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CITY COUNCIL AGENDA ITEM NO. 10

Meeting Date: March 14, 2006

Subject/Title: Approve a Resolution approving an Affordable Housing Agreement between the City of Brentwood and Meritage Homes of Northern California, Inc. for Subdivision 8875 – Sterling Preserve III

Prepared by: Kwame P. Reed, Senior Housing Analyst

Submitted by: Howard Sword, Community Development Director

RECOMMENDATION
Approve a Resolution approving an Affordable Housing Agreement between the City of Brentwood and Meritage Homes of Northern California, Inc. for Subdivision 8875 – Sterling Preserve III.

PREVIOUS ACTION
Ordinance 790 was adopted by the City Council on January 11, 2005 amending the City of Brentwood Affordable Housing Program. At its meeting of April 7, 2005, the Housing Subcommittee recommended approval of the Affordable Housing Agreement with Meritage Homes of Northern California, Inc. for Subdivision 8875 – Sterling Preserve III.

BACKGROUND
Subdivision 8875 was approved (Rezone, Tentative Map and Design Review) by the Planning Commission on April 5, 2005. The Housing Division staff has negotiated an agreement with the Developer to pay the associated in-lieu fees for the 4-unit obligation. The negotiated agreement was based on the “phase-in” portion of Ordinance 790 allowing developers of subdivisions with average lot sizes of over 8500 square feet to “fee out” of both their very-low income unit obligation and their low income unit obligation if the project had an approved RGMP allocation prior to the adoption of Ordinance 790.

The Housing Subcommittee is recommending the included agreement to City Council for approval. With the average lot size over 9,000 square feet, the developer has agreed to pay the following in lieu fees upon approval of this agreement to meet their affordable housing obligation.

• 84 units x 10% = 8.4 units or 8.4 units X 50% = 4.2 units, say 4 units

The in-lieu fee shall be calculated as follows:

• Very low –pay in-lieu fee for 1 units (1 x $238,995) $238,995
• Low – pay in-lieu fee for 3 units (3 x $178,992) $536,976
• Total In-Lieu Fees = $775,971

Please note: The above fee is an estimate. The actual fee in effect at the time of building permit will be calculated.

FISCAL IMPACT
As prescribed by Ordinance 790, all in-lieu fees collected are deposited into the Housing Trust Fund. Twenty percent of those fees are used to pay for the administrative expenses of the Housing Division.

Attachments
Resolution
Affordable Housing Agreement

RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BRENTWOOD APPROVING AND AUTHORIZING THE CITY MANAGER TO SIGN, AN AFFORDABLE HOUSING AGREEMENT BETWEEN THE CITY OF BRENTWOOD AND MERITAGE HOMES OF NORTHERN CALIFORNIA, INC. FOR SUBDIVISION 8875

WHEREAS, on January 11, 2005, the City Council adopted Ordinance 790, an Ordinance of the City Council of the City of Brentwood approving an amendment to the Municipal Code adding Chapter 17.725 that establishes an Affordable Housing Program; and

WHEREAS, Meritage Homes of Northern California, Inc. had a Condition of Approval to their project to comply with the City of Brentwood Affordable Housing Program; and

WHEREAS, the Developer has agreed to pay in lieu fees in effect at the time of building permit based on the following formula:
One (1) Unit x Very-Low Unit In-Lieu Fee
Three (3) Units x Low Unit In-Lieu Fee

NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Brentwood does hereby approve and authorize the City Manager to sign, an Affordable Housing Agreement with Meritage Homes of Northern California, Inc. for Subdivision 8875 and such other documents as may be needed to complete the transaction.

PASSED, APPROVED AND ADOPTED by the City Council of the City of Brentwood at a regular meeting held on the 14th day of March 2006 by the following vote
 

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