined as a mother, father, brother, sister, grandparent or
grandchild.
Figure 9 demonstrates how the preference points are calculated.
FIGURE 9
Example 1: An applicant for an Inclusionary Unit lives in Dublin (for at least one
year) and works in Dublin (for at least 6 months).
This individual will receive the following points:
Lives in Dublin 3 points
Works in Dublin 3 points
Total number of points 6 points
Example 2: An applicant for an Inclusionary Unit works in Dublin and is a
schoolteacher.
This individual will receive the following points:
Works in Dublin 3 points
Public Service Employee 1 point
Total number of points 4 points
Example 3: An applicant for an Inclusionary Unit is a senior citizen (62 years old)
and lives in the City of Dublin (for at least one year).
This individual will receive the following points:
Senior citizen 1 point
Lives in Dublin 3 points
Total number of points 4 points
Apri129, 2005 19
~~
5.5 Occupant Selection. for Rental Developments
In rental developments, the management firm (which could be the owner or builder) is
the entity that will be responsible for occupant selection and documentation.
The Management Plan for the development will outline how tenants will be selected and
prioritized to comply with the Regulations' preferences. Each applicant shall complete
the Application for Inclusionary Unit and return it to the management company.
Exhibit No 3 is a copy of the Application for Inclusionar~it.
The management company's leasing staff should be trained to understand and explain the
Affordable Housing Application and process to applicants. To lease the Inclusionary
Units the developer/management company will need to do the following:
• Collect applications. for a given time period. An initial qualification is made
based on household size (See Section 5.3) and household income (see State of
California, Housing and Community Development Department website,
www.hcd.ca.~ov);
Sort and rank the applications based on the Inclusionary Zoning Regulations'
preferences for occupant selection. Complete the ranking process and produce a
list with those applicants with the most City of Dublin preference points at the top
followed by all other applicants in descending order based on number of points
received. If more than one applicant receives the same number of City preference
points or if some applicants receive no points the developer shall use other
objective criteria in occupant selection. The criteria that the developer will use in
the event of a tie shall be submitted to City Staff ahead of time in the
Management Plan. For example, the developer may date stamp all applicant
applications and, in the event of a tie, will offer the unit to that applicant that
applied first, or the developer may choose to hold a lottery to break ties. The
ranked list must be completed within 30 days of the application deadline;
• Offer the units to applicants based on the list established above, offering first to
those applicants with the most points, then in descending order; and
• Maintain application with income verification for City to review at onsite
monitoring.
If a project is financed through a program that has stricter occupant selection or occupant
documentation requirements than the City, the City may elect to defer to those
requirements and not require additional documentation. The City will require tenant
income verification and restriction of the units for 55 years for the three income
categories; however, the management firm may send to the City copies of the
documentation that is required and produced for other monitoring agencies.
Apri129, 2005 20
~ ~ ~-~~
~~
5.6 Calculating Affordable Rents
Affordable rents are calculated by multiplying the annual household income of the
income-qualifying household by 0.30, then dividing by 12. The result is the maximum
monthly rent for the Inclusionary Unit if the tenant pays no utilities.
The Inclusionary Zoning Ordinance Regulations state that maximum rents cannot exceed
30% of household income for the maximum income in a given category. Following
rental programs such as HUD's Section 8 or the Tax Credit Allocation Committee rental
tables, reduction in rental amounts are taken if tenants are required to pay utilities.
If tenants pay for utilities, the maximum rent must be reduced to account for the cost of
utilities (a utility allowance). Utilities include gas, electric, water, and trash disposal. If
tenants are required to provide their own stove, refrigerator, or washer and dryer, those
expenses are considered utilities, and the maximum rent is further reduced. If the tenant
is responsible for any of the above, an allowance reduces the rent by the amounts listed in
Exhibit No. 7 .
Figure 10 illustrates the calculation of maximum rent.
FIGURE 10
Example 1: A developer provides 2 bedroom rental units for moderate-income households.
The developer establishes a tenant eligibility list and for moderate-income the first
household on the list for atwo-bedroom unit is a family of four with an annual income of
$91,900. Thirty percent of $91,900 is $27,570, and 1/12 of $27,570 is $2297.50. This
would be the maximum monthly rent.
The maximum rent could be charged to this household if the household were not responsible for
any utilities.
Example 2: Following on Example 1, the maximum rent for the moderate-income unit for
a household of four was $2297.50, but this development requires tenants to pay electric, gas
and water and water heating (gas) bills. The heating and cooking are both gas. The
management pays for trash, provides the refrigerator and the stove.
Using the current Utility Allowance in Exhibit 7, the following amounts are to be deducted
from the maximum monthly rent.
$2,297.50
gas heating (2 bdrm) $ 12.00
gas cooking " $ 2.00
gas water heating " " $ 10.00
water $ 14.00
$2,259.50
The rent that may be charge to this household could not exceed $2,259.50 monthly.
" The Utility Allowances are established by the Housing Authority of Alameda County and revised
periodically. The most current Utility allowances for Alameda County may be accessed at the following
web site: htt~//www.haca.net., then click on statistics.
April 29, 2005 21
~ r "'r
c ~fh ~;
5.7 Monitoring Rents
The Inclusionary Ordinance (Section 8.68.OSO.B) states that the management entity for
the development will provide the City of Dublin an Annual Report (Exhibit No 8). The
annual report will include the following information:
1. Income of BMR tenant households, reviewed annually;
2. Identification of all Inclusionary Units (very low-, low- and moderate-
income units) within the development;
3. Monthly rents charged to all BMR tenant households; and
4. Vacancy of Inclusionary Units during the previous year.
This report will be due annually on October 31st. The City of Dublin Housing Staff will
send a reminder letter to the management firm, with a copy of the Annual Report form
for completion and certification at least three months prior to the anniversary date. This
form must be completed and returned to the City by the anniversary date.
G:\PA#\2001\O1-038 Inclusionary ZOA\Inclusionary Guidelines\Inclusionary Guidelines -Final on 4-29-OS.doc
Apri129, 2005 22
~ i
~J
~ +
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
CITY OF DUBLIN,
100 Civic Plaza
Dublin, California 94568
Attn: City Clerk
To be recorded without fee.
(Gov. Code, §§ 6103 and 27383.)
(Space Above This Line For Recorder's Use Only)
RESALE RESTRICTION AGREEMENT
AND OPTION TO PURCHASE
Owner:
Property Address:
Dublin, California 94568
Name of Development:
This RESALE RESTRICTION AGREEMENT AND OPTION TO PURCHASE
("Agreement") is entered into by and between the CITY OF DUBLIN, a California municipal
corporation (the "City") and ("Owner") regarding certain
improved real property which is more particularly described in Exhibit A attached hereto and
incorporated herein and commonly known as
,Dublin, CA, 94568 _ (the "Property") effective
as of , 20_ ("Effective Date"). City and Owner are hereinafter collectively
referred to as the "Parties."
RECITALS
A. The City has Inclusionary Zoning Regulations (Dublin Municipal Code Chapter
8.68) (the "Regulations") that require developers of rental and ownership housing to
construct within their projects units that are affordable to very low-, low-, and moderate-
income households ("the Program"). To further its goal of creating affordable home
ownership opportunities for very low-, low-, and moderate-income persons and families, the
City has initiated a program for the sale of some homes at a price below their market rate
("Program"). Pursuant to the Program, developers of housing developments agree to set
aside a certain number of units for purchase or rent, as applicable, by very low-, low-, and
moderate-income persons and families, as defined herein.
~2s~os-a -1- Form Revised May 27, 2005
Fxhih;t 1
a ~:~~~,
B. Owner is an eligible [very low-, low- or moderate-]income purchaser under the
Program, intends to live in the Property as an owner occupant, and agrees to maintain the
Property as Owner's principal residence.
C. In order to maintain and preserve the Property as housing affordable to eligible
[very low-, low-, or moderate-]income purchasers, it is necessary to restrict the use and
resale of the Property through imposition of the occupancy and resale restrictions set forth
herein. These restrictions are intended to prevent initial and subsequent purchasers from
using the Property for purposes incompatible with the Program and realizing unwarranted
gains from sales of the Property at unrestricted prices. The terms and conditions of this
Agreement are intended to provide the necessary occupancy and resale restrictions to
ensure that the Property is used, maintained, and preserved as housing affordable to
eligible [very low-, low-, or moderate-]income purchasers. To further serve the purposes of
the Program, it is necessary that the City be granted an option to purchase the property so
that the property may be resold by the City to an eligible household.
D. The Property constitutes a valuable community resource by providing decent,
safe, and sanitary housing to persons and families of [very low, low, or moderate] income
who otherwise would be unable to afford such housing. To protect and preserve this
resource it is necessary, proper, and in the public interest for the City to administer
occupancy and resale controls consistent with the Program and the Regulations by means
of this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the substantial economic benefits inuring to
Owner and the public purposes to be achieved under the Program, Owner and City hereby
agree as follows:
1. Definitions.
a. "Affordable Unit Cost" shall be as defined in the Regulations, as follows:
"Owner-occupied units are deemed affordable units if the sales price results
in annual housing expenses that do not exceed 35% of income level for very-low-,
low-, and moderate-income households, adjusted for household size and as defined
below. For a very low-income owner occupied units, the unit shall be deemed an
affordable unit if the sales price results in annual housing expenses that do not
exceed 35% of the maximum in the very low-income level, adjusted for household
size and as defined below."
b. "Area [Very Low, Low, or Moderate] Income for Alameda County" means
those income and eligibility levels determined, updated, and published each year by the
California Department of Housing and Community Development, based on Alameda County
median income levels, adjusted for household size.
c. "Persons and families of [very low, low, or moderate] income" means
persons and families whose income does not exceed [fifty percent (50%); eighty percent
~ze~os-a -2- Form Revised May 27, 2005
d-,
~.~ ~, ..a
~:
~,...~? ,
f}
(80%); or one hundred twenty percent (120%)] of the Area Median Income for Alameda
County, as adjusted for household size.
d. Persons and families meeting the definition set forth in Paragraph 1(b)
above shall be referred to as "Eligible Households."
2. Program Requirements.
a. Affordability Restrictions. Owner hereby covenants and agrees that
during the term of this Agreement all of the requirements and restrictions of this Agreement
shall apply, and the Property shall be sold or otherwise transferred only pursuant to the
terms and conditions of this Agreement and only to (i) Eligible Households at a price not to
exceed the Adjusted Resale Price, as .defined in Paragraph 5, (ii) the City pursuant to
Paragraph 3, or (iii) a permitted transferee pursuant to Paragraph 9.
b. Disclosure. DURING THE TERM OF THIS AGREEMENT THERE
SHALL BE NO SALE OR OTHER TRANSFER OF THE PROPERTY WITHOUT THE
WRITTEN CERTIFICATION BY THE CITY THAT THE TRANSFEREE QUALIFIES AS AN
ELIGIBLE HOUSEHOLD AND THAT THE PROPERTY IS BEING TRANSFERRED AT A
PRICE NOT TO EXCEED THE ADJUSTED RESALE PRICE, WHICH IS CAPPED AT THE
AFFORDABLE UNIT COST AS DEFINED IN PARAGRAPH 1 a. ANY SALE OR OTHER
TRANSFER OF THE PROPERTY IN VIOLATION OF THIS COVENANT SHALL BE
VOIDABLE BY THE CITY.
c. Principal Residence Requirement. OWNER COVENANTS AND
AGREES THAT HE/SHE/THEY SHALL OCCUPY THE PROPERTY AS HIS/HER/THEIR
PRINCIPAL RESIDENCE FOR THE DURATION OF HIS/HER/THEIR OWNERSHIP AND
SHALL NOT RENT OR LEASE THE PROPERTY OR PORTION THEREOF DURING THE
TERM OF THIS AGREEMENT WITHOUT PRIOR WRITTEN APPROVAL OF CITY.
Without limiting the generality of the foregoing, any absence from the Property by Owner for
a period of ninety (90) or more days shalt be deemed an abandonment of the Property as
the principal residence of Owner in violation of the conditions of this Paragraph. Upon
request by the City made from time to time, the Owner of the Property shall submit an
affidavit to the City certifying that the Property is the Owner's principal residence and
provide such documents and other evidence as may be requested to verify Owner's
compliance with this requirement. Abandonment of the Property shall constitute an Option
Event (as defined in Paragraph 3.c below) and shall entitle the City to exercise its Option to
purchase the Property.
3. Option to Purchase.
a. Grant of Option to Purchase. Owner hereby grants to the City an option
("Option") to purchase all of Owner's right, title and interest in and to the Property upon the
occurrence of an Option Event (defined in Paragraph 3.c below), subject to the terms and
conditions contained herein.
b. Assignment of the Option. The City may assign the Option to another
government entity, anon-profit affordable housing provider or a person or family that
qualifies as an Eligible Household. The City's assignment of the Option shall not extend
~ 251 os-s -3- Form Revised May 27, 2005
~-
,''' ~' 1
~,
any time limits contained herein with respect to the exercise period of the Option or the
period within which the Property must be purchased.
c. Events Giving Rise to Right to Exercise Option. The City shall have
the right to exercise its Option upon the occurrence of any of the following events (each, an
"Option Event"):
3.d.i below);
Receipt of a Notice of Intent to Transfer (defined in Paragraph
ii. Any actual, attempted or pending sale, conveyance, transfer
lease or other attempted disposition of the Property or of any estate or interest therein,
except as provided in Paragraph 10 below;
iii. Any actual, attempted or pending encumbrance of the
Property, including without limitation by way of mortgage or deed of trust, or by judgment,
mechanics, tax or other lien, except as provided in Paragraph 9 below;
iv. Recordation of a notice of default and/or notice of sale
pursuant to California Civil Code section 2924 (or successor provisions) under any deed of
trust or mortgage with a power of sale encumbering the Property;
the Property;
Commencement of a judicial foreclosure proceeding regarding
vi. Execution by Owner of any deed in lieu of foreclosure
transferring ownership of the Property;
vii. Commencement of a proceeding or action in bankruptcy,
whether voluntary or involuntary, pursuant to Title 11 of the United States Code or other
bankruptcy statute, or any other insolvency, reorganization, arrangement,. assignment for
the benefit of creditors, receivership or trusteeship, concerning the Owner; or
viii. Any violation by Owner of any provision of this Agreement
including, without limitation, the conditions set forth in Paragraph 2 above.
d. Method of Exercising the Option.
i. Notice of Intent to Transfer. If Owner desires to sell, convey,
transfer (other than pursuant to Paragraph 9), lease, encumber (other than pursuant to
Paragraph 10) or otherwise dispose of the Property or of any estate or interest therein, no
less than 45 days prior to the date of such proposed sale, conveyance, transfer, lease,
encumbrance or disposition, Owner shall notify City in writing to that effect (the "Notice of
Intent to Transfer"). The Notice of Intent to Transfer shall be in substantially the form
attached hereto as Exhibit B. In the case of a proposed sale of the Property to an identified
prospective purchaser, the Owner shall submit to the City, together with the Notice of Intent
to Transfer, a copy of the prospective purchaser's income certification, a list of all assets
owned by the prospective purchaser, and other financial information reasonably requested
by City, in a form approved by the City, along with the income certification to be provided to
any lender making a loan to the prospective purchaser. The City may require
125106-8 -4- Form Revised May 27, 2005
r""" ..
f>.
documentation evidencing and supporting the income and other financial information
contained in the certifications.
ii. Notice of Exercise. Upon the occurrence of any Option Event,
the City may exercise its Option by delivering notice, pursuant to Paragraph 16 and within
the time period specified in Paragraph 3(d)(iv), to Owner of City's intent to exercise such
Option pursuant to the terms of this Agreement ("Notice of Exercise"). The Notice of
Exercise may be in the form attached hereto and incorporated herein as Exhibit C, or in
such other form as the City may from time to time adopt. If the Option Event relates to the
potential foreclosure of a mortgage under Paragraphs 3.c.iv, 3.c.v, or 3.c.vi, then the City
shall also deliver the Notice of Exercise. to the mortgagee or beneficiary under such
mortgage, at such mortgagee's or beneficiary's address of record in the Office of the
Recorder of Alameda County.
iii. Notice of Consent to Transfer. If the City does not exercise
the Option, it may give its consent to the occurrence of the Option Event ("Consent to
Transfer"). If the Option Event involves a proposed sale of the Property to a prospective
purchaser, the City's consent shall be conditioned upon (i) the proposed purchaser's
qualification as an Eligible Household; (ii) the sale of the Property at a price not to exceed
the Adjusted Resale Price; (iii) the proposed purchaser's execution of a Disclosure
Statement in the form attached hereto as Exhibit F or such other form or forms as may be
promulgated by the City; and (iv) the proposed purchaser's assumption of Owner's duties
and obligations under this Agreement pursuant to a written assumption agreement in a form
acceptable to City, or execution of an agreement substantially similar to this Agreement,
within thirty (30) days after the Consent to Transfer has been delivered to Owner and
recordation of such assumption agreement or substitute agreement. SELLER SHALL PAY
REAL ESTATE COMMISSIONS, IF ANY, WHICH SHALL NOT TO EXCEED 6% OF THE
ACTUAL SALES PR1CE. If the prospective purchaser (i) fails to qualify as an Eligible
Household, (ii) fails to execute and deliver the Disclosure Statement to the City, or (iii) fails
to execute and deliver to the City an assumption agreement or an agreement substantially
similar to this Agreement within such thirty (30) day period, then the Consent to Transfer
shall expire and the City may, at its option, either notify Owner of the disqualification,
thereby entitling Owner to locate another purchaser who qualifies as Eligible Household, or
exercise the Option, as if no Consent to Transfer had been delivered.
iv. Time Period for Notice. The City shall deliver a Consent to
Transfer, if applicable, not later than thirty (30) days after the date that it receives
notification of an Option Event. The City shall deliver a Notice of Exercise, if applicable, on
or before the date which is the later to occur of the following: (i) thirty (30) days after the
date that the City receives notification of an Option Event or (ii) fifteen (15) days after a
Consent to Transfer has expired. For purposes of computing commencement of the
delivery periods, the City shall be deemed to have received notification of an Option Event
on the date of delivery of a Notice of Intent to Transfer, pursuant to the terms of Paragraph
16 below or on the date it actually receives notice of default, summons and complaint or
other pleading, or other writing specifically stating that an Option Event has occurred. The
City shall have no obligation to deliver a Notice of Exercise or Consent to Transfer, and the
applicable time period for exercise of the Option shall not commence to run, unless and
until the City has received notification of an Option Event in the manner specified in this
subparagraph. If there is a stay or injunction imposed by court order precluding the City
izs~os-a -5-- Form Revised May 27, 2005
from delivering its Consent to Transfer or Notice of Exercise within the applicable time
period, then the running of such period shall cease until such time as the stay is lifted or the
injunction is dissolved and the City has been given written notice thereof, at which time the
period for delivery of a Consent to Transferor Notice of Exercise shall again begin to run.
v. Notice of Abandonment. If the City fails to deliver a Notice of
Exercise or Consent to Transfer within the time periods set forth in paragraph 3.d.iv, upon
request by Owner, the City shall cause to be filed for recordation in the Office of the
Recorder of Alameda County, a notice of abandonment, which shall declare that the
provisions of the Option are no longer applicable to the Property. Unless Owner requests
recordation of notice of abandonment within 30 days of the City's failure to deliver Notice of
Exercise or Consent to Transfer, the City shall have no obligation to record the notice of
abandonment. Upon recordation of a notice of abandonment, the Option shall terminate
and have no further force and effect. If the City fails to record a notice of abandonment, the
sole remedy of Owner shall be to obtain a judicial order instructing prompt recordation of
such a notice.
vi. Right to Reinstatement. If the Option Event is the recordation
of a notice of default, then the City shall be deemed to be Owner's successor in interest
under California Civil Code Section 2924c (or successor section) solely for purposes of
reinstatement of any mortgage on the Property that has led to the recordation of the notice
of default. As Owner's deemed successor in interest, the City shall be entitled to pay all
amounts of principal, interest, taxes, assessments, homeowners' association fees,
insurance premiums, advances, costs, attorneys' fees and expenses required to cure the
default. If the City exercises the Option, then any and all amounts paid by the City pursuant
to this Paragraph shall be treated as Adjustments to the Base Resale Price for the Property,
as defined in Paragraph 5 below.
vii. Inspection of Property. After receiving a Notice of Intent to
transfer or delivering a Notice of Exercise, the City shall be entitled to inspect the Property
one or more times prior to the close of escrow to determine the amount of any Adjustments
to the Base Resale Price. Before inspecting the Property, the City shall give Owner not
less than forty-eight (48) hours written notice of the date, time and expected duration of the
inspection. The inspection shall be conducted between the hours of 9:00 a.m. and 5:00
p.m., Monday through Friday, excluding court holidays, unless the parties mutually agree in
writing to another date and time. Owner shall make the Property available for inspection on
the date and at the time specified in the City's request for inspection.
viii. Escrow. Promptly after delivering a Notice of Exercise, the
City shall open an escrow account for its purchase of the Property. Close of escrow shall
take place on such date which is the later to occur of the following, (a) sixty (60) days after
a Notice of Exercise has been delivered, or (b) ten (10) days after Owner has performed all
acts and executed. all documents required for close of escrow. Prior to the close of escrow,
the City shall deposit into escrow with a title company of City's choosing, the Adjusted
Resale Price as defined in Paragraph 5 below and all escrow fees and closing costs to be
paid by City. Commissions (not to exceed 6% of the actual sales price), closing costs and
title insurance shall be paid pursuant to the custom and practice in the County of Alameda
at the time of the opening of escrow, or as may otherwise be provided by mutual
~25~os-s -8- Form Revised May 27, 2005
'1 w"'ix
agreement. Owner agrees to perform all acts and execute ail documents reasonably
necessary to effectuate the close of escrow and transfer of the Property to the City.
ix. Proceeds of Escrow; Removal of Exceptions to Title. Prior to close of
escrow, Owner shall cause the removal of all exceptions to title to the Property that were
recorded after the Effective Date with the exception of (i) taxes for the fiscal year in which
the escrow for this transaction closes, which taxes shall be prorated as between Owner and
City as of the date of close of escrow; (ii) quasi-public utility, public alley, public street
easements, and rights of way of record, and (iii) such other liens, encumbrances,
reservations and restrictions as may be approved in writing by City ("Permitted
Exceptions").
The purchase price deposited into escrow by the City shall be applied first to the
payment of any and all Permitted Encumbrances (as defined in Paragraph 10) recorded
against the Property in order of lien priority, and thereafter to the payment of Owner's share
of escrow fees and closing costs. Any amounts remaining after the purchase price has
been so applied, if any, shall be paid to Owner upon the close of escrow. If the purchase
price is insufficient to satisfy all liens and encumbrances recorded against the Property, the
Owner shall deposit into escrow such additional sums as may be required to remove said
liens and encumbrances. In the event that the City agrees to proceed with close of escrow
prior to the date that Owner has caused all exceptions to title recorded after the Effective
Date other than Permitted Exceptions to be removed, then Owner shall indemnify, defend
and hold City harmless from any and all costs expenses or liabilities (including attorneys'
fees) incurred or suffered by City that relate to such exceptions and their removal as
exceptions to title to the Property.
4. Base Resale Price. Prior to adjustment pursuant to Paragraph 5 the base
resale price ("Base Resale Price") of the Property shall be the lowest of:
a. Median Income. The original price ("Base Price") paid by Owner for
acquisition of the Property pursuant to the Program, increased (but not decreased) by an
amount, if any, equal to the Base Price multiplied by the percentage increase in the median
household income ("Median Income") for Alameda County published by the California
Department of Housing and Community Development, Division of Housing Policy
Development, between the Effective Date and the date that the City receives notification of
an Option Event; or
b. Fair Market Value. The fair market value of the Property as determined
by an appraiser selected and paid for by Owner and approved in writing by the City.
To compute the Base Resale Price, the City may use the Base Resale Price Worksheet
attached as Exhibit D hereto, or such other form as the City may from time to time adopt.
