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1 SANTA CRUZ COUNTY BOARD OF SUPERVISORS INDEX SHEET Creation Date: Source Code: Agenda Date: I NVENUM: Resolution(s):. Ordinance(s): Contract(s): 4/28/10 PLANN 5/4/ Continue Date(s): Index: --Letter of the Planning Department dated April 18, Resolution Temporarily Amending Section 2 of the Affordable Housing Guidelines --Exhibit A: Affordable Housing Guidelines Item: 37. ADOPTED RESOLUTION NO temporarily modifying the minimum bedroom size requirement for Measure J units, and approved related actions, as recommended by the Planning Director

2 COUNTY OF SANTA CRUZ PLANNING DEPARTMENT 701 OCEAN STREET, 4TH FLOOR, SANTA CRUZ, CA (831) FAX: (831) Too: (831) KATHLEEN MOLLOY PREVISICH, PLANNING DIRECTOR 0169 April 18, 2010 Board of Supervisors County of Santa Cruz 701 Ocean Street Santa Cruz, CA APPROVED AN FILED BOAR, OF SUrERVISORS D.UE: y)~ 'fi ejo/o coc"tviia"ta CRUZ SlS.~~ A MAURELLO EX-OFF 0 CLE, ft BY AGENDA: May 4th, 2010 SUBJECT: Temporary modification to the Affordable Housing Guidelines to faciltate the sale of Measure J units Members of the Board: As you now, the County of Santa Cruz Planning Department administers a variety of housing programs and from time to time makes recommendations to your Board to improve program operations. The purpose of this letter is to recommend a temporary modification to the Measure J Program's Affordable Housing Guidelines' minimum bedroom size requirement to address current market conditions. Background As you know, the County of Santa Cruz Planning Department administers the 1978 voter approved Measure J Program. This program requires affordable housing to be incorporated into new development projects and today there are more than 500 price restricted homes located throughout the unincorporated County. These units are limited to low and moderate-income eligible purchasers and the Program requires current owners to sell or transfer their home to familieslindividuals who meet all criteria of the Program. In addition to the Program's income restrictions, eligible purchasers must meet additional criteria prior to taking ownership of an affordable unit. Currently, the Program has a first time homebuyer, County live or work and a minimum household size requirement, where the household size must be equal to the number of bedrooms in the unit. For example, a three-bedroom unit can only be purchased by a household comprised of three or more members. In today's real estate lending market, purchasers are expected to have a downpayment of 10% of the purchase price, high credit scores and substantial assets in order to qualify for a mortgage, in addition to meeting the Measure J eligibility requirements. As a result, Measure J homeowners are having difficulty selling their home. In reviewing possible options to expand the pool of eligible buyers, staff believes the program's first time homebuyer and county live or work requirement reflect a long-standing Board priority and 37,,

3 Board of Supervisors Agenda: Measure J minimum bedroom size requirement, May 4th, 2010 Page 2 of should not be altered. At this time, the minimum household size requirement is the only requirement that staff recommends be modified to expand the pool of eligible buyers. While staff agrees with the overall goal that household size should correlate to bedroom size to maximize the number of people served by the program, in light of current market conditions, staff is recommending your Board adopt the attached resolution to temporarily adjust this requirement to one less person than the number of bedrooms. This would allow for a two bedroom home to be purchased by a single homeowner, a three bedroom home to be purchased by a two-person household, and a four bedroom to be purchased by a three-person household. This provision would sunset in two years, unless a further extension is approved by your Board. The Housing Advisory Commission discussed this matter at their April meeting and the Commissioners unanimously supported this recommendation. It is therefore RECOMMENDED that your Board adopt the attached resolution (Attachment 1) modifying the Measure J Affordable Housing Guidelines as outlined in this letter. Sincerely, ~N A. MAURIELLO County Administrative Officer KMP:ES:PH Attachment 1: Resolution CC: Housing Advisory Commission 37 ~

