Santa Ana City Council
April 15, 2025

Exhibit B
55394.00101\43423340.1
City Council 24 – 213 4/15/2025
DRAFT

EXHIBIT B

FORM OF AFFORDABLE HOUSING RESALE RESTRICTIONS, EQUITY SHARING, AND

REGULATORY AGREEMENT

RECORDING REQUESTED BY,
AND WHEN RECORDED MAIL TO:

City of Santa Ana
20 Civic Center Plaza (M-30)
P.O. Box 1988
Santa Ana, CA 92702
Attn: City Clerk
Free Recording pursuant to
Government Code 6103 & 27383

AFFORDABLE HOUSING RESALE RESTRICTIONS, EQUITY SHARING AND

REGULATORY AGREEMENT
2020 East First Street, APN: 402-191-02
This AFFORDABLE HOUSING RESALE RESTRICTIONS, EQUITY SHARING AND REGULATORY AGREEMENT (“Affordable Housing Resale Restrictions” or "Agreement") is made as of______________, by ________________(“Homebuyer”) in favor of the CITY OF SANTA ANA, a municipal corporation (“City”).

R E C I T A L S
A. Homebuyer has purchased a single family house located at_________________, Santa Ana, California, _____, as such real property is more particularly described in “Exhibit 1” attached hereto and incorporated herein (“Property”).

B. In connection with Homebuyer purchasing the Property, Homebuyer acknowledged and received disclosures that the purchase was subject to a Density Bonus Housing Agreement with Declaration of Covenants, Conditions and Restrictions ("Density Bonus Agreement"), dated on or about ______, 2025, between the developer of the Property, ______________ ("Developer"). The Density Bonus Agreement required the Property to be sold to a Very Low Income Household, subject to the provisions of this Affordable Housing Resale Restrictions, pursuant to which Developer imposed covenants upon the Property to be sold to Eligible Homebuyers at an Affordable Sales Price. Homebuyer hereby acknowledges and agrees that this Affordable Housing Resale Restrictions is intended to implement the requirements of the Density Bonus Agreement, and that the purchase, use and occupancy of the Property is subject to

Exhibit B
55394.00101\43423340.1
City Council 24 – 214 4/15/2025
DRAFT
the conditions, covenants and restrictions contained herein. Capitalized terms used herein and not otherwise defined shall have the same meaning as set forth in the Density Bonus Agreement.

C. Homebuyer desires and intends to restrict the Property and the improvements thereon in accordance with this Affordable Housing Resale Restrictions. Homebuyer agrees and acknowledges that this Affordable Housing Resale Restrictions is intended to implement and further the intent of the Density Bonus Agreement, entered into between City and Developer of the Property, which was recorded against the Affordable Unit to impose the conditions, covenants, and restrictions as set forth herein. This Affordable Housing Resale Restrictions shall be construed in accordance with the Regulatory Agreement.

D. Homebuyer is a Very Low Income Household, as that term is defined in this Agreement.

E. Homebuyer has represented to City that Homebuyer and Homebuyer’s household intend to reside in the Property as Homebuyer’s principal residence at all times during Homebuyer’s ownership of the Property.

NOW, THEREFORE, for good and valuable consideration, the parties agree as follows:

1. DEFINITIONS
“Affordability Term” means that period of time commencing upon the Date of this Agreement and terminating on the date that is fifty five (55) years from the date a certificate of occupancy was issued for the Property.
“Affordable Housing Cost” means the purchase price for Very Low Income Households pursuant to California Health & Safety Code Section 50052.5, and implementing regulations of Sections 6920, 6924 and 6926 of Title 25 of the California Code of Regulations for Very Low Income Households.
"Affordable Sales Price" means a purchase price required under a written purchase sale agreement that does not exceed the sum of the Supportable Mortgage plus the Benchmark Down Payment.

Affordable Unit" or "Property" means the individual dwelling unit restricted by this Agreement
“City” means the City of Santa Ana, California, a California municipal corporation, and the City’s successors and assigns.
"City Deed of Trust" means the City Deed of Trust, securing this Affordable Housing Resale Restrictions and the City Promissory Note, and dated on or about the same date hereof. "City Equity Share" means the amount that Homebuyers agree to pay to the City in accordance with the City Promissory Note.

Exhibit B
55394.00101\43423340.1
City Council 24 – 215 4/15/2025
DRAFT
"City Promissory Note" means the City Promissory Note, evidencing Homebuyer's agreement to pay the City Equity Share and dated on or about the same date hereof. “County” means the County of Orange, California.
“Date of this Agreement” means the date in the first paragraph of this Agreement. “Default” means the failure of a party to perform any action or covenant required by this Agreement within the time periods provided herein following notice and opportunity to cure.

The term default also includes an Ownership Default and a Maintenance Default as more fully defined and described herein. Notwithstanding the foregoing for purposes of acceleration of the City Promissory Note , or initiation of foreclosure proceedings there shall be a distinction between the types of default hereunder, including an “Ownership Default” and a “Maintenance Default.” The term “Ownership Default” means the failure of Homebuyer to perform any action or covenant required by the Affordable Housing Resale Restriction related to ownership, owner-occupancy, lien priority, and restrictions on sale and resale of the Property subject to the notice and opportunity to cure provisions set forth herein. A default of any obligation secured by the First Lien shall be a cross-default and also constitute an Ownership Default. The term “Maintenance Default” means the failure of Homebuyer to perform any action or covenant required by this Agreement relating to a “Maintenance Deficiency,” including the ongoing upkeep, maintenance, and use of the Property in decent, safe, sanitary, clean, and neighborly manner, subject to the notice and opportunity to cure provisions set forth herein (and expressly excluding an Ownership Default). “Developer” means MLC Holdings, Inc./Meritage Homes.
"Eligible Household" means a Household whose income does not exceed the “Very Low Income Household” qualifying limit as defined herein.
“First Lien” means the lien of the institution making the purchase money mortgage loan to Homebuyer for the purchase of the Property.
“Homebuyer” means the person or persons set forth in the first paragraph of this Agreement, and their successors and assigns.
“Housing Cost” means and includes all of the following costs associated with ownership of an Affordable Unit as defined in Title 25 of the California Code of Regulations Section 6920, and Santa Ana Municipal Code, including:
(a)
(b)
(c)
Principal and interest on a mortgage loan at the defined interest rate; Property tax and assessments;
Fire and casualty insurance covering replacement value of property improvements;
(d) Property maintenance and repairs;

Exhibit B
55394.00101\43423340.1
City Council 24 – 216 4/15/2025
DRAFT
(e)
Housing Authority; and
A reasonable utility allowance, as determined by the Orange County (f) Homeowner Association assessments and dues.
“Legal Description” means the legal description of the Property which is attached hereto as Exhibit A and incorporated herein.
"Median Income" means the area median income for Orange County PMSA, adjusted for family size appropriate to the unit pursuant to California Health and Safety Code § 50052.5(h), as periodically published by the California Department of Housing and Community Development.
“Very Low Income and Very Low Income Households” means a Household whose income does not exceed fifty (50%) of the area median income for the Orange County, California PMSA, adjusted for household size, as published by HCD. “Notice of Intent to Transfer” means a written notice from Homebuyer to the City that provides notice of an intent to Transfer the Property and all information required by this Agreement in connection with the proposed Transfer.
“Permitted Transfer” means any Transfer which is permitted under this Agreement with the written consent of the City.
“Prohibited Transfer” means any Transfer which is disapproved by the City or violates this Agreement.
“Property” means that certain real property located at the street address set forth in Recital A and legally described in the Legal Description.
“Purchase Agreement” means that certain agreement pursuant to which Homebuyer has agreed to purchase the Property from the Developer.
“Request for Notice” means the Request for Notice of Default attached hereto as Exhibit I and incorporated herein.
“Sales Price” means the sum to be paid by a Transferee for the Transfer of the Property. “Transfer” shall mean any sale, assignment, conveyance, lease or transfer, voluntary or involuntary, of any interest in the Property. Without limiting the generality of the foregoing, Transfer shall include (i) a transfer by devise, inheritance or intestacy; (ii) creation of a life estate; (iii) creation of a joint tenancy interest; (iv) a gift of all or any portion of the Property; or (v) any voluntary conveyance of the Property.
“Transferee” shall mean any natural person or entity who obtains ownership or possessory rights in the Property pursuant to a Transfer.

Exhibit B
55394.00101\43423340.1
City Council 24 – 217 4/15/2025
DRAFT

2. HOMEBUYER’S REPRESENTATIONS AND WARRANTIES AS TO THE SALE OF THE PROPERTY TO HOMEBUYER.

2.1 Homebuyer represents and warrants to City that the financial and other information which Homebuyer has provided to City with respect to Homebuyer’s income and the purchase price of the Property was true and correct at the time such information was provided, and remains true and correct as of the Date of this Agreement.

2.2 RESTRICTIONS ON SALE OF PROPERTY.

3.1 Homebuyer covenants and agrees that during the Affordability Term, any resale Homebuyer agrees to occupy the Property as Homebuyer's primary residence.

3. of the Property shall be to a Very Low Income Household for an amount that does not exceed an Affordable Sales Price.

3.2 Prior to any Transfer of the Affordable Unit, Homebuyer shall provide the City with a Notice of Intent to Transfer, in a form approved by the City, and the City shall have the right to approve or disapprove of any Transfer, which approval shall not be unreasonably withheld.

3.3 Permitted Transfers. Prior to any Transfer of the Property, Homebuyer shall obtain City's written consent pursuant to the requirements of Section 4 and 5, below, and subject to the following:
(a) During the Affordability Term, the Homebuyer may Transfer the Property to a Very Low Income Household for an Affordable Sales Price. (b) Upon expiration of the Affordability Term, Homebuyer may sell the Property without the affordability restrictions of this Agreement, subject to the satisfaction of the City Promissory Note and City Deed of Trust.

3.4 Prohibited Transfers. Any Transfer of the Property without the City's written consent or in violation of this Agreement is a Prohibited Transfer.

4. HOMEBUYER PROCEEDS FROM SALE OF PROPERTY.

4.1 This Agreement implements the provisions of the Density Bonus Agreement for disbursement of funds from a sale of the Property, as further set forth below.

4.2 Permitted Transfers During the Affordability Term. During the Affordability Term, a Homebuyer retains the proceeds from a Permitted Transfer after payment of the First Lien, and reasonable closing costs and broker fees. The City Deed of Trust shall remain a lien on the Property, or the Transferee shall executed a new Affordable Housing Resale Restrictions, City Promissory Note, and City Deed of Trust.

4.3 Permitted Transfers Upon Expiration of the Affordability Term. Upon expiration of the Affordability Term, the City Equity Share shall become due and payable upon a

Exhibit B
55394.00101\43423340.1
City Council 24 – 218 4/15/2025
DRAFT
Permitted Transfer, and the proceeds from a sale shall be used for payment of the City Equity Share in satisfaction of the City Promissory Note.

4.4 Prohibited Transfers. Homebuyer agrees and acknowledges that a Prohibited Transfer is a default of this Agreement and, in the event of such a default, the City shall be entitled to the greater of: (a) all amounts paid for the Property in excess of the Affordable Sales Price shall be forfeited to the City, or (b) the City Equity Share.

4.5 Equity Sharing Agreement.

4.5.1 Following the expiration of the Affordability Term, Homebuyer agrees to pay to the City the City Equity Share, as follows:

4.5.2 The City Equity Share shall be paid out of proceeds from a Transfer of the Property after the Affordability Term.

4.5.3 The City Equity Share includes the following:
(a) An amount equal to the difference between the fair market value of the Affordable Unit at the time of the initial purchase and the Affordable Sales Price (the "Initial Subsidy").
(b) An amount equal to the product of (1) the appreciation of the Affordable Unit, as measured by the increase in the fair market value of the Affordable Unit at the time of the sale to the Homebuyer and the resale of the Affordable Unit, and (2) the percentage that the initial subsidy represented of the fair market value of the Affordable Unit when it was purchased by the Homebuyer (the "Proportionate Share of Appreciation").

4.6 The City Equity Share shall only be subordinate to a First Lien, as approved by the City at the time of the initial sale (or subsequent approval in the event of a refinance or resale during the Affordability Term), and amounts owed to Homebuyer for the value of improvements to the Property and the down payment paid by Homebuyer.

4.7 For purposes of determining the City Equity Share, at the time of the initial sale of the Property, and each re-sale during the Affordability Term, the fair market value shall be determined as follows:

4.7.1 For the initial sale, Developer may propose to the City a fair market value based on a price per square foot that is based on comparable sales of other units within the Project.

4.7.2 Except as approved in writing by the City, prior to the sale of an Affordable Unit, a qualified appraiser shall conduct an appraisal of the Affordable Unit to determine fair market value without the restrictions of this Agreement. If the Developer or a prospective Homebuyer disputes the appraised value, then that party may pay for the costs of a second appraisal and, if there is still disagreement, the average of the two appraisals shall be used to determine the fair market value.

Exhibit B
55394.00101\43423340.1
City Council 24 – 219 4/15/2025
DRAFT

4.7.3 The fair market value of the Affordable Unit, as determined in accordance with the above, shall be provided to the City for approval or disapproval, which City shall provide within thirty (30) days of receipt of the proposed fair market value. If City does not provide a written response within such time period, then the proposed fair market value shall be deemed approved by the City.

5. PROCESS FOR TRANSFER OF THE PROPERTY. In the event that Homebuyer desires to Transfer the Property, the following procedure shall apply:

5.1 Notice to City. Prior to any Transfer, Homebuyer shall send a completed Notice of Intent to Transfer to City at the address set forth in Section 22. The Notice of Intent to Transfer shall include: (a) the identity of the proposed Transferee and contact information, including current address and phone number, (b) the proposed terms of the Transfer, (c) whether the Property is being sold to a purchaser that qualifies as a Very Low Household and supporting documentation, and (d) if during the Affordability Term, the proposed Affordable Sales Price and the resulting Monthly Housing Costs. If the proposed Transfer is upon expiration of the Affordability Term, then the Notice of Intent to Transfer shall include the proposed sales price and a good faith estimate of the proceeds from the sale of the Property. The City may request additional information as reasonably necessary to evaluate the requested Transfer.

5.2 Qualification of Proposed Transferee. For a transfer during the Affordability Term, the proposed Transferee shall complete an Income Verification Form, in a form approved by the City, which shall include, without limitation, a certification as to the income and family size of the proposed Transferee.

5.3 Certificates from Parties. In the event the City approves the proposed Transfer, Homebuyer and proposed Transferee each shall certify in writing, in a form acceptable to City, that the Transfer shall be closed in accordance with the terms of the sales contract and other documents submitted to and approved by City and that all consideration delivered by the proposed Transferee to owner has been fully disclosed to City. The written certificate shall also include a provision that in the event a Transfer is made in violation of the terms of this Agreement or false or misleading statements are made in any documents or certificate submitted to City for its approval of the Transfer, City shall have the right to file an action at law or in equity to make the parties terminate and/or rescind the sales contract and/or declare the sale void notwithstanding the fact that the Transfer may have closed and become final as between Homebuyer and Transferee.

5.4 Requirements for Permitted Transfers. For a Permitted Transfer during the Affordability Term, the City will require: (1) an assignment and assumption agreement that is reasonably acceptable to City, or (2) the proposed Transferee execute a new City Promissory Note, City Deed of Trust, and Affordable Housing Resale Restrictions. Upon expiration of the Affordability Term, the City will require a closing statement setting forth the proceeds from a proposed sale, and shall have at least thirty (30) days to review and approve the sales documents.

5.5 Written Approval of City Required Before Transfer. The purchase sale agreement or other contract for Transfer of the Property, and the Income Verification Form, shall be provided to the City, which shall have at least thirty (30) days to review. The Property, and any interest therein, shall not be conveyed by any Transfer except with the express written consent of

Exhibit B
55394.00101\43423340.1
City Council 24 – 220 4/15/2025
DRAFT
City, which consent shall be given only if the Transfer is in accordance with the provisions of this Agreement.

5.6 Notice of Prohibited Transfer. Within thirty (30) days after receiving all information required by this Section 5, the City shall determine and give notice to Homebuyer as to whether the City consents to the Transfer as a Permitted Transfer, or if the City determines the proposed Transfer is a Prohibited Transfer. Any attempt to Transfer the Property without the City's written approval, or after the City has given notice of a Prohibited Transfer, shall be a Default of this Agreement, and the City may apply to a court of competent jurisdiction for specific performance of this Agreement, for an injunction prohibiting a proposed sale or Transfer in violation of this Agreement, for a declaration that the Prohibited Transfer is void, or for any such other relief as may be appropriate.

5.7 Delivery of Documents. Upon the close of the proposed Transfer, Homebuyer and Transferee, as applicable, shall provide the City with a copy of the final sales contract, settlement statement, escrow instructions, all certificates required by this Section 5 and any other documents City may request.

6. ENCUMBRANCES.

6.1 Subordination. Except as provided otherwise herein, the provisions of this Agreement, the Notice of Affordability Restrictions and the City Deed of Trust, the obligations herein and therein, shall be subordinate only to the First Lien on the Property and, if applicable, other loan(s) as approved by the City, including lien instruments that secure other Homebuyer purchase money and/or down payment assistance, including without limitation City, State of California, or federal affordable housing programs, which liens shall not impair the rights under the First Lien in the event of default under the First Lien by Homebuyer. Such remedies under the First Lien include the right of foreclosure or acceptance of a deed or assignment in lieu of foreclosure.

6.2 Request for Notice of Default. City may cause a Request for Notice to be recorded on the Property subsequent to the recordation of the First Lien deed of trust or mortgage requesting a statutory notice of default as set forth in California Civil Code Section 2924b. A form of a Request for Notice is attached hereto as Exhibit I and incorporated herein.

6.3 Further Encumbrances. Homebuyer agrees that it shall not record or cause the recordation of any deed of trust (“Further Encumbrance”) securing a note having an original principal sum which, when added to the sum of the principal amount(s) of any notes secured by any deeds of trust against the Property as of the date of recordation of the Further Encumbrance, exceeds one hundred percent (100%) of the fair market value of the Property.