5. Adjustments to Base Resale Price. Subject to the Affordable Unit Cost
restriction described in subparagraph (d) below, the Base Resale Price shall be increased
or decreased, as applicable, by the following adjustment factors ("Adjustment"):
a. Capital Improvements. An increase for capital improvements made to
the Property, but only if the amount of such improvements has been previously approved in
~2e~os-a -7- Form Revised May 27, 2005
.-~
Q, ~ ~~,1
J
writing by the City after Owner has submitted original written documentation of the cost to
the City for verification. The amount of the Adjustment shall equal the original cost of any
such capital improvements.
b. Damages. A decrease by the amount necessary to repair damage to the
Property, if any, and to place the Property into saleable condition as reasonably determined
by the City upon City's exercise of its Option hereunder, including, without limitation,
amounts attributed to cleaning; painting; replacing worn carpeting and draperies; making
necessary structural, mechanical, electrical and plumbing repairs; and repairing or replacing
built-in appliances and fixtures. Owner hereby covenants to, at Owner's expense, maintain
the Property in the same condition as in existence on the date of City's Notice of Exercise,
reasonable wear and tear excepted.
c. Advances by the City. A decrease in an amount equal to the sum of all
costs advanced by the City for the payment of mortgages, taxes, assessments, insurance
premiums, homeowner's association fees and/or associated late fees, costs, penalties,
interest, attorneys' fees, pest inspections, resale inspections and other expenses related to
the Property, which Owner has failed to pay or has permitted to become delinquent.
d. Adjusted Resale Price Not to Exceed Affordable Unit Cost. The Base
Resale Price as adjusted, is hereinafter referred to as the "Adjusted Resale Price."
Notwithstanding any other provision hereof to the contrary, in no event shall the Adjusted
Resale Price exceed the Affordable Unit Cost.
6. Priority and Effectiveness of the Option.
a. Recordation. This Agreement shall be recorded in the Office of the
Recorder of the County of Alameda on or as soon as practicable after the Effective Date.
The Option shall have priority over any subsequent sale, conveyance, transfer, lease or
other disposition or encumbrance of the Property, or of any estate or interest therein, and, in
the event of exercise of the Option by City, the City shall take the Property subject only to
Permitted Exceptions. Except as otherwise provided in Paragraph 7.a, the exercise of the
Option by the City at any time and from time to time shall not extinguish the Option or cause
a merger of the Option into any estate or other interest in the Property, and the Option shall
continue to exist and be effective with respect to the Property against any and all
subsequent owners in accordance with the terms and conditions hereof.
b. Request for Notice of Default. The City shall file a Request for Notice of
Default for recordation in the Office of the Recorder of the County of Alameda promptly
upon execution of this Agreement (see Exhibit E .
c. Subordination. The City agrees that in order to assist qualified
purchasers to secure purchase money financing for the acquisition of the Property, the City
will enter into a subordination agreement with a senior purchase money lender to
subordinate this Agreement under such terms as the City and the senior purchase money
lender shall negotiate.
7. Survival of Option Upon Transfer.
~25~os-a -8- Form Revised May 27, 2005
r' .>;
~-'~ -G~, , ' ;' t
a. In General. The City's right to exercise the Option shall survive any
transfer of the Property by Owner. Each transferee, assignee or purchaser of the Property
during the term hereof shall be required to execute an agreement substantially in the form
of this Agreement, provided that the term of any such agreement shall be for the duration of
the term hereof as of the date of any such transfer, assignment or sale. The Option may be
exercised against the Property throughout the term hereof, regardless of whether the
Property is owned, possessed or occupied by Owner or any successor, transferee,
assignee, heir, executor, or administrator of Owner, regardless of household income (if
applicable) including adebtor-in-possession, debtor or trustee pursuant to Title 11 of the
United States Code. Notwithstanding the foregoing, the Option shall not survive (i) the sale
and transfer of the Property to a third party purchaser pursuant to a judicial or non-judicial
foreclosure or a deed-in-lieu of foreclosure under a power of sale contained in a mortgage
or deed of trust held by an institutional lender, or (ii) the recording of an instrument
conveying Owner's interest in the Property to the City, or its assignee, provided the
conveyance is in accordance with the terms of this Agreement.
b. HUD Insured Mortgage. If Owner has acquired the Property by a
mortgage insured by the Secretary of the United States Department of Housing and Urban
Development, and a notice of default has been recorded pursuant to California Civil Code
Section 2924 (or successor provisions), then this Option shall automatically terminate if title
to the Property is transferred by foreclosure or deed-in-lieu of foreclosure, or if the insured
mortgage is assigned to the Secretary.
8. Voidable Transfers. As long as the Option has not been abandoned pursuant
to Paragraph 3.d.v, any actual or attempted sale, conveyance, transfer or other disposition
of the Property, or of any estate or interest therein, in violation of the terms and conditions
of this Agreement, shall be voidable at the election of the City.
9. Permitted Transfers. Provided that the transferee assumes, within 30 days of a
written request by the City, all of Owner's duties and obligations under this Agreement
pursuant to a written assumption agreement in a form acceptable to City, or at City's
election, execution of an agreement substantially similar to this Agreement, the following
transfers ("Permitted Transfers") of title to the Property, or of any estate or interest therein,
shall not be subject to the City's prior approval, shall not trigger the exercise of the Option,
and shall not be considered Option Events: (a) a good-faith transfer by gift, devise or
inheritance to Owner's spouse or issue; (b) a taking of title by a surviving joint tenant; (c) a
court-ordered transfer of title to a spouse as part of a divorce or dissolution proceeding; (d)
a transfer by Owner into an inter vivos trust in which the Owner is a beneficiary and the
Owner continues to occupy the property as his/her primary residence; (e) an acquisition of
title, or of any interest therein, in conjunction with marriage; or (f) any good faith transfer to
an Eligible Household. Notwithstanding any Permitted Transfer, the Option shalt remain
effective with respect to the Property for the duration of the term hereof.
10. Permitted Encumbrances and Refinancing. This Option shall not become
exercisable as the result of Owner's encumbering the Property for the purpose of securing
financing to purchase the Property pursuant to the Program, to refinance indebtedness
incurred to purchase the Property pursuant to the Program, or to make necessary repairs to
the Property in an amount approved by City pursuant to Paragraph 5a ("Permitted
Encumbrances"). The maximum aggregate amount of such encumbrances outstanding at
~2s~os-a -9- Form Revised May 27, 2005
~i ~ .~-t
any time (the "Permitted Encumbrance Amount") shall not exceed an amount equal to
ninety percent (90%) of the Base Resale Price calculated as provided in Paragraph 4. The
Permitted Encumbrance Amount shall be calculated as if the City had received notification
of an Option Event on the earlier of (a) the date on which the deed of trust or mortgage
securing the indebtedness is filed for record in the Office of the Recorder of the County of
Alameda, or (b) the date the City receives Notice of Intent to Transfer pursuant to
Paragraph 3.d.i above. Owner hereby covenants and agrees that he/she/they shall use
his/her/their best efforts to ensure that any deed of trust or other agreement encumbering
the property shall include provisions providing for notice to be delivered to City of any
default thereunder and for City's right to cure such default at City's election.
11. Obligation of Owner After Option Abandonment. If the City records a notice
of abandonment of the Option, then the Property may be sold by Owner to a third party
without restriction as to price; however, upon such sale, Owner shall pay to City an amount
("City's Share") equal to twenty-five .percent (25%) of the difference between (a) the actual
sales price net of reasonable and customary real estate commissions. paid (such
commissions not to exceed six percent (6%) of the actual sales price), and (b) the Adjusted
Resale Price. The City's Share shall be paid to the City concurrently with close of escrow
on the sale of the Property, or upon receipt by Owner of the sale price for the Property ,
whichever shall first occur.
12. Limits on Liability. In no event shall the City become liable or obligated in any
manner to Owner by reason of the assignment of this Agreement or the Option, nor shall
City be in any way liable or obligated to Owner for any failure of the City's assignee to
consummate a purchase of the Property or to comply with the terms of this Agreement or
the Option, or any escrow instructions or agreement for the purchase of the Property.
13. Insurance Proceeds and Condemnation Award. In the event the Property is
destroyed and insurance proceeds are distributed to Owner instead of being used to rebuild
the Property, or, in the event of condemnation, if the proceeds thereof are distributed to
Owner, any surplus of proceeds remaining after payment of the senior liens and
encumbrances on the Property shall be distributed as follows: that portion of the surplus up
to, but not to exceed, the net amount Owner would have received pursuant to Paragraph
3.d.ix had the City exercised its Option on the date of the destruction of condemnation
valuation date shall be distributed to Owner, and the balance of such surplus, if any, shall
be distributed to the City.
14. Effective Date. The rights and obligations of the City and Owner set forth in this
Agreement shall be effective as of the Effective Date.
15. Term of Agreement and Option. The restrictions contained herein and the
City's option to purchase the Property shall continue for a period of fifty-five (55) years
commencing on the Effective Date. Notwithstanding anything to the contrary in the
foregoing, the Agreement shall remain in effect until the first transfer on or after the
termination of the restrictions and option to purchase pursuant to this paragraph. Upon
such sale, Owner shall pay to City an amount ("City's Share") equal to twenty-five percent
(25%) of the difference between (a) the actual sales price net of reasonable and customary
real estate commissions paid (such commissions not to exceed six percent (6%) of the
~ 2s~ os-a -10- Form Revised May 27, 2005
r 4
actual sales price), and (b) the Adjusted Resale Price on the date of the termination of the
restrictions and option to purchase pursuant to this paragraph. The City's Share shall be
paid to the City concurrently with close of escrow on the sale of the Property, or upon
receipt by Owner of the sale price for the Property, whichever shall first occur. Following
completion of a sale in compliance with this provision, this Agreement shall terminate.
16. Notices. Except as otherwise specified in this Agreement, all notices to be sent
pursuant to this Agreement shall be made in writing, and sent to the Parties at their
respective addresses specified below or to such other address as a. Party may designate by
written notice delivered to the other Party in accordance with this Section. All such notices
shall be sent by:
(a) personal delivery, in which case notice shall be deemed delivered upon receipt;
(b) certified or registered mail, return receipt requested, in which case notice shall be
deemed delivered two (2) business days after deposit, postage prepaid in the United States
mail;
(c) nationally recognized overnight courier, in which case notice shall be deemed
delivered one (1) day after deposit with such courier; or
(d) facsimile transmission, in which case notice shall be deemed delivered on
transmittal, provided that a transmission report is generated reflecting the accurate
transmission thereof.
City: City of Dublin,
100 Civic Plaza
Dublin, California 94568
Attn: City Manager
Owner: At the address of the Property
17. Remedies Upon Breach.
a. Specific Performance. Owner acknowledges that any breach in the
performance of its obligations under this Agreement shall cause irreparable harm to the
City. Owner agrees that the City is entitled to equitable relief in the form of specific
performance upon its exercise of the Option, and that an award of damages shall not be
adequate to compensate the City for Owner's failure to perform according to the terms of
this Agreement.
or equity.
b. Other Remedies. City shall have all of the remedies provided for at law
18. General Provisions.
a. Attorneys' Fees. If either party initiates legal proceedings to interpret or
enforce its rights under this Agreement, the prevailing party in such action shall be entitled
i2s~os-a -11- Form Revised May 27, 2005
^ l„ t
~~,{ +
to an award of reasonable attorneys' fees and costs in additions to any other recovery to
which it is entitled under this Agreement.
b. No Joint Venture; No Third-Party Beneficiary. No joint venture or other
partnership exists or is created between the Parties by virtue of this Agreement. Except as
expressly stated herein, this Agreement does not benefit any third party.
c. Successors; Assignment. This Agreement shall inure to the benefit of
and shall be binding upon the Parties to this Agreement and their respective heirs,
executors, administrators, successors and assigns. City shall have the right to assign all of
its rights and obligations under this Agreement without the consent of Owner.
d. Entire Agreement; Amendment. This Agreement constitutes the entire
agreement of the Parties with respect to the subject matter hereof, and supersedes any and
all other prior negotiations, correspondence, understandings and agreements with respect
thereto. There are no representations, promises, agreements or other understandings
between the Parties relating to the subject matter of this Agreement that are not expressed
herein. This Agreement may be modified only by an instrument in writing executed by the
Parties or their respective successors in interest.
e. Survival; No Merger. All of the terms, provisions, representations,
warranties and covenants of the Parties under this Agreement shall survive the close of
escrow of any sale of the Property and shall not be merged in any deed transferring the
Property.
f. Authority And Execution. Each Party represents and warrants that
it has full power and authority to enter into this Agreement and to undertake all of its
obligations hereunder, that each person executing this Agreement on its behalf is duly and
validly authorized to do so.
g. Severability. The invalidity or unenforceability of any term or
provision of this Agreement shall not impair or affect the remainder of this Agreement, and
the remaining terms and provisions hereof shall not be invalidated but shall remain in full
force and effect.
h. Waiver; Modification. No waiver or modification of this Agreement or
any covenant, condition, or limitation herein contained shall be valid unless in writing and
duly executed by the Party to be charged therewith. No evidence or any waiver or
modification shall be offered or received in evidence in any proceeding, arbitration, or
litigation between the Parties arising out of or affecting this Agreement or the rights or
obligations of any Party hereunder, unless such waiver or modification is in writing and duly
executed as aforesaid. The provisions of this section may not be waived except as herein
set forth. A waiver or breach of any covenant, condition or provision of this Agreement shall
not be deemed a waiver of any other covenant, condition or provision hereof.
i. Construction. The section headings and captions used in this
Agreement are for convenience of reference only and shall not modify, define, limit or
amplify any of the terms or provisions hereof. This Agreement shall not be construed as if
it had been prepared by one of the Parties, but rather as if both Parties have prepared it.
~z5ios-s -12- Form Revised May 27, 2005
~~~a~~
j. Governing Law. This Agreement shall in all respects be governed by
and construed in accordance with the laws of the State of California.
k. Time of the Essence. Time is of the essence in this Agreement as to
each provision in which time is an element of performance.
I. Further Assurances. Each Party will, upon reasonable request of the
other Party, execute, acknowledge, and deliver, or cause to be executed, acknowledged,
and delivered, such further instruments and documents as may be reasonably necessary in
order to fulfill the intents and purposes of this Agreement.
m. Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original, and all which together shall constitute one and
the same instrument.
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
executed as of the date first written above.
OWNER(S):
CITY:
CITY OF DUBLIN
By:
Its:
ATTEST:
City Cierk
APPROVED AS TO FORM:
City Attorney
~2s~os-s -13- Form Revised May 27, 2005
~s~ a~~
STATE OF CALIFORNIA )
COUNTY OF )
On
before me,
in and for said county and state, personally appeared
a Notary Public
personally known to me (or
proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s)
is/are subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s), or the entity upon behalf of which the
person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature
(Seal)
STATE OF CALIFORNIA
COUNTY OF
On
before me,
in and for said county and state, personally appeared
a Notary Public
personally known to me (or
proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s)
is/are subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s), or the entity upon behalf of which the
person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature
(Seal)
i2s~os-s -1- Form Revised May 27, 2005
r7_ (~ ~ ~ d~ `~
~,
STATE OF CALIFORNIA )
COUNTY OF )
On before me,
in and for said county and state, personally appeared
a Notary Public
personally known to me (or
proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s)
is/are subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s), or the entity upon behalf of which the
person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature
(Seal)
~z5~os-a -1- Form Revised May 27, 2005
~~~~~
CERTIFICATE OF ACCEPTANCE
(Pursuant to Government Code §27281)
This is to certify that the interest in real property conveyed by the Resale Restriction
Agreement and Option to Purchase dated from
to the City of Dublin, a California municipal corporation, is
hereby accepted by the undersigned office or agent on behalf of the City of Dublin pursuant
to authority conferred by the Resolution No. dated ;and the
grantee consents to recordation thereof by its duly authorized officer.
Dated:
By:
Its:
Attest:
City Clerk
~25~os-s -1- Form Revised May 27, 2005
~a~a6~
EXHIBIT A
Legal Description
[To be inserted]
~25~os-s -1- Form Revised May 27, 2005
~q ~ a~~
EXHIBIT B
FORM: NOTICE OF INTENT TO TRANSFER
VIA CERTIFIED MAIL -RETURN RECEIPT REQUESTED
To: City of Dublin
100 Civic Center
Dublin, California
Attn: City Manager
Date:
Re: Notice of Intent to Transfer
Pursuant to the terms of the Resale Restriction Agreement and Option to Purchase,
dated ,the undersigned Owner(s),
hereby give(s) notice of his/her/their
intent to transfer the property located at
,Dublin, California (the "Property").
Owner may be contacted at the Property or at the following address:
Owner's daytime telephone number is (_)
[If applicable: The proposed transfer of the Property is to the following person(s):
Name:
Address:
Telephone: (~
The proposed transfer is (check one):
^ Sale
^ Other Specify:
Owner(s) signature(s):
i25~os-a -1- Form Revised May 27, 2005
~~ ~ a~r~
EXHIBIT C
FORM: NOTICE OF EXERCISE
Date:
To:
Owner or Transferee
Address
Re: Notice of Exercise
The City of Dublin ("City") hereby gives notice that it is exercising its option to
purchase the real property located at ,Dublin,
California. The option has been granted to the City pursuant to the Resale Restriction
Agreement and Option to Purchase between Owner and the City dated
and recorded on as Instrument No. [The
City has assigned its option to purchase the real property to .] An
escrow for the purchase will be opened with the First American Title Company
City of Dublin
By:
Its:
~2e~os-s -1- Form Revised May 27, 2005
~.
EXHIBIT D
INCLUSIONARY ZONING HOMEOWNERSHIP PROGRAM
INCLUSIONARY ZONING BASE RESALE PRICE WORKSHEET
Date:
Owner:
Address:
Purchase Price:
Date of Purchase:
Years Owned: years
CALCULATION BASED ON INCREASE IN MEDIAN INCOME***
Present Median Income: $
Family of four, County of Alameda
(at time of sale of unit)
Original Median Income: $
Family of four, County of Alameda
(at time of purchase of unit)
Amount of Increase:
Family of four, County of Alameda
(Present median income minus original median
income)
Increase in Price:
Method #1 Resale Price:
Effective Date:
Effective Date:
x x =
Based on the above, the base resale rice as of this date, , is:
By:
~ zs~ os-s -1- Form Revised May 27, 2005
EXHIBIT E
REQUEST FOR NOTICE OF DEFAULT
Order No.
Escrow No.
Loan No.
WHEN RECORDED MAIL TO:
CITY OF DUBLIN
Dublin, California
Attn:
(Space Above This Line For Recorder's Use Only)
REQUEST FOR NOTICE UNDER SECTION 2924b CIVIL CODE
In accordance with Section 2924b, Civil Code, request is hereby made that a copy of any Notice
of Default and a copy of any Notice of Sale under the Deed of Trust recorded as Instrument No.
on , in the Official Records of Alameda County,
California, and describing land therein as:
executed by
Dublin, California ,Attn:
as
By:
as Trustor, in which
is named as Beneficiary, and
trustee, be mailed to the City of Dublin,
NOTICE: A COPY OF ANY NOTICE OF DEFAULT AND OF ANY NOTICE OF SALE WILL BE SENT
ONLY TO THE ADDRESS CONTAINED IN THIS RECORDED REQUEST. IF YOUR ADDRESS
CHANGES, A NEW REQUEST MUST BE RECORED.
STATE OF CALIFORNIA
COUNTY OF
On before me,
said county and state personally appeared
a Notary Public in and for
personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that
by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal.
Signature (This area for official notarial seal)
~2eios-s -1- Form Revised May 27, 2005
5~ ~~~
EXHIBIT F
DISCLOSURE STATEMENT
THERE ARE RESTRICTIONS ON THE SALE OF THE
PROPERTY YOU ARE BUYING. EXCEPT FOR A TRANSFER
TO THE CITY FOLLOWING CITY'S EXERCISE OF ITS OPTION
TO PURCHASE, THIS PROPERTY MAY ONLY BE SOLD TO
AN "ELIGIBLE HOUSEHOLD" AT A PRICE NOT TO EXCEED
THE ADJUSTED RESALE PRICE WHICH IS CAPPED AT AN
"AFFORDABLE HOUSING COST."
THIS MEANS THAT YOU MAY NOT SELL THE PROPERTY FOR MARKET VALUE TO
WHOMEVER YOU LIKE.
THESE RESTRICTIONS WILL BE IN EFFECT UNTIL
ANY SALE OF THE PROPERTY IN VIOLATION OF THE RESTRICTIONS, SHALL BE
VOIDABLE AT THE ELECTION OF THE CITY.
TO DETERMINE WHO AN ELIGIBLE HOUSEHOLD IS, AND WHAT THE ADJUSTED
RESALE PRICE AND AFFORDABLE HOUSING COST ARE, YOU SHOULD CONTACT
THE OF THE CITY OF DUBLIN.
YOU SHOULD ALSO READ THE RESALE RESTRICTION AGREEMENT AND OPTION
TO PURCHASE RECORDED AGAINST THE PROPERTY. YOU MAY OBTAIN A COPY
FROM THE CITY OF DUBLIN OR FROM THE ESCROW COMPANY.
I HAVE READ THE FOREGOING AND I UNDERSTAND WHAT IT MEANS.
BUYER BUYER
~z5~os-s -1- Form Revisad May 27, 2005
~h~ ~~~
CITY OF DUBLIN
100 Civic Plaza, Dublin, California 94568 Website: http://www.ci.dublin.ca.us
O~~
Application and Information Packet
John Doe, Inc., Developers of the Leprechaun Homes will be offering the first twenty-five (25)
below market rate (BMR) homes to eligible very low-, low- and moderate-income applicants. 8
will be made available to very low-income households, 5 will be made available to low-income
households and 12 will be made available to moderate income households.
The following income limits are the maximum incomes allowed for each of the three category of
restricted sale price homes:
No. of people in 1 2 3 4 5
Household
Very low-income $28,050 $32,050 $36,050 $40,050 $43,250
Low-income $44,850 $51,250 $57,650 $64;100 $69,200
Moderate-income $69,050 $78,900 $88,800 $98,650 $106,550
To qualify for one of these homes you must complete the attached "Application for Inclusionary
Unit" and the "Qualification Questionnaire" and deliver to John Doe Inc., at the Sales office
located at XXXX Nice Da~Drive Dublin, California 94568.
If you have any questions, please contact John Doe, Inc. at (925) 111-1010. You may contact
the City at (925) 833-6610 for answers to questions, but John Doe, Inc. must receive all
completed applications at the above address by Friday, Month, Day, Year.
L SELECTION PROCESS
The following steps will take place for buyer selection:
1. Interested applicants must be income qualified prior to being considered a possible buyer.
The application acceptance period will begin on Monday, Month, Day Year. You must
complete an "Application for Inclusionary Unit" to be pre-qualified. These forms must
.EXHIBIT 2
Area Code (925) • City Manager 833-6650 • City Council 833-6650 • Personnel 833-6605 • Economic Development 833-6650
Finance 833-6640 • Public Works/Engineering 833-6630 • Parks & Community Services 833-6645 • Police 833-6670
Planning/Housing/Code Enforcement 833-6610 • Building Inspection 833-6620 • Fire Prevention Bureau 833-6606
~~- ~ ~-, fir'}
,~
be returned to John Doe, Inc. for their review, along with a copy of your (latest year)
Federal and State Income Tax returns. If you are already pre-approved by a lender,
please include, with the above documents, confirmation, in writing, from your chosen
lender that you are pre-approved for a loan and the amount of loan for which you are pre-
approved.
2. Once all applicants have been reviewed and verified by John Doe, Inc., John Doe, Inc.
will begin offering the homes to applicants. The sale price of the home will be based on
the applicant's income. When an offer has been made and accepted, the following
documents will be submitted to the City of Dublin:
a) all household income verification,
b) the sale contract,
c) the lender "truth in lending statement"
d) the Loan Agreement
e) the "Application for Inclusionary Unit"
f) an executed Resale Agreement; and,
g) any verification for a City of Dublin preference
The City of Dublin will confirm any applicant claiming one or more of the City
established preferences for preference points, review all documents to confirm that
the developer is selling the unit to a household of adequate size, that the household is
in the correct income category and will review the loan product to assure it is
acceptable. If the City of Dublin receives a complete set of documents from the
developer, the City of Dublin will complete the review and return all documents to
the developer with the exception of the executed Resale Agreement and the
"Application for Inclusionary Unit," to the developer within 7 business days.
3. At this point the developer may enter into escrow for sale of the Inclusionary Units
with the City approved applicant.
4. The escrow closes and the Applicant becomes the owner of a new home in the City of
Dublin.
