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w <br />6i <br />4. what if improvements are made? <br />In order to preserve the intended benefits of affordable housing, <br />any resale of a home during the contract period must be to another <br />qualifying household. Because the resale price may be below market <br />value, the it is possible that the investment made in improvements <br />will not be regained if the property is sold prior to the <br />expiration of the contract period. It is the recommendation of the <br />Planning Staff that improvements not be prohibited, however, it is <br />critical that the owner be aware that the value of the improvements <br />may not be reflected in the resale price. Article 7.14.4.5 <br />requires that this be disclosed to the potential buyer prior to the <br />sale, in a meeting with the Planning Department and HCD. All terms <br />of the contract would be reviewed at that time to ensure that there <br />is complete understanding on the part of the buyer. <br />s. what if income increases after occupancy? <br />Once a home is purchased by a qualifying household, there is no <br />requirement that income stay within qualifying levels. It is hoped <br />that income will increase. If the owner wishes to relocate, at <br />some time during the contract period, there are two options <br />available. First, the home could be sold to a qualified buyer, as <br />discussed in *3 and #4 above. Second, the owner could lease the <br />home to a qualified renter. The second option would be preferable <br />if, for example, there were only two or three years remaining in <br />the contract. It is recommended that the minimum term of the lease <br />be for 2 years. <br />Likewise, the contract with Orange County would allow for renters <br />whose income increased to continue to rent the unit. However, <br />terms of a private lease agreement may dictate otherwise, so that <br />the property owner would have the option of not renewing a lease or <br />rental agreement if income had increased. The lease would have <br />been reviewed and approved by HCD to assure that terms were <br />reasonable. <br />6. is there assurance that land donated to the County <br />will be used for affordable housing? <br />Yes. Article 7.14.4.6 specifies that land donated to Orange County <br />in exchange for a density bonus will be donated in trust to Orange <br />County for that sole purpose. The instruments of conveyance will <br />be approved by the County Attorney to assure that the use of the <br />property could not be changed. The property would be earmarked for <br />the development of affordable housing, independent of any future <br />changes in regulations or possible action by future Commissioners. <br />7. Application in watersheds <br />Article 7.4.4.2a of the proposed amendment originally stated that <br />the bonus provisions may not apply in Watersupply Watersheds, <br />