7. USES. Homebuyer covenants and agrees to devote, use and maintain the Property in accordance with this Agreement. All uses conducted on the Property, including, without limitation, all activities undertaken by Homebuyer pursuant to this Agreement, shall conform to all applicable provisions of the Santa Ana Municipal Code, and the recorded documents pertaining to and running with the Property.

Exhibit B
55394.00101\43423340.1
City Council 24 – 221 4/15/2025
DRAFT

8. NONDISCRIMINATION COVENANTS.

Homebuyer covenants by and for itself, its successors and assigns, and all persons claiming under or through them that there shall be no discrimination against or segregation of, any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein conveyed, nor shall the grantee or any person claiming under or through him or her, establish or permit any practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the premises herein conveyed. The foregoing covenants shall run with the land. All deeds, leases or contracts relating to the Property, or any part thereof, shall contain or be subject to substantially the following non-discrimination or non-segregation clauses:
“The grantee herein covenants by and for himself or herself, his or her heirs, executors, administrators, and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of, any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure, or enjoyment of the premises herein conveyed, nor shall the grantee or any person claiming under or through him or her, establish or permit any practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees, or vendees in the premises herein conveyed. The foregoing covenants shall run with the land.”
The covenants established in this Section 8 shall, without regard to technical classification and designation, be binding for the benefit and in favor of City and its successors and assigns, and shall remain in effect in perpetuity.

9. MAINTENANCE OF PROPERTY.

Homebuyer shall maintain the improvements and landscaping on the Property in a manner consistent with community standards which will uphold the value of the Property, in accordance with the Santa Ana Municipal Code. Homebuyer also agrees to comply with all applicable federal, state and local laws.

9.1 Exterior Maintenance. Except as to be maintained by the homeowners association, as applicable, all exterior, painted surfaces of any structures located on the Property shall be maintained at all times in a clean and good condition. Any defacing marks shall be cleaned or removed within a reasonable period of time.

9.2 Front and Side Exteriors. Except as to be maintained by the homeowners association, as applicable, Homebuyer shall at all times maintain the front exterior, any visible side exteriors, and yards, if any, in a clean, safe and presentable manner.

Exhibit B
55394.00101\43423340.1
City Council 24 – 222 4/15/2025
DRAFT

9.3 Graffiti Removal. All graffiti and defacement of any type, including but not limited to marks, words and pictures, shall be promptly removed from the Property within two (2) days of the time they were made and any necessary painting or repair completed in a timely and expeditious manner after notice thereof, whichever is less.

9.4 No Nuisance. Homebuyer shall not maintain, cause to be maintained, or allow to be maintained on or about the Property any public or private nuisance, including without limitation, the conduct of criminal activities set forth in the nuisance abatement provisions of the Uniform Controlled Substances Act (Health & Safety Code Sections 11570, et seq.) or the Street Terrorism Enforcement and Prevention Act (Penal Code Sections 186.22 et seq.), or any successor statute or law.

10. OCCUPANCY STANDARDS.

The Property shall be used as the principal personal residence of Homebuyer and Homebuyer’s immediate family/household and for no other purpose. Homebuyer shall not enter into an agreement for the rental or lease of all or any part of the Property. Homebuyer shall not rent out a room or rooms at the Property. Homebuyer may request a temporary waiver of the foregoing requirement in the event of extreme hardship requiring Homebuyer to move to another geographical area or to less expensive housing, including, for example and without limitation, transfer of job location, loss of job, or unexpected major expenses. City may approve or disapprove such request in its sole discretion, and may require as a condition of approval that Homebuyer only rent the Property to Eligible Households at an affordable rent (as defined in Section 50052.5 and 50053 of the California Health & Safety Code.) Subject to applicable state or federal law, the standard occupancy for the Property shall be consistent with the Regulatory Agreement. Homebuyer shall, upon demand by City, submit to City an affidavit of occupancy verifying Homebuyer’s compliance with this Section 10. Such affidavit may be required by City on an annual basis.

11. EFFECT OF VIOLATION OF THE TERMS AND PROVISIONS OF THIS AGREEMENT.

11.1 In General. The covenants established in this Agreement shall, without regard to technical classification and designation, be binding for the benefit and in favor of City, its successors and assigns, as to those covenants which are for its benefit. The covenants contained in this Agreement shall remain in effect for the periods of time specified herein. The covenants against discrimination shall remain in effect in perpetuity. City is deemed the beneficiary of the terms and provisions of this Agreement and of the covenants running with the land, for and in its own rights and for the purposes of protecting the interests of the community and other parties, public or private, in whose favor and for whose benefit this Agreement and the covenants running with the land have been provided. This Agreement and the covenants herein shall run in favor of City, without regard to whether City has been, remains or is an owner of any land or interest therein in the Property or in the Project Area. City shall have the right, if the Restriction or covenants are breached, to exercise all rights and remedies, and to maintain any actions or suits at law or in equity or other proper proceedings to enforce the curing of such breaches to which it or any other beneficiaries of this Agreement and covenants may be entitled.

Exhibit B
55394.00101\43423340.1
City Council 24 – 223 4/15/2025
DRAFT

11.2 Acceleration. The City shall be entitled to accelerate payments due under the City Promissory Note, and the amount required thereunder shall become due and immediately payable to City by Homebuyer upon the occurrence of any one of the following events of acceleration:

11.2.1 During the Affordability Term, Homebuyer Transfers the Property for a price in excess of an Affordable Sales Price or to a Transferee who does not qualify as a Very Low Income Household;

11.2.2 Homebuyer makes a Prohibited Transfer of title to or any interest in the Property without City's consent or in violation of this Agreement;

11.2.3 Homebuyer refinances any lien or encumbrance to which City Deed of Trust is subordinate (each such lien, a “First Lien”) for a loan amount in excess of the then current loan balance secured by such lien or encumbrance and loan closing costs;

11.2.4 Homebuyer fails to occupy the Property as Homebuyer’s principal residence or is in Default of any other obligation under the Affordable Housing Resale Restrictions;

11.2.5 Homebuyer has an Ownership Default violating any affordable housing terms or provisions of this Agreement.

12. COMPLIANCE WITH LAWS; GOVERNING LAW.

Homebuyer hereby agrees to comply with all applicable ordinances, rules, and regulations of City.

Nothing herein is intended to be, nor shall it be deemed to be, a waiver of any City ordinance, rule, or regulation. This Agreement shall be governed by the laws of the State of California. Any legal action brought under this declaration must be instituted in the Superior Court of the County of Orange, State of California, or in the Federal District Court in the Central District.

13. INDEMNIFICATION.

Homebuyer shall pay for, defend, indemnify and hold harmless City and the City and their respective officers, officials, agents, employees, representatives, and volunteers from and against any loss, liability, claim, or judgment relating in any manner to Homebuyer’s use of the Property or Homebuyer’s violation of this Agreement. Homebuyer shall remain fully obligated for the payment of taxes, liens and assessments related to the Property. There shall be no reduction in taxes for Homebuyer, nor any transfer of responsibility to City to make such payments, by virtue of this Agreement.

14. INSURANCE.

Homebuyer shall maintain, during the term of this Agreement, an all-risk property insurance policy insuring the Property in an amount equal to the full replacement value of the structures on the Property. The policy shall contain a statement of obligation on behalf of the carrier to notify the City of any material change, cancellation or termination of coverage at least thirty (30) days in advance of the effective date of such material change, cancellation or termination. Homebuyer

Exhibit B
55394.00101\43423340.1
City Council 24 – 224 4/15/2025
DRAFT
shall transmit a copy of the certificate of insurance to City within thirty (30) days of the effective Date of this Agreement, and Homebuyer shall annually transmit to City a copy of the certificate of insurance, signed by an authorized agent of the insurance carrier setting forth the general provisions of coverage. The copy of the certificate of insurance shall be transmitted to City at the address set forth in Section 22 hereof. The form, content and issuer of any certificate of insurance approved by City.

15. DEFAULTS.

Failure or delay by either party to perform any term or provision of this Agreement which is not cured within thirty (30) days after receipt of notice from the other party constitutes a default under this Agreement; provided, however, that if such default is of the nature requiring more than thirty (30) days to cure, the defaulting party shall avoid default hereunder by commencing to cure within such thirty (30) day period, and thereafter diligently pursuing such cure to completion. The party who so fails or delays must immediately commence to cure, correct or remedy such failure or delay, and shall complete such cure, correction or remedy with diligence. The injured party shall give written notice of default to the party in default, specifying the default complained of by the injured party. Except as required to protect against further damages, the injured party may not institute proceedings against the party in default until thirty (30) days after giving such notice.

Failure or delay in giving such notice shall not constitute a waiver of any default, nor shall it change the time of default.

16. NON-WAIVER.

Failure to exercise any right City may have or be entitled to, in the event of default hereunder, shall not constitute a waiver of such right or any other right in the event of a subsequent default.

17. FURTHER ASSURANCES.

Homebuyer shall execute any further documents consistent with the terms of this Agreement, including documents in recordable form, as City shall from time to time find necessary or appropriate to effectuate its purposes in entering into this Agreement.

18. GOVERNING LAW.

Homebuyer hereby agrees to comply with all ordinances, rules and regulations of City. Nothing in this Agreement is intended to be, nor shall it be deemed to be, a waiver of any City ordinance, rule or regulation. This Agreement shall be governed by the laws of the State of California. Any legal action brought under this Agreement must be instituted in the Superior Court of the County of Orange, State of California, or in the Federal District Court where the City is located.

19. AMENDMENT OF RESTRICTION.

No modification, rescission, waiver, release or amendment of any provision of this Agreement shall be made except by a written agreement executed by Homebuyer and City.

20. CITY MAY ASSIGN.

Exhibit B
55394.00101\43423340.1
City Council 24 – 225 4/15/2025
DRAFT
City may, at its option, assign its rights hereunder without obtaining the consent of Homebuyer.

21. HOMEBUYER ASSIGNMENT PROHIBITED.

In no event shall Homebuyer assign or transfer any portion of this Agreement without the prior express written consent of City, which consent shall be given by City only in the event that City determines that the assignee or transferee is an Eligible Household, that the assignee’s or transferee’s monthly housing payments are at an Affordable Housing Cost, and that the assignee or transferee has expressly assumed this Agreement by execution of a written assignment document to be provided by City and recorded against the Property, or execution of new instruments by the transferee. This section shall not affect or diminish City’s right to assign all or any portion of its rights hereunder.

22. NOTICES.

Any notices, requests or approvals given under this Agreement from one party to another may be personally delivered or deposited with the United States Postal Service for mailing, postage prepaid, registered or certified mail, return receipt requested to the following address:

To Homebuyer: At the property address.

To City: City of Santa Ana
20 Civic Center Plaza
Santa Ana, CA 92702
Attn: City Clerk
Either party may change its address for notice by giving written notice thereof to the other party.

23. ATTORNEYS’ FEES AND COSTS.

In the event that any action is instituted to enforce payment or performance under this Agreement, the parties agree the non-prevailing party shall be responsible for and shall pay all costs and all attorneys’ fees incurred by such prevailing party in enforcing this Agreement.

24. ENTIRE AGREEMENT.

This Agreement, together with the City Promissory Note and City Deed of Trust, and all attachments thereto and hereto, constitutes the entire understanding and agreement of the parties.

This Agreement integrates all of the terms and conditions mentioned herein or incidental thereto, and supersedes all prior negotiations, discussions and previous agreements between the City and Homebuyer concerning all or any part of the subject matter of this Agreement.

Exhibit B
55394.00101\43423340.1
City Council 24 – 226 4/15/2025
DRAFT
[Signature block begins on follow page.]

Exhibit B
55394.00101\43423340.1
City Council 24 – 227 4/15/2025
DRAFT
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set forth above.

HOMEBUYER:

By:

By:_______________________________________

CITY OF SANTA ANA
CITY:

ATTEST:
___________________________ _______________________
By: By:

City Clerk City Manager
Dated: Dated:

Exhibit B
55394.00101\43423340.1
City Council 24 – 228 4/15/2025
DRAFT
EXHIBIT 1 OF THE AFFORDABLE HOUSING RESALE RESTRICTIONS, EQUITY

SHARING, AND REGULATORY AGREEMENT

LEGAL DESCRIPTION

Exhibit 1
of the Affordable Housing Resale Restrictions, et al.
55394.00101\43423340.1
City Council 24 – 229 4/15/2025
DRAFT

EXHIBIT C

FORM OF CITY PROMISSORY NOTE
City Equity Share [DATE]
Santa Ana, CA

1. FUNDAMENTAL PROVISIONS.

The following terms will be used as defined terms in this City Promissory Note (as it may be amended, modified, extended and renewed from time to time, this “Note”):

Lender/Payee: City of Santa Ana, a California municipal corporation.

Borrower/Maker:

Principal Amount:
[HOMEBUYER]
City Equity Share, as defined in the Affordable Housing Resale Restrictions
Interest Rate: None.

Default Interest Rate:

Affordability Term:

Eight percent per annum.

The date of this Note until [ADD DATE 55 YEARS FROM
CERTIFICATE OF OCCUPANCY]
Maturity Date:

Business Day:

The date of a Transfer of the Property after expiration of the Affordability Term.

Any day of the year other than Saturdays, Sundays and legal holidays on which City's main office is closed.

Property: [ADDRESS]
Deed of Trust: The City Deed of Trust executed by Borrower, as “Trustor”, for the benefit of City, as “Beneficiary,” concurrently with this Note, and recorded against the Property.

Affordable Housing
Resale Restrictions: The Affordable Housing Resale Restrictions, Equity Sharing and Regulatory Agreement, dated on or about [DATE].

Loan: The agreement by Borrower to pay the Principal Amount to City, in accordance with the Affordable Housing Resale Restrictions and this Note.

Exhibit C
55394.00101\43423340.1
City Council 24 – 230 4/15/2025
DRAFT
City Documents: This Note, the Affordable Housing Resale Restrictions, the City Deed of Trust

2. PROMISE TO PAY. For value received, Borrower promises to pay to the City, at its office at 20 Civic Center Plaza (M-30), Santa Ana, CA 92702, or at such other place as the Lender hereof may from time to time designate in writing, the Principal Amount together with interest thereon, and all other sums due under and secured by the Deed of Trust.

3. SECURITY. This Note is secured by the City Deed of Trust. The holder of this Note will be entitled to the benefits of the security provided by the City Deed of Trust and will have the right to enforce the covenants and agreements of Maker contained therein and in the Affordable Housing Resale Restrictions

4. PAYMENTS. The City Equity Share is due upon a Transfer of the Property after expiration of the Affordability Term, or upon an event of Default. In the event any City Equity Share become due and payable hereunder or pursuant to the Affordable Housing Resale Restrictions, the City Equity Share shall be immediately due and payable hereunder. Failure to declare such amounts due in any instance shall not constitute a waiver on the part of the City to declare them due in the future. Maker will pay to City all sums owing under this Note without deduction, offset, or counterclaim of any kind.

5. DEFAULT RATE OF INTEREST. If City Equity Share payable to City pursuant to the Affordable Housing Resale Restrictions and this Note are not paid to City within ten (10) days of the due date thereof, then interest shall accrue on such sum at a rate equal to the lesser of eight percent (8%) interest per annum, compounded annually, or the maximum rate permitted by law.

6. 7.

PREPAYMENT. This Note may not be prepaid in whole or in part.

TRANSFER. Maker shall not transfer, lease, sell, assign, refinance, encumber, convey or otherwise Transfer any interest in the Property without complying with all requirements of the Affordable Housing Resale Restrictions. Maker’s failure to comply with the requirements of this paragraph shall be a Default under this Note.

8. DEFAULT. The occurrence of any one or more of the following shall constitute an event of default (“Default”) hereunder.

8.1 The occurrence of a breach of any of Maker’s covenants, warranties, or representations under this Note, the City Deed of Trust, or the Affordable Housing Resale Restrictions, including without limitation, any unauthorized refinancing, sale, conveyance, lease, assignment, encumbrance, or other Transfer of the Property, Maker’s failure to occupy the Property as Maker’s principal residence, any failure to pay amounts payable pursuant to this

Exhibit C
55394.00101\43423340.1
City Council 24 – 231 4/15/2025
DRAFT
Note, and Maker’s failure to maintain insurance on the Property as required pursuant to the City Deed of Trust.

8.2 The entry of an order for relief under federal bankruptcy laws as to Maker or the adjudication of Maker as insolvent or bankrupt pursuant to the provisions of any state or federal insolvency or bankruptcy act, or Maker’s consent to, acquiescence in, or attempt to secure the appointment of, any receiver for all or any substantial part of the Property.

8.3 The occurrence of an event of default under any loan secured by the Property and the continuance of such default beyond the expiration of all applicable cure periods such that the holder of such loan has the right to accelerate such loan.

9. Remedies. Upon the occurrence of a Default, the giving of any required notice thereof, and the expiration of any applicable cure period, City may, at its option, exercise any one or more of the following remedies:

9.1 Declare all of the sums payable under this Note to be immediately due and payable without further demand.

9.2 9.3
Pursue the exercise of the power of sale provided under the City Deed of Trust.

Either in person or by agent, with or without bringing any action or proceeding, or by a receiver appointed by a court, and without regard to the adequacy of its security, enter upon the Property and take possession thereof (or any part thereof) and of any of the Security in its own name or in the name of the Trustee, and do any acts which it deems necessary or desirable to preserve the value or marketability of the Property, or part thereof or interest therein, or protect the security thereof. The entering upon and taking possession of the Security shall not cure or waive any breach hereunder or invalidate any act done in response to such breach, and notwithstanding the continuance in possession of the Property, the City shall be entitled to exercise every remedy provided by the City Documents or by law, upon the occurrence of any uncured breach.

9.4 Commence an action to foreclose the City Deed of Trust as a mortgage, appoint a receiver, or specifically enforce any of the covenants set forth in the City Documents.

