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Item 6b Recmest bv Ponderosa Homes for Incluslonarv Unit Credits. (SR 04:260) Mr. Bocian presented the staff report. Ms. Ayala said that at the time this matter was brought before Council, Council was told that there was no monetary value to the inclusionary unit credits. She noted that the neighborhood was promised certain things when this development occurred. The way Council was able to satisfy the neighborhood was to ensure that the 24-acres was going to remain idle for eight years until the School District decided whether it had the need to build a school. If the School District did not pursue this option, then Ponderosa Homes could proceed with building single-family senior housing. She asked if it is a possibility that the option on the 24-acres will not exist for the entire eight years? Mr. Bocian said that this option was not included in staff's recommendation. The eight-year option would be an action that the School District would take and not related to any City action. Mayor Pico invited public comments. Mark Sweeney, representing Ponderosa Homes, believed that the City's Inclusionary Zoning ordinance ensures the community that it will receive the benefit of additional affordable housing in the near term in return for the possibility that a developer could recover some of its investment in the long term. He noted that seniors would be occupying the Gardens project at Ironwood in the next few months at affordable rental rates. If Council agrees with staff's recommendation, Ponderosa Homes may be in a position over the next nine years to recover some of its investment in that affordable housing. Ponderosa Homes provides affordable housing now in return for the possibility of getting credit for that housing in the future. Ponderosa Homes is asking Council to consider adopting staff's recommendation as it pertains to the 23-acre Pieasanton Unified School District site. Ponderosa Homes agrees that it is the only entity that could utilize these credits and they could not be transferred. The credits have a term of five years from the date that the Pleasanton Unified School District closes escrow or terminates its option. Ponderosa Homes also requests that Council approve the ratios as outlined in the staff report that dictates how the credits are used on the site depending on the type of housing that might be developed. Ponderosa Homes is also asking Council to adopt Alternative Number Three as outlined in the staff report. This alternative would allow Ponderosa Homes to come before a future City Council and ask them to consider allowing Ponderosa Homes credits on sites elsewhere in Pleasanton. He pointed out that the Housing and Planning Commissions both supported this idea. From Ponderosa Homes' point of view, this is a critical component of the City's ordinance, and it feels strongly that the City will be sending a message to developers that it is serious about working with them to provide additional affordable housing on a particular site, while potentially giving them the option to use credits on another site that may not be as appropriate for affordable housing. Alternative Three is consistent with the City's existing Inclusionary Zoning ordinance. Ponderosa Homes agrees with staff's recommendation to make an adjustment to the period that the credits could be used if Alternative Three is adopted. Ponderosa Homes agrees with the idea that a future Council would have complete discretion over whether to allow the credits to be used on another site. Ponderosa Homes also agrees with staff's recommendation that it maintain Pleasanton City Council 5 11/02/04 Minutes