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Ms. Stern said what counts towards the regional housing needs are the affordability categories provided by the state. Moderate-income rental units can be provided by the market without subsidization. Low and very low-income units would have to have subsidies. Ms. McGovern asked if the low-income housing must be subsidized, where does the city get the money for it? Ms. Stern said some funds come from the low-income housing fees. Ms. McGovern asked if those funds are used for silent second mortgages to help families get into homes, does that count as affordable housing? Ms. Stern said it did if it makes housing affordable for the families. Ms. McGovern asked if there were ways for the community to meet affordable housing goals without building new units? Ms. Stern said there were ways to make new units affordable. Ms. McGovern said her point was when talking about land use that we stop thinking only about building affordable units, but rather to look at other ways of addressing affordability like the silent second loans. We should ask how many of those we could provide a year to help people get into our community. Mayor Hosterman asked if she was asking for an opportunity or way to add to those affordable housing numbers without actually building additional affordable housing? Ms. McGovern said that was correct. She wanted to use the current housing units better by helping people to get into them by using the low-income fees to subsidize. That money would be returnable to the city for reuse for other people. Mayor Hosterman felt that the Staples Ranch project was a new community for those who are aging in the community. It is a wonderful opportunity for the city. The numbers are interesting because in trying to compare them to other assisted living projects in Pleasanton, it is clear this is a really different project. It is a commercial venture and she was not sure it was appropriate to count beds towards the housing cap. She felt it made sense to add convalescent beds towards meeting the regional housing needs. The theory is if you take an individual who was living in a home in the community and that person graduates to a convalescent hospital situation, then that home is open for another individual to occupy. The Staples project is a different situation. The funding is different and the licensing structure is different. Based on the lifetime continuing care facility, it is a different commercial project. She could see the argument that if there are 65 individual units that act and look like housing units, then Joint Workshop City Council/Planning Commission 18 11/29/05