9.5 Exercise its option to purchase the Property pursuant to the Affordable Housing Resale Restrictions.

9.6 Exercise all other rights and remedies provided herein or in any other City Document.

9.7 Exercise any other remedy provided by law or in equity.

Exhibit C
55394.00101\43423340.1
City Council 24 – 232 4/15/2025
DRAFT
The rights and remedies of the City hereunder are cumulative, and the City’s exercise or failure to exercise one or more of such rights or remedies shall not preclude City’s exercise, at the same time or different times, of any other right or remedy for the same Default or any other Default.

10. Maker’s Personal Liability. Maker will be fully and personally liable for all loss, cost, liability, damage, and expense (including without limitation attorneys’ fees) suffered or incurred by City arising from any of the following:

10.1 Failure to pay taxes, assessments, and any other charges that could result in liens against any portion of the Property or any other Security.

10.2 Failure to pay and discharge any mechanics’ liens, materialmen’s liens, or other unpermitted liens against any portion of the Property or any other Security.

10.3 Maker’s fraud or intentional misrepresentation with respect to any representations, warranties, or certifications made in the City Documents or in connection with Maker’s application to participate in the City’s affordable housing program.

10.4 Maker’s retention of any rental income or other income arising with respect to any portion of the Property or any other Security subsequent to the date of City’s delivery of any notice of a Default, or which, under the terms of the City Documents, should otherwise have been paid to City.

10.5 Maker’s retention or use of insurance proceeds, condemnation awards, or other similar funds or payments attributable to the Property or any other Security that pursuant to the City Documents should have been paid to City or used for another purpose.

10.6 Waste of the Property, or any other failure to maintain, repair, or restore any portion of the Property or any other Security in accordance with the requirements of the City Documents.

10.7 The removal, demolition, damage or destruction of any portion of the Property or any other Security that is neither consented to in writing by City nor fully compensated for by insurance proceeds or condemnation awards.

10.8 The failure of the City Documents to constitute a lien or security interest, as applicable, on the Property or any other Security, subject only to those exceptions, if any, permitted by the City Documents or otherwise approved in writing by City.

10.9 Nothing in this paragraph will affect or limit the rights of City to enforce any of City’s rights or remedies with respect to any portion of the Property or any other Security.

Exhibit C
55394.00101\43423340.1
City Council 24 – 233 4/15/2025
DRAFT

11. Maker’s Waivers. Maker hereby expressly waives diligence, presentment, protest, and demand, and notice of protest, notice of dishonor and notice of nonpayment of this Note, and expressly waives any rights to be released by reason of any extension of time or change in terms of payment, or change, alteration or release of any security given for the payments hereof, and expressly waives the right to plead any and all statutes of limitation as a defense to any demand on this Note.

12. Notices. All notices, requests, demands, reports or other communications regarding this Note shall be in writing and delivered: (i) personally; or (ii) by independent, reputable, overnight commercial courier; or (iii) by deposit in the United States mail, postage and fees fully prepaid, registered or certified mail, with return receipt requested; addressed as follows, or to such other address as specified in written notice delivered to the parties pursuant to this Section:

To Maker:

To City:

At the Property address.

City of Santa Ana
20 Civic Center Plaza (M-30)
P.O. Box 1988
Santa Ana, CA 92702
Attn: City Clerk

13. Any notice that is personally delivered (including by means of professional messenger service, courier service such as United Parcel Service or Federal Express, or by U.S. Postal Service), shall be deemed received on the documented date of delivery thereof.

14. Assignment by Lender; Successors and Assigns. This Note shall be binding upon Maker and Maker’s heirs, successors and assigns; provided however, Maker may not assign this Note without City’s prior written consent except as may be permitted in accordance with the City Deed of Trust and the Affordable Housing Resale Restrictions. City may assign its rights to receive the proceeds under this Note to any person or entity without the consent of Maker, and upon notice to Maker of such assignment, all payments shall be made to the assignee.

15. No Joint Venture. The relationship of Maker and City under this Note is solely that of a participant and administrator of an affordable housing program, and in no manner are the City and the Maker partners or joint ventures, nor do any of the City Documents establish a principal and agent relationship between City and Maker.

16. Attorneys’ Fees and Costs. If any legal action is filed to interpret or enforce this Note, the prevailing party shall be entitled to an award of its reasonable attorneys’ fees, costs and expenses incurred therein. Maker agrees to pay all costs and expenses (including reasonable attorneys’ fees) that City may incur in connection with enforcement of this Note and collection of sums payable hereunder whether or not suit is filed.

Exhibit C
55394.00101\43423340.1
City Council 24 – 234 4/15/2025
DRAFT

17. No Third-Party Beneficiaries. This Note shall not benefit or be enforceable by any person or entity except the City and the Maker and their respective successors and assigns.

18. Entire Agreement; Amendments. This Note, together with the Affordable Housing Resale Restrictions and the City Deed of Trust, sets forth the entire understanding between Maker and the City with respect to the subject matter hereof. Any previous representations, warranties, agreements, and understandings among the parties regarding the subject matter of the Affordable Housing Resale Restrictions, this Note and City Deed of Trust whether written or oral, are superseded by the terms of the Affordable Housing Resale Restrictions, this Note and the City Deed of Trust. This Note may be modified or amended only by a written instrument duly executed by City and Maker.

19. No City Waiver. Any waiver of any term or provision of this Note must be in writing.

No waiver of any breach, default or failure of condition under this Note or any other City Document shall be implied from City’s failure or delay in declaring a default or exercising any of City’s rights or remedies with respect to such breach, default or failure, or from any previous waiver of any similar or unrelated breach, default or failure, nor shall acceptance by City of any payment hereunder constitute a waiver of City’s right to require prompt payment of any remaining amounts owed. Without limiting the generality of the foregoing, City’s failure or delay in declaring any amount due hereunder shall not constitute a waiver of City’s right to declare such sum due for the same or any subsequent event that triggers Maker’s payment obligations hereunder.

20. Severability. If any provision of this Note shall be held by a court of competent jurisdiction to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions of this Note shall not be affected or impaired thereby.

21. Controlling Law and Venue. The terms of this Note shall be interpreted under the laws of the State of California without regard to principles of conflicts of law. This Note was entered into and is to be performed in the County of Orange, which is the exclusive venue for any action or dispute arising hereunder.

22. Captions. All captions and headings in this Note are for the purposes of reference and convenience and shall be disregarded for all other purposes, including the construction or enforcement of any of the provisions of this Note.

23. Joint and Several. The obligations of each signatory to this Note shall be joint and several.

24. Time of the Essence. Time is of the essence with regard to all matters contained in this Note.

MAKER and HOMEBUYER:

Exhibit C
55394.00101\43423340.1
City Council 24 – 235 4/15/2025
DRAFT
By:_______________________________

Exhibit C
55394.00101\43423340.1
City Council 24 – 236 4/15/2025
DRAFT

EXHIBIT D

FORM OF CITY DEED OF TRUST

CITY DEED OF TRUST

RECORDING REQUESTED BY,
AND WHEN RECORDED MAIL TO:

City of Santa Ana
20 Civic Center Plaza (M-30)
P.O. Box 1988
Santa Ana, California 92702
Attention: City Clerk
Free Recording pursuant to
Government Code 6103 & 27383

CITY DEED OF TRUST, ASSIGNMENT OF RENTS AND SECURITY

AGREEMENT

THIS PERFORMANCE DEED OF TRUST, ASSIGNMENT OF RENTS AND SECURITY AGREEMENT (“Deed of Trust”) is made as of _______________, 20__, by _______________ and _______________ (collectively, “Trustor”) as Trustor, to the City of Santa Ana, as Trustee and Beneficiary (hereafter, "Trustee", "Beneficiary," or "City").

The Trustor, in consideration of the promises herein recited and the trust herein created, irrevocably and unconditionally grants, transfers, conveys and assigns to Trustee, in trust for the benefit of City, with power of sale and right of entry and possession, all of Trustor’s right, title and interest now held or hereafter acquired in and to the property located in the City of Santa Ana, Orange County, State of California, described in the attached Exhibit 1 and more commonly known as: _________________ (APN: _____) (the “Property”); TOGETHER with the rents, issues, and profits of such Property, subject however, to the right, power, and authority granted and conferred on City in this Deed of Trust to collect and apply the rents, issues, and profits; and TOGETHER with all the improvements now or hereafter erected on the Property, and all easements, rights of way, and appurtenances thereto, and all fixtures now or hereafter attached to the Property, all of which, including replacements and additions thereto, shall be deemed to be and remain a part of the Property covered by this Deed of Trust; All of the foregoing, together with the Property, is herein collectively referred to as the “Security.”
TO HAVE AND TO HOLD the Security, together with acquittances, to the Trustee, its successors and assigns forever;

Exhibit D
55394.00101\43423340.1
City Council 24 – 237 4/15/2025
DRAFT
TO SECURE to the City the payment of the sums, and the performance of the covenants and agreements of the Trustor evidenced by (i) that certain Affordable Housing Resale Restrictions, Equity Sharing and Regulatory Agreement executed by and between Trustor and City, dated as of the date hereof and recorded substantially concurrently herewith (the “Affordable Housing Resale Restrictions”), and (ii) that certain City Promissory Note (the “Note”) dated as of the date hereof and executed by Trustor for the benefit of City, pursuant to which Trustor is obligated to pay to City a City Equity Share, and all extensions, modifications, or renewals of the Note and the Affordable Housing Resale Restrictions. The Note and the Affordable Housing Resale Restrictions are incorporated herein by this reference; and TO SECURE the payment of all other sums, with interest thereon, advanced in accordance herewith to protect the security of this Deed of Trust and the performance of the covenants and agreements of Trustor herein contained.

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is agreed as follows:

1. Trustor’s Estate. Trustor represents and warrants that Trustor is lawfully seized of the estate hereby conveyed, has the right to grant and convey the Security, and that other than this Deed of Trust, the Security is encumbered only by: (1) that certain deed of trust executed by Trustor and recorded against the Property substantially concurrently herewith to secure repayment of a loan made by ___________________ (the “First Mortgage Lender”) to assist Trustor in the purchase of the Property and evidenced by a promissory note executed by Trustor in favor of the First Mortgage Lender in the original principal amount of [Dollars] ($ ____ )(the “First Mortgage Note”), and (2) the Affordable Housing Resale Restrictions. Trustor agrees to warrant and defend generally the title to the Security against all claims and demands, subject to any declarations, easements or restrictions listed in a schedule of exceptions to coverage in any title insurance policy insuring the City’s interest in the Security, and Trustor shall pay all costs and expenses, including cost of evidence of title and attorneys’ fees in a reasonable sum, in any such action or proceeding in which City or Trustee may appear, and in any suit brought by City to foreclose this Deed of Trust. As used in this Deed of Trust, the term “First Mortgage Lender” shall include all successors and assigns of the First Mortgage Lender with respect to the First Mortgage Note.

2. Note and Affordable Housing Resale Restrictions. Trustor will promptly pay when due all sums payable pursuant to the Note and shall perform all of Trustor’s covenants and obligations under the Note, the Affordable Housing Resale Restrictions, and this Deed of Trust.

The amount due under the Note is payable upon transfer of the Property following expiration of the Affordability Term. The Affordability Term expires on [ADD DATE THAT IS 55 YEARS FROM CERTIFICATE OF OCCUPANCY].

3. Charges and Liens. Trustor will promptly pay when due, the interest, principal, and all other charges accruing under any deed of trust, mortgage, or other instrument encumbering the Property, and will pay when due directly to the payee thereof all taxes, assessments and other charges, fines and impositions affecting the Property. Upon request by the City, Trustor will promptly furnish to the City copies of all notices of amounts due described in this Section and evidence of payment of such amounts. Trustor shall pay when due each obligation secured by or reducible to a lien, charge or encumbrance which now does or later may encumber or appear to encumber all or part of the Property or any interest therein, whether or not such lien, charge or

Exhibit D
55394.00101\43423340.1
City Council 24 – 238 4/15/2025
DRAFT
encumbrance is or would be senior or subordinate to this Deed of Trust; provided however, Trustor will not be required to discharge the lien of the deed of trust securing the First Mortgage Note (the “First Mortgage Deed of Trust”), and Trustor will not be required to pay any tax, charge, lien or assessment described in this Section so long as Trustor is actively contesting its validity in good faith and by appropriate legal proceedings that will operate to prevent the enforcement of the lien or forfeiture of the Property or any part thereof. Trustor shall post security for the payment of such contested claims as may be requested by the City.

4. Protection of Security. If Trustor fails to perform any of the covenants and agreements set forth in this Deed of Trust, or if any action or proceeding is commenced that materially affects City’s interest in the Property, including, but not limited to, default under any senior lienholder document, eminent domain, insolvency, code enforcement, arrangements or proceedings involving a bankrupt or decedent, foreclosure of any mortgage secured by the Property or sale of the Property under a power of sale of any instrument secured by the Property, City, at its option, without releasing Trustor from any obligation hereunder, may upon notice to Trustor, make such appearance, disburse such sums and take such action as is necessary to protect City’s interest, including, but not limited to, the purchase of insurance, disbursement of reasonable attorneys’ fees and entry upon the Property to make repairs. Any amounts disbursed by City pursuant to this Section, with interest thereon, shall become additional indebtedness of Trustor secured by this Deed of Trust. Unless Trustor and City agree to other terms of payment, such amounts shall be payable upon notice from City to Trustor requesting payment thereof, and shall bear interest from the date of disbursement at the highest rate permissible under applicable law.

Nothing contained in this Section shall require City to incur any expense or take any action hereunder.

5. Inspection. The City may make, or cause to be made, reasonable entries upon the Property and inspections of the Security; provided that the City will give Trustor reasonable notice of inspection.

6. Title Insurance. At Trustor’s expense, Trustor shall purchase a CLTA lender’s policy of title insurance for the benefit of City, insuring this Deed of Trust as a secondary lien on the Property, with no delinquent taxes or assessment liens appearing as exceptions to title.

7. Hazard Insurance. Trustor shall keep the Property insured by a standard all-risk property insurance policy with endorsements for vandalism, malicious mischief, and special extended perils, in the full replacement value of the improvements, and with endorsements for increases in costs due to changes in code and inflation, with loss payable to City and any superior trust deed holder, as their interests may appear, and any other insurance required by the City.

The insurance carrier providing such insurance shall be licensed to do business in the State of California and may be chosen by Trustor, subject to approval by City. All insurance policies and renewals thereof shall be in a form acceptable to the City, and shall include a standard mortgagee clause with standard lender's endorsement in favor of the holder of any senior lien and the City as their interests may appear and in a form acceptable to the City. Trustor shall provide City with copies of all policies and renewals thereof, certificates of insurance, all renewal notices and all receipts of paid premiums. In the event of loss, Trustor shall give prompt notice to the insurance carrier and the City or its designated agent. The City, or its designated agent, may make

Exhibit D
55394.00101\43423340.1
City Council 24 – 239 4/15/2025
DRAFT
proof of loss if not made promptly by Trustor. The policies shall include an endorsement providing that City shall receive thirty (30) days’ advance written notice of the cancellation, expiration or termination or any material change in the coverage afforded by any of the insurance policies required under this Section.

If the Property is acquired by the City, all right, title and interest of Trustor in and to any insurance policy and in and to the proceeds thereof resulting from damage to the Property prior to the sale or acquisition will pass to the City to the extent of the sums secured by this Deed of Trust immediately prior to such sale or acquisition, subject to the rights of the holder of any senior lien.

Renewal policies and any replacement policies, together with premium receipts satisfactory to the City, shall be delivered to the City at least thirty (30) days prior to the expiration of existing policies. Neither Trustee nor the City shall by reason of accepting, rejecting, approving or obtaining insurance incur any liability for the existence, nonexistence, form or legal sufficiency of such insurance, or solvency of any insurer for payment of losses. The application of proceeds pursuant to this Section shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice.

8. Awards and Damages. Subject to the rights of senior lienholders, all judgments, awards of damages, settlements and compensation made in connection with or in lieu of (a) taking of all or any part of or any interest in the Property by or under assertion of the power of eminent domain, (b) any damage to or destruction of the Property or any part thereof by insured casualty, and (c) any other injury or damage to all or any part of the Property, are hereby assigned to and shall be applied to the restoration or repair of the Property (if applicable) or paid to the City. The City is authorized and empowered (but not required) to collect and receive any such sums and is authorized to apply them in whole or in part upon any indebtedness or obligation secured hereby, in such order and manner as the City shall determine at its option. The City shall be entitled to settle and adjust all claims under insurance policies provided under this Deed of Trust and may deduct and retain from the proceeds of such insurance the amount of all expenses incurred by it in connection with any such settlement or adjustment. All or any part of the amounts so collected and recovered by the City may be released to Trustor upon such conditions as the City may impose for its disposition. Application of all or any part of the amounts collected and received by the City or the release thereof shall not cure or waive any default under this Deed of Trust. If the Property is abandoned by Trustor, or if, after notice by City or its designated agent to Trustor that the condemnor or insurer offers to make an award or settle a claim for damages, Trustor fails to respond to City within thirty (30) days after the date such notice is mailed, City or its designated agent is authorized to collect and apply the proceeds, at City’s option, either to restoration or repair of the Property or to the sums secured by this Deed of Trust

9. Maintenance. Trustor shall maintain the Property and all structures and landscaping thereon in good condition and repair. Trustor agrees to complete installation of landscaping as approved by the City, and to diligently maintain and care for installed landscaping, using generally accepted methods of cultivation and watering. Trustor shall not remove or demolish any building located on the Property, and agrees to complete or restore promptly and in good and workmanlike manner any building which may be constructed, damaged or destroyed thereon, and to pay when due all claims for labor performed and materials furnished therefor, and to comply with all laws affecting the Property or requiring any alterations or improvements to be

Exhibit D
55394.00101\43423340.1
City Council 24 – 240 4/15/2025
DRAFT
made thereon. Trustor shall not commit or permit waste thereof, and shall not commit or permit any act upon the Property in violation of applicable laws. Trustor will comply with all applicable laws, ordinances and governmental regulations affecting the Property or requiring any alteration or improvement thereof, and will not suffer or permit any violations of any such law, ordinance or governmental regulation, nor of any covenant, condition or restriction affecting the Property. If there arises a condition in contravention of this Section, and if the Trustor has not cured such condition within thirty (30) days after receiving a notice from City of such a condition, then in addition to any other rights available to City, City shall have the right (but not the obligation) to perform all acts necessary to cure such condition, and to establish or enforce a lien or other encumbrance against the Property to recover its cost of cure.