Exhibit 2 2
f
II. ELIGIBILITY REQUIREMENTS
To qualify for the purchase of a home in this project, the applicant must meet the following
criteria:
The household must be of adequate size. The City of Dublin states that the units be sold to
applicants based on the following unit and household size:
Studio 1 person household
1 bedroom 1-2 people household
2 bedroom 2-4 people household
3 bedroom 3-6 people household
The annual household income may not exceed the appropriate income limit of the Area
Median Income (AMI), adjusted for household size, as issued by the State Housing and
Community Development Department (HCD). (See page one of this packet)
Annual household income includes:
a. The income of all household members over the age of 18 years who will be
residing in the home. Annual household income includes all income listed in the
(most current year) Income Tax Return of all adult members, including all
schedules listing interest and dividends.
b. 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, whether or not they are declared on
Income Tax Return (most current year).
c. Payment in lieu of earnings, such as unemployment and disability compensation,
worker's compensation and severance pay, whether or not they are declared on
Income Tax Return (most current year)
d. Child Support Payments
e. Public Assistance payments of any type
Owner must occupy the property as the principal place of residence for at least nine (9)
months (cannot be absent for a period of ninety [90] days of more) of each calendar year.
The property and improvement must be maintained in good condition and repair throughout
the period of ownership.
Buyer must be willing to enter into a Resale Restriction Agreement with the City of Dublin
which establishes, in part, residency requirements, home maintenance standards and restricts
the resale price and process for the resale of the homes.
Exhibit 2
57~a~-
III. GENERAL INFORMATION
Homes will be available to eligible purchasers with qualified financing and selected by John
Doe, Inc.
Pre-qualified applicants will be ranked according to the preferences listed in the Dublin
Inclusionary Ordinance Section 8.68.050D.
The ordinance specifies points for various preferences in occupant selection
- Dublin Resident for over 1 year
- Employed in Dublin for at least 6 month
• Public service employee working in Dublin
- Senior applicant
- Disabled
- Immediate family member of a Dublin resident
- Required to relocated from current Dublin residence
due to demolition of dwelling or conversion of
dwelling
3 points
3 points
1 additional point
I point
1 point
1 point
1 point
Claiming any of the above preferences in the "Application for Inclusionary Unit" will require
verification by applicant. John Doe, Inc. will request the applicant provide proof within a given
time period (approximately one week). Failure to do so, within the given time period will
disqualify applicant from receiving claimed priority.
Exhibit 2 4
~~~a~
~~,
~_~~
APPLICATIOI`~ FOR Il`ICLUSIOI`IARY UI`IIT
PLEASE PROVIDE TI1E FOLLOWING II~FORMATIOI~:
(Please type or print clearly)
To apply for an Inclusionary Unit, you must list all members of your household: I`lo. in household
1. Name: Social Sec. #
Current Address: Age:
City/Zip: Home Phone #:
Employer: Work Phone #:
Work Address:
City/Zip:
2. Name: Social Sec. #
Employer: Age:
Work Address: Work Phone #:
City/Zip:
3. name: Social Sec. #
Employer: Age:
Work Address: Work Phone #:
City/Zip:
(/f ynu need addlfiona/ space p/ease attach a sheet of paper)
Total Annual Household Income: ~
(Line 36 of 1040; Line 21 of 1040A; Line 4 of 1040EZ)
To assist us with the process, please check the statement below which applies to at lease one adult that will own the home.
ves no
Are you over 62 years of age? ^ ^
Are you permanently disabled? ^ ^
Currently work in Dublin and have continuously for the past 6 months? ^ ^
And if so, are you a Public Service employee working in Dublin? ^ ^ ,
Currently live in Dublin and have continuously for the past year or longer? ^ ^
Have an immediate family who is a Dublin resident ~ has continuously lived in Dublin the past year? ^ ^
Must move because housing is to be demolished or converted to condo? ^ ^
I/We certify that the information provided in this application is true and correct
Signature/Date Signature/Date
Development:
G:\PA#\2001\O1-038 Inclusionary ZOA\Inclusionary Guidelines\APPLICATION FOR INCLUSIONARY UNIT- Revised.doc EXHIBIT 3
~,.
DEVELOPER LETTERHEAD
Date
Dear Interested Applicant:
You have completed and returned an Application for Inclusionary Unit as the first step to qualify to
purchase an Inclusionary or Below Market Rate (BMR) condominium in
Your application indicates that you are claiming a City of Dublin Selection Preference/s. We are writing
to verify that/those preference/s and allow for your application to continue for further processing.
Please provide us with the checked material no later than , SPM.
FAILURE TO PROVIDE THE REQUESTED DOCUMENTS BY THIS DEADLINE WILL NOT
DISQUALIFY YOU FROM THE BUYER SELECTION PROCESS, BUT YOU WILL NOT
RECEIVE THE POINTS ASSOCIATED WITH THE PREFERENCE CATEGORY/IES YOU
SELECTED.
If you have any questions please feel free to contact us at (925) XXX-XXXX.
You indicated that you or an adult member who will own and occupy the home:
Are 62 years of age or older
Please bring a copy of a photo identification card indicating birth date. You may use
^ A valid California (or other state with photo id) drivers license
^ A valid California (or other state with photo id) identification card
^ A valid Passport, in English
^ Other valid and official photo identification document
Are permanently disabled
Please provide us with one of the following:
^ A note from your doctor confirming that one adult applicant is permanently disabled
^ Other verification from a State Agency establishing permanent disability status
^ Verification of receipt of SSI
EXHIBIT 4
~~~~~
fi~
INCLUSIONARY ORDINANCE PREFERENCE POINT VERIFICATION LETTER
Project:
Page 2
Currently work in Dublin and have continuously for the past six (6) months.
Please bring a copy of both, a first and most recent paycheck stub establishing length of
employment
Letter from Employer, on company letterhead, indicating continuous employment for the
past six month.
W2~ for the last two years
**If you are a newly hired teacher to be working in Dublin, please bring in a copy of your
employment contract, to waive the 6 month employment requirement**
Are a Public Service Employee working in Dublin
In addition to the above needed proof of employment please provide a letter from your
employer indicating your job title and a telephone contact, of an individual who would be
authorized to verify your job title
***Newly hired teachers in Dublin to bring in a copy of employment contract***
Currently live in Dublin and have continuously for the past year
Please bring us a copy of one of the following:
^ Copy of two utility bills (PG&E or water), one from at least one year ago and the
most recent utility bill both showing the applicant with a Dublin address
^ A copy of a current apartment or house lease for a residence in Dublin, indicating
when you moved in to the apartment or house, and proof that you are still residing
there.
Have an immediate family who is a Dublin resident and has continuously lived in Dublin
the past year
Please bring us a copy of one of the following:
^ Copy of birth certificate for self and immediate family member (mother, father,
brother, sister, child, grandparent or-grandchild)
^ Other legal document establishing relation
Must move because housing is to be demolished or converted to condo
Please bring us a copy of one of the following:
• Letter from Apartment owner requiring vacating of unit
Thank you for working with us on this process. We request that you respond as quick as possible and
make sure that the requested documents are at our office by the date indicated on the first page so that
you may take advantage of the preference category/ies that apply to your situation.
Sincerely,
Josephine Smith
Developer
TABULATION OF MAXIMUM SALE PRICE FOR BMR UNITS Address of Unit
Name of household
Soc. Sec. # head of hshold
at 35 % w/ net deductions
Household size
Max. allowable annual income
Annual household income
Gross monthly income ~ -
paid toward housing 35%
Gross monthly housing expense $ '
Minus insurance (Interior home ins.) $ -
Prop. Tax
Homeowners Assoc dues
Net mo hsg. expense - HOA $ '
PMI .
Max monthly housing expense $ '
Interest Rate
Term 30
Maximum Loan $0.00
Downpayment required (5%) $0.00
TOTAL SALES PRICE ALLOWED $0.00
6n/2ooz
EXHIBIT 5
4.
., ~
~. ~
Mate Income Limits for 20U
Page 1 of 7
Number of Persons in Household
County Income Category 1 2 3 4 5 6 T 8
Alameda County Extremely law 17,400 19,850 22,350 24,850 2$,850 28,800 30;800 32,800
Area Median Income: Very Law Incan3e 29,000 33,100 37,250 41,444 44,700 48,000 x1,350 54,650
82,200 Lauver lncarr~e 46,350 53,000 513,600 68,254 71,550 76,850 82.150 87,450
Median Income 57,550 65,750 74,000. 82,264 8$,800 95,350 107,950 108,500
Moderate Income 69,050 78,900 88,800 98,656 106,550 114,450 122,350 130,200
Aiplne County Extremely Low 13,100 15,000 16,850 18,70fl 20,200 21,700 23,200 24,700
Area Median Income: Very Law Income 21,850 24,950 28,100 31,260 33,700 36,200 38,700 41,200
62,400 Lower Income 34,950 39,950 44,950 49,964 53,900 57,900 61,900 6;"1,900
Med'€an income 43,700 49,900 56,150 62,400 67,400 72.400 77„400 82,350
Moderate Income 52,450 59,900 57,400 74,900 80,900 86,500 92,900 98,850
Amador County Extremely Law 12,850 14,700 16.;500 18,350 19,$50 21,300 22,750 24,250
Rrea Median Incc,me: Very Law lneome 21,400 24,500 27,550 36,546 33,050 35,500 37,950 40,400
61,200 Lower Income 34,250 39,150 44,050 48,954 52,900 56,800 60,700 64,650
Median Income 42,850 48,950 55,100 61,24{1 66,100 71,000 75.,900 80;800
Moderate Income 51,400 58,750 66,100 73,450 79,35(7 85,200 91,100 96,950
Butte County Extremely Law 10,300 11,800 13:,250 14,756 15,900 17,100 18,250 19,450
Area Median Income: Very low Income 17,200 19,650 22,100 24,550 26,500 28,500 30,450 32,400
49,100 lawerlncome ~ 27,500 31,400 35350 39;364 42,400 45,550 48,700 51,850
Median Income 34,350 39,300 44,200 49,104 53,050 58,950 60,900 64,800
Moderatelncame 41,250 47,100 53;000 58,906 63,600 68,300 73,050 77,750
CalaverasCounty Extremely LQw 12,200 13:900 15,650 17,406 18,800 20,200 21,600 22,950
Area Median Income: Very Low Income 20,300 23,200 26,100 29,006 31,300 33,650 35,950 38..300
58,.000 Lower income 32,500 37,100 41.,750 46,404 50,100 53,800 57.550 61,250
Median Income 40,600 46,400 52,200 58,004 62,650 67,300 71,900 76,550
Moderate Income 48,700 55,700 62,65fl 69.,606 75,150 80,750 86.300 91,850
Colusa County Extremely Law 10,300 11,800 13,250 14,756 15,900 17,100 18,250 19,450
Area Median Income: Very Law Income 17,200 19,650 22,100 24,556 26,500 28,500 30.450 32,400
49,1.£10 Lower Income 27.500 31,400 38.350 39,304 42,400 45,550 48.700 51,850
Median Income 34,350 39,300 44,200 49,106 53,b50 56,950 60.900 64,800
Moderate Income 41,250 47,100 53,000 58,9116 63,600 68,300 73,050 77,750
Contra Gasta County Extremely Law 17,400 19,850 22,350 24,850 26,$50 28.800 30.800 32,800
Area Median Incarrie: Very Law Income 29,000 33,100 37,250 41,400 44,700 48,000 51.350 54,650
82,200 Lower Income 46,350 53,000 59,500 66,2511 71,550 76.850 82,150 87,450
Median Income 57,550 6x,750 74,000 82,266 88,800 95,350 101,950 108,50{3
Moderate (naame 69.050 78,800 88,800 98,656 106,550 114,450 122,350 130,200
[7el Norte County Extremely low 10,300 11.800 13,250 14,756 15.900 17,100 18,250 19,450
Area h~ledian Income: Very Law Income 17,200 '19,650 22,104 24,550 26,500 28,500 30,450 32,400
49,100 lower income 27,500 31,400 35,3513 39',366 42,413.0 45,550 48,700 51;850
Median Income 34,350 39,300 44,200 49,140 53,050 56.,950 60,900 64,800
h~taderate Inaame 41,250 47,100 53,000 58,9{16 63,60fl 68,300 73,050 77,750
EI Ctarada County Extremely Law 13,451} 15,400 17,300 19,256 20,750 22<300 23,850 25,400
Area Median Income: Very Lew Income 22,450 25.;650 28,850 32,050 34,6(30 37,200 39.750 42,300
64,100 Lower Income 35,900 41;000 46,150 51,304 55,400 59,500 63,600 67,700
M~dlan Income 44,850 51,300 57,700 64,100 69,250 74,350 79,500 84,600
Moderate Income 63,850 61,500 69,2130 76,90p 83,(350 89,200 95,350 101,500
Attachment 6
Exhibit 6
~~ ~~~
d
HOUSING AUTHORITY OF THE COUTY OF ALAMEDA
UTILITY ALLOWANCES EFFECTIVE 10/1/03
Attached Homes -
Apu-trnents, Condos, Townhomes
Utility or Serivice OBR 1 BR 2 BR 3 BR 4 BR 5 BR
Gas Heating $8 $11 $12 $15 $17 $17
Electric Heating $9 $11 $16 $18 $20 $25
Gas Cooking $2 $2 $2 $2 $2 $2
Electric Cooking $2 $3 $3 $4 $4 $4
Gas Water Healing $.5 $7 $10 $13 $15 $16
Electric Water Heating $11 $16 $25 $31 $32 $32
Water $9 $11 $14 $18 $25 $29
Trash $17 $17 $17 $27 $27 $44
Stove $2 $2 $2 $2 $2 $2
Refrigerator $2 $2 $2 $2 $2 $2
Other Electric $14 $20 $27 $34 $39 $43
Single Family Homes
Utility or Serivice OBR 1 BR 2 BR 3 BR 4 BR 5 BR
Gas Heating $10 $14 $18 $21 $25 $30
Electric Heating $10 $14 $2.5 $29 $48 $.58
Gas Cooking $2 $2 $2 $2 $2 $2
Electric Cooking $2 $3 $3 $4 $4 $4
Gas Water Heating $5 $7 $10 $13 $15 $16
Electric Water Heating $11 $16 $25 $31 $32 $32
Water $9 $11 $14 $18 $25 $29
Trash $17 $17 $17 $27 $27 $44
Stove $2 $2 $2 $2 $2 $2
Refrigerator $2 $2 $2 $2 $2 $2
Other Electric $14 $20 $27 $34 $39 $43
Exhibit 7
--~
Q.J
~~~a~~
Gig of
DuBi~ihi
Guidelines to the Inclusionary
Zoning Ordinance
Regulations
November 7, 2008
EXHIBIT B TO
ATTACHMENT 2
G~~~~
CITY OF DUBLIN
TABLE OF CONTENTS
1 LIST OF EXHIBITS 1
2 INTRODUCTION TO THE GUIDELINES TO THE INCLUSIONARY ZONING
ORDINANCE 2
3 DEFINITION OF TERMS 3
4 REQUIREMENTS FOR DEVELOPERS 9
4.1 Overview of the Inclusionary Zoning Process 9
4.2 Determining the Number and Size of Units Required 9
4.3 How to Calculate the Inclusionary Obligation 10
4.4 How to Calculate How Many Units Must Be Constructed and
How Many Units May be Subject to the In-Lieu Fee 10
4.5 How to Calculate the Amount of the In-Lieu Fee 11
4.6 How to Calculate How Many BMR Units Must Be Provided 12
4.7 How to Determine the Size. of BMR Units 13
4.8 How to Determine the Location of BMR Units Within the Development 14
4.9 Housing Agreements 14
4.10 Procedures for Initial Sale of BMR Units 16
4.10.1 The Marketing Plan 16
4.10.2 Application and Screening Process 17
4.10.3 Sale price of BMR Units 19
4.11 Procedures for Initial Rental of BMR Units 21
4.11.1 The Management Plan for Rental BMR Units 21
4.11.2 Application and Screening Process 21
4.11.3 Calculating Maximum Rent 22
4.11.4 .Annual Report 23
4.11.5 Annual Monitoring by City 24
5 BUYER AND RENTER QUALIFICATIONS FOR BMR UNITS 24
Printed 11/10/2008 3:49:46 PM 1
K:Inclusionary Regulations~2007 Layperson's Guidelines Update~FINAL DRAFT - Inclusionary Guidelines I 1-7-08.DOC
~~ ~ a~ ~
5.1 Buyer Qualifications
5.2 Renter Qualifications
5.3 Household Size
5.4 Total Household Income
5.4.1 Gross Household Income
5.4.2 Assets
5.5 Credit Score
5.6 Preference Points
6 REQUIREMENTS FOR BUYERS OF BMR UNITS
6.1 Financing Requirements
6.1.1 Acceptable Loan Products
6.1.2 Prohibited Loan Products
6.2 Down Payment
6.3 Debt to Income Ratio
6.4 Closing Costs and Deposits
6.5 Homebuyer Education Program
6.6 Documents that Each Buyer Must Sign
6.6.1 Highlights of the Resale Restriction Agreement
Annual Survey
7 REQUIREMENTS FOR RESALE OF BMR UNITS
7.1 Resale Procedure
7.2 Calculating Restricted Resale Price
7.3 Fees Associated with the Selling of a BMR Unit
7.4 Capitallmprovements
7.4.1 Procedure for Receiving Approval of Capital Improvements
7.4.2 Special Assessments
7.4.3 Capital Improvements Cap
7.4.4 List of Eligible and Ineligible Capital Improvements
7.4.5 Building Permits
24
25
26
26
27
28
30
31
34
34
34
34
35
35
35
35
36
36
37
38
38
39
39
39
40
41
41
41
43
Printed 11/10/2008 3:49:46 PM 11
K:Inclusionary Regulations~2007 Layperson's Guidelines Update~F'INAL DRAFT - Inclusionary Guidelines 11-7-08.DOC
8 REQUIIZEMENTS FOR OWNER'S OF SECONDARY UNITS
8.1 Secondary Unit Regulatory Agreement and Declaration of Restrictive
Covenants
8.2 Rental Requirements
8.3 Reporting Requirements
8.4 Annual Report; Inspections
8.5 Management Responsibilities
43
43
43
43
44
44
Printed 11/10/2008 3:49:46 PM ill
K:Inclusionary Regulations~2007 Layperson's Guidelines Update~FINAL DRAFT - Inclusionary Guidelines 11-7-08.DOC
p~~;y~ "~
a°
1 LIST OF EXHIBITS
Exhibit 1 Resale Restriction Agreement and Option to Purchase
Exhibit 2 Performance Deed of Trust
Exhibit 3 Sample Rental BMR Unit Application Packet
Exhibit 4 Sample Ownership BMR Unit Application Packet
Exhibit 5 Sample Credit Report Authorization and Release
Exhibit 6 Excel Spreadsheet to Calculate Ownership Sale Prices
Exhibit 7 State of California Housing and Community Development Department
Income for Guidelines (Example 2007)
Exhibit 8 Current Alameda County Housing Authority Utility Allowance Sheet
Exhibit 9 Annual Report for Rental Units
Exhibit 10 Sample Marketing Plan
Exhibit 11 Internal Revenue Service (IRS) Code 26 USC, Section 61
Exhibit 12 Sample Management Plan
Exhibit 13 Reservation Instrument
Exhibit 14 Secondary Unit. Regulatory Agreement and Declaration of Restrictive
Covenants
1
Revised November 7, 2008
1 b y~'
~~
2 GUIDELINES TO THE INCLUSIONARY ZONING ORDINANCE
REGULATION
This document is the Guidelines (these "Guidelines") to the City's Inclusionary Zoning Ordinance
Regulations (the "Ordinance") set forth in the City's Municipal Code at Chapter 8.68. The City
Council's purpose in adopting the Ordinance is to increase the diversity of housing prices/rents in
the community and ensure that the range of prices/rents continues over time.
In general, the Ordinance requires that 12.5% of the units constructed in a Residential Development
project of 20 residential units or more be restricted in occupancy and in sale price or rent charged.
Such restricted units are referred to as Below Market Rate (BMR) Units. For for-sale units, 60%
must be affordable to moderate-income households and 40% to_low-income households. For rental
units, 50% must be affordable to Moderate-Income households, 20% to Low-Income households
and 30% to Very Low-Income households. (Section 8.68.030.B)
The purpose of these Guidelines is to assist the layperson in interpreting the Ordinance. The
Guidelines will assist developers early in the development process so that Residential Development
projects are sensitively designed from the beginning in compliance with the requirements of the
Inclusionary Zoning Ordinance. In addition, the Guidelines will inform developers, management
firms and owners of BMR Secondary Units of the procedures for selling and renting BMR Units
and Secondary Units. Furthermore, the Guidelines will provide households interested in renting or
purchasing a BMR Unit with an overview of the eligibility requirements, the application and
screening process, the restrictions on ownership BMR Units, and the procedures for reselling a
BMR Unit.
These Guidelines should be read in conjunction with the Ordinance. While every effort has been
made to ensure that these Guidelines are consistent with the Ordinance, if there is any conflict with
these Guidelines and the Ordinance, the terms of the Ordinance shall prevail. In addition, the
provisions of a Housing Agreement or Resale Restriction Agreement (or like Agreement) recorded
against a BMR Unit shall prevail over any general requirements of the Ordinance.
Users of these Guidelines are encouraged to seek their own legal counsel to aid in understanding the
requirements of the City's Inclusionary Program. Far any general questions regarding the
Guidelines, users may call 925-833-6610.
The effective date of these Guidelines is , 2008. The City will review and to the extent
necessary update these Guidelines annually. The Community Development Director may make
interim revisions, interpretations or clarifications to these Guidelines provided that he or she
considers the revision, interpretation, or clarification to be minor and consistent with the purposes
of the Inclusionary Zoning Regulations and the Guidelines. Any such revision, interpretation, or
clarification shall not become effective until posted on the City's website
2
Revised November 7, 2008
"11 ~ 26'I
3 DEFINITION OF TERMS
As used in these Guidelines, the following terms shall be defined as follows:
Administration Fees
• A $1,500 fee charged by the City to the BMR Owner for all sales and re-sales of BMR
Units,
• A $500 fee charged by the City to the developer/property manager for the annual review of
rental developments
• A $200 fee charged by the City to the BMR Owner for requests to subordinate the Resale
Restriction Agreement and/or Performance Deed of Trust or requests to refinance a BMR
umt
Fees maybe adjusted from time to time by the City.
Affordable Housing Agreement
An agreement between the developer and the City for an ownership Residential Development
project which is recorded against the property containing the BMR Units; sets forth the developer's
Inclusionary Obligation and the method by which the developer will comply with the requirements
of the Inclusionary Zoning Ordinance; and requires, among other things, that the developer require
purchasers of BMR Units to execute and record a Resale Restriction Agreement and Option to
Purchase and Performance Deed of Trust.
Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants
An agreement between the developer and the City for a rental Residential Development project
which is recorded against the property containing the BMR Units; sets forth the developer's
Inclusionary Obligation and the method by which the developer will comply with the requirements
of the Inclusionary Zoning Ordinance:; and requires, among other things, that the BMR Units are
reserved for occupancy by Very-Low, Low.-, and/or Moderate-Income households at rents
affordable to such households for a period of not less than 55 years.
AMI or Area Median Income
The area median income adjusted for household size as published annually by the County of
Alameda's Department of Housing and Community Development (HCD).
Approved Capital Improvements
Capital improvements to BMR Units that have been approved by the City pursuant to the procedure
set forth in Section 7.4.1. The cost of such improvements may be added to the resale price of the
BMR Unit.
BMR Owner
A household that owns a BMR Unit.
BMR Units
A Below Market Rate or BMR Unit is a unit that is reserved for rent to Very-Low, Low, or
Moderate-Income households or for-sale to Low or Moderate Income households at a price or rent
that is affordable to such households. BMR Units have restrictions recorded against them to ensure
Revised November 7, 2008
~ a ~ ~~
that they remain affordable for a period as set forth in the Housing Agreement or Resale Restriction
Agreement.
• Rental units are deemed affordable if the annual rent does not exceed 30% of the maximum
income level for Very Low-Income, Low-Income, or Moderate-Income households, as
applicable, adjusted for household size.
• Owner-occupied units are deemed affordable if the sales price results in annual Housing
Expenses that do not exceed 35% of the maximum income level for Low- or Moderate-
Income households, as applicable, adjusted for household size.
