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A. Off-Site Projects Inclusionary Units required pursuant to this Chapter may be permitted to be constructed at a location within the City other than the project site. Any of,~site Inclusionary Units must meet the following criteria: 1. The off-site Inclz~rionary Units must be determined to be consistent with the City's goal of creating, preserving, maintaining, and protecting housing for Very Low, Low, and Moderate Income Households. 2. The off-site Inclusionary Units must not result in a significant concentration of Inclusionary Units in any one particular neighborhood. 3. The off-site Inclusionary Units shall conform to the requirements of all applicable City Ordinances and the provisions of this Chapter. 4. The occupancy and rents of the off-site Inclusionary Units shall be governed by the terms of a deed restriction, and if applicable, a declaration of covenants, conditions and restrictions similar to that used for the on-site Inclusionary Units. The Af,~ordable Housing Agreement shall stipulate the terms of the o,~`=site Inclusionary Units. If the construction does not take place at the same time as project development, the agreement shall require the Units to be produced within a specified time frame, but in no event longer than fcve (S) years. A cash deposit or bond m'ay be required by the City, refundable upon construction, as assurance that the units will be built. Based on the above, the IZO accommodates the developer's proposal with exception of the requirement that units be produced within five yeazs. While staff has discussed the five-year requirement with the developer, the ten-yeaz time frame is being utilized to reflect the expected lengthy lead time required prior to any construction of the units on the Oak Grove site. Further, because it may be difficult to accommodate the 47-units on a vacant site, the developer may need to partner with another developer or look at redeveloping an existing site, both of which will require additional time to address. As a result, while staff'would prefer the five-year time frame, in this case, it can support the ten years. As an alternative to the above proposal, the developer can meet its IZO requirements by paying the City's in-lieu fee. Assuming the City Council approves a 51 unit project, the LIHF, which is currently $9,393 per unit for single family development, would apply to the 51 units in the project. Therefore, the developer would pay approximately $479,043. [The exact amount would vary depending upon the amount of the fee at the time building permits are issued. The LIHF is adjusted annually based on the change in the CPT.] Page-4-