10. Occupancy. Trustor shall occupy the Property as Trustor’s primary residence, and the Property shall be used as the primary residence of Trustor and Trustor’s household and for no other purpose. The Property shall not be leased or rented by Trustor to any person or entity other than as expressly permitted by the Affordable Housing Resale Restrictions or consented to by City in writing. The City shall have the right to monitor whether the Property is owner-occupied by requesting that Trustor provide City with a written certification under penalty of perjury that the Property is owner-occupied, accompanied by supporting documentation reasonably satisfactory to the City.

11. Transfer. Trustor shall not allow any Further Encumbrance or Transfer of the Property (as such terms are defined in the Affordable Housing Resale Restrictions) any without complying with all requirements of the Affordable Housing Resale Restrictions.

12. Assignment of Rents. Trustor hereby irrevocably, absolutely, presently and unconditionally assigns to City the rents, issues, revenue and profits of the Property. This is an absolute assignment and not an assignment for security only. Subject to the limitations on lease or rental of the Property as set forth herein and in the Affordable Housing Resale Restrictions, City hereby confers upon Trustor a license to collect and retain such rents, issues, revenue and profits, as they become due and payable prior to any Default hereunder. Upon the occurrence of any such Default, City may terminate such license without notice to or demand upon Trustor and without regard to the adequacy of any security for the indebtedness hereby secured, and may either in person, by agent, or by a receiver to be appointed by a court, enter upon and take possession of the Property or any part thereof, and sue for or otherwise collect such rents, issues, and profits, including those past due and unpaid, and apply the same, less costs and expenses of operation and collection, including reasonable attorneys’ fees, to any indebtedness secured hereby, and in such order as City may determine. City’s right to the rents, issues, revenue and profits of the Property does not depend upon whether or not City takes possession of the Property. The entering upon and taking possession of the Property, the collection of such rents, issues, revenue and profits, and the application thereof as aforesaid, shall not cure or waive any default or notice of default hereunder or invalidate any act done pursuant to such notice. If a Default occurs while City is in possession of all or part of the Property and/or is collecting and applying rents as permitted under this Deed of Trust, City, Trustee and any receiver shall nevertheless be entitled to exercise and invoke every right and remedy afforded any of them under this Deed of Trust and at law or in equity, including the right to exercise the power of sale granted hereunder. Regardless of whether or not City, in person or by agent, takes actual possession of the Property, City shall not be deemed to be a

Exhibit D
55394.00101\43423340.1
City Council 24 – 241 4/15/2025
DRAFT
“mortgagee in possession,” shall not be responsible for performing any obligation of the lessor under any lease, shall not be liable in any manner for the Property, or the use, occupancy, enjoyment or operation of any part of it , and unless due solely to the willful misconduct or gross negligence of City, shall not be responsible for any dangerous or defective condition of the Property or any negligence in the management, repair or control of the Property.

13. Default. An event of default (“Default”) shall arise hereunder upon the occurrence of any one or more of the following and the expiration of any applicable cure period:
a.
b.

Trustor fails to occupy the Property as Trustor’s principal residence; The sale, conveyance, encumbrance, refinance, assignment, or other transfer of the Property including without limitation, the lease or rental of the Property in violation of the Affordable Housing Resale Restrictions;
c. An event of default arises under the Note or the Affordable Housing Resale Restrictions, and such default remains uncured following the expiration of any applicable cure period;
d. Trustor fails to pay when due any sum payable pursuant to the Note, the Affordable Housing Resale Restrictions or this Deed of Trust; e. The Property is refinanced or encumbered in violation of the Affordable Housing Resale Restrictions or this Deed of Trust;
f. Trustor fails to maintain insurance on the Property as required by the Affordable Housing Resale Restrictions and this Deed of Trust, g. Subject to Trustor’s right to contest the following charges, Trustor fails to pay prior to delinquency taxes or assessments due on the Property or fails to pay when due any other charge that may result in a lien on the Property, and Trustor fails to cure such default within twenty (20) days of date of delinquency, but in all events prior to the time that the holder of such lien has the right to pursue foreclosure thereon;
h. Trustor declares bankruptcy or makes an assignment of assets for the benefit of creditors, or an order for relief is entered under federal bankruptcy laws as to Trustor, or Trustor is adjudicated as insolvent or bankrupt pursuant to the provisions of any state or federal insolvency or bankruptcy, or Trustor consents to, acquiesces in, or attempts to secure the appointment of, any receiver for all or any substantial part of the Property; i. The occurrence of an event of default under any loan secured by the Property and the continuance of such default beyond the expiration of all applicable cure periods such that the holder of such loan has the right to accelerate such loan. j. Trustor fails to observe or perform any other covenant, condition, or agreement to be observed or performed by Trustor pursuant to the Note, the Affordable Housing Resale Restrictions or this Deed of Trust.

Exhibit D
55394.00101\43423340.1
City Council 24 – 242 4/15/2025
DRAFT

14. Remedies. Upon the occurrence of a Default, the giving of notice thereof and the expiration of any applicable cure period, City may, at its option, exercise any one or more of the following remedies:
a. Declare all of the sums payable under the Note to be immediately due and payable without further demand.
b.
c.

Pursue the exercise of the power of sale provided under this Deed of Trust.

Either in person or by agent, with or without bringing any action or proceeding, or by a receiver appointed by a court, enter upon, take possession thereof (or any part thereof) and of any of the Security, in its own name or in the name of Trustee, and do any acts which it deems necessary or desirable to preserve the value or marketability of the Property, or part thereof or interest therein, increase the income therefrom, or protect the security thereof. The entering upon and taking possession of the Security shall not cure or waive any breach hereunder or invalidate any act done in response to such breach and, notwithstanding the continuance in possession of the Security, the City shall be entitled to exercise every right and remedy provided under the Note, this Deed of Trust, or the Affordable Housing Resale Restrictions, or by law upon occurrence of any uncured breach.
d. Commence an action to foreclose this Deed of Trust as a mortgage, appoint a receiver, or specifically enforce any of the covenants hereof. e. Exercise any option to purchase the Property, as authorized pursuant to the Affordable Housing Resale Restrictions.
f. Exercise all other rights and remedies provided herein, in the instruments by which the Trustor acquires title to any Security, or in any other document or agreement now or hereafter evidencing, creating or securing all or any portion of the obligations secured hereby. g.

Acceleration and Sale.
a. Notice of Default. Upon Trustor’s breach of any covenant or agreement of Exercise any other remedy provided by law or in equity.

15. Trustor under the Note, the Affordable Housing Resale Restrictions or this Deed of Trust, City shall mail notice to Trustor as provided in Section 24 hereof specifying: (i) the nature of the breach; (ii) the action required to cure such breach; (iii) a date no less than thirty (30) days from the date the notice is mailed to Trustor by which such breach must be cured or such shorter cure period as may be provided in the Note, the Affordable Housing Resale Restrictions or this Deed of Trust; and (iv) that failure to cure such breach on or before the date specified in the notice may result in acceleration of the Loan and the sale of the Property. The notice shall further inform Trustor of Trustor’s right to reinstate after acceleration and the right to bring a court action to assert the nonexistence of a default or any other defense of Trustor to acceleration and sale. If the breach is not cured on or before the date specified in the notice, City at City’s option declare all of the sums secured by this Deed of Trust to be immediately due and payable without further demand and may invoke the power of sale and/or pursue any other remedy provided herein or available under law.

Exhibit D
55394.00101\43423340.1
City Council 24 – 243 4/15/2025
DRAFT
City shall be entitled to collect from the Trustor, or from the proceeds of the sale of the Property, all reasonable costs and expenses incurred in pursuing the remedies provided hereunder, including, but not limited to, reasonable attorneys’ fees.

If a non-monetary default is not reasonably capable of being cured within thirty (30) days, the City, in its sole and absolute discretion, may grant the Trustor or the First Mortgage Lender such additional time as is reasonably necessary to cure the default provided that the Trustor or the First Mortgage Lender (i) initiates corrective action within said period, and (ii) diligently, continually, and in good faith works to effect a cure as soon as possible.

Notwithstanding the cure periods established in this Section, in no event shall the City be precluded from sooner exercising any remedies if its security becomes or is about to become materially jeopardized by any failure to cure a default or the default is not cured within ninety (90) days after the first notice of default or delinquency is given. b. Trustor’s Right to Reinstate. Notwithstanding City’s acceleration of the sums secured by this Deed of Trust, Trustor will have the right to have any proceedings begun by City to enforce this Deed of Trust discontinued at any time prior to five (5) days before sale of the Property pursuant to the power of sale contained in this Deed of Trust or at any time prior to entry of the judgment enforcing this Deed of Trust if: (a) Trustor pays City all sums which would be then due under this Deed of Trust and the Note had no acceleration occurred; (b) Trustor pays all reasonable expenses incurred by City and Trustee in enforcing the covenants and agreements of Trustor contained in this Deed of Trust, including, but not limited to, reasonable attorneys’ fees; Trustor cures all breaches of any other covenants or agreements of Trustor set forth in the Affordable Housing Resale Restrictions and this Deed of Trust; and (d) Trustor takes such action as City may reasonably require to assure that the lien of this Deed of Trust, City’s interest in the Property and Trustor’s obligation to pay the sums and perform the obligations secured by this Deed of Trust shall continue unimpaired. Upon such payment and cure by Trustor, this Deed of Trust and the obligations secured hereby will remain in full force and effect as if no acceleration had occurred.
c. Sale. After delivery to Trustee of a Notice of Default and Demand for Sale and after the expiration of such time and the giving of such notice of default and sale as may then be required by law, and without demand on Trustor, Trustee shall sell the Property at the time and place of sale fixed by it in said notice of sale, at public auction to the highest bidder for cash in lawful money of the United States of America, payable at time of sale. Trustee may postpone sale of all or any portion of the Property by public announcement at such time and place of sale and from time to time thereafter may postpone such sale by public announcement at the time and place fixed by the preceding postponement. Any person, including Trustor, Trustee or the City, may purchase at such sale. Upon such sale by Trustee it shall deliver to such purchaser its deed conveying the Property so sold, but without any covenant or warranty expressed or implied. The recitals in such deed of any matters or facts shall be conclusive proof of their truthfulness. Upon sale by Trustee and after deducting all costs, expenses and fees of Trustee, Trustee shall apply the proceeds of sale to the payment of the indebtedness hereby secured, including without limitation the indebtedness evidenced by the Note, any advances made or costs or expenses paid or incurred by City under this Deed of Trust, any indebtedness evidenced by any other instrument hereby

Exhibit D
55394.00101\43423340.1
City Council 24 – 244 4/15/2025
DRAFT
secured, and all other sums then secured hereby, including without limitation, interest as provided in the Note and the Affordable Housing Resale Restrictions, in such order as the City shall direct; and then the remainder, if any, shall be paid to the person or persons legally entitled thereto.

16. Remedies Cumulative; No Waiver. No exercise of any right or remedy by the City or Trustee hereunder shall constitute a waiver of any other right or remedy herein contained or provided by law, and no delay or forbearance by the City or Trustee in exercising any such right or remedy hereunder shall operate as a waiver thereof or preclude the exercise thereof in any continued or subsequent default hereunder. All remedies provided in this Deed of Trust are distinct and cumulative to any other right or remedy under this Deed of Trust or any other document, or afforded by law or equity, and may be exercised concurrently, independently or successively. No sale of the Property, forbearance on the part of City, or extension of the time for payment of the indebtedness hereby secured shall operate to release, discharge, waive, modify, change or affect the liability of Trustor either in whole or in part.

17. Indemnity. Trustor agrees to defend, indemnify, and hold the Santa Ana, and its elected and appointed officers, officials, employees, and agents harmless from all losses, damages, liabilities, claims, actions, judgments, costs, and reasonable attorneys’ fees that they may incur as a direct or indirect consequence of: (i) Trustor’s failure to perform any obligations as and when required by the Note, the Affordable Housing Resale Restrictions, or this Deed of Trust; or (ii) the failure at any time of any of Trustor’s representations or warranties herein or in the Affordable Housing Resale Restrictions or the Note to be true and correct.

18. Due on Transfer of the Property. If the Trustor sells, conveys, assigns, transfers, alienates, or otherwise disposes of its interest in the Property, either voluntarily or involuntarily or by operation of law, in part or in full, in violation of the Affordable Housing Resale Restrictions, the City may, at its option, require immediate payment in full of all sums due under the Note.

19. Reconveyance. Upon payment of all sums and satisfaction of all obligations secured by this Deed of Trust, including without limitation, payment of the City Equity Share as defined in the Affordable Housing Resale Restrictions, and upon the expiration or termination of the Affordable Housing Resale Restrictions, the City will provide a written request to the Trustee to reconvey the Security and will surrender this Deed of Trust and the Note to Trustee. The Trustee shall reconvey the Security without warranty and without charge to the person or persons legally entitled thereto. Such person or persons shall pay all costs of recordation, if any. The recitals in the reconveyance of any matters or facts shall be conclusive proof of the truthfulness thereof.

20. Trustee Substitution. The City, at its option and without prior notice, may from time to time, by written instrument, remove the Trustee and appoint a successor trustee pursuant to a written instrument executed by City and duly acknowledged and recorded in the Official Records of Orange. Such instrument shall be conclusive proof of proper substitution of such successor Trustee or Trustees, who shall, without conveyance from the predecessor Trustee, succeed to all the title, estate, power and duties conferred upon the Trustee herein and by applicable law. Such instrument shall set forth the name of the Trustor, the original Trustee and the Beneficiary hereunder, the book and page where this Deed of Trust is recorded, and the name and address of the new Trustee.

Exhibit D
55394.00101\43423340.1
City Council 24 – 245 4/15/2025
DRAFT

21. City’s Rights to Release. Without affecting the liability of any person for payment of any indebtedness hereby secured (other than any person released pursuant hereto), including without limitation any one or more endorsers or guarantors, and without affecting the lien hereof upon any of the Property not released pursuant hereto, at any time and from time to time without notice: (a) City may in its sole discretion: (i) release any person now or hereafter liable for payment of any or all such indebtedness, (ii) extend the time for or agree to alter the terms of payment of any or all of such indebtedness, and (iii) release or accept additional security for such indebtedness, or subordinate the lien or charge hereof; and (b) Trustee, acting pursuant to the written request of the City, may reconvey all or any part of the Property, consent to the making of any map or plot of the Land, join in granting any easement thereon, or join in any extension agreement of any agreement subordinating the lien or charge hereof.

22. Subordination. Absent the prior written consent of City, this Deed of Trust shall not be subordinated to any other deed of trust or encumbrance on the Property, except a First Lien, as allowed by the Affordable Housing Resale Restrictions.

23. Request for Notice. City requests that copies of any notice of default and notice of sale affecting the Property be sent to City at its address set forth herein. City shall record a Request for Notice of Default and Sale.

24. Notices. All notices, requests, demands, reports or other communications regarding this Deed of Trust shall be in writing and delivered: (i) personally; or (ii) by independent, reputable, overnight commercial courier; or (iii) by deposit in the United States mail, postage and fees fully prepaid, registered or certified mail, with return receipt requested, and addressed as follows, or to such other address as specified in written notice delivered to the parties pursuant to this Section:

To Trustor:

To City:

At the Property address.

City of Santa Ana
20 Civic Center Plaza (M-30)
Santa Ana, CA 92702
Attn: City Clerk
Any notice that is personally delivered (including by means of professional messenger service, courier service such as United Parcel Service or Federal Express, or by U.S. Postal Service), shall be deemed received on the documented date of delivery thereof.

25. Successors Bound. The terms of this Deed of Trust shall be binding upon the Trustor and the Trustor’s heirs, legatees, devisees, administrators, executors, successors and assigns.

26. Attorneys’ Fees and Costs. If any legal action is filed to enforce or interpret this Deed of Trust, or the interpretation or enforcement thereof, the prevailing party shall be entitled to an award of its reasonable attorneys’ fees, costs and expenses incurred therein.

Exhibit D
55394.00101\43423340.1
City Council 24 – 246 4/15/2025
DRAFT

27. No Waiver. Any waiver of any term or provision of this Deed of Trust must be in writing. No waiver shall be implied from any delay or failure by City to take action on any breach or default hereunder or to pursue any remedy allowed under this Deed of Trust or applicable law.

No failure or delay by City at any time to require strict performance of any provision of this Deed of Trust or to exercise any election contained herein or any right, power or remedy hereunder shall be construed as a waiver of any other provision or any succeeding breach of the same or any other provision hereof or a relinquishment for the future of such election.

28. No Third-Party Beneficiaries. This Deed of Trust shall not benefit or be enforceable by any person or entity except the City, the Trustee, and the Trustor and their respective successors and assigns.

29. Entire Agreement. This Deed of Trust, together with the Affordable Housing Resale Restrictions and the Note, sets forth the entire understanding between Trustor and the City with respect to the subject matter hereof. Any previous representations, warranties, agreements, and understandings among the parties regarding the subject matter of the Affordable Housing Resale Restrictions, this Deed of Trust and Note whether written or oral, are superseded by the terms of the Affordable Housing Resale Restrictions, the Note and this Deed of Trust.

30. Amendments. This Deed of Trust shall not be amended except by a written instrument duly executed by Trustor and Beneficiary and recorded in the Official Records of Orange.

31. Severability. If any provision of this Deed of Trust shall be held by a court of competent jurisdiction to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions of this Deed of Trust shall not be affected or impaired thereby.

32. Controlling Law and Venue. The terms of this Deed of Trust shall be interpreted under the laws of the State of California without regard to principles of conflicts of law. This Deed of Trust was entered into and is to be performed in the County of Orange, which is the exclusive venue for any action or dispute arising out of this Deed of Trust.