Ca1HFA
The California Housing Finance Agency
City
The City of Dublin
Consent Agreement
An agreement between the City and a Qualified Household which authorizes the City to access and
review the Qualified Household's credit reports or other personal or financial information to verify
a Qualified Household's compliance with the Resale Restriction Agreement, the Ordinance and
these Guidelines. This agreement must be executed by purchasers of ownership BMR Units prior to
the close of escrow.
Domestic Partner
A legal or personal relationship between individuals who live together and share a common
domestic life, but are not joined in a traditional marriage or a civil union as formalized through a
local or state registry.
Homebuyer
A person who has not owned any interest in real property during the three-year period prior to the
date of the household's application to qualify for purchase of a BMR Unit, including without
limitation, real property in which a household member's name appears on title regardless of whether
the member's interest in such property results in a financial gain, such property is located in another
state or country, or the member has occupied such property as his or her primary residence. If any
person has had his or her name on title of a property, but the property was sold more than three
years ago from the date of application, the person is considered a Homebuyer.
Homebuyer Education Workshop for Below Market Rate Buyers
A HUD approved 8-hour course designed to provide basic education specific to Below Market Rate
Homebuyers. Refer to the City's web site for organizations that may offer this course at
www.ci.dublin.ca.us The date on the completion. certificate for the class must be within 6 months
of the date of application for a Below Market Rate unit.
Gross Household Income
"Gross Household Income" means all income, from whatever source derived, of all adult household
members (18 years of age and older), whether or not such income is exempt from Federal income
tax. Such income includes, but is not limited to, the following:
4
Revised November 7, 2008
~3~~z~~
• Compensation received from an employer
• Compensation includes, but is not limited to salary, overtime pay, and other pay
• Other pay includes, but is not limited to, compensation for special working conditions or one
time pay-out of unused vacation and sick leave.
• Alimony, spousal and child support
• Cash
• Pensions, if at an age where pension is being received as income
• Public benefits including, but not limited to, CalWorks, SSI, and disability income
• All interest, dividends, and royalties
• Income derived from private businesses
• Rentallncome
• Income from pensions
• Compensation for services rendered including fees, fringe benefits, commissions, tips, and
bonuses
• Stipend received for participation in a mentor, learning or education opportunity
• Gains from dealings in private and/or commercial property
• Gambling Winnings
• Annuities, life insurance, and endowment contracts
• Income from discharge of indebtedness
• Gross partnership contributions or distributions
• Income from an interest in an estate or trust
Exceptions:
1) Gross Household Income does not include income earned by a household member who is
between the ages of 1$-26 and meets°'both of the following criteria:
• Is claimed as a dependent of a household member on such member's federal income
taxes; and
• Is a full time student {12+ units -school transcript must be provided).
2) Gross Household Income does not include payments to a household member from a
governmental fund income if all of the following requirements are satisfied:
• The payments are based on the recipient's or the recipient's family's financial need;
• The payments do not represent compensation for services rendered; and
• The payments are part of a governmental housing subsidy program including, but not
limited to, Section 8 federal housing assistance payments
(These) Guidelines
These Guidelines to the Inclusionary Zoning Regulations
HCD
The California Department of Housing and Community Development.
HOA
5
Revised November 7, 2008
Homeowner's Association
~~~~~
Housing Agreement
An Affordable Housing Agreement, an Affordable Housing Regulatory Agreement and Declaration
of Restrictive Covenants or a Secondary Unit Regulatory Agreement and Declaration of Restrictive
Covenants or other Agreement that relates to Housing that maybe adopted from time to time by the
City.
Housing Expenses
Principal, interest, taxes, insurances and HOA dues.
HUD
The United States Department of Housing and Urban Development.
Immediate Family Member
A mother, father, brother, sister, child, grandparent or grandchild.
Inclusionary Obligation
The number of BMR Units a developer is required to construct (or pay fees in lieu thereof) in a
Residential Development project to comply with the Inclusionary Zoning Regulations.
Inclusionary Zoning Regulations
Chapter 8.68 of the City of Dublin Municipal Code.
In-Lieu Fee
A fee paid by a developer in lieu of constructing BMR Units to satisfy up to 40% of its inclusionary
obligation.
Legal Resident
A citizen or other national of the United States or a qualified alien as defined by the Federal
Personal Responsibility and Work Opportunity Reconciliation Act of 1996 ("PRWORA").
Low Income
Total Household Income that is 50% to 80% of AMI, adjusted for actual household size.
Management Plan
A plan required for rental Residential Developments that contains the information set forth in
Section 4.11.1 of these Guidelines.
Marketing Plan
A plan required for ownership Residential Developments that contains the information set forth in
Section 4.10.1 of these Guidelines.
Maximum Income
The maximum income for an income category (Very-Low, Low-, or Moderate-Income) determined
periodically by HCD based on AMI. See Section 5.4 of these Guidelines for Maximum Incomes.
Moderate Income
6
Revised November 7, 2008
~~ ~~
Total Household Income that is 80% to 120% of AMI, adjusted for actual household size.
Performance Deed of Trust
A deed of trust recorded against a BMR Unit by the City which secures a BMR Owner's
compliance with the Resale Restriction Agreement and Option to Purchase.
Preference Points
Points assigned to persons employed within the City of Dublin, public service employees working
within the City of Dublin, Dublin residents, Seniors (62+), persons who are permanently disabled
(with written verification from a physician or show receipt of SSI or SSDI), persons who are
immediate family members of a Dublin resident, and persons who are required to relocate from a
Dublin residence due to demolition of the residence or conversion of the residence from a rental to
an ownership unit. Persons with Preference Points are given priority over other Qualified
Households in the rental or purchase of a BMR Unit.
Principal Residence
The place where a person resides on a substantially full-time basis during not less than ten (10)
months per year. Children attending college and not living at home as their principal residence may
not be counted as a household member.
Priority List
A list which ranks Qualified Households based on the number of Preference Points received.
Qualified Household
A qualified household is defined in terms of financial relationships and can include any group of
persons, so long as such persons, when viewed as a whole, satisfy the eligibility requirements for a
household.
For an ownership BMR Unit or for a rental BMR Unit, a "qualified household" means a household
that satisfies the requirements listed in Section 5 `of these Guidelines.
Resale Restriction Agreement and Option to Purchase, also known as "Resale Restriction
Agreement"
An agreement between the City and a BMR Owner that is recorded against the BMR Unit and ,
among other restrictions, requires the unit to remain affordable to Low- or Moderate-Income
households usually for a period of 55 years or as outlined in the Housing Agreement, restricts the
resale price of the BMR Unit, requires the BMR Owner to notify the City upon refinancing,
reselling or changing the title of a BMR Unit, and provides the City with an option to purchase the
BMR Unit upon the occurrence of certain events.
Residential Development
This includes, without limitation, detached single-family dwellings, multiple-dwelling structures,
groups of dwellings, condominium or townhouse developments, condominium conversions,
cooperative developments, mixed use developments that include housing units, and residential land
subdivisions intended to be sold to the general public.
Secondary Unit
7
Revised November 7, 2008
~b ~~~~
A legal secondary dwelling unit that has been approved by the City and that is reserved for
occupancy by Very Low-, Low- or Moderate-Income households at rents affordable to such
households.
Secondary Unit Regulatory Agreement and Declaration of Restrictive Covenants
An agreement between the City and the owner of a Secondary Unit which is recorded against the
property containing the Secondary Unit and requires, among other things, that the Secondary Unit
be reserved for occupancy by Very-Low, Low-, or Moderate-Income households at rents affordable
to such households for an amount of time specified in the Affordable Housing Agreement or
Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants.
Senior
A person 62 years of age or older for the purpose of qualifying for preference points
Special Assessment
A proportional fee charged to the BMR Owner by an HOA to cover the cost of physical
improvements to the entire building.
Total Household Income
All Gross Household Income and assets received (as calculated pursuant to Sections 5.4.2 and
5.4.3 .
Very-Low Income
Total Household Income that is fifty percent (50%) or less of AMI, adjusted for actual household
size.
Revised November 7, 2008
~,..
4 REQUIREMENTS FOR DEVELOPERS
4.1 Overview of the Inclusionary Zoning Process
Residential Developments consisting of 20 residential units or more must comply with the
Inclusionary Zoning Regulations (Section 8.68.030(A)). In general, the Regulations require that
12.5% of the units constructed in a Residential Development be reserved for occupancy by For-Sale
Units to Moderate-Income households and low-income households or rented at prices affordable to,
Very-Low-, Low-, and Moderate-Income households. Such restricted units are referred to as BMR
Units. (Section 8.68.030.A)
Of these units, 50% must be affordable to Moderate-Income households, 20% to Low-Income
households and 30% to Very Low-Income households. (Section 8.68.030.B) Moderate-.Income
households, Low-Income households, and Very Low-Income households are defined as households
that have a Total Household Income of 120% to 80%, 80% to 50%, and less than 50% of AMI,
respectively.
While the Regulations require that 12.5% of the units in the Residential Development be BMR
Units, the Regulations permit the developer to meet 40% of this obligation by paying an In-Lieu
Fee. Thus, there is a "must-build" requirement of 7.5% of the units mthe Residential Development,
and the obligation with respect to the remaining 5% of the units may be satisfied by the payment of
an In-Lieu Fee. BMR Units- must remain affordable for a period of 55 years, through affordability
restrictions recorded against the property.
In addition, the Inclusionary Zoning Regulations require that BMR Units:
• Be constructed concurrently with the market-rate units in the Residential Development;
• Have a similar range of bedrooms to the market-rate units in the Residential Development;
• Not be distinguished by design or materials from the market-rate units in the Residential
Development; and
• Be reasonably dispersed throughout the Residential Development.
A developer may also satisfy its Inclusionary Obligation by dedicating land or constructing BMR
Units off-site if the City Council makes the required findings. See Section 8.68.040 of the
Inclusionary Zoning Regulations for alternate methods of complying with the requirements of the
Ordinance.
4.2 Determining the Number and Size of Units Required
Prior to submitting an application to the City for a Residential Development that includes 20 or
more residential units, the developer should begin thinking about how to comply with the
Inclusionary Obligation. As part of the initial project review, Housing Staff is available to discuss
with the developer options for meeting the Inclusionary Obligation. For example, if a developer
intends to build only the minimum number of BMR Units and to pay an In-Lieu Fee for the
remaining units, Housing Staff can, for planning purposes, provide the developer with the
9
Revised November 7, 2008
~~~ 2~~
preliminary number of BMR Units the developer would be required to build, the income levels and
sizes of the required BMR Units, and the amount of the In-Lieu Fey under the then-current fee
schedule.
After a Residential Development application is submitted to the Community Development
Department for review, a Project Review Committee meeting is generally held. In this meeting City
Staff and interested agencies involved in the development process review the Residential
Development and give preliminary comments to the developer.
Prior to or following the Project Review Committee (PRC) meeting, Housing Staff will send a letter
to the developer indicating the developer's Inclusionary Obligation for the Residential Development
as preliminarily proposed. A copy of this letter will also be directed to the City's Project Planner
responsible for the Residential Development. The purpose of this letters to provide the developer
information on the Inclusionary Obligation as early as possible in the development process. The
City recognizes that the Residential Development is likely to evolve over time and that the
Residential Development will likely change prior to obtaining City entitlements. However, this
information is provided early in the process as a service to the developer for plamiing purposes.
The developer's final Inclusionary Obligation will be formalized in an Affordable Housing
Agreement between the City and the developer, prior to the recordation of the first final map or the
issuance of the first building permit, whichever occurs first, for the development.
4.3 How to Calculate the Inclusionary Obligation
Pursuant to Section 8.68.030.A of the Inclusionary Zoning Ordinance, 12.5% of the total number of
units within a Residential Development project must be BMR Units. In making this calculation,
any decimal fraction less than or equal to 0.50 is disregarded, and a decimal fraction greater than
0.50 is construed as a unit.. Two examples of how the Inclusionary Obligation for a particular
development is calculated arr shown in Figure 1.
FIGURE 1
Example 1: The developer proposes a 224-unit subdivision. 12.5% percent of 224 is 28.
The Inclusionary Obligation is 28 units of the origina1224 units.
I
Example 2: The developer proposes a 316-unit subdivision. 12.5% percent of 316 is
39.5. Rounding the decimal fraction down, the Inclusionary Obligation is 39 units of the
original 316 units.
4.4 How to Calculate How Many Units Must Be Constructed and How Many Units
of the Obligation May be Satisfied with an In-Lieu Fee
The Ordinance permits a Developer to pay an In-Lieu Fee for up to 40% of its Inclusionary
Obligation. When the calculation of the fee results in a decimal fraction, the rounding rules
contained in Section 8.68.030A are used.
10
Revised November 7, 2008
.,~ ,.-~
~~ ~'~~
Using the same. examples from Figure 1, Figure 2 illustrates the calculation of the number of BM
Units that may be subject to the In-Lieu Fee.
FIGURE 2
Example 1: The developer proposes a 224-unit subdivision, for which the Inclusionary
Obligation is 28 units of the 224 units. 40% of 28 units =11.2 units. Disregarding the
fraction, the developer may pay an In-Lieu Fee for the remaining 11 units, and the
developer's "must-build" obligation would be 17 units. 11 + 17 = 28 units.
Example 2: The developer proposes a 316-unit subdivision, for which the Inclusionary
Obligation is 39 units of the 316 units. 40% of 39 units = 15.6 units. This number is
rounded up to 16 and In-Lieu Fees may be paid for this amount, instead of providing
units. The "must-build" obligation would be 23 units. 16 + 23 = 39 units.
4.5 How to Calculate the Amount of the In-Lieu Fee
The amount of the In-Lieu Fee is set by Resolution of the City Council. Resolution No. 56-02
provides that the In-Lieu Fee per BMR Unit is adjusted annually on Tuly 1 to reflect the greater of
the percentage change either in a) the Bay Area Urban Consumer Price Index (CPI) as of February
of each year, or b) the United States Department of Housing and Urban Development (HUD) Fair
Market Rent limits for the Oakland Primary Metropolitan Statistical Area (PMSA) that are in effect
at the time. The fee as of July 1, 2008 is $ 91,916 per BMR Unit.
THE ENTIRE IN-LIEU FEE AMOUNT FOR THE RESIDENTIAL DEVELOPMENT IS DUE
AND PAYABLE UPON ISSUANCE OF THE FIRST BUILDING PERMIT FOR THE
RESIDENTIAL DEVELOPMENT:
Using the examples from Figures '1 and 2, Figure 3 illustrates, how to calculate the amount of the In-
Lieu Fee.
FIGURE 3
Example 1: The developer proposes a 224-unit subdivision. Iri-Lieu Fees may be paid
for 11 units. 11 X $91,916 is $1,011,076 which is the amount of the In-Lieu Fee for the
Residential Development. This entire amount would be due prior to issuance of first
building permit.
Example 2: The developer proposes a 316-unit subdivision. In-Lieu Fees may be paid
for 16 units. 16 X $91,916 = $1,470,656 which is the amount of the In-Lieu Fee for the
Residential Development. This entire amount would be due prior to issuance of first
building permit.
11
Revised November 7, 2008
~~ ~~
4.6 How to Calculate How Many BMR Units Must Be Provided for Each Income Level
Pursuant to Section 8.68.030.B of the Inclusionary Zoning Ordinance, the BMR Units included in
each Residential Development project must be allocated to households in the following manner:
For-Sale Units
^ 60% to moderate-income households
^ 40% to low-income households
Rental Units:
^ 50% to moderate-income households
^ 20% for low-income households
^ 30% for very-low income households
Once again, if the allocation calculations results in a decimal fraction, the rounding rules contained
in Section 8.68.030.A apply. In addition, if the allocation calculation results in fewer units than
would otherwise be required; one additional unit should be allocated to the lowest income level with
the decimal fraction closest to 0.50. (Section 8.68.030.B)
Figure 4 illustrates how to calculate the number of units that must be provided at each income level
and how the rounding requirement is implemented.
FIGURE 4
FOR RENTAL BELOW MARKET RATE UNIT
The Residential Development includes200 units. The Inclusionary
Obligation is 25 units. The developer chooses to pay an In-Lieu Fee for
40% of the units, which equals 10 units. The developer's must-build
requirement (7.5%) is 15 units.
• 50% of those 15 units would need to be restricted for Moderate-
Income households, 5`0% of 15 = 7.5
• 20% of those 15 units would need to be restricted for Low-Income
households, 20% of 15 = 3
• 30% of those 15 units would need to be restricted for Very Low-
Income households; 30% of 15 = 4.5
7.5+3+4.5=15
Since two of these numbers are fractions at exactly .5, the City of Dublin would
require that the unit be provided in the lower income category.
In this example the income- unit mix would be:
• 7Moderate-Income units
• 3Low-Income units
• 5 Very Low-Income units
12
Revised November 7, 2008
4.7 How to Determine the Size of BMR Units
The Ordinance requires that the same proportion of bedrooms be reflected in the BMR Units as are
in the market rate units. Once again, the rounding conventions in Section 8.68.030.A are used, if the
allocations result in decimal fractions.
Figure 5 illustrates how to determine the number of BMR Units that must be provided at each unit
size.
FIGURE 5
To determine bedroom requirement:
The developer proposes a 200-unit rental Residential Development and is paying In-
Lieu Fees for 40% of the BMR Units. The must build obligation is 15 units.
The Residential Development includes:
• 50 one-bedroom units (25 % of total)
• 100 two-bedroom units (50% of total)
• 50 three-bedroom units (25% of total)
Therefore:
• 25% of the BMR Units are to be one-bedrooms
• 50% of the BMR Units are to be two-bedrooms
• 25% of the BMR Units are to be three-bedrooms
To determine bedroom requirement per income category:
If 5 of the units are Very Low-Income, using the percentages above the requirement
for bedrooms are:
• 25% of 5 = 1.25 one-bedroom units
• 50% of 5 = 2.5 two-bedroom units
• 25% of 5 = 1.25 three-bedroom units
Therefore, the development would be required to provide:
• lone-bedroom unit
• 3 two bedroom units
• 1 three bedroom unit
The same calculation is performed to determine the bedroom sizes of the Low-
Income and Moderate-Income units.
13
Revised November 7, 2008
~~ ~ ~`~~
4.8 How to Determine the Location of BMR Units Within the Development
The Inclusionary Zoning Ordinance requires that BMR Units be reasonably dispersed throughout
the Residential Development. The purpose of this requirement is to avoid concentration of the
BMR Units in a particular location within a development, effectively segregating them from the rest
of the Residential Development. There are many ways in which to implement this requirement and
consultation with Community Development Department Staff is recommended prior to developing
the final site plan. Ultimately, the Planning Commission or City Council will determine, based on
Staff recommendation, if this requirement has been met.
Per section 8.68.040(E) of the Inclusionary Zoning Regulations, the City Council, at its discretion
may waive, wholly or partially, the requirements of this ordinance and approve alternate methods of
compliance with this Chapter if the developer demonstrates, and the City Council finds, that such
alternate methods meet the purposes of this Chapter.
4.9 Housing Agreements
Section 8.68.50 of the Inclusionary Zoning Regulations requires the developer to execute one of the
following Housing Agreements with the City:
Affordable Housing Agreement
An agreement between the developer and the C'it~for a Residential Development project that
includes ownership BMR units (and potentially Secondary Units). Such Agreements axe
recorded against the property on which the Residential"Development is being constructed;
set forth the developer's Inclusionary Obligation and the method by which the developer
will comply with :the requirements of the Inclusionary Zoning Ordinance; and require,
among other things, that the developer require. purchasers of BMR Units to execute a Resale
Restriction Agreement and Option to Purchase with the City.
Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants
An agreement between'the developer and the City for a Residential Development project that
includes rental BMR units. Such agreements are recorded against the property containing
the BMR Units; set forth the developer's Inclusionary Obligation and the method by which
the developer will comply with the requirements of the Inclusionary Zoning Ordinance; and
requires, among other things, that the BMR Units are reserved for occupancy by Very-Low,
Low-, and/or Moderate-Income households at rents affordable to such households for a
period of not less than 55 years.
Secondary Unit Regulatory Agreement and Declaration of Restrictive Covenants
This Agreement is similar to a Resale Restriction Agreement and is executed after an
Affordable Housing Agreement or Affordable Housing Regulatory Agreement and
Declaration of Restrictive Covenants. This agreement is between the City and the owner of
a Secondary Unit and is recorded against the property containing the Secondary Unit and
requires, among other things, that the Secondary Unit be reserved for occupancy by Very-
14
Revised November 7, 2008
r'»e
'd ~`
~N} ~"' s
Low, Low-, and Moderate-Income households at rents affordable to such households for the}!'
period of time set forth in the agreement.
The Housing Agreements set forth the legal requirements for the Residential Development project
for compliance with the Inclusionary Zoning Ordinance. The Housing Agreements are recorded
against the property on which the Residential Development is being constructed, run with the land,
and survive transfer or sale of the land. The term of the Affordable Housing Regulatory
Agreements is a period of 55 years. The Affordable Housing Agreement is effective until all of the
In-Lieu Fees are paid; the BMR units are constructed, sold, and subject to a Resale Restriction
Agreement. If a developer executes a Housing Agreement for a particular Residential Development
project but the project is not built and new entitlements are sought for the applicable property, the
developer must execute a new Housing Agreement, which would replace the existing Agreement.
Among other things, the Housing Agreements must contain the following information:
1. A description of how the developer will comply with its Inclusionary Obligation (whether
through unit construction and/or payment of an In-Lieu Fee);
2. Whether the BMR Units will be ownership or rental units;
3. The number of BMR Units the developer will construct for each income category;
4. The size of the BMR Units the developer must construct for each income category;'
5. Depending on the nature of the development, the timing of construction of the units to
ensure that the BMR Units are constructed concurrently with the market-rate units;
6. If the development proposes ownership BMR Units, a requirement that the developer
prepares and obtains City approval of a Marketing Plan, prior to issuance of any building
permits in the Residential Development, indicating how the developer plans to sell the BMR
Units. This requirement is discussed in additional detail in Section 4.10.1 below;
7. If the development proposes ownership BMR Units, there is a requirement that the
developer require the purchasers of such units to execute a Resale Restriction Agreement or
a Secondary Unit Regulatory Agreement and Declaration of Restrictive Covenants and a
Performance Deed of Trust. A sample Resale Restriction Agreement is attached as Exhibit
No. 1. A sample Performance Deed of Trust is attached as Exhibit No. 2. A sample
Secondary Unit Regulatory Agreement and Declaration of Restrictive Covenants is attached
as Exhibit No. 3.
8. If the development proposes rental BMR Units, a requirement that the developer provide a
Management Plan and Marketing Plan as described in Section 4.11.1 to the City for its
approval and prepare the Annual Report described in Section 4.11.4.
15.
Revised November 7, 2008
4.10 Procedures for Initial Sale of BMR Units
4.10.1 The Marketing Plan for Ownership Units
~""` ~~
Prior to the issuance of building permits for any ownership BMR Units, the developer.shall submit a
Marketing Plan to the City for approval. The Marketing Plan must contain the following:
1. A one-page narrative summary suitable for advertising the availability of the BMR Units on
the City web page and other locations, including a description of the total number of BMR
Units and market-rate units in the Residential Development; the HOA dues for each BMR
Unit; the amenities included in the unit, and a telephone number for interested applicants to
call for additional information;
2. An explanation of the application process and the deadline for submitting applications. If the
development is phased, the developer must establish deadlines for each phase of the
development that includes BMR Units;
3. An explanation of the selection process, including an explanation of the Preference Point
system;
4. Timelines for buyer selection. If the development is a phased project, information must be
provided on the number of phases and the timelines for those. phases;
5. Timeline for the developer's sales staff to meet wth'the City's Housing Staff to receive
training on the sale selection and applicaton`process
6. Marketing materials;
7. An application packet which includes:
• Application for Inclusionary Unit
• Disclaimer for BMR Application Qualification Questionnaire
• Credit Authorization and Release
• Signed Sample Resale Disclosure Statement
• Required Supporting Documentation Submitted
• Highlights of Dublin Resale Restriction Agreement
• Written confirmation ofpre-approval for the home which must be validated through
Developer's preferred lender.
See Exhibit No. 3 for a sample ownership BMR Unit application packet.
No marketing of the BMR Units shall begin until the developer has received written approval of the
Marketing Plan from the City and the developer's sales staff has met with the Housing Staff for
training so that the sales staff understands and can explain the application process.
