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Mr. Dolan stated that staff received a total of 9 emails supporting the project as well as 1 phone call and several emails expressing concerns. Staff has also provided the Council with a copy of an email from East Bay Regional Parks District. He introduced the 3 agreements associated with the application, noting that the terms of the proposed Development Agreement represent a real give and take on the part of both the city and the applicant. He highlighted several key features of the agreement, which include a vested entitlement for 10 years, the city's ability to use the project's in lieu park dedication fees towards improving city parks including Bernal Community Park, and a requirement that the applicant come forward with payment of school impact fees in accordance with an agreement between the applicant and Pleasanton Unified School District. Assistant City Manager Bocian presented an overview of the Affordable Housing Agreement (AHA), explaining that any development in excess of 15 units per acre is subject to the city's Inclusionary Zoning Ordinance and required to make 15% of total units affordable to low and very low income households. The IZO requires a total of 52 affordable units for the proposed project. At its workshop with the Housing Commission, the Council also directed staff to be flexible and creative in terms of trying to reach an agreement that honors the spirit of the IZO and meets the developer's needs in the context of the current legal environment. Staff created a unit mix that meets the total unit requirement, 10 of which would be made available to very low income, 17 to low income and 25 to median income households. While this mix offers roughly half of the affordable units to median income households, the Council may recall that it is essentially identical to what was approved for the California Center project. The proposed AHA is consistent with the city's standard format and also addresses several concerns raised by the Council relative to the St. Anton project. The agreement therefore includes specific requirements relative to some of the improvements to those units that are made accessible to the physically disabled. The agreement requires that accessible units remain on the market for a period of 21 days, where in the past the requirement was 10 days, before being made available to market rate tenants. The agreement also contains specific language requiring that the property manager make attempts to relocate non-disabled tenants residing in accessible units should the need to accommodate a physically disabled tenant arise. As with other agreements, the proposed AHA requires acceptance of Section 8 vouchers for eligible qualified applicants, is recorded with the land, is subject to the city's preference system and links rents to household size. This particular agreement also includes an option, to be exercised at the City's discretion, for the applicant to pay a $4.5 million fee in lieu of providing any rent restricted units within the development. He noted that if the Lower Income Housing Fee were to be amended between now and occupancy of the project and if it were to result in a fee greater than this, this proposed fee prevails. Current fees for multifamily development would yield a fee of approximately $1 million, $3.4 million less than staff was able to negotiate with the applicant. As indicated in the AHA, the City must indicate its preference within 45 days from the time the developer notifies the city of its intent to begin construction or within 1 year of the effective date of the agreement. Staff's intent is to report back to the Council sometime after the effective date of the agreement with its recommendation and for the Council to discuss appropriation of the funding if the fee option is selected. While lower income housing in lieu fees have historically been placed in the city's Lower Income Housing Fund, staff feels that the portion in excess of the standard fee may be used for something other than is specifically identified in the fee ordinance. Staff is also interested to see what occurs with another high density development currently working its way through the process before making a recommendation on what would yield the greatest overall level of affordability. Mr. Bocian provided a slide demonstrating the project's compliance with the IZO. He noted that it fails to meet requirements regarding depth of affordability and unit mix. He explained that while the IZO considers 3 bed units to accommodate a household of 4, staff has historically associated 3 bed units City Council Minutes Page 3 of 10 August 6, 2013