33. Captions and Gender. All captions and headings in this Deed of Trust are for the purposes of reference and convenience and shall be disregarded for all other purposes, including the construction or enforcement of any of provisions thereof. Whenever the context so requires, the masculine gender includes the feminine and/or neuter, and the singular number includes the plural.

34. Joint and Several. The obligations of each signatory to this Deed of Trust shall be joint and several.

35. Time of the Essence. Time is of the essence with regard to all matters contained in this Deed of Trust.

Exhibit D
55394.00101\43423340.1
City Council 24 – 247 4/15/2025
DRAFT
[SIGNATURES ON FOLLOWING PAGE]
IN WITNESS WHEREOF, Trustor has executed this Deed of Trust as of the date first written above.

TRUSTOR:

By: _________________________
Print Name: ___________________
By: _________________________
Print Name: ____________________
(Signatures must be acknowledged by notary)

Exhibit D
55394.00101\43423340.1
City Council 24 – 248 4/15/2025
DRAFT

CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
A notary public or other officer completing this
certificate verifies only the identity of the
individual who signed the document to which this
certificate is attached, and not the truthfulness,
accuracy, or validity of that document.

State of California County of Orange} ss.

On ____________________, 20___, before me, ___________________, a Notary Public, personally appeared _____________ who proved to me on the basis of satisfactory evidence to be the person/s whose name/s is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity/ies, and that by his/her/their signature/s on the instrument the person/s, or the entity upon behalf of which the person/s acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing is true and correct.

WITNESS my hand and official seal Signature of Notary Public ____________________________________________

Exhibit D
55394.00101\43423340.1
City Council 24 – 249 4/15/2025
DRAFT
EXHIBIT 1 OF DEED OF TRUST

LEGAL DESCRIPTION

Exhibit 1
of Deed of Trust (Legal Description)
55394.00101\43423340.1
City Council 24 – 250 4/15/2025

EXHIBIT E

INCOME VERIFICATION FORM
Affordable Unit Address: ________________________________________________________________ Head of Household (Print Name):

Current Address (if
different from above):

Telephone Number:

Email address:

Home: Work: Cell:

Date of Birth: Social Security # or TIN:

Household Composition
List All Household Members Living in the Affordable Unit Dependent Social Security #
Name Sex Age (Y/N) or Taxpayer ID #
List additional household members on a separate sheet of paper.

Exhibit E
55394.00101\43423340.1 City Council 24 – 251 4/15/2025

INCOME VERIFICATION FORM
Monthly Gross Income *
List All Sources of Income of All Household Members Living in the Affordable Unit Part 1: Earned Income
Other
Head of Household
Household Members Total

1. Gross wages, before payroll deductions and
including overtime pay, commissions, fees, tips
and bonuses.
$ $ $

2. 3.

Net income from self employment, independent
contractor work or a business.
$
$
$
$
$
Social security and any payments from annuities, $
insurance policies, pension/retirement funds,
disability or death benefits received periodically.

4. Payment in lieu of earnings, such as $ $ $
unemployment, disability compensation, worker’s
compensation and severance pay.

5. 6.

7. Public assistance, welfare payments $
$
$
$
$
$
$
$
$
Alimony, child support, other periodic allowances
Regular pay, special pay and allowances of
members of the Armed Forces

8. Other $ $ $
Subtotal: Monthly Earned Income $
Total Monthly Earned Income x 12 = $_______________ Total Annual Household Gross Earned Income

INCOME VERIFICATION FORM
Monthly Gross Income *

Exhibit E
55394.00101\43423340.1 City Council 24 – 252 4/15/2025
List All Sources of Income of All Household Members Living in the Affordable Unit Part 2: Investment Income
Total
Other Adult Household
Investment
Income
Head of Household
Household Members

1. 2.

Interest paid on Bank and Savings accounts $
$
$
$
$
Dividends and other payments from stocks and $
bonds

3. 4.

Income from real property (i.e. rental property)
Other (describe)
$
$
$
$
$
$
Subtotal: Monthly Investment Income: $
Total Monthly Investment Income x 12 = $_______________ Total Annual Household Investment Income *Note: The following items are not considered income: casual or sporadic gifts; amounts specifically for or in reimbursement of medical expenses; lump sum payments such as inheritances, insurance payments, capital gains and settlement for personal or property losses; educational scholarships paid directly to the student or educational institution; special pay to a serviceman head of family away from home and under hostile fire; relocation payments under federal, state or local law; foster child care payments; value of coupon allotments for purpose of food under Food Stamp Act of 1964 which is in excess of amount actually charged the eligible household; payments received pursuant to participation in the following programs: VISTA, Service Learning Programs, and Special Volunteer Programs, SCORE, ACE, Retired Senior Volunteer Program, Foster Grandparent Program, Older American Community Services Program, and National Volunteer Program to Assist Small Business Experience.

Exhibit E
55394.00101\43423340.1 City Council 24 – 253 4/15/2025

INCOME VERIFICATION FORM
Assets **
List the Current Value of All Assets of All Household Members Living in the Affordable Unit If the Asset generates income, that income must be specified In Part 2 above Other Adult
Head of
Household
Value
Household
Members
Value
Total Value of
Assets

1. $

2. 3.

4. Bank and Savings accounts
Stocks and bonds
$
$
$
$
$
$
$
$
$
$
$
Real property (i.e. rental property)
Other (describe)
Total Asset Value $______________________
**Note: Necessary items, such as furniture and automobiles, used for personal use are excluded from household assets. Collections of items for hobby, investment or business purposes must be included in household assets. If the total value of household assets exceeds $5,000, the calculation of the household’s annual income shall include the greater of the actual amount of income, if any, derived from all of the household assets; or 10% of the total value of the assets.

Exhibit E
55394.00101\43423340.1 City Council 24 – 254 4/15/2025

INCOME VERIFICATION FORM
If the total asset value exceeds $5,000, perform the calculations in the following table. If the total asset value is less than $5,000, the amount of investment income to be included in annual household income is $0.

Calculation of Investment Income to be Included in Annual Household Income

1. 2.

Total Annual Household Investment Income
Total Asset Value
$
$ x 10% $
The Greater of #1 or #2 = Investment Income to be Included in Annual Household Income $___________ Calculation of the Household’s Total Annual Income
Total Annual Household Gross Earned Income $
Total Investment Income to be Included in Annual Household Income $ Total Household Income $
Documentation
Attach True Copies of the Relevant Documents Listed Below Paycheck stubs from three most recent
pay periods Bank/Savings account verification
Employment verification Self-employment verification
Three years Income tax returns for Title
Holders Unemployment verification
Social security verification Welfare verification
Alimony/child support verification
Other (Describe)
Disability income verification

Exhibit E
55394.00101\43423340.1 City Council 24 – 255 4/15/2025

AFFIDAVIT
This Affidavit is made with the knowledge that it will be relied upon by _____________ and the City of Santa Ana to determine maximum income for eligibility to purchase the Affordable Unit listed above. (I/we) warrant that all information set forth in this document is true, correct and complete and based upon information (I/we) deem reliable and based upon such investigation as (I/we) deemed necessary.
(I/We) acknowledge that (I/we) have been advised that the making of any misrepresentation or misstatement in this affidavit will constitute a material breach of (my/our) purchase agreement and will additionally enable the seller to terminate the purchase contract and sell the Affordable Unit to another party.
(I/We) do hereby swear under penalty of perjury that the foregoing statements are true and correct and that this affidavit has been executed as of the date specified below by each adult member of the household which intends to occupy an Affordable Unit located at ______________________ ,Santa Ana, California.

Signature Date
Printed Name
Executed at __________________________________, Santa Ana, California Signature Date
Printed Name
Executed at __________________________________, Santa Ana, California

Exhibit E
55394.00101\43423340.1
City Council 24 – 256 4/15/2025

EXHIBIT F

CERTIFICATION OF CONTINUED OCCUPANCY
Date:

Owner(s) Name:

Address: Santa Ana, CA
We are the Owners of an Inclusionary Unit that was produced under the requirements of the City of Santa Ana Inclusionary Housing Ordinance. We understand and agree that the Inclusionary Unit must be used as our Primary Residence and for no other purpose.

By this Certification, we declare under penalty of perjury that:

1. 2.

3. 4.

We currently occupy the Inclusionary Unit; and
We have occupied the Inclusionary Unit for at least ten (10) out of the past twelve (12) months; and We have not used the Inclusionary Unit for any other purpose than as our Primary Residence; and We are not renting or leasing any part of the Inclusionary Unit to another party.

We have attached true and accurate copies of two utility bills or other documentation evidencing our continued occupancy of the Inclusionary Unit.

We acknowledge that any intentional or negligent misrepresentation in this Certification may result in civil liability and/or criminal penalties including, but not limited to, fine or imprisonment, or both, and liability for monetary damages under the provisions of Title 18, United States Code, Section 100.1, et seq.

Signed: _____________________________
Signed: _____________________________

Exhibit F
55394.00101\43423340.1
City Council 24 – 257 4/15/2025

EXHIBIT G

FORM OF NOTICE OF AFFORDABILITY RESTRICTIONS ON TRANSFER OF

PROPERTY

RECORDING REQUESTED BY,
AND WHEN RECORDED MAIL TO:

City of Santa Ana
20 Civic Center Plaza (M-30)
P.O. Box 1988
Santa Ana, California 92702
Attention: City Clerk
Free Recording pursuant to
Government Code 6103 & 27383

NOTICE OF AFFORDABILITY RESTRICTIONS ON

TRANSFER OF PROPERTY
This Notice of Affordability Restrictions on Transfer of Property (or “Notice of Affordability Restrictions”) is executed and recorded pursuant to the Density Bonus Housing Agreement With Declaration of Covenants, Conditions, and Restrictions (the "Density Bonus Agreement"), recorded on or about __________, 202_, in the Official Records of Orange County, against that certain real property generally located at_______________ (APN: ______) in the City of Santa Ana, California (“City”) as legally described in Exhibit 1 hereto (“Property”). The City of Santa Ana, a municipal corporation (“City”), and
____________________________(collectively “Homebuyer”) have entered into that certain Affordable Housing Resale Restrictions, Equity Sharing, and Regulatory Agreement, dated concurrently herewith (“Affordable Housing Resale Restrictions”).

1. The Affordable Housing Resale Restrictions provides for affordability restrictions and restrictions on the transfer of the Property, as more particularly set forth in the Affordable Housing Resale Restrictions. A copy of the Affordable Housing Resale Restrictions is on file with City as a public record and is deemed incorporated herein. Reference is made to the Affordable Housing Resale Restrictions with regard to the complete text of the provisions of such agreement and all defined terms therein, which provides for affordability restrictions and restrictions on the transfer of the Property.

2. The Affordable Housing Resale Restrictions contains restrictions on the sale of the Property and an equity sharing agreement for Homebuyer to pay to the City certain proceeds from the sale of the Property upon the expiration of the Affordability Term for the Property.

Exhibit G
55394.00101\43423340.1
City Council 24 – 258 4/15/2025

2. The Affordable Housing Resale Restrictions contains restrictions on the sale of the Property and an equity sharing agreement for Homebuyer to pay to the City certain proceeds from the sale of the Property upon the expiration of the Affordability Term for the Property. (A) For a period commencing upon the date on which the Property receives a certificate of occupancy, which occurred on [DATE], and terminating on the date that is fifty five (55) years later (the "Affordability Term"), the Property may only be transferred to another eligible, qualified Very Low Income Household, at an Affordable Sales Price; such restrictions are set forth at greater length in the Density Bonus Agreement and the Affordable Housing Resale Restrictions.
(B) Upon expiration of the Affordability Term, the City is entitled to an amount of the proceeds from any Transfer that is equal to the City Equity Share, which is secured by the City Deed of Trust. The City Equity Share is based on the following: (i) an amount equal to the difference between the fair market value of the Affordable Unit at the time of the initial purchase and the Affordable Sales Price (the "Initial Subsidy"), plus (ii) an amount equal to the product of (1) the appreciation of the Affordable Unit, as measured by the increase in the fair market value of the Affordable Unit at the time of the sale to the Homebuyer and the resale of the Affordable Unit, and (2) the percentage that the initial subsidy represented of the fair market value of the Affordable Unit when it was purchased by the Homebuyer (the "Proportionate Share of Appreciation"). The City Deed of Trust will not be released as an interest in the Property or otherwise reconveyed unless and until the City is paid the City Equity Share in accordance with the Affordable Housing Resale Restrictions.

3. Prior to a transfer of the Property, Homebuyer must comply with requirements of the Affordable Housing Resale Restrictions, including but not limited to the following requirements of Section 5:
a. Notice to City. Homebuyer shall send the Notice of Intent to Transfer to City pursuant to Section of the Affordable Housing Resale Restrictions. b. Qualification of Proposed Transferee. During the Affordability Term, the proposed Transferee shall provide City with sufficient information in the form provided by City including without limitation, a certification as to the income and family size of the proposed Transferee, for City to determine if the proposed Transferee is a Very Low Income Household, and the proposed Affordable Sales Price.
c. Certificates from Parties. During the Affordability Term, Homebuyer and proposed Transferee each shall certify in writing, in a form acceptable to City, that the Transfer shall be closed in accordance with, and only with, the terms of the sales contract and other documents submitted to and approved by City and that all consideration delivered by the proposed Transferee to owner has been fully disclosed to City. The written certificate shall also include a provision that in the event a Transfer is made in violation of the terms of this Agreement or false or misleading statements are made in any documents or certificate submitted to City for its approval of the Transfer, City shall have the right to file an action at law or in equity to make the

Exhibit G
55394.00101\43423340.1
City Council 24 – 259 4/15/2025
parties terminate and/or rescind the sales contract and/or declare the sale void notwithstanding the fact that the Transfer may have closed and become final as between Homebuyer and Transferee. d. Written Consent of City Required Before Transfer. During the Affordability Term, the purchase sale agreement or other contract for Transfer of the Property, and the Income Verification Form, shall be provided to the City, which shall have at least thirty (30) days to review. The Property, and any interest therein, shall not be conveyed by any Transfer except with the express written consent of City, which consent shall be given only if the Transfer is in accordance with the provisions of this Agreement The Property, and any interest therein, shall not be conveyed by any Transfer except with the express written consent of City, which consent shall be given only if the Transfer is in accordance with the provisions of the Affordable Housing Resale Restrictions.
e. Notice of Prohibited Transfer. Within thirty (30) days after receiving all information required by the Affordable Housing Resale Restrictions, the City shall determine and give notice to Homebuyer as to whether the City consents to the Transfer as a Permitted Transfer, or if the City determines the proposed Transfer is a Prohibited Transfer. Any attempt to Transfer the Property without the City's written approval, or after the City has given notice of a Prohibited Transfer, shall be a Default of this Agreement, and the City may apply to a court of competent jurisdiction for specific performance of this Agreement, for an injunction prohibiting a proposed sale or Transfer in violation of this Agreement, for a declaration that the Prohibited Transfer is void, or for any such other relief as may be appropriate. f. Delivery of Documents. Upon the close of the proposed Transfer, Homebuyer and Transferee, as applicable, shall provide the City with a copy of the final sales contract, settlement statement, escrow instructions, all required certificates, and any other documents City may request.”

8. The Affordable Housing Resale Restrictions and the Density Bonus agreement both remain in full force and effect and are not amended or altered in any manner whatsoever by this Notice of Affordability Restrictions.

10. Capitalized terms shall have the meaning established under the Density Bonus Agreement or the Affordable Housing Resale Restrictions (including all Attachments or Exhibits thereto) excepting only to the extent as otherwise expressly provided under this Notice of Affordability Restrictions.

11. Persons having questions regarding this Notice of Affordability Restrictions, the Affordable Housing Resale Restrictions or the Density Bonus Agreement should contact City to obtain copies.

HOMEBUYER:

By:

By:_________________________________

Exhibit G
55394.00101\43423340.1
City Council 24 – 260 4/15/2025
(Signatures must be acknowledged by notary)

CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
A notary public or other officer completing this
certificate verifies only the identity of the
individual who signed the document to which this
certificate is attached, and not the truthfulness,
accuracy, or validity of that document.

State of California County of Orange} ss.

On ____________________, 20___, before me, ___________________, a Notary Public, personally appeared _____________ who proved to me on the basis of satisfactory evidence to be the person/s whose name/s is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity/ies, and that by his/her/their signature/s on the instrument the person/s, or the entity upon behalf of which the person/s acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing is true and correct.

WITNESS my hand and official seal Signature of Notary Public ____________________________________________

Exhibit G
55394.00101\43423340.1
City Council 24 – 261 4/15/2025
EXHIBIT 1 TO NOTICE OF AFFORDABILITY RESTRICTIONS

LEGAL DESCRIPTION

Exhibit 1
to Notice of Affordability Restrictions (Legal Description) 55394.00101\43423340.1
City Council 24 – 262 4/15/2025
Exhibit H

FORM OF REQUEST FOR NOTICE OF DEFAULT

RECORDING REQUESTED BY,
AND WHEN RECORDED MAIL TO:

City of Santa Ana
20 Civic Center Plaza (M-30)
P.O. Box 1988
Santa Ana, California 92702
Attention: City Clerk
Free Recording pursuant to
Government Code 6103 & 27383
REQUEST FOR NOTICE UNDER CIVIL CODE SECTION 2924B
In accordance with California Civil Code Section 2924b request is hereby made that a copy of any Notice of Default and a copy of any Notice of Sale under the Deeds of Trust recorded as Instrument Nos.