16
Revised November 7, 2008
~~~~,
~:
4.10.2 Application and Screening Process
The developer must require each applicant to complete the application that has been approved by
the City as part of the Marketing Plan and to provide the required supporting documentation by the
deadline set forth in the Marketing Plan. The developer should plan accordingly to assure that
applicants are not qualified more than 6 months before the move-in date of the unit.
Application packets should include at a minimum:
• Complete application ;
• Income documentation set forth in Section 5.4.1;
• Reservation instrument showing the address, number of bedrooms and sales price;
• A loan pre-approval letter with Good Faith Estimate and Truth in Lending Statement;
• A signed Disclosure Statement (Exhibit F of the Resale Restriction Agreern~nt);
• A signed credit report authorization and release or other consent and verification letter;
• Copy of tri-merge Credit Report;
• Evidence of 3% available funds to be used as a down payment
The developer must comply with the following process to sell the BMR Units:
Developer collects applications for the period of time set forth in the approved Marketing
Plan.
2. Developer screens applicants`to determine whether they satisfy the requirements for
Qualified Households set forth in Section 5.1.
3. Developer sorts and ranks the Qualified Households based on the Preference Points and
creates a Priority List with those applicants with the most Preference Points at the top
followed by all other applicants in descending order based on the number of Preference
Points received. If more than one qualified applicant receives the same number of
Preference Points or if some applicants receive no Preference Points, the developer shall
rank the Qualified Households based on other objective criteria outlined in its approved
Marketing Plan. For example, the developer may date stamp all applications and, in the case
of a tie, rank the Qualified Households based on who applied first, or the developer may
choose to hold a lottery to break ties. However, whichever criteria the developer uses must
be set forth in its approved Marketing Plan.
4. Developer completes the Priority List within 30 days of the application deadline and submits
the list to the City.
5. Developer reviews and sorts the application packets in order of the Priority List and submits
complete application packets of Qualified Households, together with supporting
documentation, to the City within forty-five (45) days prior to -close of escrow.
17
Revised November 7, 2008
G ~ .~ M
6. The Cit reviews the a lication ackets to verif the a licants are ualified Households" .
Y pp p Y pp Q
The City will make every effort to review the applications within 7 working days of
receiving a complete application packet.
Once the City has verified that the applicant is a Qualified Household, the City will send the
developer a conditional approval letter (or similar document) indicating the applicant's
name, income level and the maximum sale price of the unit (see Section 4.10.3 for more
detail on establishing the sale price) and any requirements that must be met before moving
forward•with the applicant. Once all the required information is received, the City will then
send a conditional qualification letter (or similar document) which is valid for 6 months
from the date of the letter. A copy of the application packet, along with income verification
for the household will be retained by the City as proof of the buyer's qualification to
purchase the BMR Unit. If the City determines that the applicant is not a Qualified
Household, the City will send the developer an ineligibility letter. An applicant who has
been deemed to be ineligible may not reapply for a period of one year from the date of the
ineligibility letter.
The developer bears the responsibilities of ensuring applicants are not qualified more than 6
months before a unit becomes available and closes escrow. Applicants must be re-qualified
if occupancy is to take place more than 6 months from the date of the conditional
qualification letter. Applicants may or may not qualify to purchase a BMR Unit upon re-
qualification. In addition, the price of the BMR Unit may change,upon re-qualification. If,
upon re-qualification, an applicant does not qualify, it is the responsibility of the developer
to notify the applicant.
Conditional approvals are based on information which was supplied to the City by the
developer, or their agent. If there are any material changes to the financial conditions,
marital status, employment status or other facts or information that is made known to the
City prior to loan closing, the developer, their agentor the lender must notify the City of
Dublin in writing of these changes. The City expressly reserves the right to re-verify the
applicant(s) and may void or cancel this conditional approval or other approval at any time
prior to the loan closing if these material changes affect the qualification status of the
buyer(s).
Qualification determinations may be appealed by the Developer to the Community
Development Director.
THE SALE CANNOT PROCEED UNTIL ALL REQUIIZED DOCUMENTS ARE
PROVIDED TO THE CITY AND THE DEVELOPER RECEIVES A WRITTEN
QUALIFICATION LETTER FROM THE CITY.
7. The developer will offer the unit to Qualified Households based on the Priority List, offering
the BMR Unit first to those applicants with the most Preference Points, then in descending
order.
8. The developer and applicant will enter into a purchasing agreement.
18
Revised November 7, 2008
~~~~~~~
9. The developer will require the selected buyer to execute a Resale Restriction Agreement and
Option to Purchase and a Performance Deed of Trust.
10. The developer will provide the City with the name and address of the title company closing
the sale and the name of the escrow officer.
11. Prior to the City sending escrow instructions the City will review all final loan documents
for compliance to the Section 6.1 Financing Requirements.
12. The City will prepare and send escrow instructions to the Title Company.
13. The Title Company will submit the following documents to the City:
• Completed and Signed Residential Loan Application;
• Completed Truth in Lending Statement, Good Faith Estimate, and a estimated HUD-1
statement from the Title Company;
• Completed, executed, and notarized Resale Restriction Agreement and Option to
Purchase; and
• Completed, executed, and notarized Performance Deed of Trust.
14. The City will review the above documents for completeness, prepare the Request for Notice
of Default for each of the buyer's loans, secure the signature of the City Manager or his/her
designee on the necessary documents, and return the loan documents to the lender.
15. The City will send the original Resale Restriction Agreement, Performance Deed of Trust
and Request(s) for Notice of Default to the escrow officer for recording.
If at any time during the application, screening, or sale process, an applicant requires translation
services, the developer shall provide such services at the developer's sole cost and expense.
4.10.3 Sale price of BMR Units
Pursuant to Section 8.68.020A.2 of the Inclusionary Zoning Ordinance,, the maximum sale price for
.a BMR Unit is the price that would allow an applicant in the applicable income category to pay no
more than 35% of its Total Household Income for Housing Expenses.
Owner-occupied units are deemed affordable units if the sales price results in annual housing
expenses that do not exceed 35% of the maximum income level for low-, and moderate-income
households, adjusted for household size.
Below Market Rate For-Sale units are priced based on a designated income point that is affordable
to a greater range of households in each applicable income category.
• For Low-Income Households (household income of between 50% and 80% of Area Median
Income), the sales price would be set at a level so that total monthly housing payment would
not exceed thirty-five percent (35%) of one-twelfth of seventy percent (70%) of the Area
Median Income for Alameda County.
19
Revised November 7, 2008
"' ~. ~~ _~
t
• For Moderate-Income Households (household income of up to 120% of Area Median
Income), the sales price would be set at a level so that total monthly housing payment would
not exceed thirty-five percent (35%) of one-twelfth of one hundred and ten percent (110%)
of the Area Median Income.
In addition, the fixed sales price approach would be based upon the number of bedrooms in the
home instead of the number of persons in the particular household. For example, if a developer is
selling atwo-bedroom unit, the sales. price would be calculated under the "number of bedrooms,
plus one" rule for the assumed household size. In each case the sales price would be set based upon
the following assumed household sizes for the following sizes of residential units:
No. of Bedrooms Assumed Household :Size
1 2
2 3
3 4
4 5
The assumptions below are used to calculate the maximum sale price for BMR Units. However, a
Qualified Household's actual Housing Expenses may differ from these assumptions.
• Interest -Prevailing rate (fixed rate for30 years), secondary market fixed rate, Fannie Mae
or Freddie Mac, as determined by staff, on the date that is 30 days prior to the applicable
application deadline.
• Mortgage Term -fixed rate for 30-years.
• Taxes - 1.25% of the estimated sale price of the unit.
• Insurance -homeowner's insurance
o Homeowner's Insurance -The cost of homeowner's insurance may be calculated
based on an estimate provided by the developer. (If the homeowner's insurance is
covered by an HOA structure, homeowner's insurance need not be included, but it
must be documented that the HOA will provide adequate insurance.)
• HOA dues, if any.
Figure 6 shows how the sale price is calculated:
20
Revised November 7, 2008
8~1 ~ ~~
~.:N. x
FIGURE 6
,.Number Bedroom
'Household Size
1 '..Annual household income
2 Gross monthly income (line 1 diHded by 12)
paid toward housing
2
3 Moderate
85,250.00 110% AMI
7,104.17
35%
Enter
Amounts
3 Gross monthly housing expense (line 2 multiplied by 35%) 2,486.46
Less Interior Homeowner Insurance 35.00 2,451.46
Less Property Taxes 286.17 ' 2,.165.29
Less Homeowners Association Dues (HOA) 150 2,015.29
Net monthly housing expense 2,015.29
'MAXIMUM MONTHLY MORTGAGE PAYMENT -
.Interest Rate _ 6.25%`
-.Term _ __ 30,
4 .Sale Price
4.11 Procedures for Initial Rental of BMR Units
After the Housing Agreement is executed, and .:prior to the issuance of any building permits, the
developer must prepare and submit a Management Plan to the-City of Dublin Housing Division for
approval. After the Management Plan has been approved by the City, and prior to the rental of any
units, the developer must screen, rank.and qualify eligible tenants and send a priority list to the City
of Dublin's Housing Division. This should happen within 30 days, if possible. In addition, the rent
for a BMR Unit must be calculated pursuant to Section 4.11.3.
4.11.1 The Management Plan for Rental BMR Units
Prior to the issuance of building permits, the developer must submit a Management Plan to the City
for its approval. The Management Plan must contain the following information:
• a Plan outlining how the management firm will market and maintain the rental BMR Units,
• how the firm will maintain a waiting list for the BMR Units;
• how the management firm will verify applicants' Total Household Income, both initially and
annually;
• information on the units to be made available for the City to use on the City website;
• a contact telephone number;
• and the names of those individuals responsible for contact and communication with the City.
4.11.2 Application and Screening Process
The management firm (which could be the owner or builder) is the entity that will be responsible for
occupant selection and documentation of rental BMR Units. The management firm's leasing staff
21
Revised November 7, 2008
~~ ~~~-6
should be trained so the staff understands and can explain the rental application process to
applicants.
The management firm must require each applicant to complete and return to the management
company a Rental BMR Unit Application packet. A sample Rental BMR Unit Application packet is
attached as an Exhibit to these Guidelines.
To lease the BMR Units the developer/management company must do the following:
1. Collect applications for a given time period.
2. Screen applicants to determine whether they satisfy the requirements for Qualified
Households set forth in Section 5.2.
3. Sort and rank the applications of Qualified Households based on the Preference Points and
produce a Priority List with those applicants withthe most Preference Points at the top
followed by all other applicants in descending order based on number of Preference Points
received. If more than one applicant receives the same number of Preference Points or if
some applicants receive no points the developer shall use other objective criteria set forth in
the approved Management Plan to select occupants. For example, the management firm may
date stamp all applicant applications and, in the event of a tie, offer the unit to that applicant
that applied first, or the management firm may choose to hold a lottery to break ties.
However, whichever criteria the management firm uses must be set forth in the approved
Management Plan.
4. The Priority List must be completed within 30 days of the application deadline and
submitted to the City for approval;
5. Offer the BMR Units to applicants based on the Priority List, offering first to those
applicants with the most points, then in descending order;
6. Execute a Rental Agreement with the tenant that notifies the tenant that he or she may not
sublease the unit and that annual certification is required.
7. Maintain applications with income verification and re-certification for City to review at
annual onsite monitoring.
Qualification determinations may be appealed by the Developer to the Community Development
Director.
4.11.3 Calculatin~Maximum Rent
The Inclusionary Zoning Regulations state that maximum rents cannot exceed 30% of the
Maximum Income in a given income category. Affordable rents are calculation formula is listed
below for Very Low, Low and Moderate Income Households:
• Very Low Income Tenants, monthly rent not in excess of thirty percent (30%) ofone-twelfth
of fifty percent (50%) of the annual Median Income for the Area;
22
Revised November 7, 2008
Low Income Tenants, monthly rent not in excess of thirty percent (30%) ofone-twelfth of
sixty percent (60%) of the annual Median Income for the Area; and
Moderate Income Tenants, monthly rent not in excess of thirty percent (30%) of one-twelfth
ofone-hundred and ten percent (110%) of the annual .Median Income for the Area, with in
each case based upon the following assumed household sizes for the following sizes of
residential units in the Project:
If tenant is required to pay for utilities, the maximum rent must be reduced to account for the cost of
such utilities (a utility allowance). Utilities include gas, electric, water, and trash disposal. In
addition, if tenants are required to provide their own stove, refrigerator, or washer and dryer, these
expenses are considered utilities, and the maximum rent is further reduced. If the tenant is
responsible for any of the above, the maximum rent must be reduced by the amounts listed in the
Utility Allowance Sheet* (See Exhibit No. 8).
Figure 7 illustrates the calculation of maximum rent.
FIGURE 7
2008 Rent limits
Bedroom Size Assumptio ns 0 bdrm = 1 person 1 bdrrn = 2 people
2 bdrm = 3 people 3 bdrm = 4 people
50% 60% 110%
_.
0. $754 $905 $1,658
1 $861 $1,034 $1,895...
2 $969 $1,163 $2,131
3 $1,076 ...$1,292 $2,368
4 _ $,1,163 $1,395 $2,558
If a tenants/households income increases to where the tenant/household is no longer income or
household size qualified for the BMR rental unit, the tenant/household will not be required to move;
however, the household will no longer be considered qualified for a BMR unit and the rent may be
increased to market rate rent. The developer/landlord will then offer the next available unit with the
same specifications (i.e. bathrooms and bedrooms) as a BMR rent restricted unit.
4.11.4 Annual Report
Pursuant to Section 8.68.OSO.B of the Inclusionary Zoning Regulations, the management entity for
the development must provide the City an annual report (See Exhibit No 9). The annual report
must include the following information:
* The Utility Allowances are established by the Housing Authority of Alameda County and revised periodically. The
most current Utility allowances for Alameda County may be accessed at the following web site: http//www.haca.net.,
then click on statistics.
23
Revised November 7, 2008
~,~,,, `~
• Total Household Income for the prior year for each BMR Unit;
• Number of people residing in each BMR Unit;
• Monthly rents charged and proposed to be charged for each BMR Unit; and
• Vacancy of BMR Units during the previous year.
The management firm must submit the report annually by October 31st. The City of Dublin
Housing Staff will send a reminder letter to the management firm, with a copy of the Annual Report
form for completion and certification at least three months prior to the anniversary date. This form
must be completed and returned to the City by the anniversary date.
4.11.5 Annual Monitoring by City
The City of Dublin may perform an annual site visit to monitor the records of all BMR Units. The
City will provide at least two-week's notice to the developer and/or management firm as to the date
of the site visit. Files for all BMR Units must be made available for review at the request of the
City. The purpose of the monitoring is to ensure compliance with the City's Inclusionary Zoning
Ordinance and these Guidelines.
If a Residential Development is financed through a government program that has stricter occupant
selection or occupant documentation requirements than the City, the City may elect to rely on those
requirements and associated documentation and not require additional documentation. The City
will require tenant income verification and restriction of the BMR units for 55 years; however, the
management firm may send to the City copies of the documentation that is required and produced
for other monitoring agencies...
5 BUYER AND RENTER QUALIFICATIONS FOR BMR UNITS
5.1 Buyer Qualifications
A household is qualified to purchase a BMR Unit if it satisfies the following requirements:
1. The household's Total Household Income does not exceed the applicable Maximum
Income set forth in Section 5.4;
2. The household will occupy the unit as its Principal Residence within 30 days of the
close of escrow on the unit;
3. The household is of a size meeting the household size criteria set forth in Section
5_3;
4. All title holders of the property must take an 8-hour Homebuyer Education workshop
and receive a certificate of completion. Certificate of Completion must be dated
within 6 months of the date of application;
5. All applicants have a minimum FICO credit score of 620 (See Section 5.5);
24
Revised November 7, 2008
;~~,
6. The City will require all household members to be either a citizen or national of the
United States or a qualified aliens defined by the federal Personal Responsibility and
Work Opportunity Reconciliation Act of 1996(PRWORA);
7. All members of the household are either:
a. persons who hold title to the BMR Unit„ appear on the mortgage, and have
executed a Resale Restriction Agreement and Performance Deed of Trust for
the unit; or
b. persons who are claimed as a dependent on the tax returns of a household
member who satisfies the requirements in subsection (a) above;
8. All members of the household must meet the definition of a qualified homebuyer.
Qualified Households with Preference Points will receive priority over other Qualified Households.
For information on the application and screening process, see Section 4.10.2.
Once the City has verified that the applicant is a Qualified Household, the City will send the
developer a conditional appzoval letter (or similar document) indicating the applicant's name,
income level and the maximum sale price of the unit (see Section 4.10.3 for more detail on
establishing the sale price) and any requirements that must be met before moving forward with the
applicant. Once all the required information is received, the City will then send a conditional
qualification letter (or similar document) which. is valid for 6 months from the date of the letter. A
copy of the application packet, along with income verification
Applicants who are determined ineligible will receive an ineligibility letter. Ineligible applicants
may not reapply to purchase any BMR Unit for a period of one year from the date of the City's
ineligibility letter.
Qualification determinations may be appealed by the'Developer to the Community Development
Director.
5.2 Renter Qualifications
A household is qualified to rent a BMR Unit if it satisfies the following requirements:
1. The household's Total Household Income does not exceed the applicable Maximum
Income (See Section 5.4);
2. All members of the household are Legal Residents;
The household will occupy the unit as its Principal Residence within 30 days of
executing the lease; and
4. The household is of a size meeting the household size criteria set forth in Section
5_3).
5. The names of all non-dependent household members must appear on the lease for the
BMR Unit
25
Revised November 7, 2008
6. No member of the Qualifying Household must own any interest in any real property,
including but not limited to, any dwelling unit, commercial real estate, or land.
Qualified Households with Preference Points will receive priority over other Qualified Households.
For information on the application and screening process, see Section 4.11.2.
Qualification determinations maybe appealed by the Developer to the Community Development
Director.
5.3 Household Size
The size of the household is determined by the number of people living in a household at the time
of application. In the case of a pregnant person, the baby .may not be included as a member of the
household until the baby is born.
To qualify for a BMR Unit, the size of a household must be compatible with the size of the unit
being rented or purchased.
The household size for each BMR Unit may not exceed two people for each bedroom and may not
be less than one person per bedroom, unless. otherwise permitted by special financing sources.
Consult with the City of Dublin for further clarification..The chart below contains the household
size permitted for each BMR Unit based on the number of bedrooms:
Studio
One-bedroom units
Two-bedroom units
Three-bedroom units
Four-bedroom units
5.4 Total Household Income
1-2 people households
1-2 people households
2-4 people. households
3-6 people households
4-8 people households
To be eligible for a BMR Unit, the applicant's Total Household Income must not exceed the
applicable Maximum Income. Total Household Income means the household's Gross Household
Income (see Section 5.4.1 below) plus assets calculated pursuant to Section 5.4.3. Maximum
Income is determined periodically by HCD based on AMI. Below are the Maximum Incomes for
Alameda County for 2008.
Number of Persons in Household
Income Category 1 2 3 4 5 6 7 8
Very Low ~ 30,150 $ 34,450 $ 38,750 $ 43,050 $ 46,500 $ 49,950 $ 53,400 $ 56,850
Low ~ 46,350 $ 53,000 $ 59,600 $ 66,250 $ 71,550 $ 76,850 $ 82,150 $ 87,450
Moderate $ 72,300 $ 82,600 $ 93,000 $ 103,300 $ 111,600 $ 119,800 $ 128,100 $ 136,400
26
Revised November 7, 2008
~' _~«~_
? +"`"` ~"
5.4.1 Gross Household Income
Gross Household Income means all income from all adult household members (18 years of age and
older) derived from all sources as provided in the Internal Revenue Code (Title 26, Subtitle A,
Chapter 1, Subchapter B, Part I, Section 61), whether or not such income is exempt from Federal
income tax. Such income includes, but is not limited to, the following:
• Compensation received from an employer
• Compensation includes, but is not limited to salary, overtime pay, and other pay
• Other pay can include, but is not limited to compensation for special working conditions or
one time pay-out of unused vacation and sick leave.
• Alimony, spousal and child support
• Cash
• Pensions, if at an age where pension is being received`'as income
• Public benefits including, but not limited to, CalWorks, SSI, and disability income
• All interest, dividends, and royalties
• Income derived from private businesses
• Rental Income
• Income from pensions
• Compensation for services rendered including fees, fringe benefits, commissions, tips, and
bonuses
• Stipend received for participation in a mentor, learning or education opportunity
• Gains from dealings in private and/or commercial property
• Gambling Winnings
• Annuities, life insurance, and endowment contracts
• Income from discharge of indebtedness
• Gross partnership contributions or distributions
• Income from an interest in an estate or trust
Exceptions:
1) Gross Household Income does not include income household earned by a household member
who is between the ages of 18-26 and meets both of the following criteria:
• Is claimed as a dependent of a household member on such member's federal income
taxes; and
• Is a full time student (12+ units -school transcript must be provided)
2) Gross Household Income does not include payments to a household member from a
governmental fund Income if all of the following requirements are satisfied:
• The payments are based on the recipient's or the recipient's family's financial need;
• The payments do not represent compensation for services rendered; and
• The payments are part of a governmental housing subsidy program including, but not
limited to, so-called Section 8 federal housing assistance payments
27
Revised November 7, 2008
~ .~~ ~~
For purposes of determining Gross Household Income, each person, 18 years of age or older, must
present the following:
a complete set of Federal and State Income Tax Returns for the past three years, including
all schedules (signed & dated) and W-2 forms; (in the case where taxes have not been filed
for any of the past three years, aletter ofverification ofnon-filing from the Internal Revenue
Service is required);
• four most recent and consecutive pay stubs; and
three recent and consecutive statements for all financial accounts, including but not limited
to, savings accounts, checking accounts, retirement accounts, 401(K) accounts, stock
accounts and another accounts held in the applicant(s) name(s), whether held individually or
together.
If a household member is self-employed, in addition to the information above;. the member must
submit profit and loss statements for the past 3 years (if applicable), and a current profit and loss
statement for the year.
5.4.2 Income Calculation
a. Wage and Salary
If an applicant is a full time employee (usually 30 to 40 hours) or an employee with
consistent regular hours or income, or income with overtime or adjustments as a
regular part of their job, one of the following formulas listed below in Section "a"
will be used to determine the applicant's salary. Bonuses and commissions may be
calculated into the annual income. calculation. In the case of unclear income or
income that is somewhat difficult to calculate, please contact the City of Dublin
Housing Division. The City of Dublin will make the final determination which
Income Calculation to use.
Monthly income x 12 months =annual income
Twice monthly x 24 =annual income
Bi-weekly income x 26 =annual income
Weekly income x 52 =annual income
Hourly income x 40 (or whatever normal hours per week may be) x 52 =annual
income
An employee who works consistent hours, with some overtime, shall be calculated
using the above formula.
28
Revised November 7, 2008
b. Variable Income
~~ ~
For applicants who are part-time employees or employees with variable hours every
pay period (or variable hours less than 40 hours per week), inconsistent income or
hours, overtime, bonuses and commissions, etc. their annual salary shall be
calculated using year-to-date income, plus previous year income (from same income
source or employer), divided by the number of months reviewed (UP TO BUT NOT
EXCEEDING 12 MONTHS) times 12 to arrive at their annual income. If there is no
previous year income from same employer, or the job was started mid-year, use
current income year to date using the calculation explained in (a) above shall be
used. If an applicant works consistently 40 hours per week and has occasional or
regular overtime, use the calculation listed in "a"above to calculate income.
c. Inconsistent or Temporary change in Income Due to a Temporary Circumstance
If an applicant has a temporary situation (7 months or less) that makes income
calculation difficult, a Verification of Employment may be used to calculate
applicant's income based on a normal annual time period. Or, the income may be
calculated based on the person's hourly rate. times their normal working hours (as
shown in item "a" above).
d. Self-Employed or Non-Corporation
A self-employed applicant is also considered to have variable income. Gross annual
income calculations will be based on the previous two year's net income shown on
Schedule C of the federal income tax returns, plus net income before taxes from the
applicant's signed, year-to-date Profit and Loss Statement, divided by the
appropriate number of months (NOT TO EXCEED 12 MONTHS) times 12 to arrive
at the annual income.