4 ATTACHMENT BEFORE THE BOAR OF SUPERVISORS OF THE COUNTY OF SANTA CRUZ, STATE OF CALIFORNIA RESOLUTION NO On the motion of Supervisor Pirie duly seconded by Supervisor Leopold the following resolution is adopted: RESOLUTION TEMPORARILY AMENDING SECTION 2 OF THE AFFORDABLE HOUSING GUIDELINES WHEREAS, Chapter 17.10, Affordable Housing Requirements, of the Santa Cruz County Code requires that affordable housing program criteria be established by resolution of the Board of Supervisors; and WHEREAS, the Affordable Housing Guidelines were adopted pursuant to County Code Chapter and requires buyers to meet first time homebuyer, County live or work and minimum bedroom size requirements; and WHEREAS, current owners of homes due to the requirements of Measure J units are having diffculty selling their the program and the current real estate market; and WHEREAS, a mior modification to The Affordable Housing Guidelines minimum bedroom size requirement for Measure J purchasers would increase the pool of eligible buyers; and WHEREAS, temporarly modifying the Affordable Housing Guidelines current minimum bedroom size requirement to one less person than the number of bedrooms will increase the pool of eligible buyers. NOW, THEREFORE, BE IT RESOLVED AND ORDERED that the temporary requirement be added to Section 2, Eligibility Requirements, as illustrated in Exhibit A..~'.'.. e!. ~ '..'..'?.. ~:.

5 0172 PASSED AND ADOPTED by the Board of Supervisors of the County of Santa Cruz, State of Californa, this 4th day of May, 2010 by the following vote: AYES: NOES: ABSTAIN: SUPERVISORS SUPERVISORS SUPERVISORS Leopold, Pirie, Coonerty, Stone and Campos None None TONVCAMPS Chairperson of the Board of Supervisors ATTEST: ~ALD Clerk of the Board (1 ~ APPROVED AS TO FORM: STATE DISTRIBUTION: County Counsel Planng Deparent - Housing Of CALIFORNIA ) COUNty OF SANTA CRUZ ) ss i. SUSAN A. MAURIEL.lO. County Adn nistrative Officer and ele.ohlcio Clerk of the Board of Super- 'iisms ot the County of Santa Cruz, State of California do hereby certify that the foregoing is il true and correct copy of the resolution pased ilnd adopted by and entered in the minutes of tl said board. In witness hereof I have hereuto set my h and ah ed the seal of th said Boad on i 20 11J County ~)" ~J 6

6 EXHIBIT A 0173 Santa Cruz County Affordable Housing Guidelines ELIGIBILITY REQUIREMENTS Residency In order to be eligible to purchase or rent any Measure J affordable unit, at least one Principal Occupant must currently reside within Santa Cruz County (including its incorporated cities); or at least one Principal Occupant must be employed within Santa Cruz County (local employment must be their primary employment and source of income). Principal Occupants for affordable units must provide the Administering Agency with documentation that they have resided and/or been employed within Santa Cruz County for at least 60 days prior to their application to purchase or rent an affordable unit. Minimum Household Size In order to be eligible to purchase or rent a Measure J affordable unit, the Household must be of a size equal to the number of bedrooms in the unit. For instance, in order to be eligible to purchase a three-bedroom unit, a Household must be made up of at least three members. Please see Table One for further clarification. Households must provide the Agency Administering Agency with documentation to verify the Household size claimed. Table One: Minimum Household Size Unit Size Current Minimum Household Size StudiolOne Bedroom 1 2 Bedrooms 2 3 Bedrooms 3 4 Bedrooms 4 5 Bedrooms 5 Applications by smaller-sized Households for larger units wil only be considered by the Administering Agency based on documentation by the Principal Occupant that there are unique and compelling individual circumstances that justify a greater number of bedrooms than the number of persons in the Household. Temporarv Adjustment in Minimum Household Size Requirement For a period of two years, beginning on June 5th, 2010 and ending on June 5th, 2012, the minimum household size requirement has been adjusted to one less person than the number of bedrooms to assist with affordable housing fl. -~:f... ~, transactions during a diffcult real estate and lending market. e.