California,
, , and on _______ in the Official Records of County of Orange, and
describing land therein as:
[See Exhibit 1 attached hereto]
executed by ______________________________________, as Trustor/Borrower, in which the City of Santa Ana is named as Beneficiary and Trustee, be mailed to:

City of Santa Ana, 20 Civic Center Plaza (M-30) P.O. Box 1988, Santa Ana, CA 92702, Attention:

City Clerk.
[Signature on next page]

Exhibit H
55394.00101\43423340.1
City Council 24 – 263 4/15/2025
ATTEST: CITY OF SANTA ANA
Jennifer Hall
City Clerk
Alvaro Nuñez
City Manager
APPROVED AS TO FORM:

By: [NAME]
City Attorney

Exhibit H
55394.00101\43423340.1
City Council 24 – 264 4/15/2025
EXHIBIT 1 TO REQUEST FOR DEFAULT

LEGAL DESCRIPTION

Exhibit 1
to Request for Default (Legal Description)
55394.00101\43423340.1
City Council 24 – 265 4/15/2025
EXHIBIT 11
The Meritage Homes Project Sunshine Ordinance Meeting Materials may be accessed at:
https://www.santa-ana.org/mlc-holdings-meritage-homes-2020-east-first-street/ City Council 24 – 266 4/15/2025
City of Santa Ana
2020 E. 1st Street - Fiscal Impact &
Economic Benefit Analysis
February 27, 2025
Prepared for:

MLC Holdings, Inc.
5 Peters Canyon Road, Suite 310
Irvine, CA 92606
Prepared by:
28202 Cabot Road, Suite 620
Laguna Niguel, CA 92677
T. 949-542-7070
F. 949-542-7076
City Council 24 – 267 4/15/2025
MLC Holdings, Inc. - 2020 E. 1st Street
Fiscal Impact & Economic Benefit Report
February 27, 2025
2 | Page

1. INTRODUCTION
On behalf of MLC Holdings, Inc. (“Developer”), Zimmerman Group, Inc. has completed a fiscal impact analysis (“FIA”) and economic benefit analysis (“EBA”) for the proposed residential home development located at 2020 E. 1st Street (“Property”) in the City of Santa Ana (“City”).

There is an existing office building on the Property that is no longer in use, and Developer is proposing to develop 86 residential units (“Project”) on the Property. The Project is proposed to include seventy-five 3-story market rate townhomes, five 3-story affordable townhomes, and six 4-story urban duplex homes. The FIA portion of this report calculates the estimated annual recurring fiscal impact on the City’s general fund (“General Fund”) that will result from development of the proposed Project. The EBA portion of this report calculates the estimated onetime economic benefits to the City and surrounding area during the construction phase of the proposed Project.

2. FISCAL IMPACT ANALYSIS

2.1 PURPOSE & METHODOLOGY
The FIA analyzes the additional revenues and expenses to the City’s General Fund expected to result from the development of the Project. The additional revenues are then compared to the additional expenses to determine the net fiscal impact (surplus or deficit) on the City’s General Fund. Revenues and expenses are calculated using the case study method (“Case Study Method”) and per capita method (“Per Capita Method”). The Case Study Method uses Project specific variables, such as estimated home pricing, to determine the estimated impact on the General Fund. The Per Capita Method is based on the City’s total revenue or expense from the Adopted 2024-25 Budget, divided by the current service population to determine the average revenue or expense per person. For certain revenue and expense categories, adjustments are made to account for the marginal impact differing from the existing citywide average per capita amount. For example, there are certain fixed costs that are not expected to increase as a result of the Project development.

The estimated projected revenues and expenditures are based on information and assumptions for the proposed Project, data from the City’s Fiscal Year 2024-25 Operating Budget, 2024-25 tax City Council 24 – 268 4/15/2025
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rates and tax allocations from the Orange County Auditor Controller, 2024-25 assessed values and tax rate area information from the Orange County Treasurer, as well as statistical data from the California Department of Finance and the U.S. Bureau of Statistics.

2.2 CONCLUSIONS
A. Summary
The increase in General Fund revenues following buildout of the Project is estimated at approximately $340,716 per year, and the increase in General Fund expenses is estimated at approximately $231,055 per year. Accordingly, there is expected to be an annual surplus of approximately $109,662 to the General Fund following Project buildout. The table below summarizes the estimated annual General Fund revenues, expenses and surplus. As indicated, the revenue to expense ratio is 1.47, meaning the revenues exceed the expenses by approximately 47%.

City Council 24 – 269 4/15/2025
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TABLE 2-1
GENERAL FUND – FISCAL IMPACTS
Annual General Fund Revenues
Amount at
Buildout
Percent
of Total
Property Tax $107,512 31.6%
Prop Tax-In Lieu VLF 84,328 24.8%
Utility User Taxes 29,216 8.6%
Documentary Stamp Tax 4,162 1.2%
Sales Tax 32,023 9.4%
Sales Tax Measure X 48,034 14.1%
Half-Cent Sales Tax (Safety) 1,454 0.4%
Franchise Fees 10,655 3.1%
Fines and Forfeitures 4,882 1.4%
Charges for Services 18,449 5.4%
Total Revenues $340,716 100.0%
Annual General Fund Expenditures
Amount at
Buildout
Percent
of Total
Library 1,704 0.7%
Museum Fund 369 0.2%
Parks, Rec. & Community Services 6,924 3.0%
Police Department 139,957 60.6%
Fire & Emergency Medical Services 49,800 21.6%
Planning & Building 8,064 3.5%
Public Works 22,373 9.7%
Community Development 1,863 0.8%
Total Expenditures $231,055 100.0%
Annual Recurring Surplus/(Deficit) at Buildout $109,662 Revenues to Expenditure Ratio 1.47
B. Recurring Revenues
Property Tax
The County Auditor-Controller identifies property tax rates as a percentage of total assessed valuation by Tax Rate Area ("TRA"). The Project is located in TRA 11-029. Property tax revenues are calculated using the TRA apportionment factors to forecast property tax revenues City Council 24 – 270 4/15/2025
MLC Holdings, Inc. - 2020 E. 1st Street
Fiscal Impact & Economic Benefit Report
February 27, 2025
5 | Page
expected from the Project. Based on information provided by the Auditor-Controller’s office, the City General Fund receives approximately 17.27% of the basic one percent ad valorem property tax levy. Based on the projected assessed value for the Project, less the existing assessed value of the vacant office building, additional property tax revenues to the City’s General Fund are projected to be $107,512 annually at build-out. See Tables 2A and 3A of Appendix A for details of the property tax calculations.

Prop Tax-In Lieu VLF
Historically, approximately three-fourths of Vehicle License Fee (VLF) revenue was allocated to cities and counties as general-purpose funding. Beginning in 1998-99, the State reduced the VLF payment required from vehicle owners. However, the State made up the revenue impact of the VLF rate reductions with State General Fund revenue (the “VLF Backfill”). The VLF Backfill was eliminated in the 2004-05 State Budget. In that year, the VLF Backfill to cities and counties was permanently replaced with an equivalent increase in property tax revenues (Property Tax In Lieu of VLF). This increase was funded by decreases in property tax revenues allocated to schools and community colleges.

Annual Property Taxes in Lieu of VLF are estimated to be $84,328 for the Project as shown in Table 2A. Revenues from Property Taxes In Lieu of VLF are estimated at .13547% of the increase in assessed valuation of $62,246,082. This percentage is based on the total Property Tax In Lieu of VLF in the Adopted Budget of $44,009,010 divided by the total City assessed valuation of $32,485,033,990.

Utility User Taxes
Utility User Taxes are the taxes imposed by the City on the consumption of utility services, such as cell phones, cable television, electricity, gas, sanitation, sewer, telephone, and water. The Project is estimated to generate additional revenues of $29,216, based on the Per Capita Method, as shown in Table 5A of Appendix A.

Documentary Stamp Tax
Property transfer tax applies to all sales of real property at a rate of $1.10 per $1,000 of sale or resale value, excluding assumed liens or encumbrances. The City receives 50% of the City Council 24 – 271 4/15/2025
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February 27, 2025
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Documentary Stamp Tax, and it is assumed the Project will have a 10% turnover rate each year estimated to generate $4,162 per year in revenues to the City’s General Fund as shown in Table 2A of Appendix A.

Sales Tax
Sales tax revenues are generated by taxable purchases made within the City. As shown in Table 4A of Appendix A, it is anticipated that the Project will generate approximately $37,236 in annual taxable sales per unit totaling $3,202,296 in taxable sales at buildout. This includes only the taxable sales expected to be captured by the City. The City will receive 1.00% of taxable sales resulting in an estimated recurring annual sales tax revenue of $32,023 to the City General Fund.

Sales Tax Measure X
In November 2018, Santa Ana voters approved Measure X: the Santa Ana Neighborhood Safety, Unhoused Community prevention and Essential City Services Enhancement Measure. Measure X became effective April 1, 2019, and levies a local 1.5% sales tax rate, decreasing to 1.0% in 2029, then sunsets in 2039. Vital goods like groceries, gasoline, medication and housing are exempt from this tax. Revenues from Measure X at Project buildout are estimated to be $48,034 as shown in Table 4A of Appendix A.

Half-Cent Sales Tax (Safety)
The Half-Cent Sales Tax (Safety) revenues are funds to be dedicated to local public safety including sheriff, police, fire, county district attorneys, and corrections. The tax is collected by the State Board of Equalization and allocated to each county based on the county’s share of the state’s total taxable sales. The county then determines the amount each city is to receive from the tax. It is estimated the City receives 9.08% of the Half-Cent Sales Tax (Safety) revenues and the increase to the General Fund will be $1,454 for the Project as shown in Table 4A of Appendix A.

Franchise Fees
Franchise Fees are the fees paid by businesses such as utility companies for the use of public streets and roadways. The Project is estimated to generate additional revenues of $10,655, based on the Per Capita Method, as shown in Table 5A of Appendix A.

City Council 24 – 272 4/15/2025
MLC Holdings, Inc. - 2020 E. 1st Street
Fiscal Impact & Economic Benefit Report
February 27, 2025
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Fines and Forfeitures
Fines and Forfeitures include court fines, traffic school fines, alcohol education prevention, penalties and interest on late or unpaid taxes, and bail forfeitures. The Project is estimated to generate additional revenues of $4,882, based on the Per Capita Method, as shown in Table 5A of Appendix A.

Charges for Services
Charges for Services revenues are the revenues generated by the City for services it provides to the population of the City. The fees include, but are not limited to, youth sports, adult sports, zoo admissions, paramedic services, and plan checks. The Project is estimated to generate additional revenues of $18,449, based on the Per Capita Method, as shown in Table 5A of Appendix A.

C. Recurring Expenses
Library
The Library’s purpose is to respond to the City population’s informational, educational, and personal interest needs using books, materials, technology, e-resources and professional expertise.

The Project is estimated to generate additional costs of $1,704, based on the Per Capita Method and a marginal cost impact adjustment, as shown in Table 6A of Appendix A.

Museum Fund
The Museum Fund accounts for the City’s contractual obligation to maintain the City-owned building occupied by the Bowers Museum, which enriches lives through the world’s finest arts and cultures. The Project is estimated to generate additional costs of $369, based on the Per Capita Method and a marginal cost impact adjustment, as shown in Table 6A of Appendix A.

Parks, Rec. & Community Services
The Parks, Recreation and Community Services Department is responsible for delivering a variety of services to the community that includes hundreds of recreation programs annually, 49 parks, 6 community centers, 2 recreation centers, 2 senior centers, 10 fitness courts, 7 recreational trails, 5 municipal swimming pools, 5 community gardens, 2 log cabins, 3 skate parks, 2 lakes, 1 tennis City Council 24 – 273 4/15/2025
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February 27, 2025
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center, 1 stadium and operations of the Santa Ana Zoo. The Project is expected to generate additional costs of $6,924, based on the Per Capita Method and a marginal cost impact adjustment, as shown in Table 6A of Appendix A.

Police Department
The Santa Ana Police Department provides effective police services with integrity, respect, and compassion while fostering strong partnerships with the community. The Project is expected to generate additional costs of $139,957, based on the Per Capita Method, as shown in Table 6A of Appendix A.

Fire & Emergency Medical Services
The City contracts with Orange County Fire Authority and CARE Ambulance to provide emergency fire and medical response. The Project is expected to generate additional costs of $49,800, based on the Per Capita Method, as shown in Table 6A of Appendix A.

Planning & Building
The Planning and Building Agency plays a critical role in achieving the City Council’s goals for the physical development of the community. The agency’s objective is to provide a safe, attractive, and business friendly community through implementing state and local construction codes, as well as planning and regulating future land uses. The Project is expected to generate additional costs of $8,064, based on the Per Capita Method and a marginal cost impact adjustment, as shown in Table 6A of Appendix A.

Public Works
The Public Works Agency constructs and maintains public facilities and the public right-of-way, and provides water, sewer and contracted trash services. The Project is expected to generate additional costs of $22,373, based on the Per Capita Method and a marginal cost impact adjustment, as shown in Table 6A of Appendix A.

Community Development
The Community Development Agency (CDA) is responsible for providing services in the areas of economic development, job training, affordable housing, parking enterprise and downtown City Council 24 – 274 4/15/2025
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development. The Project is expected to generate additional costs of $1,863, based on the Per Capita Method and a marginal cost impact adjustment, as shown in Table 6A of Appendix A.

3. ECONOMIC BENEFIT ANALYSIS

3.1 PURPOSE & METHODOLOGY
The EBA portion of this analysis uses the IMPLAN modeling system to determine the one-time economic benefits to occur within the City during the construction phase of the proposed Project and how those impacts create additional one-time economic benefits throughout the local region.

IMPLAN is the most widely employed and accepted regional economic analysis software for predicting economic impacts. The IMPLAN model is used to predict the economic consequences of a development project within a local economy and measures the direct, indirect, and induced effects in terms of employment and earnings within a specific region. The analysis estimates the economic benefits of the increases in employment and labor income, based on the estimated total output of the proposed Project. Each economic benefit is then broken down into direct impacts caused by the output of goods and services on-site, indirect impacts caused by increases from the use of goods and services of industries that provide the direct goods and services to the proposed Project, and induced impacts caused by the increase in employment and household spending. The analysis uses the North American Industry Classification System to classify the industry of the proposed Project and then utilizes a Social Accounting Matrix to generate a transactions table that dictates how industries are connected to the rest of an economy. These measures of connectivity are referred to as multipliers. These multipliers are then utilized to estimate the indirect and induced impacts on employment and labor income to occur within the local region. In addition to the economic benefits indicated by the IMPLAN model, development of the Project will also generate various one-time revenues for the City and other local agencies in the form of impact fees and other fees.

3.2 ECONOMIC BENEFITS
This EBA focuses on the direct benefits estimated to occur within the City and the increases in employment and labor income during the construction phase of the proposed Project. The proposed Project is expected to start vertical construction in September 2026 and to finish in January 2028. The total construction budget is expected to be $28.6 million and is the output City Council 24 – 275 4/15/2025
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February 27, 2025
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metric used to determine the associated increases in employment, labor income, and value added in the IMPLAN analysis.

The one-time economic benefits for the direct impacts on the City from the construction phase of the proposed Project are an increase in employment by 140.26 full-time equivalent constructionrelated jobs and an increase in labor income of $12,250,665. Indirect and induced impacts expected to occur within the surrounding area of the proposed Project can be found in Table 1B of Appendix B.

3.3 ONE-TIME FEES
During the construction of the Project, development impact fees required by the applicable public agencies will be paid. The estimate of development impact fees applicable to the Project are as follows:

TABLE 3-1

DEVELOPMENT IMPACT FEES
Public Agency Estimate of Project Fees
City of Santa Ana – DIF $647,778
Santa Ana Unified School District Fee 727,398
Transportation Corridor Agencies 235,812
County of Orange Sanitation District 578,514
Total Fees $2,189,502
These development impact fees are considered one-time revenues and are estimates based on current fee schedules from each public agency effective at the time of this report. Development impact fees are subject to change and increase annually based on the policies of the public agency.

City Council 24 – 276 4/15/2025

APPENDIX A

FISCAL IMPACT CALCULATIONS

PROPOSED RESIDENTIAL PROJECT
City Council 24 – 277 4/15/2025
TABLE 1A

ESTIMATE OF PROJECT POPULATION
2020 E. 1ST STREET - FISCAL IMPACT ANALYSIS

PROPOSED RESIDENTIAL PROJECT
City-Wide Household Population (a) 306,488
Number of Housing Units (a) 80,468
City-Wide Average Persons Per Unit 3.81
Project Residential Units at Buildout 86
Total Project Population at Buildout 328
Footnotes:
(a) Source: E-5 City/County Population and Housing Estimates, 1/1/2024 from the Department of Finance.

City Council 24 – 278 4/15/2025
TABLE 2A

ESTIMATE OF REVENUES FROM PROPERTY TAXES
2020 E. 1ST STREET - FISCAL IMPACT ANALYSIS

PROPOSED RESIDENTIAL PROJECT
Property Tax Levy 1.00% In-Lieu Property Tax Per $1,000 of Transfer Tax Rate (d) 0.055% City Portion (b) 17.27% AV Growth (c) $1.3547 Turnover Rate (e) 10.00% Floor Plan
Unit
Mix (a)
Assessed
Value (a)
Total
Assessed
Value
Property Tax
Revenue/
Unit
Property Tax
Revenue at
Buildout
Property Tax
In-Lieu
Revenues/ Unit
In-Lieu
Property
Revenues at
Buildout
Property
Transfer Tax
Revenue/Unit
Property
Transfer Tax
Revenue at
Buildout
Plan 1 10 $835,000 $8,350,000 $1,442 $14,422 $1,131 $11,312 $46 $459 Plan 2 32 $890,000 $28,480,000 $1,537 $49,191 $1,206 $38,583 $49 $1,566 Plan 3 33 $980,000 $32,340,000 $1,693 $55,858 $1,328 $43,813 $54 $1,779 Plan 4 6 $1,085,000 $6,510,000 $1,874 $11,244 $1,470 $8,819 $60 $358 Plan 1A 2 $193,000 $386,000 $333 $667 $261 $523 $0 $0
Plan 2A 2 $219,000 $438,000 $378 $757 $297 $593 $0 $0
Plan 3A 1 $240,000 $240,000 $415 $415 $325 $325 $0 $0
Total at Buildout 86 $76,744,000 $132,553 $103,969 $4,162 Less Existing Assessed Value (f) -$14,497,918 -$25,041 -$19,641 $0 Total Increase to General Fund $62,246,082 $107,512 $84,328 $4,162 Footnotes:
(a) Unit mix and assessed value based on information received from Developer. Plans 1A, 2A, & 3A represent affordable housing units. (d) Transfer tax is 0.11% of the sale price of residential property and the City receives 50% of the taxed amount. (e) Assumes a 10% turnover rate each year.
(f) Project site has assessed value of $14,497,918 per the 2024-25 property tax bill. (c) AV Growth is calculated by taking the Property Taxes-In Lieu amount of $44,009,010, from the Adopted FY 2024-25 Budget, divided by the City AV Estimate of $32,485,033,990, from the 2023-2024 District Values for Publication of Assessed Valuations Booklet Equalized Roll Values from the Orange County Auditor Controller, multiplied by $1,000 to equal $1.3547 of every $1,000 of AV Growth. (b) The Project's Tax Rate Area for the subject property has a property tax rate of 17.27%.