5.4.3 Assets
An asset test will be applied `to all applicants to determine whether they satisfy the income
requirements. If an applicant has assets that exceed $30,000, the following amounts will be added
to the applicant's Gross Household Income to determine the household's Total Household Income:
• Ten percent (10%) of all assets between $30,001 and $130,000
• Thirty percent (30%) of all assets over $130,000
The maximum assets allowed are $250,000. Households with assets in excess of $250,000 will be
disqualified. Assets include, but are not limited to, cash, all savings and checking accounts, stocks,
bonds, real estate, gifts and other sources of money. Pensions and federally approved retirement
savings accounts, such as IRA's, Roth IRA's and 401K's, are excluded; however, retired applicants
who receive income from their retirement account must include such income as Gross Household
Income on their application.
29
Revised November 7, 2008
Figure 8 illustrates the calculation for determining income with assets.
FIGURE 8
Example:
Household of 3 earns $50,000 a year (minus) total household assets = $150,000
$150,000 (minus) $30,000 = $120,000 (which equals less than $130,000)
10% of $120,000 = $12,000
New total household income: $50,000 + $12,000 = $62,000
Household of 3 earns $50,000 a year (minus) total household assets = $200,000
$200,000 (minus) $30,000 = $170,000 (which equals more than $130,000)
10% of $130,000 = $13,.000
30% of balance of $40,000 = $12,000
New total household income: $50,000 + $13,000 + $1,000 = $75,000
5.5 Credit Score
For ownership BMR Units, a credit check will be conducted on all adults (other than dependents)
in the household. Applicants must have sufficient creditworthiness to qualify. Creditworthiness
means that:
i) All household individuals shall have a minimum of three years since Chapters 7 or 13
bankruptcy discharge date and/or foreclosure and evidence of reestablished credit is
required; and
ii) All persons appearing on the mortgage shall have a minimum FICO credit rating of 620
points from all three credit agencies. The representative credit score is the middle score
of the three. sets of repository scores reported for each household member. If more than
one eligible applicant is applying, all middle scores will be considered and the lowest of
the middle scores shall be the score used in qualifying the household (must be 620 or
higher).
Figure 9 shows an example of how to calculate a representative credit score:
_.___
FIGURE 9
Borrower
Co-Borrower
The Lowest
Middle Credit
Score of Borrowers
Lowest Credit
Score
678
690
Middle Credit
Score
706
697
697
Highest Credit
Score
709
703
30
Revised November 7, 2008
~~ ~a~-~
5.6 Alternative Credit History Parameters
Alternative Credit History is permitted with a minimum of four trade lines and twelve-month of
satisfactory payment record. One of the trade lines must be a twelve-month verification of rent
(VOR) history.
5.7 Preference Points
Applicants will be screened by the developer or their designated party, for initial eligibility based on
the requirements set forth in Section 5.1 (for ownership units) or Section 5.2 (for rental units).
Qualified Households will then be ranked based on the number of Preference Points they receive.
The Preference Point system set out in the Inclusionary Zoning Ordinance (see Table 1) provides
priority to those persons who live in Dublin, work in Dublin, are public-service employees in
Dublin, are seniors age 62 and older, are permanently disabled, are an immediate family member of
a Dublin resident, and/or are being required to relocate from their :current Dublin residence due to
demolition of their dwelling or conversion of their dwelling from rental to ownership: Each
household may only claim Preference Points once for any given category. The Ordinance provides
that even if two persons in the household qualify for Preference Points for the same category, the
points are only awarded for one person. For example, if a husband and wife are both employed in
Dublin, the couple receives only 3 Preference Points for being employed in Dublin, or if the
applicant lives with a family member in Dublin, the applicant will only be entitled to a total of 3
Preference Points. Similarly, if two seniors make up a household, they would be entitled to only 1
Preference Point.
Table 1: The Preference Point System
Priority Points
Employed in Dublin for at least 6 months* 3 points
Public service employee n Dublin* * 1 additional
point
Has resided in Dublin for at least one year 3 points
Seniors (62 and over) l point
Permanently disabled 1 point
Has an .immediate family member who is a 1 point
Dublin resident & who has continuously
lived in Dublin for at least one year
Must move because housing is to be 1 point
demolished or converted to condo
*Newly hired teacher that will be working in Dublin may waive the six-month employment criteria by submitting a
copy of their employment contract. Teacher must be credentialed and work as a school that is a State accredited school.
* If self-employed in Dublin, then the business must have a current City business license for at least 6 months at the
time of application
** A public service employee is a person who is employed by a public agency such as the City of Dublin, a fire fighter
or police officer assigned to work in Dublin, BART, DSRSD, or USPS working in Dublin.
31
Revised November 7, 2008
~~~~~
Figure 10 demonstrates how Preference Points are calculated.
FIGURE 10
Example 1: An applicant for a BMR Unit both lives in Dublin (for at least one year) and
works in Dublin (for at least 6 months).
This individual will receive the following points:
Lives in Dublin 3 points
Works in Dublin 3 points
Total number of points 6 points
Example 2: An applicant for a BMR Unit works in Dublin and is a schoolteacher.
This individual will receive the following points:
Works in Dublin 3 paints
Public Service Employee 1 point
Total number of points 4 points
Example 3: An applicant for a BMR Unit is a senior citizen (62 years old) and lives in
the City of Dublin (for at least one year).
This individual will receive the following points:
Senior citizen 1 paint
Lives in Dublin 3 points
Total number of points 4 points
If the household indicates on its application that it qualifies for Preference Points, the household
will be required to provide the following proof:
If Resident of Dublin:
• Copy of two utility bills (PG&E or water), one from at least one year ago and one most
recent utility bill both showing the applicant with a Dublin address; or
• Copy of a current rental agreement.
If Employed in the City of Dublin:
• Copy of first and most recent pay stub establishing length of employment; or
• Letter from employer, on company letterhead, indicating continuous employment for the
past six months; or
• For a newly hired teacher that will be working in Dublin, a copy of employment contract.
• If self-employed in Dublin, then the business must have a current City business license for at
least 6 months at the time of application
32
Revised November 7, 2008
1 ~-~' ~7
If Public Service Employee working in Dublin:
• Copy of first and most recent pay stub establishing length of employment; or
• Letter from employer, on company letterhead, indicating continuous employment for the
past six months; or
• For a newly hired teacher, at a State accredited school, that will be working in Dublin, a
copy of employment contract; and
• A letter from employer confirming employment and employer contact. information.
If Senior Citizen:
• A valid California (or other state with photo ID.) driver license; or
• A valid California (or other state with photo ID.) identification card; or
• A valid passport.
If Permanently Disabled Individual:
• Doctor's note confirming that applicant is permanently'disabled; or
• Other verification from a State Agency establishing permanent disability status; or
• Verification of receipt of SSI or SSDI.
If Person Who Has an Immediate Family Member s~ That Are Dublin Residents:
• Copy of two utility bills (PG&E or water), one from at least one year ago and one most
recent utility bill both showing the immediate family member with a Dublin address; or
Copy of the immediate family member's current rental agreement; and
A copy of birth certificates for self and immediate family member, establishing relationship;
or
• Other legal document establishing relationship.
If Relocated Dublin resident due to Demolition or Condominium Conversion:
• Letter from apartment owner or management firm verifying either the imminent
condominium conversion or demolition of the unit; and
• Confirmation from the City's Community Development Department.
Where definitions are not explicitly stated in the Regulations, the City has developed these
definitions:
• A senior is defined as a person 62 years of age or older for the purpose of qualifying for
preference points;
• To qualify for the permanently disabled point, the person must be able to provide written
verification from a physician or show receipt of SSI.
33
Revised November 7, 2008
~ ~~
Immediate family is defined as a mother, father, brother, sister, child, grandparent or
grandchild currently living together for 6 months or more.
6 REQUIREMENTS FOR BUYERS OF BMR UNITS
6.1 Financing Requirements
All BMR buyers must be able to secure a loan through a lending institution for a BMR Unit. At the
time of application, the developer may require that all applicants get pre-approval from the
developer's preferred lender. However, once an applicant receives approval to purchase a unit, the
applicant may use a lender of its choice, provided that the lender is able to adhere to the City of
Dublin's Guidelines for acceptable loan products.
6.1.1 Acceptable Loan Products for Purchase and Refinancing of a BMR
Unit
The City reserves the right to reject loan products if the City believes in its sole discretion that there
is a stronger likelihood that the loan product would potentially result in loss of the BMR Unit due to
the purchasers' inability to comply with the terms of the loan.
Ca1HFA or Ca1VA loan products for first mortgages. are not permitted; however a number of
CaIHFA loan products are permitted for second and third loans. Other loan products may be
evaluated upon request. From time to time, the City will make available a list of acceptable loan
products.
The following is an example of anon-exclusive list of the loan products that maybe acceptable to
the City. The list is not intended to be exhaustive and other loan products may be evaluated upon
request.
Acceptable 1st Mortgage Loan Products
• Fixed Mortgages up to 40 years
• Maximum 97% combined loan to value
6.1.2 Prohibited Loan Products
• Interest-only loans
• Negative amortizing loans
• Adjustable rate loans
• Balloon payment loans
• Some lines of credit that exceed the resale price of the unit
Unacceptable Mortgages Features
• Stated income loans
• Excessive points and fees
34
Revised November 7, 2008
f~
6.2 Down Payment
• Applicants must provide a minimum down payment equal to three percent (3%) of the
purchase price from their own funds.
• Funds must be seasoned (on deposit in a financial institution)- for a minimum of three
months prior to the initial date of the application with documentation showing these funds
are available for use as down payment.
• Funds must be placed into escrow prior to close of escrow and proof of availability of funds
must be given to the City before close of escrow.
Down Payment Assistance
The City reserves the right to reject down payment assistance products if the City believes in
its sole discretion that there is a stronger likelihood that the down payment assistance
product would potentially result in loss of the BMR Unit due to the purchasers' inability to
comply with the terms of the assistance.
6.3 Debt to Income Ratio
Homebuyer's total debt to income ratio will be set from time to time by the City based on current
financial or real estate market conditions.
6.4 First Mortgage Loan Value Ratio
Borrower must provide funds in an amount equal to a minimum of 3% of the purchase price for
use as a down payment. Buyer must deposit 3% of the purchase price of their own money into
escrow prior to the close of escrow. The 3% must be applied to the purchase price so the
combined loan to value does not exceed 97%. The 3% down payment may not be used towards
closing costs.
6.5 Closing Costs and Deposits
The buyer is responsible for all closing costs related to the purchase of the BMR Unit,
including but not limited to, title fees, escrow fees, and loan origination fees
(approximately 2-3% percent of the purchase price). Homebuyer may be "gifted" funds to
pay for closing costs.
The buyer may take advantage of other down payment assistance programs to assist with
closing costs with the approval from the City.
6.6 Homebuyer Education Program
Homebuyer(s) must successfully complete a City approved Below Market Rate 8-hour
Homebuyer Education Class prior to the close of escrow and must provide the City with evidence
of completion.
35
Revised November 7, 2008
6.7 Documents that Each Buyer Must Sign
~ ~~ ~~,
~~~ ~
r~
The Inclusionary Zoning Ordinance requires that all BMR Units be restricted for a period of
SS years. As a result, BMR Unit buyers must execute a Resale Restriction Agreement with the City
and a Performance Deed of Trust. These documents must be signed by all titleholders and
recorded.
6.7.1 Highlights of the Resale Restriction Agreement
The following list highlights some of the restrictions in the Resale Restriction Agreement. This list
is not intended to be exhaustive.
Principal Residence Requirement
The unit must be owner-occupied and shall not be used as an investment or rental property. BMR
Owners are required to .occupy the BMR Unit as their Principal Residence. BMR Owners are
prohibited from renting their unit without prior written approval from the City. The owner of an
ownership. BMR Unit may rent his or her unit for a period not to exceed twelve{12) months upon
demonstration of hardship, as determined in the sole and absolute discretion of the City Manager,
and written approval from the City of Dublin. "Hardship" means circumstances in which a BMR
Owner is required to be absent from the unit for an extended period of time due to either a change in
the location of his or her employment or health problems of the BMR Owner or an Immediate
Family Member of the BMR Owner. Once the BMR Owner obtains written approval from the City
to rent his or her BMR Unit, the BMR Owner shall select a Qualified Household to rent the unit.
The monthly rental payment for the BMR Unit shall be calculated pursuant to Section 4.11.3.
The BMR Owner shall not execute a rental agreement for the BMR Unit without first obtaining the
City's approval of such agreement. The rental agreement shall clearly state (1) the term of the
rental (not to exceed the twelve month period rental is permitted pursuant to these Guidelines), (2)
the monthly rental payment, and (3);that the rental is for a limited period of time.
Any rental agreement in violation of these Guidelines is prohibited, and any BMR Owner who
violates these Guidelines shall be deemed to be in default under his or her Resale Restriction
Agreement.
Resale of BMR Unit
The City of Dublin is not responsible for locating or providing qualified buyers for BMR units;
however, all potential buyers must be qualified by the City before the sale can proceed. BMR
owners may only sell their units to a Qualified Household or to the City for a restricted price
calculated pursuant to Section 7.2. A BMR owner must follow the requirements set forth in Section
7.1 when selling his or her unit. The City has the right of first refusal.
Appreciation Share
Upon the first sale of the BMR Unit after the end of the 55-year term of the Resale Restriction
Agreement, the owner must pay to the City an amount equal to 25% of the difference between the
actual sale price and the adjusted resale price calculated pursuant to the formula set forth in Section
7.2. For example, if a unit is originally purchased for $200,000 (actual sale price) and at the end of
55 years sells for $500,000 (adjusted resale price), the equity of the unit is $300,000. The amount
owed to the City would be 25% of the $300,000 or $75,000.
36
Revised November 7, 2008
~ ~~ . ~~
Title Changes
A BMR Owner cannot make changes to the title on a BMR Unit without prior written approval
from the City of Dublin. BMR Owners must request changes to title in writing before making a~
changes to the title of a BMR Unit and are responsible for all costs associated with adding or
removing a person to or from the title.
In the case of a change in the household makeup, due to either marriage, divorce, legal separation,
death or other occasion that will cause a person to move in or to vacate the BMR Unit, owners
should contact the City to ascertain how to add or remove names from the Resale Restriction
Agreement and Performance Deed of Trust.
City's Option to Purchase
The City has the option to purchase a BMR Owner's unit upon the occurrence of certain events,
including but not limited to, the sale of the BMR Unit, bankruptcy of the BMR Owner, and
foreclosure. A BMR Owner must notify the City when it desires to sell its BMR Unit by submitting
a Notice of Intent to Transfer (Exhibit B to the Resale Restriction Agreement) to the City. If the
City decides not to purchase the unit, the City will send the BMR Owner a letter, along with a
packet of information that will assist the BMR Owner in finding another Qualified Household to
purchase the unit.
Refinancing BMR Units and Taking Cash Out
In general, BMR Owners may refinance their units only to take advantage of a new loan that
benefits the BMR Owner financially (e.g. a lower interest rate with lower monthly payments). BMR
Owners must contact the City in writing for prior written approval of all refinancing. Taking cash
out of the unit is not allowed. unless the cash is going to be used for Approved Capital
Improvements as outlined in Section 7.4.
Annual Survey/Montorng
Each year, the City of Dublin will monitor and require occupancy certification for all BMR Units.
An annual survey will be mailed to the owner(s) ofeach BMR Unit, usually around the anniversary
date of the purchase of the unit. Each owner must complete and return the survey along with
qualifying documentation. Failure to return the survey and documentation could place the owner(s)
in default of the Resale Restriction Agreement. In addition, pursuant to the Consent Agreement, the
City may access and review the BMR Owner's credit reports or other financial or personal
information to verify the BMR Owner's compliance with the Resale Restriction Agreement and
these Guidelines.
Estate Planning
Upon the death of a BMR Owner, the inheriting owner must notify the City of the BMR Owner's
death within 30 days of the date of death and must sell the BMR Unit to a Qualified Household at a
restricted resale price within 180 days (or longer if approved by the City of Dublin due to market
conditions) unless (i) the inheriting owner is the legal child or step-child of the BMR Owner; (ii) the
City verifies that legal child or step-child qualifies as a Qualified Household; and (iii) the legal child
or step-child signs a Resale Restriction Agreement and a Performance Deed of Trust.
37
Revised November 7, 2008
t
7 Requirements for Resale of BMR Units
7.1 Resale Procedure
An owner must comply with the following procedures when reselling an ownership BMR Unit:
The owner must inform the City of his or her intent to sell the unit by filling out a Notice of
Intent to Transfer (Exhibit B to the Resale Restriction Agreement) and submitting it, along
with any letters from the City for Approved Capital Improvements, to the City. (The owner
may still decide not to sell their unit after submitting these documents.)
2. The City may exercise its option to purchase the unit. If the City decides not to purchase the
unit, the City will send the BMR Owner a Conditional Consent to Transfer letter and a
packet of information that will assist the BMR Owner in finding another Qualified
Household to purchase the unit. The Conditional Consent to Transfer letter is valid for 90
days from the date of the letter.
3. The City will inform the owner of the permissible-sale price of the unit and any other
conditions of sale within thirty (30) days following receipt of the Notice of Intent to
Transfer. The sale price will be calculated pursuant to the formula in Section 7.2.
4. The BMR Owner must market the unit and pay all fees associated with the sale of the unit.
The BMR Owner may resell the BMR Unit through a BMR Resale Program conducted by a
for-profit or non-profit organization, such as the Tr-Valley Housing Opportunity Center. If
the seller uses a Real Estate Agent, the Agent must contact the City to find out requirements
for listing the property, and proper contact .information.
5. At least fifteen (15) days prior to the anticipated date of the close of escrow, the prospective
buyer must submit the following documentation to the City Housing Staff for approval:
a. The income documentation set forth in Section 5.4.1;
b. Evidence of completion of a Below Market Rate Homebuyer Education Workshop;
c. Completed purchase agreement;
d. A loan pre-approval letter with Good Faith Estimate and Truth in Lending Statement
e. A signed Disclosure Statement (Exhibit F of Resale Agreement)
f. A signed Credit Authorization and Release Form, or similar document
g. Name, address and phone number of Title Company handling the transaction along
with the name of the escrow officer
h. Copy of tri-merge Credit Report;
i. Evidence of 3% available funds to be used as a down payment
38
Revised November 7, 2008
i~ ~ ~a.~~
6. The City shall notify the owner within seven (7) days of receipt of complete packet of
documentation as listed above of its approval or disapproval of the prospective buyer.
7.2 Calculating Restricted Resale Price
The resale price of a BMR Unit is dependent on AMI at the time of sale and the value of Approved
Capital Improvements.
The resale price is equal to:
The lowest of the (i) original price paid by the owner for the BMR Unit, increased by an
amount equal to the original price .multiplied by the percentage increase in AMI between the
effective date of the Resale Restriction Agreement and the date the City receives the
owner's Notice of Intent to Transfer. (For instance, if the original price of the unit was
$200,000 and the median income increases 2% between the effective date of the Resale
Restriction Agreement and the date the City receives the owner's Notice of Intent to
Transfer, the unit price will increase by 2%, or $4,000 to 204,000); or (ii) the fair market
value of the BMR Unit as determined by an appraiser-approved in writing by the City; plus
2. The cost of Approved (in writing by the City) Capital Improvements; minus
3. The cost to repair damage to the.BMR Unit and to place the unit into saleable condition (the
determination of what is considered damage to a unit will be determined by the City). Such
items may include, but not limited to, ripped or torn carpet, damage to kitchen or bathroom
appliances or fixtures; broken fight fixtures, broken or missing tiles and/or grout around
tiles, damage to floor or ways; minus
4. The amount of all costs advanced by the City for the payment of mortgages, taxes,
assessments, insurance premiums HOA dues and/or associated late fess, costs, penalties,
interest, attorneys' fees, pest inspections, resale inspections and other expenses related to the
BMR Unit, which the owner has failed to pay or has permitted to become delinquent.
7.3 Fees Associated with the Selling of a BMR Unit
The BMR Owner is responsible for all fees associated with the sale of the unit including, but not
limited to, any real estate fees, and the City's Administration Fee of $1,500, which maybe adjusted
from time to time.
7.4 CapitalImprovements
As discussed in Section 7.2 above, the resale price of the BMR Unit will be increased by the
amount of Approved Capital Improvements. It is the responsibility of the BMR Owner to keep cost
and accounting records of all Approved Capital Improvements.
39
Revised November 7, 2008
7.4.1 Procedure for Receiving Approval of Capital Improvements
In the exercise of reasonable discretion in accordance with regulations adopted by the City from
time to time, the City will approve capital improvements that improve the health and safety
conditions of a BMR Unit. To receive such approval, the BMR Owner must:
submit evidence to the City showing the purpose and estimated cost of the capital
improvements;
• receive written approval from the City prior to commencing any improvements; and
• submit documentation to the City within 30 days of completion of the improvements
verifying that such improvements have been completed.
Upon receipt of the estimate for capital improvements, City Staff will review the request for
compliance with these Guidelines. The City will review all capital improvements claims and
categorize them into three distinct categories: 1) Eligible Capital Improvements; 2) Eligible
Replacement and Repair; and 3) Ineligible Costs. Each category is defined below.
1. Eligible Capital Improvements include major structural system upgrades, Special
Assessments, selected additions to the unit (where the new space is needed to meet the size
of a growing family) and improvements related to increasing the health, safety and energy
efficiency of the BMR Unit. Improvements that meet these criteria will be given 100%
credit.
2. Eligible Replacement and Repair includes in-kind replacement of existing amenities,
repairs and general maintenance that keeps the BMR Unit in good working condition.
Costs that meet these criteria will be given 50% credit.
3. Ineligible Costs include cosmetic enhancements, installations with limited useful life spans
and non-permanent fixtures. Homeowners may undertake these projects at their discretion;
however, they will not be given capital improvements credit.
The City will send a letter to the BMR Owner either approving or denying the submitted capital
improvements within 30 days of original receipt. The letter will be maintained in the BMR Unit's
file at the City of Dublin for use when the unit is resold.
Once the City has approved the capital improvements, the BMR Owner may then proceed with the
work, obtaining permits from the Building Division, if applicable. Within 30 days of completion of
the improvements and sign-off by the Building Division, if applicable, the BMR Owner must
submit the following information:
• A copy of the receipt/invoice for each eligible improvement;
• Proof of payment, such as a cancelled check, bank account statement or credit card
bill;
• A copy of Building Permit, if required; and
40
Revised November 7, 2008
1~`~ ~~-~
• A picture or pictures of completed work.
The City may, at its discretion, visit the job site to visually view the completed work.
7.4.2 Special Assessments
HOA- initiated Special Assessments are considered capital improvements and will be added to the
resale price of the BMR Unit. In order to receive credit for Special Assessments, homeowners must
submit the following documentation within 3-months of payment:
• Invoice for Special Assessment; and
• Proof of Payment, such as a cancelled check, bank account statement or credit card
bill.
7.4.3 Capital Improvements Cap.
In order to maintain the affordability of the BMR Unit for subsequent buyers, at the time of sale, the
City of Dublin will cap all Approved Capital Improvements at 5% of the resale price.
7.4.4 List of Eligible and Ineli ibg_ Ie Gapital Improvements
Eligible Capital Improvements include major structural system upgrades, some new additions to the
unit and improvements related to increasing the health, safety and energy efficiency of the BMR
Unit. Improvements that meet these criteria will be given 100% credit. Below is anon-exclusive
list of Eligible Capital Improvements:
• Major Electrical Wiring System Upgrade
• Major Plumbing System Upgrade
• Upgrade to Double Paned Windows
• Fireplace Glass Screen
• Room Additions (if room addition meets the criteria for the family size)
• Installation of Additional Closets and Walls
• Alarm System
• Removal of Toxic Substances such as Asbestos; Lead or Mold/Mildew
• Insulation
• Upgrade to Energy Star Built-In Appliances, as follows:
• Furnace
• Water Heater
• Stove/Range
• Dishwasher
• Microwave Hood
Eligible Replacement and Repair includes in-kind replacement of existing amenities, repairs
and general maintenance that keeps the property in good working condition. Costs that meet
these criteria will be given 50% credit for repairs. Below is anon-exclusive list of Eligible
41
Revised November 7, 2008
~~~~a~1
Replacement and Repair:
• Electrical Maintenance and Repair, such as:
• Switches
• Outlets
• Plumbing Maintenance and Repair, such as:
• Faucets
• Supply Line
• Sinks
• Flooring
• Countertops -
• Cabinets
• Bathroom Tile
• Bathroom Vanity
• Replacement of Built-In Appliances, as follows:
• Furnace
• Water Heater
• Stove/Range
• Dishwasher
• Microwave Hood
• Garbage Disposal
• Window Sash
• Fireplace Maintenance or In-kind Replacement (Gas)
• Heating System
• Lighting System (Recessed)
Ineligible Costs include cosmetic enhancements, installations with limited useful life spans
and non-permanent fixtures. Owners may undertake these projects at their discretion,
however they wi1I not be given capital improvements credit. Below is anon-exclusive list of
Ineligible Costs:
• Cosmetic Enhancements, such as:
• Fireplace Tile and Mantel
• Decorative Wall Coverings or Hangings
• Window Treatments (Blinds, Shutters, Curtains, etc.)
