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of the total number of units rather than 15%. Because it is less than 15% of the total units, it requires Council action to waive the fees. He believed the fee waiver was justified because if this project is compared to a number of others that have previously approved, this is as good a program as any that have been presented. The prices are as low as any offered, the size of the units are as large if not larger than others offered, and he felt it was a very good package overall. He said there have already been calls from interested parties. The PUD on this project was reduced significantly in size. Tree there are 31 market units, but those are now on smaller lots in order to provide the five affordable units. Ms. Ayala asked how large the market units are. Mr. Champion said they are from 2,500 to 4,000 square feet and will sell from $700,000. Ms. Michelotti asked what the affordable units would sell at market rate. Mr. Champion said they had not offered any at that size, but believed they could sell at $360,000. He said it was tree the construction cost was $70 per square foot, but the company still has to pay about $55,000 in fees, which are quite high. He stated this is a $90,000 home to build. The lots must be improved and off-site costs have to be included as well, which means an additional $70,000 is added per lot. Then there are indirect costs for design, engineering, property taxes, financing, insurance, etc. He assured Council his company is losing money on these five lots contrary to the previous statement that the company was making a profit. He added that with regard to the homeowners association dues, if the affordable unit fees are reduced to half, the market rate units will pay about $7-8 more per month. The fee was calculated to be $96 for all units and if the affordable units pay $51, then the market rate units would pay about $103. That is not a huge difference. It was moved by Mr. Pico, seconded by Ms. Ayala, to deny the waiver of $89,528 in lower income housing fees and that those fees be combined with an allocation of $160,472 from the affordable housing fund for a total of $250,000 which would be used for silent second mortgages or other financing mechanism to lower the price of the affordable units to $130,000 each, and that the homeowners dues in the affordable units not be reduced. Mr. Pico believed the price of the houses could be lowered to $130,000 and there is affordability in this entire project since its approval. If the property values of this project have escalated at the same rate as other homes in Pleasanton, then there has been a significant increase in profit to the developer. He did not think this was a major burden on the developer. He agreed with Mayor Tarver that the price of these homes needed to be as low as possible. He encouraged other developers to work with the City to find creative means to provide affordable housing units. Pleasanton City Council 17 Minutes 04/18/00