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There was discussion about the second mortgage program, specifically who can get a second and when it must be repaid. Ms. McKeehan related the City's experience with turnover of these units and the factors that influence whether a family keeps the unit or decides to sell it. Ms. Ayala agreed these units am good for starter homes, but she was concerned that them appears to be a widening gap between the subsidized housing at one end and the large, expensive housing at the other end. There seems to be a large gap in the middle. Ms. McKeehan pointed out that at the beginning of the affordable housing program, there was a lot of interest in moderate priced housing and Council decided to focus more on the very low income. Things just seem to go in cycles and staff will do whatever Council decides. Mr. Brozosky was concerned about how long a person can stay in the for sale units and only having to qualify once. He asked if there were a way to have a second mortgage with no interest for five or ten years and then a balloon payment. At that point, if the owner still qualifies, then the mortgage would be renewed or the owner would be required to sell. Mr. Bocian said it would be necessary to discuss that with the lenders. He noted that the people who qualify for these affordable units generally do not greatly increase their incomes in the future. Typically, the largest group of buyers are single mothers with careers that provide moderate incomes. He continued the staff presentation regarding the inclusionary zoning ordinance. He noted the entire affordable housing program changes over time to meet the needs that arise. Ms. Ayala noted the inclusionary zoning ordinance could be changed by a future Council. Mayor Pico did not feel this Council can judge or try to control what will happen ten or fifteen years fi.om now. He did not believe this was "social engineering"; he felt Council was trying to be compassionate and trying to meet the housing goals for the City. Mr. Bocian continued with his report. Ms. Ayala pointed out that the turnover of these homes is limited. Ms. Hosterman believed that someone who purchased a home at $199,000 ten years ago with hopes to later purchase a market rate home would have little chance of doing so. However, there is still a need for that type of housing. She acknowledged that a portion of the City's housing stock should be of that kind. She agreed with Ms. Ayala that there needs to be more discussion of how to get more people into homes in Pleasanton. Mr. Bocian continued his report. Ms. Hosterman wanted to clarify the terms of the inclusionary zoning ordinance, since Council has not had the opportunity to apply it to a new project. She wanted to make certain the latitude described in the staff report was available. Pleasanton City Council 13 05/20/03 Minutes