• Installed Mirrors
• Shelving
• Refinishing of Existing Surfaces
• Non-Permanent Fixtures, such as:
• Track Lighting
• Door Knobs, Handles and Locks
• Portable Appliances (Refrigerator, Microwave, Stove/Oven, etc.)
• Installations with Limited Useful Life Spans, such as:
• Carpet
42
Revised November 7, 2008
ll I 2~~`1
• Painting of Existing Surfaces /~
• Window Glass
• Light Bulbs
7.4.5 Building Permits
It is the responsibility of the BMR Owner to ascertain (and obtain if necessary) if the work to be
performed requires a City building permit. Any work that is done without the required permit will
automatically be deemed ineligible as a capital improvement expense whether or not it fits within
the definition of an Eligible Capital Improvement or Eligible Replacement and Repair. BMR
Owners may call (925) 833-6620 to inquire about building permits.
8 REQUIREMENTS FOR OWNER'S OF BMR SECONDARY UNITS
A Secondary Unit is a legal secondary dwelling unit on an owner's property that. has been approved
by the City of Dublin as a rental BMR Unit for purposes of compliance with the Inclusionary
Zoning Ordinance and that is reserved for occupancy by, and at rents affordable to, Very-Low,
Low-, and Moderate-Income households. The City Council may approve such units as part of
Developer's proposal for an alternate method of compliance with the Inclusionary Zoning
Regulations.
The owner of a Secondary Unit must sign a Secondary Unit Regulatory Agreement and Declaration
of Restrictive Covenants, which is recorded against the property containing the Secondary Unit and
requires, among other things, that the Secondary Unit be reserved for occupancy by, and at rents
affordable to, Very-Low, Low-, and Moderate-Income households for the length of the restrictions.
The Agreement will remain in effect regardless of any sale, assignment, or transfer of the property,
unless the Agreement is terminated by the City in writing.
8.1 Rental Requirements
If the owner rents the Secondary Unit, the owner shall rent the unit to a Qualified Household and
must follow the procedures set forth in Section 4.11. The rent charged to the Qualified Household
must not exceed one twelfth (1112) of thirty percent (30%) of the applicable Maximum Income,
adjusted for household size, less a utility allowance as specified by the Housing Authority of
Alameda County. Owner shall ensure that all leases and contracts with tenants prohibit subleasing
of the Secondary Unit.
8.2 Reporting Requirements
Prior to a household's initial occupancy of a Secondary Unit, and on every anniversary thereafter,
the owner or its authorized agent shall obtain from each household written documentation verifying
each tenant's eligibility containing all of the following, including additional documentation as City
.may reasonably require:
• Number of people in the household; and
43
Revised November 7, 2008
• Total household income.
Ua ~ a~~
The owner or its authorized agent shall retain this documentation for not less than three (3) years,
and upon City's request, shall make the documentation available for inspection by City and shall
provide copies of the documentation to City. The owner or its authorized agent may require each
household to certify the verifying documentation.
8.3 Annual Report -Inspections
Owner shall submit an annual report to the City in conformity with the requirements of Section
8.68.OSO.B of the Inclusionary Zoning Regulations, together with a certification that the property is
in compliance with the requirements of the Secondary Unit Regulatory Agreement and Declaration
of Restrictive Covenants. The annual report shall, at a minimum, include the following
information: (i) the address of the Secondary Unit; (ii) the monthly rents charged and proposed to
be charged; (v) the number of people residing in the unit; and (vi) the total household income of
residents. Upon City's request, Owner shall include with the annual report, a copy of the verifying
documentation described in Section 8.3, and such additional information as City may, reasonably
request from time to time in order to show compliance with the Secondary Unit Regulatory
Agreement and Declaration of Restrictive Covenants.
Owner shall permit representatives of City to enter and inspect the property during reasonable
business hours in order to monitor compliance with the Secondary Unit Regulatory Agreement and
Declaration of Restrictive Covenants upon 24 hours advance notice of such visit to Owner.
8.4 Management Responsibilities
Owner shall be responsible for all management functions with respect to the Property, including
without limitation the selection of tenants, certification and recertification of household income and
eligibility, evictions, collection of rents and deposits, maintenance, landscaping, routine and
extraordinary repairs, replacement of capital items, and security. Except as City may otherwise
agree in writing, City shall have no responsibility for management or maintenance of the Property.
The contracting of management services to a management entity shall not relieve owner of its
primary responsibility for proper performance of management duties.
44
Revised November 7, 2008
~ ~ 3 ~a~~
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
CITY OF DUBLIN,
100 Civic Plaza
Dublin, California 94568
Attn: City Clerk
To be recorded without fee. (Space Above This Line For Recorder's Use Only)
(Gov. Code, §§ 6103 and 27383.)
ti~~\~
~I~
\~
RESALE RESTRICTION AGREEMENT
AND OPTION TO PURCHASE
Owner:
Property Address:
Dublin, California 94568
Name of Development:
This RESALE RESTRICTION AGREEMENT AND OPTION TO PURCHASE
("Agreement") is entered into by and between the CITY OF DUBLIN, a California municipal
corporation (the "City") and ("Owner")
regarding certain improved real property which is more particularly described in Exhibit A
attached hereto and incorporated herein and commonly known as
,Dublin, CA, (the "Property") effective as of , 20
("Effective Date"). City and Owner are hereinafter collectively referred to as the "Parties."
RECITALS
A. The City has Inclusionary Zoning Regulations (Dublin Municipal Code Chapter
8.68) (the "Regulations") that require developers of rental and ownership housing to
construct within their projects units that are affordable to very low-, low-, and moderate-
income households ("the Program"). To further its goal of creating affordable home
ownership opportunities for very low-, low-, and moderate-income persons and families, the
City has initiated a program for the sale of some homes at a price below their market rate
("Program"). Pursuant to the Program, developers of housing developments agree to set
aside a certain number of units for purchase or rent, as applicable, by very low-, low-, and
moderate-income persons and families, as defined herein.
B. Owner is an eligible (very low-, low- or moderate-]income purchaser under the
Program, intends to live in the Property as an owner occupant, and agrees to maintain the
Property as Owner's principal residence.
~soz~~.z
EXHIBIT
-1- City of Dublin
Housing Division
Form Revised April 18, 2006
I t~ ~~~ ~
C. In order to maintain and preserve the Property as housing affordable to eligible
[very low-, low-, or moderate-]income purchasers, it is necessary to restrict the use and
resale of the Property through imposition of the occupancy and resale restrictions set forth
herein. These restrictions are intended to prevent initial and subsequent purchasers from
using the Property for purposes incompatible with the Program and realizing unwarranted
gains from sales of the Property at unrestricted prices. The terms and conditions of this
Agreement are intended to provide the necessary occupancy and resale restrictions to
ensure that the Property is used, maintained, and preserved as housing affordable to
eligible [very low-, low-, ormoderate-]income purchasers. To further serve the purposes of
the Program, it is necessary that the City be granted an option to purchase the property so
that the property may be resold by the City to an eligible household.
D. The Property constitutes a valuable community resource by providing decent,
safe, and sanitary housing to persons and families of [very low, low, or moderate] income
who otherwise would be unable to afford such housing. To protect and preserve this
resource it is necessary, proper, and in the public interest for the City to administer
occupancy and resale controls consistent with the Program and the Regulations by means
of this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the substantial economic benefits inuring to
Owner and the public purposes to be achieved under the Program, Owner and City hereby
agree as follows:
1. Definitions.
a. "Affordable Unit Cost".shall be as defined in the Regulations, as follows:
"Owner-occupied units are deemed affordable units if the sales price results
in annual housing expenses that do not exceed 35% of income level for very-low-,
low-, and moderate-income households, adjusted for household size and as defined
below. For very low-income owner occupied units, the unit shall be deemed an
affordable unit if the sales price results in annual housing expenses that do not
exceed 35% of the maximum in the very low-income level, adjusted for household
size and as defined below."
b. "Area [Very Low, Low, or Moderate] Income for Alameda County" means
those income and eligibility levels determined, updated, and published each year by the
California Department of Housing and Community Development, based on Alameda County
median income levels, adjusted for household size.
c. "Persons and families of [very low, low, or moderate] income" means
persons and families whose income does not exceed [fifty percent (50%); eighty percent
(80%); or one hundred twenty percent (120%)] of the Area Median Income for Alameda
County, as adjusted for household size.
~so2n.2 -2- City of Dublin
Housing Division
Form Revised April 18, 2006
1i5~~~
d. Persons and families meeting the definition set forth in Paragraph 1.b
above shall be referred to as "Eligible Households."
2. Program Requirements.
a. Affordability Restrictions. Owner hereby covenants and agrees that
during the term of this Agreement all of the requirements and restrictions of this Agreement
shall apply, and the Property shall be sold or otherwise transferred only pursuant to the
terms and conditions of this Agreement and only to (i) Eligible Households at a price not to
exceed the Adjusted Resale Price, as defined in Paragraph 5, (ii) the City pursuant to
Paragraph 3, or (iii) a permitted transferee pursuant to Paragraph 9.
b. Disclosure. DURING THE TERM OF THIS AGREEMENT THERE
SHALL BE NO SALE OR OTHER TRANSFER OF THE PROPERTY WITHOUT THE
WRITTEN CERTIFICATION BY THE CITY THAT THE TRANSFEREE QUALIFIES AS AN
ELIGIBLE HOUSEHOLD AND THAT THE PROPERTY IS BEING TRANSFERRED AT A
PRICE NOT TO EXCEED THE ADJUSTED RESALE PRICE, WHICH IS CAPPED AT THE
AFFORDABLE UNIT COST AS DEFINED IN PARAGRAPH 1.a. ANY SALE OR OTHER
TRANSFER OF THE PROPERTY IN VIOLATION OF THIS COVENANT SHALL BE
VOIDABLE BY THE CITY.
c. Principal Residence Requirement. OWNER COVENANTS AND
AGREES THAT HE/SHE/THEY SHALL OCCUPY THE PROPERTY AS HIS/HER/THEIR
PRINCIPAL RESIDENCE FOR THE DURATION OF HIS/HER/THEIR OWNERSHIP AND
SHALL NOT RENT OR LEASE THE PROPERTY OR PORTION THEREOF DURING THE
TERM OF THIS AGREEMENT WITHOUT PRIOR WRITTEN APPROVAL OF CITY.
Without limiting the generality of the foregoing, any absence from the Property by Owner for
a period of ninety (90) or more days shall be deemed an abandonment of the Property as
the principal residence of Owner in violation of the conditions of this Paragraph. Upon
request by the City made from time to time, the Owner of the Property shall submit an
affidavit to the City certifying that the Property is the Owner's principal residence and
provide such documents and other evidence as may be requested to verify Owner's
compliance with this requirement. Abandonment of the Property shall constitute an Option
Event (as defined in Paragraph 3.c below) and shall entitle the City to exercise its Option to
purchase the Property.
3. Option to Purchase.
a. Grant of Option to Purchase. Owner hereby grants to the City an option
("Option") to purchase all of Owner's right, title and interest in and to the Property upon the
occurrence of an Option Event (defined in Paragraph 3.c below), subject to the terms and
conditions contained herein.
b. Assignment of the Option. The City may assign the Option to another
government entity, anon-profit affordable housing provider or a person or family that
qualifies as an Eligible Household. The City's assignment of the Option shall not extend
any time limits contained herein with respect to the exercise period of the Option or the
period within which the Property must be purchased.
~902~~.2 -3- City of Dublin
Housing Division
Form Revised April 18, 2006
' i,
c. Events Giving Rise to Right to Exercise Option. The City shall have
the right to exercise its Option upon the occurrence of any of the following events (each, an
"Option Event"):
Receipt of a Notice of Intent to Transfer (defined in Paragraph
3.d.i below);
ii. Any actual, attempted or pending sale, conveyance,. transfer,
lease or other attempted disposition of the Property or of any estate or interest therein,
except as provided in Paragraph 10 below;
iii. Any actual, attempted or pending encumbrance of the Property,
including without limitation by way of mortgage or deed of trust, or by judgment, mechanics,
tax or other lien, except as provided in Paragraph 9 below;
iv. Recordation of a notice of default and/or notice of sale pursuant
to California Civil Code section 2924 (or successor provisions) under any deed of trust or
mortgage with a power of sale encumbering the Property;
v. Commencement of a judicial foreclosure proceeding regarding
the Property;
vi. Execution by Owner of any deed in lieu of foreclosure
transferring ownership of the Property;
vii. Commencement of a proceeding or action in bankruptcy,
whether voluntary or involuntary, pursuant to Title 11 of the United States Code or other
bankruptcy statute, or any other insolvency, reorganization, arrangement, assignment for
the benefit of creditors, receivership or trusteeship, concerning the Owner; or
viii. Any violation by Owner of any provision of this Agreement
including, without limitation, the conditions set forth in Paragraph 2 above.
d. Method of Exercising the Option.
i. Notice of Intent to Transfer. If Owner desires to sell, convey,
transfer (other than pursuant to Paragraph 9 below), lease, encumber (other than pursuant
to Paragraph 10 below) or otherwise dispose of the Property or of any estate or interest
therein, no less than 45 days prior to the date of such proposed sale, conveyance, transfer,
lease, encumbrance or disposition, Owner shall notify City in writing to that effect (the
"Notice of Intent to Transfer"). The Notice of Intent to Transfer shall be in substantially the
form attached hereto as Exhibit B. In the case of a proposed sale of the Property to an
identified prospective purchaser, the Owner shall submit to the City, together with the Notice
of Intent to Transfer, a copy of the prospective purchaser's income certification, a list of all
assets owned by the prospective purchaser, and other financial information reasonably
requested by City, in a form approved by the City, along with the income certification to be
provided to any lender making a loan to the prospective purchaser. The City may require
documentation evidencing and supporting the income and other financial information
contained in the certifications.
~so2~~z -4- City of Dublin
Housing Division
Form Revised April 18, 2006
ii~~~~
ii. Notice of Exercise. Upon the occurrence of any Option Event,
the City may exercise its Option by delivering notice, pursuant to Paragraph 17 and within
the time period specified in Paragraph 3.d.iv, to Owner of City's intent to exercise such
Option pursuant to the terms of this Agreement ("Notice of Exercise"). The Notice of
Exercise may be in the form attached hereto and incorporated herein as Exhibit C, or in
such other form as the City may from time to time adopt. If the Option Event relates to the
potential foreclosure of a mortgage under Paragraphs 3.c.iv, 3.c.v, or 3.c.vi, then the City
shall also deliver the Notice of Exercise to the mortgagee or beneficiary under such
mortgage, at such mortgagee's or beneficiary's address of record in the Office of the
Recorder of Alameda County.
iii. Notice of Consent to Transfer. If the City does not exercise
the Option, it may give its consent to the occurrence of the Option Event ("Consent to
Transfer"). If the Option Event involves a proposed sale of the Property to a prospective
purchaser, the City's consent shall be conditioned upon (i) the proposed purchaser's
qualification as an Eligible Household; (ii) the sale of the Property at a price not to exceed
the Adjusted Resale Price; (iii) the proposed purchaser's execution of a Disclosure
Statement in the form attached hereto as Exhibit F or such other form or forms as may be
promulgated by the City; (iv) the proposed purchaser's assumption of Owner's duties and
obligations under this Agreement pursuant to a written assumption agreement in a form
acceptable to City, or execution of an agreement substantially similar to this Agreement,
within thirty (30) days after the Consent to Transfer has been delivered to Owner and
recordation of such assumption agreement or substitute agreement; and (v) the proposed
purchaser's execution of a Performance Deed of Trust in the form attached hereto as
Exhibit G. SELLER SHALL PAY REAL ESTATE COMMISSIONS, IF ANY, WHICH SHALL
NOT TO EXCEED 6% OF THE ACTUAL SALES PRICE. If the prospective purchaser (i)
fails to qualify as an Eligible Household, (ii) fails to execute and deliver the Disclosure
Statement to the City, (iii) fails to execute and deliver to the City an assumption agreement
or an agreement substantially similar to this Agreement within such thirty (30) day period, or
(iv) fails to execute and deliver to the City a Performance Deed of Trust in the form attached
hereto as Exhibit G, then the Consent to Transfer shall expire and the City may, at its
option, either notify Owner of the disqualification, thereby entitling Owner to locate another
purchaser who qualifies as Eligible Household, or exercise the Option, as if no Consent to
Transfer had been delivered.
iv. Time Period for Notice. The City shall deliver a Consent to
Transfer, if applicable, not later than thirty (30) days after the date that it receives
notification of an Option Event. The City shall deliver a Notice of Exercise, if applicable, on
or before the date which is the later to occur of the following: (i) thirty (30) days after the
date that the City receives notification of an Option Event or (ii) fifteen (15) days after a
Consent to Transfer has expired. For purposes of computing commencement of the
delivery periods, the City shall be deemed to have received notification of an Option Event
on the date of delivery of a Notice of Intent to Transfer, pursuant to the terms of Paragraph
17 below or on the date it actually receives notice of default, summons and complaint or
other pleading, or other writing specifically stating that an Option Event has occurred. The
City shall have no obligation to deliver a Notice of Exercise or Consent to Transfer, and the
applicable time period for exercise of the Option shall not commence to run, unless and until
the City has received notification of an Option Event in the manner specified in this
~so2~~.2 -5- City of Dublin
Housing Division
Form Revised April 18, 2006
subparagraph. If there is a stay or injunction imposed by court order precluding the City
from delivering its Consent to Transfer or Notice of Exercise within the applicable time
period, then the running of such period shall cease, until such time as the stay is lifted or the
injunction is dissolved and the City has been given written notice thereof, at which time the
period for delivery of a Consent to Transfer or Notice of Exercise shall again begin to run.
v. Notice of Abandonment: If the City fails to deliver a Notice of
Exercise or Consent to Transfer within the time periods set forth in Paragraph 3.d.iv, upon
request by Owner, the City shall cause to be filed for recordation in the Office of the
Recorder of Alameda County, a notice of abandonment, which shall declare that the
provisions of the Option are no longer applicable to the Property. Unless Owner requests
.recordation of notice of abandonment within 30 days of the City's failure to deliver Notice of
Exercise or Consent to Transfer, the City shall have no obligation to record the notice of
abandonment. Upon recordation of a notice of abandonment, the Option shall terminate
and have no further force and effect. If the City fails to record a notice of abandonment, the
sole remedy of Owner. shall be to obtain a judicial order instructing prompt recordation of
such a notice.
vi. Right to Reinstatement. If the Option Event is the recordation
of a notice of default, then the City shall be deemed to be Owner's successor in interest
under California Civil Code Section 2924(c) (or successor section) solely for purposes of
reinstatement of any mortgage on the Property that has led to the recordation of the notice
of default. As Owner's deemed successor in interest, the City shall be entitled to pay all
amounts of principal, interest, taxes, assessments, homeowners' association fees,
insurance premiums, advances, costs, attorneys' fees and expenses required to cure the
default. If the City exercises the Option, then any and all amounts paid by the City pursuant
to this Paragraph shall be treated as Adjustments to the Base Resale Price for the Property,
as defined in Paragraph 5 below.
vii. Inspection of Property. After receiving a Notice of Intent to
transfer or delivering a Notice of Exercise, the City shall be entitled to inspect the Property
one or more times prior to the close of escrow to determine the amount of any Adjustments
to the Base Resale Price. Before inspecting the Property, the City shall give Owner not less
than forty-eight (48) hours written notice of the date, time and expected duration of the
inspection. The inspection shall be conducted between the hours of 9:00 a.m. and 5:00
p.m., Monday through Friday, excluding court holidays, unless the parties mutually agree in
writing to another date and time. Owner shall make the Property available for inspection on
the date and at the time specified in the City's request for inspection.
viii. Escrow. Promptly after delivering a Notice of Exercise, the
City shall open an escrow account for its purchase of the Property. Close of escrow shall
take place on such date which is the later to occur of the following, (a) sixty (60) days after a
Notice of Exercise has been delivered, or (b) ten (10) days after Owner has performed all
acts and executed all documents required for close of escrow. Prior to the close of escrow,
the City shall deposit into escrow with a title company of City's choosing, the Adjusted
Resale Price as defined in Paragraph 5 below and all escrow fees and closing costs to be
paid by City. Commissions (not to exceed 6% of the actual sales price), closing costs and
title insurance shall be paid pursuant to the custom and practice in the County of Alameda
at the time of the opening of escrow, or as may otherwise be provided by mutual
~so2~~.2 -6- City of Dublin
Housing Division
Form Revised April 18, 2006
~~ ~ ~ ~
agreement. Owner agrees to perform all acts and execute all documents reasonably
necessary to effectuate the close of escrow and transfer of the Property to the City.
ix. Proceeds of Escrow; Removal of Exceptions to Title. Prior
to close of escrow, Owner shall cause the removal of all exceptions to title to the Property
that were recorded after the Effective Date with the exception of (i) taxes for the fiscal year
in which the escrow for this transaction closes, which taxes shall be prorated as between
Owner and City as of the date of close of escrow; (ii) quasi-public utility, public alley, public
street easements, and rights of way of record, and (iii) such other liens, encumbrances,
reservations and restrictions as may be approved in writing by City ("Permitted
Exceptions").
The purchase price deposited into escrow by the City shall be applied first to the
payment of any and all Permitted Encumbrances (as defined in Paragraph 10) recorded
against the Property in order of lien priority, and thereafter to the payment of Owner's share
of escrow fees and closing costs. Any amounts remaining after the purchase price has
been so applied, if any, shall be paid to Owner upon the close of escrow. If the purchase
price is insufficient to satisfy all liens and encumbrances recorded against the Property, the
Owner shall deposit into escrow such additional sums as may be required to remove said
liens and encumbrances. In the event that the City agrees to proceed with close of escrow
prior to the date that Owner has caused all exceptions to title recorded after the Effective
Date other than Permitted Exceptions to be removed, then Owner shall indemnify, defend
and hold City harmless from any and all costs expenses or liabilities (including attorneys'
fees) incurred or suffered by City that relate to such exceptions and their removal as
exceptions to title to the Property.
4. Base Resale Price. Prior to adjustment pursuant to Paragraph 5 the base
resale price ("Base Resale Price") of the. Property shall be the lowest of:
a. Median Income. The original price ("Base Price") paid by Owner for
acquisition of the Property pursuant to the Program, increased (but not decreased) by an
amount, if any, equal to the Base Price multiplied by the percentage increase in the median
household income ("Median Income") for Alameda County published by the California
Department of Housing and Community Development, Division of Housing Policy
Development, between the Effective Date and the date that the City receives notification of
an Option Event; or
b. Fair Market Value. The fair market value of the Property as determined
by an appraiser selected and paid for by Owner and approved in writing by the City.
To compute the Base Resale Price, the City may use the Base Resale Price Worksheet
attached as Exhibit D hereto, or such other form as the City may from time to time adopt.
5. Adjustments to Base Resale Price. Subject to the Affordable Unit Cost
restriction described in subparagraph (d) below, the Base Resale Price shall be increased
or decreased, as applicable, by the following adjustment factors ("Adjustment"):
a. Capital Improvements. An increase for capital improvements made to
the Property, but only if the amount of such improvements has been previously approved in
~9o2n.z -7- City of Dublin
Housing Division
Form Revised April 18, 2006
~n~~~
writing by the City after Owner has submitted original written documentation of the cost to
the City for verification. The amount of the Adjustment shall equal the original cost of any
such capital improvements.
b. Damages. A decrease by the amount necessary to repair damage to the
Property, if any, and to place the Property into saleable condition as reasonably determined
by the City upon City's exercise of its Option hereunder, including, without limitation,
amounts attributed to cleaning; painting; replacing worn carpeting and draperies; making
necessary structural, mechanical, electrical and plumbing repairs; and repairing or replacing
built-in appliances and fixtures. Owner hereby covenants to, at Owner's expense, maintain
the Property in the same condition as in existence on the date of City's Notice of Exercise,
reasonable wear and tear excepted.
c. Advances by the City. A decrease in an amount equal to the sum of all
costs advanced by the City for the payment of mortgages, taxes, assessments, insurance
premiums, homeowner's association fees and/or associated late fees, costs, penalties,
interest, attorneys' fees, pest inspections, resale inspections and other expenses related to
the Property, which Owner has failed to pay or has permitted to become delinquent.
d. Adjusted Resale Price Not to Exceed Affordable Unit Cost. The Base
Resale Price as adjusted, is hereinafter referred to as the "Adjusted Resale Price."