City Council 24 – 279 4/15/2025
District District Name
Agency Pct of
Revenue
Property Taxes
at Buildout
001C ORANGE CO GEN. FUND 0.0600410463 $37,373
710A O C FLOOD CONTROL DISTRICT 0.0192634020 $11,991
713A O C PARKS CSA 26 0.0148900651 $9,268
001C EDUCATIONAL REVENUE AUGMENTATION FUND 0.0995962625 $61,995 061B EDUCATIONAL REVENUE AUGMENTATION FUND 0.0523534691 $32,588 703A EDUCATIONAL REVENUE AUGMENTATION FUND 0.0007129873 $444 708A EDUCATIONAL REVENUE AUGMENTATION FUND 0.0018225101 $1,134 710A EDUCATIONAL REVENUE AUGMENTATION FUND 0.0079136388 $4,926 713A EDUCATIONAL REVENUE AUGMENTATION FUND 0.0028484357 $1,773 744A EDUCATIONAL REVENUE AUGMENTATION FUND 0.0008907776 $554 922A EDUCATIONAL REVENUE AUGMENTATION FUND 0.0060241466 $3,750 703A ORANGE CO CEMETERY FUND-GENERAL 0.0004842665 $301
061B SANTA ANA CITY 0.1727213135 $107,512
744A ORANGE CO VECTOR CONTROL DIST 0.0010877272 $677
960A ORANGE COUNTY WATER DISTRICT 0.0088903699 $5,534
961A ORANGE CO. WATER DIST-WATER RESERVE 0.0001334445 $83 708A ORANGE COUNTY TRANSIT AUTHORITY 0.0027337651 $1,702 916H OC SANITATION #7 GEN FUND 0.0180431340 $11,231
560B TUSTIN UNIF GEN FUND 0.4276966554 $266,224
500A SOUTH ORANGE CO COMM COLL DIST-GEN 0.0862348637 $53,678 600A O C DEPT OF EDUCATION-GEN FUND 0.0156177192 $9,721 Total 1.0000000000 $622,461
Sources:

TABLE 3A
TRA: 11-029
BREAKDOWN OF 1% AD VALOREM TAX
Orange Count Auditor office
Section 99 Factor Report by TRA 2024-2025
City Council 24 – 280 4/15/2025
TABLE 4A

ESTIMATE OF SALES TAXES
2020 E. 1ST STREET - FISCAL IMPACT ANALYSIS

PROPOSED RESIDENTIAL PROJECT
Estimate of Household Income
Average Sales Price $892,372
Down Payment 10% $89,237
Loan Amount $803,135
Interest Rate (a) 6.75%
Term (Years) 30
Annual Mortgage Payments $62,509
HOA Dues (Per Month) $300 $3,600
Maintenance / Insurance (Per Month) $150 $1,800
Property Taxes 1.20% $10,708
Total Annual Housing Costs $78,618
Percent of Income Spent on Housing (b) 37%
Average Annual Household Income $214,000
Estimated Sales Taxes Per Unit
Percent of Income on Taxable Spending (b) 34.80%
City Spending Capture 50.00%
Taxable Sales within the City $37,236
City Portion of Base Sales Tax (c) 1.00% $372
Measure X 1.50% $559
Half-Cent Sales Tax (Safety) (d) 0.05% $17
Estimated Sales Taxes at Buildout
Total Units 86
Taxable Sales with the City $3,202,296
City Portion of Sales Tax $32,023
Measure X $48,034
Half-Cent Sales Tax (Safety) $1,454
Footnote:
(a) Estimate 30 year mortgage rate based on Bankrate.com. (c) Per Page 24 of the City Operating Budget
(d) The City receives 9.08% of the Half-Cent Sales Tax (Safety) based on the 2024-25 Adopted Budget.
(b) Per the U.S. Bureau of Labor Statistics, Western Information Office, Consumer Expenditures for the Los Angeles Area - 2021-22. Assumes 50% of the 13.2% spent on food is taxable.

City Council 24 – 281 4/15/2025
TABLE 5A

ESTIMATE OF REVENUES
2020 E. 1ST STREET - FISCAL IMPACT ANALYSIS

PROPOSED RESIDENTIAL PROJECT
Demographic Profile:

Household
Population
Employment
Population (a)
Total
Population/
Jobs
Total Resident
Equivalents (b)
City of Santa Ana 306,488 148,900 455,388 380,938
2020 E 1st Street 328 0 328 328
City FY 2024-25
Adopted Budget
(c)
Per Capita
Service
Population
Per Capita
Revenue
New Residents/
Resident
Equivalents
"Marginal
Revenue" Impact
Adjustment (e)
Annual Revenue
at Buildout
Taxes
Property Taxes $48,810,310 -------------------------------Case Study------------------------------- $107,512 Prop Tax-In Lieu VLF $44,009,010 -------------------------------Case Study------------------------------- $84,328 Utility User Taxes $27,300,000 Population $89.07 328 0% $29,216 Business Tax (d) $16,200,000 Res Equiv $42.53 328 100% $0 Documentary Stamp Tax $800,000 -------------------------------Case Study------------------------------- $4,162 Sales Taxes $61,682,950 -------------------------------Case Study------------------------------- $32,023 Half-Cent Sales Tax (Safety) $2,800,000 -------------------------------Case Study------------------------------- $1,454 Sales Tax Measure X $85,632,610 -------------------------------Case Study------------------------------- $48,034 Other Taxes (d) $34,962,000 Res Equiv $91.78 328 100% $0 Franchise Fees $12,375,000 Res Equiv $32.49 328 0% $10,655 Fines and Forfeitures $5,670,100 Res Equiv $14.88 328 0% $4,882 Licenses and Permits (d) $9,163,200 Res Equiv $24.05 328 100% $0 Charges for Services $21,427,100 Res Equiv $56.25 328 0% $18,449 Intergovernmental (d) $8,089,340 Res Equiv $21.24 328 100% $0 Miscellaneous (d) $10,827,220 Res Equiv $28.42 328 100% $0 Transfers-In (d) $10,000 Res Equiv $0.03 328 100% $0
Use of Money (d) $16,768,500 Res Equiv $44.02 328 100% $0 Total Revenues $406,527,340 $340,716
Footnotes:
(b) Assumes that two employees have the same impact as one resident. (c) Amounts from the Adopted 2024-25 City Budget.
(d) Revenues assumed to not be affected by the increase of the Project population. (e) Indicates the adjustment to certain per capita revenue categories not expected to increase based on the citywide average. (a) Total Employment of 148,900 is from the City Profile on page 4 of the Adopted 2024-25 City Budget.

City Council 24 – 282 4/15/2025
TABLE 6A

ESTIMATE OF ANNUAL RECURRING EXPENDITURES
2020 E. 1ST STREET - FISCAL IMPACT ANALYSIS

PROPOSED RESIDENTIAL PROJECT
Demographic Profile:

Household
Population
Employment
Population (a)
Total
Population/
Jobs
Total Resident
Equivalents (b)
City of Santa Ana 306,488 148,900 455,388 380,938
2020 E 1st Street 328 0 328 328
City FY 2024-25
Adopted Budget
Service
Population
Per Capita
Expense
New Residents/
Resident
Equivalents
"Marginal Cost"
Impact
Adjustment (c)
Estimated
Recurring
Expenditures at
Buildout
City Manager $3,963,160 Res Equiv $10.40 328 100% $0
City Council $1,043,970 Res Equiv $2.74 328 100% $0
General Non-Dept $38,543,830 Res Equiv $101.18 328 100% $0 Interfund Transfers $17,999,970 Res Equiv $47.25 328 100% $0 City Clerk $1,934,570 Res Equiv $5.08 328 100% $0
City Attorney $4,500,350 Res Equiv $11.81 328 100% $0
Human Resources $4,393,370 Res Equiv $11.53 328 100% $0 Finance Department $13,268,160 Res Equiv $34.83 328 100% $0 Library $7,916,230 Res Equiv $20.78 328 75% $1,704
Museum Fund $1,715,320 Res Equiv $4.50 328 75% $369
Parks, Rec. & Community Services $16,083,960 Res Equiv $42.22 328 50% $6,924 Police Department $162,545,030 Res Equiv $426.70 328 0% $139,957 Fire & Emergency Medical Services $57,837,370 Res Equiv $151.83 328 0% $49,800 Planning & Building $18,731,210 Res Equiv $49.17 328 50% $8,064 Public Works $51,968,800 Res Equiv $136.42 328 50% $22,373 Community Development $4,327,760 Res Equiv $11.36 328 50% $1,863 Total Expenditures $406,773,060 $231,055
Footnotes:
(b) Assumes that two employees have the same impact as one resident. (c) Reflects adjustment to expenditures that do not have a 1:1 relationship between projected population growth and demand for municipal services. (a) Total Employment of 148,900 is from the City Profile on page 4 of the Adopted 2024-25 City Budget.

City Council 24 – 283 4/15/2025
TABLE 7A

ESTIMATE OF GENERAL FUND FISCAL IMPACT
2020 E. 1ST STREET - FISCAL IMPACT ANALYSIS

PROPOSED RESIDENTIAL PROJECT
Annual General Fund Revenues
Amount at
Buildout
Percent
of Total
Property Tax $107,512 31.6%
Prop Tax-In Lieu VLF 84,328 24.8%
Utility User Taxes 29,216 8.6%
Documentary Stamp Tax 4,162 1.2%
Sales Tax 32,023 9.4%
Sales Tax Measure X 48,034 14.1%
Half-Cent Sales Tax (Safety) 1,454 0.4%
Franchise Fees 10,655 3.1%
Business Licenses 0 0.0%
Fines and Forfeitures 4,882 1.4%
Licenses and Permits 0 0.0%
Charges for Services 18,449 5.4%
Total Revenues $340,716 100.0%
Annual General Fund Expenditures
Amount at
Buildout
Percent
of Total
City Manager $0 0.0%
City Council 0 0.0%
General Non-Dept 0 0.0%
Interfund Transfers 0 0.0%
City Clerk 0 0.0%
City Attorney 0 0.0%
Human Resources 0 0.0%
Finance Department 0 0.0%
Library 1,704 0.7%
Museum Fund 369 0.2%
Parks, Rec. & Community Services 6,924 3.0%
Police Department 139,957 60.6%
Fire & Emergency Medical Services 49,800 21.6%
Planning & Building 8,064 3.5%
Public Works 22,373 9.7%
Community Development 1,863 0.8%
Total Expenditures $231,055 100.0%
Annual Recurring Surplus/(Deficit) at Buildout $109,662 Revenues to Expenditure Ratio 1.47
City Council 24 – 284 4/15/2025

APPENDIX B

ECONOMIC BENEFIT ANALYSIS

PROPOSED RESIDENTIAL PROJECT
City Council 24 – 285 4/15/2025
TABLE 1B

ESTIMATE OF ECONOMIC BENEFITS
2020 E. 1ST STREET

PROPOSED RESIDENTIAL PROJECT
Direct (a) 140.26 $11,720,202 $28,555,449
Indirect (b) 30.58 $2,516,068 $7,304,574
Induced (c) 46.12 $3,178,367 $9,107,945
Total 216.95 $17,414,637 $44,967,968
Footnotes:
(b) Indirect impacts are economic impacts caused by increases from the use of goods and services of industries that provide the direct goods and services to the proposed Project.

Labor Income
(a) Direct impacts are economic impacts caused by the output of goods and services on-site. (c) Induced impacts are economic impacts caused by the increase in employment and household spending.

Impact Employement
Total
Output
City Council 24 – 286 4/15/2025
EXHIBIT 13
The Meritage Homes Project CEQA Section 15168 Consistency Memorandum and technical appendices may be accessed at:
https://www.santa-ana.org/mlc-holdings-meritage-homes-2020-east-first-street/ City Council 24 – 287 4/15/2025

O R A N G E C O U N T Y R E P O R T E R
OR#
~SINCE 1921~
To the right is a copy of the notice you sent to us for publication in the ORANGE COUNTY REPORTER. Thank you for using our newspaper. Please read this notice carefully and call us with any corrections. The Proof of Publication will be filed with the County Clerk, if required, and mailed to you after the last date below. Publication date(s) for this notice is (are):

Daily Journal Corporation
Serving your legal advertising needs throughout California.

Mailing Address : 600 W SANTA ANA BLVD STE 812, SANTA ANA, CA 92701 Telephone (714) 543-2027 / Fax (714) 542-6841
Visit us @ www.LegalAdstore.com

NUVIA OCAMPO

CITY OF SANTA ANA/PLANNING & BUILDING AGENCY
20 CIVIC CENTER PLAZA 2ND FLR
SANTA ANA, CA 92702

GPN GOVT PUBLIC NOTICE
2020 E 1st Street
03/14/2025
Publication
www.capublicnotices.com
Total
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ORANGE COUNTY REPORTER, SANTA ANA (714) 543-2027
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DAILY COMMERCE, LOS ANGELES (213) 229-5300
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SAN FRANCISCO DAILY JOURNAL, SAN FRANCISCO (800) 640-4829 SAN JOSE POST-RECORD, SAN JOSE (408) 287-4866
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Notice Type:

Ad Description

COPY OF NOTICE
3904127
!A000007043436!
The charge(s) for this order is as follows. An invoice will be sent after the last date of publication. If you prepaid this order in full, you will not receive an invoice.

NOTICE OF PUBLIC HEARING

BEFORE THE SANTA ANA PLANNING

COMMISSION
The City of Santa Ana encourages the
public to participate in the decisionmaking process. We encourage you to contact us prior to the Public Hearing if
you have any questions.

Planning Commission Action: The
Planning Commission will hold a Public
Hearing to receive public testimony and
will take action on the item described
below. Decision on this matter will be final
unless appealed pursuant to Article V of
Chapter 41 of the Santa Ana Municipal
Code within 10 calendar days of the
decision by any interested party or group.

Project Location: 2020 East First Street,
located within the General Commercial
(C2) zone and within the Active Urban
(AU) District of the Metro East Mixed-Use
Overly Zone (MEMU)
Project Applicant: Louisa Feletto with
MLC Holdings, Inc. /Meritage Homes
(Applicant) on behalf of Paul Miszkowicz
with 2020 E First, LLC (Property Owner)
Proposed Project: Applicant is
requesting approval of Site Plan Review
No. 2025-01, Vesting Tentative Tract Map
No. 2025-01, and Density Bonus
Agreement No. 2025-01 to facilitate the
construction of a for-sale, multi-family
residential development including 80
three-story townhome units and six fourstory duplex units (eighty-six total units), five of which would be designated for very
low-income households. The project will
utilize one concession through the density
bonus agreement pursuant to California
Government Code Sections 65915
through 65918 and Santa Ana Municipal
Code Section 41-1600 through 41-1607.

Environmental Impact: Pursuant to the California Environmental Quality Act (CEQA) and the CEQA Guidelines, the
project is exempt from further review
pursuant to Section 15168 (Program EIR)
of the CEQA Guidelines. Notice of
Exemption, Environmental Review No.
2024-53 will be filed for the project.

Meeting Details: This matter will be heard on Monday, March 24, 2025, at 5:30 p.m. in the City Council Chambers,
22 Civic Center Plaza, Santa Ana, CA
92701. Members of the public may
attend this meeting in person or join
via Zoom. For the most up-to-date
information on how to participate virtually
in this meeting, please visit
https://www.santa-ana.org/planning-andbuilding-meeting-participation/.

Written Comments: If you are unable to
participate in the meeting, you may send
written comments by e-mail to
[email protected]
(reference the Agenda Item # in the
subject line) or by mail to Nuvia Ocampo,
Recording Secretary, City of Santa Ana,
20 Civic Center Plaza – M20, Santa Ana,
CA 92701. Deadline to submit written
comments is 3:30 p.m. on the day of the
meeting. Comments received after the
deadline may not be distributed to the
Commission but will be made part of the
record.

Where To Get More Information: Additional details regarding the proposed action(s), including the full text of the
discretionary item, may be found on the
City website 72 hours prior to the public
hearing at https://santaana.primegov.com/public/portal.

Who To Contact For Questions: Should you have any project questions, please contact case planner Pedro Gomez with
the Planning Division by phone at (714)
667-2790 or by email at PGomez@santaana.org.

Note: If you challenge the decision on the
above matter, you may be limited to
raising only those issues you or someone
else raised at the public hearing
described in this notice, or in written
correspondence delivered to the Planning
Commission or City Council of the City of
Santa Ana at, or prior to, the public
hearing.

Si tiene preguntas en español, favor de
llamar a Nuvia Ocampo (714) 667-2732.

N
u c  n liên l  c b  ng ti
ng Vi  t,
xin i  n tho  i cho Kristie Ha (714)
667-2206.
3/14/25
OR-3904127#
City Council 24 – 288 4/15/2025

CITY OF SANTA ANA
Planning and Building Agency
20 Civic Center Plaza ● P.O. Box 1988
Santa Ana, California 92702
www.santa-ana.org/pba

NOTICE OF PUBLIC HEARING

BEFORE THE SANTA ANA PLANNING COMMISSION
The City of Santa Ana encourages the public to participate in the decision-making process. This notice is being sent to those who live or own property within 1000 feet of the project site or who have expressed an interest in the proposed action. We encourage you to contact us prior to the Public Hearing if you have any questions.

