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A. Affordable Housing Incentives Program Agreement. A proposed project that incorporates any of the incentives in this chapter shall not be issued permits or receive plat or land use approvals until the applicant has submitted a signed Affordable Housing Incentives Program Agreement to the City of Snohomish, in a form acceptable to the City Attorney. This agreement shall be a covenant running with the land and shall be binding on the assigns, heirs and successors of the applicant.

The agreement shall include, but not be limited to:

1. Identification of all the incentives, regulatory and financial, that the project proposes to incorporate;

2. Identification of the number of affordable housing units provided in the project;

3. Price restrictions and long-term affordability requirements;

4. Method of determining homebuyer or tenant qualifications, including age requirements, if the project is for senior housing pursuant to SMC 14.285.040(B);

5. Binding language that protects the City’s interests in the event that a developer obtains affordable housing incentives through the land use or building approval phase but fails to provide affordable housing;

6. Language that requires documentation of recording the required affordability provisions prior to the approval of a final plat or multifamily building permit;

7. Language that recognizes the potential need to modify the agreement if the submitted project requires alteration through the review and approval process; and

8. Annual reporting requirements, including the total numbers of affordable units under this chapter, and documentation of household eligibility. Reports shall be submitted to the Planning and Development Services Department.

B. Duration of Affordability. Unless expressly stated otherwise, affordable housing units created as a result of the provisions of this chapter shall remain affordable for 50 years. A recorded declaration, secured by a deed of trust, and approved by the City Attorney, running with the land and binding all the assigns, heirs, and successors of the applicant, shall secure the affordability requirements. The recorded declaration must provide that if the property is converted to a use other than housing, the property owner must pay the applicable fees pursuant to SMC 14.285.050 in effect at the time the declaration is recorded.

C. Affordability Shall Be Maintained. The affordable housing units shall be rented, sold, or resold to income-qualified households as defined in this chapter or to a nonprofit organization through the end of the required affordability duration.

D. Construction of Affordable Housing Units. For mixed-income developments constructed in phases exceeding 12 months, the same ratio of affordable units must be completed at or prior to the completion of related market rate units as the ratio of the project as a whole.

E. Location/Appearance of Affordable Housing Units. Affordable units constructed under the provisions of this chapter shall be held to the same building and design standards applicable to the underlying zone in which they are located and shall have the same general appearance as any market rate units in the same development and if held as rental units, shall be maintained and upgraded in the same manner as market rate rental units.

F. Consistency of Units. Affordable units constructed under the provisions of this chapter shall be the same general floor area size and layout as any market rate units in the same development.

G. Resale of Affordable Housing Units. Affordable housing units provided under this chapter may be sold or resold only to eligible households as described by this chapter or to a nonprofit organization that will continue to sell or rent only to eligible households through the end of the required affordability duration. For affordable housing units to be sold or resold at market rate prior to the end of the required affordability duration, the benefit provided through this chapter shall be accounted for through a recorded declaration approved by the City Attorney, running with the land, binding all the assigns, heirs and successors, and shall be accounted for as follows:

1. Payment in lieu shall be made to the City of Snohomish as compensation for the value of all incentives originally granted.

a. For solely financial incentives, repayment of reduced fees, plus six percent interest compounded annually, shall be repaid to the City upon final sale at the rates in effect at the time the declaration was recorded and evidenced in the accompanying deed of trust.

b. If incentives were solely regulatory, as described in SMC 14.285.040, 20 percent of the net proceeds of the sale, or the difference in the Snohomish County assessed value between the first 12 months after issuance of certificate of occupancy and the date of the conversion, whichever is greater, shall be paid to the City by the seller to be deposited into the City’s Housing Fund.

c. If incentives were both financial and regulatory, the payment to the City shall be the sum total of the amounts specified in subsections (G)(1)(a) and (b) of this section.

2. All payments in lieu shall be used by the City toward future incentives offered through this chapter, and/or shall be contributed to the City’s Housing Fund.

H. Participation Measure. The City of Snohomish Planning and Development Services Department shall review the effectiveness of this chapter as part of the periodic Comprehensive Plan update and may recommend modifications to the incentives, eligibility thresholds, fee reduction distribution and applicability to increase participation and achieve affordable housing goals. (Ord. 2480, 2024)