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Page 8 of 12 issues that could limit development potential in East Pleasanton. The Draft EIR prepared for the Arroyo Lago project found that the project site is suitable for the proposed development from a geotechnical standpoint, provided that various measures and recommendations would be implemented. The EIR for the East Lakes project will be required to separately analyze potential geotechnical impacts from proposed development and identify mitigation measures as needed to reduce these impacts. Similarly, Phase 1 hazardous materials reports and any relevant findings related to other regulatory agencies’ designation or monitoring of the site would be further elaborated and subject to City review, to ensure the site is developable and does not pose unacceptable adverse health risks. Inclusionary Units The City of Pleasanton Inclusionary Zoning Ordinance (IZO) in Municipal Code Chapter 17.44 establishes affordable housing requirements for new residential development in Pleasanton. Under the IZO, as amended in December 2024, residential development projects with 10 or more units must provide at least 15 percent of the project’s units as affordable to lower-income households (inclusionary units). IZO provisions most relevant to the East Lakes projects include: • Clustering Inclusionary Units: The IZO generally requires inclusionary units to be dispersed throughout the project, with some provisions to allow for limited clustering of those units (e.g., by attaching smaller duplex or apartment units). Clustering units into a single area of the site is permitted in conjunction with a tax-credit financed project; other unit types may be grouped into smaller clusters that are themselves distributed in the project. The City Council may also allow further clustering as part of an Alternative Compliance request/approval. It is noted that, on a practical level, an apartment project will have minimum size (typically between 70-120 units) in order to be competitive for tax-credit financing and feasible to construct. • Tenure and Affordability: Generally, apartment units are expected to provide rental housing; townhomes and clustered single family units will typically provide ownership opportunities, since it can be challenging to manage distributed rental units. Per the IZO, affordable rental units are to be deed-restricted at up to 50 or 60% AMI, and for- sale units up to 120% AMI. • On-site Preference: The IZO establishes a strong City preference for inclusionary units to be constructed on-site and in conjunction with market rate units within the same project. • Alternative Means of Compliance: The IZO allows alternatives to on-site inclusionary units with (from most to least preferred): 1) alternative configurations, unit types or clustering of units on site; 2) constructing units off-site; 3) dedicating land for an affordable housing project; and 4) paying the affordable housing fee. The City Council may approve an alternative means of compliance only upon finding that it is not feasible or desirable to accommodate the inclusionary units on-site or that special circumstances justify payment of fees over provision of units. • Affordable Housing Fee: To approve payment of the affordable housing fee in lieu of on-site inclusionary units, the City Council must find that all other alternative compliance means are infeasible, and that “greater benefit would accrue to the City with respect to Page 331 of 348