Notwithstanding any other provision hereof to the contrary, in no event shall the Adjusted
Resale Price exceed the Affordable Unit Cost.
6. Priority and Effectiveness of the Option.
a. Recordation. This Agreement shall be recorded in the Office of the
Recorder of the County of Alameda on or as soon as practicable after the Effective Date.
The Option shall have priority over any subsequent sale, conveyance, transfer, lease or
other disposition or encumbrance of the Property, or of any estate or interest therein, and in
the event of exercise of the Option by City, the City shall take the Property subject only to
Permitted Exceptions. Except as otherwise provided in Paragraph 7.a, the exercise of the
Option by the City at any time and from time to time shall not extinguish the Option or cause
a merger of the Option into any estate or other interest in the Property, and the Option shall
continue to exist and be effective with respect to the Property against any and all
subsequent owners in accordance with the terms and conditions hereof.
b. Request for Notice of Default. The City shall file a Request for Notice of
Default for recordation in the Office of the Recorder of the County of Alameda promptly
upon execution of this Agreement (see Exhibit E).
c. Subordination. The City agrees that in order to assist qualified
purchasers to secure purchase money financing for the acquisition of the Property, the City
will enter into a subordination agreement with a senior purchase money lender to
subordinate this Agreement under such terms as the City and the senior purchase money
lender shall negotiate.
7. Survival of Option Upon Transfer.
~so2n.2 -8- City of Dublin
Housing Division
Form Revised April 18, 2006
1- ~~~
~#
a. In General. The City's right to exercise the Option shall survive any
transfer of the Property by Owner. Each transferee, assignee or purchaser of the Property
during- the term hereof shall be required to execute an agreement substantially in the form
of this Agreement, provided that the term of any such agreement shall be for the duration of
the term hereof as of the date of any such transfer, assignment or sale. The Option may be
exercised against the Property throughout the term hereof, regardless of whether the
Property is owned, possessed or occupied by Owner or any successor, transferee,
assignee, heir, executor, or administrator of Owner, regardless of household income (if
applicable) including adebtor-in-possession, debtor or trustee pursuant to Title 11 of the
United States Code. Notwithstanding the foregoing, the Option shall not survive (i) the sale
and transfer of the Property to a third party purchaser pursuant to a judicial or non judicial
foreclosure or a deed-in-lieu of foreclosure under a power of sale contained in a mortgage
or deed of trust held by an institutional lender, or (ii) the recording of an instrument
conveying Owner's interest in the Property to the City, or its assignee, provided the
conveyance is in accordance with the terms of this Agreement.
b. HUD Insured Mortgage. If Owner has acquired the Property by a
mortgage insured by the Secretary of the United States Department of Housing and Urban
Development, and a notice of default has been recorded pursuant to California Civil Code
Section 2924 (or successor provisions), then this Option shall automatically terminate if title
to the Property is transferred by foreclosure or deed-in-lieu of foreclosure, or if the insured
mortgage is assigned to the Secretary.
8. Voidable Transfers. As long as the Option has not been abandoned pursuant
to Paragraph 3.d.v, any actual or attempted sale, conveyance, transfer or other disposition
of the Property, or of any estate or interest therein, in violation of the terms and conditions
of this Agreement, shall be voidable at the election of the City.
9. Permitted Transfers. Provided that the transferee assumes, within 30 days of a
written request by the City, all of Owner's duties and obligations under this Agreement
pursuant to a written assumption agreement in a form acceptable to City, or at City's
election, execution of an agreement substantially similar to this Agreement, the following
transfers ("Permitted Transfers") of title to the Property, or of any estate or interest therein,
shall not be subject to the City's prior approval, shall not trigger the exercise of the Option,
and shall not be considered Option Events: (a) a good-faith transfer by gift, devise or
inheritance to Owner's spouse or issue; (b) a taking of title by a surviving joint tenant; (c) a
court-ordered transfer of title to a spouse as part of a divorce or dissolution proceeding; (d)
a transfer by Owner into an inter vivos trust in which the Owner is a beneficiary and the
Owner continues to occupy the property as his/her primary residence; (e) an acquisition of
title, or of any interest therein, in conjunction with marriage; or (f) any good faith transfer to
an Eligible Household. Notwithstanding any Permitted Transfer, the Option shall remain
effective with respect to the Property for the duration of the term hereof.
10. Permitted Encumbrances. This Option shall not become exercisable as the
result of Owner's encumbering the Property (a) for the purpose of securing financing to
purchase the Property pursuant to the Program, (b) to refinance indebtedness incurred to
purchase the Property pursuant to the Program, provided that prior to refinancing the
~9o2~~z -9- City of Dublin
Housing Division
Form Revised April 18, 2006
C} a~~
Property Owner shall obtain City's approval of the refinancing pursuant to section 11 below,
which shall not be unreasonably withheld, or (c) to make necessary repairs to the Property
in an amount approved by City pursuant to Paragraph 5a ("Permitted Encumbrances"). The
maximum aggregate amount of such encumbrances outstanding at any time (the "Permitted
Encumbrance Amount") shall not exceed an amount equal to one-hundred percent (100%)
of the Base Resale Price calculated as provided in Paragraph 4. The Permitted
Encumbrance Amount shall be calculated as if the City had received notification of an
Option Event on the earlier of (a) the date on which the deed of trust or mortgage securing
the indebtedness is filed for record in the Office of the Recorder of the County of Alameda,
or (b) the date the City receives Notice of Intent to Transfer pursuant to Paragraph 3.d.i
above. Owner hereby covenants and agrees that he/she/they shall use his/her/their best
efforts to ensure that any deed of trust or other agreement encumbering the property shall
include provisions providing for notice to be delivered to City of any default thereunder and
for City's right to cure such default at City's election.
11. Refinancing; Junior Loans.
a. Initial Financing. Any prepayment and refinance of any financing used
to purchase the Property ("the Initial Financing") sha11 not be permitted unless expressly
approved by the City in writing, and the City may approve such refinancing only if all of the
following conditions are met:
i. the refinance reduces Owner's monthly payments of principal
and interest on the Initial Financing or shall be used to finance capital improvements
preapproved by the City ("Eligible Capital Improvements");
ii. the refinance does not cause the principal amount of all debt
secured by the Property to exceed the. then outstanding balance (plus refinancing and
closing costs) of the Initial Improvements plus the cost of any Eligible Capital Improvements
that shall be made by Owner;
iii. the refinance does not result in Owner receiving any cash from
the refinance other than for Eligible Capital Improvements permitted pursuant to Paragraphs
11.a.i and 11.a.ii;
iv. the refinance does not cause the Property's loan to value ratio
(calculated by comparing the total debt secured by the Property to the Adjusted Resale
Price of the Home) to exceed the loan to value ratio for the Property at the time of initial
purchase by the Owner (calculated by comparing the total debt secured by the Property to
the Purchase Price paid by the Owner).
v. the total outstanding balance of principal and any accrued
interest on all loans secured by the Property does not exceed the Adjusted Resale Price,
calculated by the City pursuant to Paragraph 5 of this Agreement.
b. Junior Loans. Mortgage loans or equity lines of credit junior in lien
priority to the Pertormance Deed of Trust are not permitted, except as when expressly
~so2~~.2 -10- City of Dublin
Housing Division
Form Revised April 18, 2006
approved by the City in writing. The City shall only approve junior mortgage loans or equity
lines of credit as follows:
i. the loan or equity line of credit does not does not cause the
Property's loan to value ratio (calculated by comparing the total debt secured by the
Property to the Adjusted Resale Price of the Property) to exceed the loan to value ratio for
the Property at the time of initial purchase by the Owner (calculated by comparing the total
debt secured by the Property to the purchase paid by the Owner);
ii. the proceeds of such loan or equity line of credit are used only
for Eligible Capital Improvements; and
iii. the total outstanding balance of principal and any accrued
interest on all loans secured by the Property does not exceed the Adjusted Resale Price,
calculated by the City pursuant to Paragraph 5 of this Agreement.
c. Eligible Capital Improvements. In the event (i) the Owner refinances
the Initial Financing in accordance with Paragraph 11.a, or (ii) the Owner borrows a junior
loan or takes an equity line of credit in accordance with Paragraph 11.b, and the funds from
such refinance, loan, or line of credit shall be used for Eligible Capital Improvements, Owner
shall provide evidence to City, in a form acceptable to City in its sole and absolute
discretion, that any amount of funds received by Owner for such Eligible Capital
Improvements shall be and are used for the construction of such Eligible Capital
Improvements.
d. Affordable Housing Cost; Subordination. The City and the Owner
agree that the requirements of this Paragraph 11 are necessary to ensure the continued
affordability of the Property to Owner and to minimize the risk of loss of the Property by
Owner through default and foreclosure of mortgage loans. Owner further acknowledges
that violation of the provisions of this Paragraph 11 shall constitute a Default under this
Agreement. In no case shall this Agreement and the Performance Deed of Trust be in
lower than third lien position on the Property. Any subordination agreement to be executed
by City shall include notice and cure rights for City regarding any defaults in the mortgage to
which the City is subordinating.
12. Obligation of Owner After Option Abandonment. If the City records a notice
of abandonment of the Option, then the Property may be sold by Owner to a third party
without restriction as to price; however, upon such sale, Owner shall pay to City an amount
("City's Share") equal to twenty-five percent (25%) of the difference between (a) the actual
sales price net of reasonable and customary real estate commissions paid (such
commissions not to exceed six percent (6%) of the actual sales price), and (b) the Adjusted
Resale Price. The City's Share shall be paid to the City concurrently with close of escrow
on the sale of the Property, or upon receipt by Owner of the sale price for the Property,
whichever shall first occur.
13. Limits on Liability: In no event shall the City become liable or obligated in any
manner to Owner by reason of the assignment of this Agreement or the Option, nor shall
City be in any way liable or obligated to Owner for any failure of the City's assignee to
~so2~~z -11- City of Dublin
Housing Division
Form Revised April 18, 2006
consummate a purchase of the Property or to comply with the terms of this Agreement or
the Option, or any escrow instructions or agreement for the purchase of the Property.
14. Insurance Proceeds and Condemnation Award. In the event the Property is
destroyed and insurance proceeds are distributed to Owner instead of being used to rebuild
the Property, or, in the event of condemnation, if the proceeds thereof are distributed to
Owner, any surplus of proceeds remaining after payment of the senior liens and
encumbrances on the Property shall be distributed as follows: that portion of the surplus up
to, but not to exceed, the net amount Owner would have received pursuant to Paragraph
3.d.ix had the City exercised its Option on the date of the destruction of condemnation
valuation date shall. be distributed to Owner, and the balance of such surplus, if any, shall
be distributed to the City.
15. Effective Date. The rights and obligations of the City and Owner set fiorth in
this Agreement shall be effective as of the Effective Date.
16. Term of Agreement and Option. The restrictions contained herein and the
City's option to purchase the Property shall continue for a period of fifty-five (55) years
commencing on the Effective Date. Notwithstanding anything to the contrary in the
foregoing, the Agreement shall remain in effect until the first transfer on or after the
termination of the restrictions and option to purchase pursuant to this Paragraph. Upon
such sale, Owner shall pay to City an amount ("City's Share") equal to twenty-five percent
(25%) of the difference between (a) the actual sales price net of reasonable and customary
real estate commissions paid (such commissions not to exceed six percent (6°t°) of the
actual sales price), and (b) the Adjusted Resale Price on the date of the termination of the
restrictions and option to purchase pursuant to this Paragraph. The City's Share shall be
paid to the City concurrently with close of escrow on the sale of the Property, or upon
receipt by Owner of the sale price for the Property, whichever shall first occur. Following
completion of a sale in compliance with this provision, this Agreement shall terminate.
17. Notices. Except as otherwise specified in this Agreement, all notices to be sent
pursuant to this Agreement shall be made in writing, and sent to the Parties at their
respective addresses specified below or to such other address as a Party may designate by
written notice delivered to the other Party in accordance with this Section. All such notices
shall be sent by:
a. personal delivery, in which case notice shall be deemed delivered upon
receipt;
b. certified or registered mail, return receipt requested, in which case notice
shall be deemed delivered two (2} business days after deposit, postage prepaid in the
United States mail;
c. nationally recognized overnight courier, in which case notice shall be
deemed delivered one (1) day after deposit with such courier; or
~so2n.2 -12- City of Dublin
Housing Division
Form Revised April 18, 2006
,~s~a~~
d. facsimile transmission, in which case notice shall be deemed delivered on
transmittal, provided that a transmission report is generated reflecting the accurate
transmission thereof.
City: City of Dublin,
100 Civic Plaza
Dublin, California 94568
Attn: City Manager
Owner: At the address of the Property
18. Remedies Upon Breach.
a. Specific Performance. Owner acknowledges that any breach in the
performance of its obligations under this Agreement shall cause irreparable harm to the
City. Owner agrees that the City is entitled to equitable relief in the form of specific
performance upon its exercise of the Option, and that an award of damages shall not be
adequate to compensate the City for Owner's failure to perform according to the terms of
this Agreement.
b. Other Remedies. City shall have all of the remedies provided for at law
or equity.
19. General Provisions.
a. Attorneys' Fees. If either party initiates legal proceedings to interpret or
enforce its rights under this Agreement, the prevailing party in such action shall be entitled
to an award of reasonable attorneys' fees and costs in additions to any other recovery to
which it is entitled under this Agreement.
b. No Joint Venture; No Third-Party Beneficiary. No joint venture or other
partnership exists or is created between the Parties by virtue of this Agreement. Except as
expressly stated herein, this Agreement does not benefit any third party.
c. Successors; Assignment. This Agreement shall inure to the benefit of
and shall be binding upon the Parties to this Agreement and their respective heirs,
executors, administrators, successors and assigns. City shall have the right to assign all of
its rights and obligations under this Agreement without the consent of Owner.
d. Entire Agreement; Amendment. This Agreement constitutes the entire
agreement of the Parties with respect to the subject matter hereof, and supersedes any and
all other prior negotiations, correspondence, understandings and agreements with respect
thereto. There are no representations, promises, agreements or other understandings
between the Parties relating to the subject matter of this Agreement that are not expressed
herein. This Agreement may be modified only by an instrument in writing executed by the
Parties or their respective successors in interest.
~so2~~.2 -13- City of Dublin
Housing Division
Form Revised April 18, 2006
e. Survival; No Merger. All of the terms, provisions, representations,
warranties and covenants of the Parties under this Agreement shall survive the close of
escrow of any sale of the Property and shall not be merged in any deed transferring the
Property.
f. Authority And Execution. Each Party represents and warrants that it
has full power and authority to enter into this Agreement and to undertake all of its
obligations hereunder, that each person executing this Agreement on its behalf is duly and
validly authorized to do so.
g. Severability. The invalidity or unenforceability of any term or provision of
this Agreement sha11 not impair or affect the remainder of this Agreement, and the
remaining terms and provisions hereof shall not be invalidated but shall remain in full force
and effect.
h. Waiver; Modification. No waiver or modification of this Agreement or any
covenant, condition, or limitation herein contained shall be valid unless in writing and duly
executed by the Party to be charged therewith. No evidence or any waiver or modification
shall be offered or received in evidence in any proceeding, arbitration, or litigation between
the Parties arising out of or affecting this Agreement or the rights or obligations of any Party
hereunder, unless such waiver or modification is in writing and duly executed as aforesaid.
The provisions of this section may not be waived except as herein set forth. A waiver or
breach of any covenant, condition or provision of this Agreement shall not be deemed a
waiver of any other covenant, condition or provision hereof.
i. Construction. The section headings and captions used in this Agreement
are for convenience of reference only and shall not modify, define, limit or amplify any of the
terms or provisions hereof. This Agreement shall not be construed as if it had been
prepared by one of the Parties, but rather as if both Parties have prepared it.
j. Governing Law. This Agreement shall in all respects be governed by and
construed in accordance with the laws of the State of California.
k. Time of the Essence. Time is of the essence in this Agreement as to
each provision in which time is an element of performance.
• 1. Further Assurances. Each Party will, upon reasonable request of the
other Party, execute, acknowledge, and deliver, or cause to be executed, acknowledged,
and delivered, such further instruments and documents as may be reasonably necessary in
order to fulfill the intents and purposes of this Agreement.
m. Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original, and all which together shall constitute one and the
same instrument.
[EXECUTION PAGE FOLLOWS]
~sozn.z -14- City of Dublin
Housing Division
Form Revised April 18, 2006
l~~ ~ ~,,~
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
executed as of the date first written above.
OWNER(S):
ATTEST:
Gaylene Burkett, Deputy City Clerk
CITY:
CITY OF DUBLIN
Richard C. Ambrose, City Manager
~so2~~.2 -15- City of Dublin
Housing Division
Form Revised April 18, 2006
lab ~ae1
STATE OF CALIFORNIA )
COUNTY OF )
On before me,
in and for said county and state, personally appeared
a Notary Public
personally known to me (or
proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s)
is/are subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s), or the entity upon behalf of which the
person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature
STATE OF CALIFORNIA )
COUNTY OF )
(Seal)
On before me, , a Notary Public
in and for said county and state, personally appeared
personally known to me (or
proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s)
is/are subscribed to the within instrument and acknowledged to me that he/she/they
executed the same in his/her/their authorized capacity(ies), and that by his/her/their
signature(s) on the instrument the person(s), or the entity upon behalf of which the
person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature
(Seal)
~so2~~.2 Form Revised April 18, 2006
laq~6~
CERTIFICATE OF ACCEPTANCE
(Pursuant to Government Code §27281)
This is to certify that the interest in real property conveyed by the Resale Restriction
Agreement and Option to Purchase dated from
to the City of Dublin, a California municipal corporation, is
hereby accepted by the undersigned office or agent on behalf of the City of Dublin pursuant
to authority conferred by the Resolution No. dated ;and the
grantee consents to recordation thereof by its duly authorized officer.
Dated: BY~
Richard C. Ambrose
Its: City Manager
Attest:
Deputy City Clerk
~so2~~.2 Form Revised April 18, 2006
130 ~. ~~-~
EXHIBIT A
LEGAL DESCRIPTION
~so2~7.2 Form Revised April 18, 2006
13~~ ~,~
EXHIBIT B
FORM: NOTICE OF INTENT TO TRANSFER
VIA CERTIFIED MAIL -RETURN RECEIPT REQUESTED
To: City of Dublin
100 Civic Center
Dublin, California 94568
Attn: City Manager
Date:
Re: Notice of Intent to Transfer
Pursuant to the terms of the Resale Restriction Agreement and Option to Purchase, dated
the undersigned Owner(s),
hereby give(s) notice of his/her/their intent to transfer the property located at
,Dublin, California (the "Property").
Owner may be contacted at the Property or at the following address:
Owner's daytime telephone number is ~)
[If applicable: The proposed transfer of the Property is to the following person(s):
Name:
Address:
Telephone: ( )
The proposed transfer is (check one):
^ Sale
^ Other Specify:
Owner(s) signature(s):
790277.2 Form Revised April 18, 2006
13~ ~ ?~,`l
EXHIBIT C
FORM: NOTICE OF EXERCISE
Date:
To:
Owner or Transferee
Address
Re: Notice of Exercise
The City of Dublin ("City") hereby gives notice that it is exercising its option to
purchase the real property located at ,Dublin,
California. The option has been granted to the City pursuant to the Resale Restriction
Agreement and Option to Purchase between Owner and the City dated
and recorded on as Instrument No. [The
City has assigned its option to purchase the real property to .] An
escrow for the purchase will be opened with the First American Title Company.
City of Dublin
By:
Its:
~so2~~.2 Form Revised April 18, 2006
EXHIBIT D
INCLUSIONARY ZONING BASE RESALE PRICE WORKSHEET
Date:
Owner:
Address:
Purchase Price:
Date of Purchase:
Years Owned: years
133 c~u,~
r~
CALCULATION BASED ON INCREASE IN MEDIAN INCOME*** ~
Present Median Income: $
Family of four, County of Alameda
(at time of sale of unit)
Original Median Income: $
Family of four, County of Alameda
(at time of purchase of unit)
Effective Date:
Effective Date:
Amount of Increase:
Family of four, County of Alameda
(Present median income minus original median
income)
Increase in Price: x x =
Method #1 Resale Price:
Based on the above, the base resale rice as of this date, , is:
By:
~902~~.2 Form Revised April 18, 2006
~~~~~~~
EXHIBIT E
REQUEST FOR NOTICE OF DEFAULT
Order No.
Escrow No.
Loan No.
WHEN RECORDED MAIL TO:
CITY OF DUBLIN
Dublin, California
Attn:
(Space Above This Line For Recorder's Use Only)
REQUEST FOR NOTICE UNDER SECTION 2924b CIVIL CODE
In accordance with Section 2924b, Civil Code, request is hereby made that a copy of any Notice
of Default and a copy of any Notice of Sale under the Deed of Trust recorded as Instrument No.
on , in the Official Records of Alameda County,
California, and describing land therein as:
executed by
Dublin, California ,Attn:
as Trustor, in which
is named as Beneficiary, and
as Trustee, be mailed to the City of Dublin,
By:
NOTICE: A COPY OF ANY NOTICE OF DEFAULT AND OF ANY NOTICE OF SALE WILL BE SENT
ONLY TO THE ADDRESS CONTAINED IN THIS RECORDED REQUEST. IF YOUR ADDRESS
CHANGES, A NEW REQUEST MUST BE RECORED.
STATE OF CALIFORNIA
COUNTY OF
On before me,
said county and state, personally appeared
a Notary Public in and for
personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that
by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal.
Signature
(Seal}
~902~~.2 Form Revised April 18, 2006
,7
~~ ~
EXHIBIT F
DISCLOSURE STATEMENT
THERE ARE RESTRICTIONS ON THE SALE OF THE
PROPERTY YOU ARE BUYING. EXCEPT FOR A TRANSFER
TO THE CITY FOLLOWING CITY'S EXERCISE OF ITS OPTION
TO PURCHASE, THIS PROPERTY MAY ONLY BE SOLD TO AN
"ELIGIBLE HOUSEHOLD" AT A PRICE NOT TO EXCEED THE
ADJUSTED RESALE PRICE WHICH IS CAPPED AT AN
"AFFORDABLE UNIT COST."
THIS MEANS THAT YOU MAY NOT SELL THE PROPERTY FOR MARKET VALUE TO
WHOMEVER YOU LIKE.
THESE RESTRICTIONS WILL BE IN EFFECT UNTIL
ANY SALE OF THE PROPERTY IN VIOLATION OF THE RESTRICTIONS, SHALL BE
VOIDABLE AT THE ELECTION OF THE CITY.
TO DETERMINE WHO AN ELIGIBLE HOUSEHOLD IS, AND WHAT THE ADJUSTED
RESALE PRICE AND AFFORDABLE HOUSING COST ARE, YOU SHOULD CONTACT
THE OF THE CITY OF DUBLIN.
YOU SHOULD READ THE RESALE RESTRICTION AGREEMENT AND OPTION TO
PURCHASE RECORDED AGAINST THE PROPERTY. YOU MAY OBTAIN A COPY
FROM THE CITY OF DUBLIN OR FROM THE ESCROW COMPANY.
YOU SHOULD ALSO BE AWARE THAT A PERFORMANCE DEED OF TRUST WILL BE
RECORDED AGAINST THE PROPERTY TO ENSURE COMPLIANCE WITH THE
RESALE RESTRICTION AGREEMENT AND OPTION TO PURCHASE. YOU MAY
OBTAIN A COPY FROM THE CITY OF DUBLIN OR FROM THE ESCROW COMPANY.
I HAVE READ THE FOREGOING AND I UNDERSTAND WHAT IT MEANS.
BUYER
BUYER
~9o2n.2 Form Revised April 18, 2006
t % ~~
i?
'1
EXHIBIT G
FORM: PERFORMANCE DEED OF TRUST
7so2~~.2 Form Revised April 18, 2006