20.30.050 Alternatives to providing on-site units.
As an alternative to developing required inclusionary units within an affected residential or mixed-use project in compliance with CMC 20.30.040 (Inclusionary unit requirements), the requirements of this chapter may be satisfied through one or more of the following alternatives, in compliance with this chapter and this title:
A. Off-Site Units. Inclusionary units required by CMC 20.30.040 (Inclusionary unit requirements), may be provided off site, pursuant to CMC 20.30.040 (Inclusionary unit requirements), if the inclusionary units are owned in whole or part, and operated, by a nonprofit housing provider for the life of the project.
The following requirements must be met to satisfy the off-site option of this chapter:
1. The developer shall identify an alternate site suitable for residential housing, which the developer either owns or has site control over (i.e., purchase agreement, option to purchase, lease) subject to city review to ensure that the proposed development is consistent with the city’s housing objectives and projects.
2. The off-site units shall be located within a one-quarter mile radius of the market-rate units.
3. The off-site units shall satisfy the requirements of CMC 20.30.040(C), (D) and (E) (Inclusionary unit requirements – Project Completeness, Units for Sale, and Rental Units).
4. The off-site units shall not count towards satisfaction of any affordable or inclusionary housing obligation, that development of the alternative site with market-rate units would otherwise be subject to, pursuant to this chapter.
Exceptions to the location of the off-site units specified in this section may be granted by the city council on a case-by-case basis.
B. Land Donation. A developer of a residential or mixed-use project may satisfy the inclusionary housing requirement by dedicating land in lieu of constructing restricted affordable units within the residential or mixed-use project if the city council determines that all of the following criteria have been met:
1. The dedicated site is transferred to the city prior to commencement of construction of the residential or mixed-use project or is subject to an agreement between the developer and the city that sets forth a date certain for transfer of the dedicated site and such agreement is in the best interests of the city; and
2. The value of the dedicated site at the date of dedication or the date such agreement to dedicate is executed, as applicable, is greater than the in-lieu fee in effect at the date of dedication or the date such agreement to dedicate is executed, as applicable, multiplied by the number of otherwise required affordable units within the residential or mixed-use project; and
3. The dedicated site could accommodate at least the number of otherwise required affordable units within the residential or mixed-use project. Notwithstanding the above, the city shall not be required to construct restricted affordable units on the dedicated site, but may sell, transfer, lease or otherwise dispose of the dedicated site as necessary in furtherance of its inclusionary affordable housing goals.
C. Purchasing Affordable Housing Covenants. A developer may purchase affordable housing covenants for units in an existing residential or mixed-use project within the city. All such units shall be:
1. Reasonably dispersed throughout the residential or mixed-use project; and
2. Located in an area or areas of the city, as approved by the city manager, or designee; and
3. Proportional in the number of bedrooms and location to the market rate units included in the developer’s residential or mixed-use project; and
4. Comparable to the market rate units included in the residential or mixed-use project in terms of design, materials, finished quality, and appearance.
D. Substantially Rehabilitating Existing Housing. A developer may purchase and substantially rehabilitate existing market rate units for conversion to affordable units. “Substantially rehabilitating” means:
1. Rehabilitating a dwelling unit that has substantial building and/or other code violations; and
2. Has been vacant for at least 90 days; and
3. The unit is returned to the city’s housing supply as decent, safe, and sanitary housing; and
4. The cost of the rehabilitation work exceeds 25 percent of the market value of the unit after rehabilitation.
E. In-Lieu Fee. The developer may choose to pay a fee in lieu of providing all or some of the inclusionary units as follows:
1. Amount of Fee. The amount of the fee shall be as required by the city council’s fee resolution.
2. Timing of Payment. One-half of the in-lieu fee shall be paid (or a letter of credit posted) before issuance of a building permit for any part of the residential or mixed-use project. The remainder of the fee shall be paid before a certificate of occupancy is issued for any unit in the project.
3. Housing Trust Fund. Fees collected in compliance with this section shall be deposited in the affordable housing trust fund. (Ord. 720 § 9 (Att. 2), 2022).