Planning Commission Action: The Planning Commission will hold a Public Hearing to receive public testimony and will take action on the item described below. Decision on this matter will be final unless appealed pursuant to Article V of Chapter 41 of the Santa Ana Municipal Code within 10 calendar days of the decision by any interested party or group.

Project Location: 2020 East First Street, located within the General Commercial (C2) zone and within the Active Urban (AU) District of the Metro East Mixed-Use Overly Zone (MEMU) Project Applicant: Louisa Feletto with MLC Holdings, Inc. /Meritage Homes (Applicant) on behalf of Paul Miszkowicz with 2020 E First, LLC (Property Owner) Proposed Project: Applicant is requesting approval of Site Plan Review No. 2025-01, Vesting Tentative Tract Map No. 2025-01, and Density Bonus Agreement No. 2025-01 to facilitate the construction of a forsale, multi-family residential development including 80 three-story townhome units and six four-story duplex units (eighty-six total units), five of which would be designated for very low-income households. The project will utilize one concession through the density bonus agreement pursuant to California Government Code Sections 65915 through 65918 and Santa Ana Municipal Code Section 41-1600 through 41-1607.

Environmental Impact: Pursuant to the California Environmental Quality Act (CEQA) and the CEQA Guidelines, the project is exempt from further review pursuant to Section 15168 (Program EIR) of the CEQA Guidelines. Notice of Exemption, Environmental Review No. 2024-53 will be filed for the project.

Meeting Details: This matter will be heard on Monday, March 24, 2025, at 5:30 p.m. in the City Council Chambers, 22 Civic Center Plaza, Santa Ana, CA 92701. Members of the public may attend this meeting in person or join via Zoom. For the most up-to-date information on how to participate virtually in this meeting, please visit https://www.santa-ana.org/planning-and-building-meeting-participation/.

Written Comments: If you are unable to participate in the meeting, you may send written comments by email to [email protected] (reference the Agenda Item # in the subject line) or by mail to Nuvia Ocampo, Recording Secretary, City of Santa Ana, 20 Civic Center Plaza – M20, Santa Ana, CA 92701. Deadline to submit written comments is 3:30 p.m. on the day of the meeting. Comments received after the deadline may not be distributed to the Commission but will be made part of the record.

Where To Get More Information: Additional details regarding the proposed action(s), including the full text of the discretionary item, may be found on the City website 72 hours prior to the public hearing at https://santa-ana.primegov.com/public/portal.

City Council 24 – 289 4/15/2025
Who To Contact For Questions: Should you have any project questions, please contact case planner Pedro Gomez with the Planning Division by phone at (714) 667-2790 or by email at PGomez@santaana.org.

Note: If you challenge the decision on the above matter, you may be limited to raising only those issues you or someone else raised at the public hearing described in this notice, or in written correspondence delivered to the Planning Commission or City Council of the City of Santa Ana at, or prior to, the public hearing.

Si tiene preguntas en español, favor de llamar a Nuvia Ocampo (714) 667-2732.

Nếu cần liên lạc bằng tiếng Việt, xin điện thoại cho Kristie Ha (714) 667-2206. 1000’ RADIUS NOTIFICATION MAP
City Council 24 – 290 4/15/2025
City Council 24 – 291 4/15/2025
City Council 24 – 292 4/15/2025
City Attorney’s Office
www.santa-ana.org/city-attorneys-office
Item # 25
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
April 15, 2025
TOPIC: Omnibus Amendments to Chapter 2 of the Santa Ana Municipal Code

AGENDA TITLE
Second Reading of the Omnibus Amendments to Chapter 2 of the Santa Ana Municipal Code Including Meeting Frequency for the Personnel Board, Contracting Authority for the City Clerk and City Attorney, and Relying on State Law Regarding Campaign Contributions Effect on Proceedings Involving a License, Permit, or other Entitlement for Use
First Reading at the April 1, 2025, City Council meeting and approved by a vote of 6-0- 0-1 (Councilmember Phan absent). Published in the OC Reporter on April 2, 2025.

RECOMMENDED ACTION
Approve the Second reading and adopt an Ordinance of the City Council of the City of Santa Ana amending Chapter 2 of the Santa Ana Municipal Code as to Section 2-328 Regarding Meetings; Chairperson and Recording Secretary of Appointive Boards and Commissions, Adding Section 2-331.5 Regarding Meetings of the Personnel Board, Amending the Title of Article VII of Chapter 2, Amending Section 2-748 Regarding City Manager Contracting Authority, Adding Section 2-748 Regarding City Attorney and City Clerk Contracting Authority, and Repealing Section 2-107 Regarding Prohibited Campaign Contributions.

ORDINANCE NO. NS-3078 entitled AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA ANA AMENDING CHAPTER 2 OF THE SANTA ANA MUNICIPAL CODE AS TO SECTION 2-328 REGARDING MEETINGS; CHAIRPERSON AND

RECORDING SECRETARY OF APPOINTIVE BOARDS AND COMMISSIONS, ADDING SECTION 2-331.5 ENTITLED MEETINGS, AMENDING THE TITLE OF ARTICLE VII OF CHAPTER 2, AMENDING SECTION 2-748 REGARDING CITY MANAGER CONTRACTING AUTHORITY, ADDING SECTION 2-749 REGARDING

CITY ATTORNEY AND CITY CLERK CONTRACTING AUTHORITY, AND REPEALING SECTION 2-107 REGARDING PROHIBITED CAMPAIGN CONTRIBUTIONS GOVERNMENT CODE §84308 APPLIES: No
City Council 25 – 1 4/15/2025
Omnibus Amendments to Chapter 2 of the Santa Ana Municipal Code April 15, 2025

DISCUSSION
On April 1, 2025, the Ordinance was introduced for first reading. The first reading was approved by a vote of 6-0 (with Councilmember Phan absent) with one amendment to Section 2-331.5 giving the Personnel Board the ability to hold up to two additional meetings per month. This Ordinance, if adopted, will address the following:
• Delete reference to monthly Personnel Board meetings from Section 2-328; • Add a new Section 2-331.5 regarding Personnel Board meetings and specify that such meetings will be held on the second and fourth Tuesdays of each month, if there is business before the board, instead of monthly and allowing up to two additional meetings per month.
• Clarifying that the City Manager’s contracting authority for non-public works contracts is $50,000, per department, and per fiscal year. • Adding Section 2-749 implementing the Charter amendment approved in 2024 to provide contracting authority for the City Attorney and City Clerk. This contracting authority will be for goods or services, not to exceed $25,000 per vendor per fiscal year.
• Repeal Section 2-107 regarding prohibited campaign contributions because the prohibited conduct is already covered by state law (Levine Act).

ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.

FISCAL IMPACT
Sections 2-328 and 2-331.5- Frequency of Personnel Board Meetings The estimated cost of the additional meeting per month is $16,200 from the General Fund for the remainder of FY 24/25. These funds are already budgeted for in the Human Resources General Fund account in the current fiscal year. The estimated cost of the additional meeting per month totals $64,800 from the General Fund for FY 25/26.

The proposed FY25/26 budget will include sufficient recurring allocations for two meetings per month.

Fiscal Year Account Estimated Amount
24/25 01109050 62300 Contracted Services – Professional $13,575 24/25 01109050 62302 Contracted Services – Personnel $2,100 24/25 01109050 63001 Miscellaneous Operating Expenses $525 Total 24/25 $16,200
25/26 01109050 62300 Contracted Services – Professional $54,300 25/26 01109050 62302 Contracted Services – Personnel $8,400 25/26 01109050 63001 Miscellaneous Operating Expenses $2,100 Total 25/26 $64,800
City Council 25 – 2 4/15/2025
Omnibus Amendments to Chapter 2 of the Santa Ana Municipal Code April 15, 2025

Sections 2-748 and 2-749 [New] City Manager, City Clerk, and City Attorney Contracting Authority
There is no fiscal impact associated with this action. All contracts entered into pursuant to the City Clerk’s and City Attorney’s contracting authority would be taken from already budgeted accounts.

Section 2-107 Prohibited Campaign Contributions
There is no fiscal impact associated with this action. There are no expenditure of funds associated with this Section or repealing this Section.

EXHIBIT(S)

1. Ordinance
Submitted By: Sonia Carvalho, City Attorney
Approved By: Alvaro Nuñez, City Manager
City Council 25 – 3 4/15/2025
Ordinance No. NS-XXX

ORDINANCE NO. NS-XXX

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
SANTA ANA AMENDING CHAPTER 2 OF THE SANTA ANA
MUNICIPAL CODE AS TO SECTION 2-328 REGARDING
MEETINGS; CHAIRPERSON AND RECORDING

SECRETARY OF APPOINTIVE BOARDS AND
COMMISSIONS, ADDING SECTION 2-331.5 ENTITLED

MEETINGS, AMENDING THE TITLE OF ARTICLE VII OF
CHAPTER 2, AMENDING SECTION 2-748 REGARDING

CITY MANAGER CONTRACTING AUTHORITY, ADDING
SECTION 2-749 REGARDING CITY ATTORNEY AND CITY

CLERK CONTRACTING AUTHORITY, AND REPEALING
SECTION 2-107 REGARDING PROHIBITED CAMPAIGN

CONTRIBUTIONS

THE CITY COUNCIL OF THE CITY OF SANTA ANA DOES ORDAIN AS FOLLOWS:

Section 1. Section 2-238 of Division 2 of Article IV of Chapter 2 of the Santa Ana Municipal Code is hereby amended to read as follows:

Sec. 2-328. Meetings; chairperson; recording secretary.

The election of each chairperson and vice-chairperson shall be held at the meetings of the respective boards and commissions during the month of July of each year. The board or commission, in the event of a vacancy in the office of the chairperson or vicechair person, shall elect one (1) of its members for the unexpired term. The chairperson shall have the responsibility for informing the city council of board, commission, or committee actions or inactions and the reasons therefore.

The city manager or his or her designee shall designate a secretary for the recording of minutes for each of such boards and commissions, who shall keep a record of its proceedings and transactions. Each board and commission shall prescribe rules and regulations governing its operations which shall be consistent with the charter, this Code, and shall be filed with the city clerk for public inspection.

Section 2. Section 2-331.5 shall be added to Division 3 of Article IV of Chapter 2 of the Santa Ana Municipal Code to read as follows:

Sec. 2-331.5. - Meetings.

The personnel board shall meet twice a month on the second and fourth Thursdays, provided there is business on the agenda to come before it and may hold up to two additional meetings per month.

City Council 25 – 4 4/15/2025
Ordinance No. NS-XXX

Section 3. The title of Article VII of Chapter 2 of the Santa Ana Municipal Code is hereby amended as follows:

ARTICLE VII. - CITY MANAGER, CITY CLERK AND CITY ATTORNEY

CONTRACTING AUTHORITY
Section 4. Subsection (a) (1) of Section 2-748 of Article VII, of Chapter 2 of the Santa Ana Municipal Code is hereby amended to read as follows:

Sec. 2-748.- City manager’s contracting authority.
(a) Non-public works contracts.
(1)The city manager is authorized to bind the city to any one (1) or more written non-public works contract, per vendor, in an amount or amounts not exceeding the sum of fifty thousand dollars ($50,000.00) per department, and per each Fiscal Year. For purposes of this section, a non-public works contract shall mean any contract not deemed to be a public works contract under subsection (b)(1). (2)The city manager is hereby authorized to bind the city on amendments to any one (1) non-public works contract when such amendment for any one (1) non-public works contract, together with any previously approved amendments for said contract, do not cumulatively amount to an increase of the city's expenditure obligation under said contract of more than twenty (20) percent of the original contract amount. (b) Public works contracts.
(1)The city manager is authorized to bind the city to any one (1) or more written public works contract, per vendor, in an amount or amounts not exceeding the sum of five hundred thousand dollars ($500,000). For purposes of this section, a public works contract shall be deemed to mean a project for the erection, improvement, and/or maintenance, inspection, testing and repair of public buildings, streets, drains, sewers, or parks.
(2)The city manager is authorized to bind the city to any one (1) written contract for emergency public works construction in an amount not exceeding the sum of five hundred thousand dollars ($500,000).
(3)The city manager is hereby authorized to bind the city on change orders to any one (1) public works contract, when such change order for any one (1) public works contract, together with any previously approved change orders for said contract, do not cumulatively amount to an increase of the city's expenditure obligation under said contract of more than twenty (20) percent of the original contract amount.

City Council 25 – 5 4/15/2025
Ordinance No. NS-XXX

(c)Website access and search features.
(1) All agreements approved by the Ccity Mmanager shall be posted to the City's website on a quarterly basis.
(2) The City's website shall provide search capabilities allowing users to search any and all agreements approved by the city manager based on words, phrases, and dollar amounts.

Section 5. A new section 2-749 is hereby added to Article VII of Chapter 2 of the Santa Ana Municipal Code to read as follows:

Sec. 2-749. - City Attorney and City Clerk contracting authority. (a) The city attorney is authorized to bind the city to any one (1) or more written contracts for goods or services, to conduct department business, per vendor and per each Fiscal Year where said contract does not exceed the sum of twenty-five thousand dollars ($25,000.00).
(b) The city clerk is authorized to bind the city to any one (1) or more written contracts for goods or services, to conduct department business, per vendor and per each Fiscal Year where said contract does not exceed the sum of twenty-five thousand dollars ($25,000.00).
(c) Website access and search features.
(1) All agreements approved by the city attorney and city clerk shall be posted to the City's website on a quarterly basis.
(2) The City's website shall provide search capabilities allowing users to search any and all agreements approved by the city attorney and city clerk based on words, phrases, and dollar amounts.

Section 6. Section 2-107 of Article II of Chapter 2 of the Santa Ana Municipal Code is repealed in its entirety.

Section 7. If any section, subsection, sentence, clause, phrase or portion of this ordinance is for any reason held to be invalid or unconstitutional by the decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this ordinance. The City Council of the City of Santa Ana hereby declares that it would have adopted this ordinance and each section, subsection, sentence, clause, phrase or portion thereof irrespective of the fact that any one or more sections, subsections, sentences, clauses, phrases, or portions be declared invalid or unconstitutional.

Section 8. This Ordinance shall become effective thirty (30) days after its adoption.

City Council 25 – 6 4/15/2025
Ordinance No. NS-XXX

Section 9. The City Clerk shall certify the adoption of this Ordinance and shall cause the same to be published as required by law.

ADOPTED this day of April, 2025.
_______________________
Valerie Amezcua
Mayor
APPROVED AS TO FORM:

Sonia R. Carvalho, City Attorney
By: ____________________________
Laura A. Rossini
Chief Assistant City Attorney
AYES: Councilmembers
NOES: Councilmembers
ABSTAIN: Councilmembers
ABSENT: Councilmembers

CERTIFICATE OF ATTESTATION AND ORIGINALITY
I, JENNIFER L. HALL, City Clerk, do hereby attest to and certify the attached Ordinance No. NS-XXXXXX to be the original ordinance adopted by the City Council of the City of Santa Ana on , 2025.

Date: _________________ _______________________
Jennifer L. Hall
City Clerk
City of Santa Ana
City Council 25 – 7 4/15/2025
Planning and Building Agency
www.santa-ana.org/pb
Item # 26
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
April 15, 2025
TOPIC: Final Extension of Moratorium on the Approval, Commencement, Establishment, Relocation, or Expansion of Industrial Uses in Specific Development No. 84

AGENDA TITLE
Final Extension of Moratorium on the Approval, Commencement, Establishment, Relocation, or Expansion of Industrial Uses in Specific Development No. 84 (SD-84), Also Known as the Transit Zoning Code (“TZC”) for Up To One Year (12 Months) Pursuant to Government Code Section 65858(a)
Legal notice published in the OC Reporter on March 19, 2025.

RECOMMENDED ACTIONS

1. Adopt an urgency ordinance approving a final extension of a moratorium for a period of up to one year on the approval, commencement, establishment, relocation, or expansion of industrial uses within SD-84, by four-fifths (4/5) vote, pursuant to California Government Code Section 65858(a), for up to one year (12 months), unless automatically repealed upon the adoption and effectiveness of a City-Council adopted ordinance to address the land use conflicts presented by industrial uses in the TZC.

UNCODIFIED URGENCY ORDINANCE NO. NS-XXXX entitled AN UNCODIFIED

URGENCY ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SANTA ANA,

EXTENDING A MORATORIUM ON THE APPROVAL, COMMENCEMENT,

ESTABLISHMENT, RELOCATION OR EXPANSION OF INDUSTRIAL USES WITHIN SPECIFIC DEVELOPMENT NO. 84 ZONING DISTRICT FOR AN ADDITIONAL ONE (1) YEAR PURSUANT TO GOVERNMENT CODE SECTION 65858

2. Find that, in accordance with the California Environmental Quality Act (CEQA), the proposed action is not subject to the requirements of the California Environmental Quality Act, pursuant to (Guidelines) Section 15060(c)(2) because the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment and 15060(c)(3) because the activity is not a project as defined in Section 15378 of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly and so is not a project.

City Council 26 – 1 4/15/2025
Final Extension of Moratorium on the Approval, Commencement, Establishment, Relocation, or Expansion of Industrial Uses in Specific Development No. 84 (Transit Zoning Code)
April 15, 2025

GOVERNMENT CODE §84308 APPLIES: No

EXECUTIVE SUMMARY
On May 21, 2024, the City Council adopted Urgency Ordinance No. NS-3064, which established a ten (10) months and fifteen (15) days extension period of a moratorium on the approval, commencement, establishment, modification, relocation, or expansion of industrial uses in Specific Development No. 84 (SD-84), also known as the Transit Zoning Code (commonly referred to as the Transit Zoning Code or TZC) while City staff researches appropriate permanent regulations and determines whether an additional extension, pursuant to California Government Code Section 65858(a), is necessary.

Ordinance No. NS-3064 shall have no further force and effect ten (10) months and fifteen (15) days from the date of its adoption, unless, after a report during the TZC moratorium extension period and a public hearing, the City Council members, again by four/fifths (4/5) vote, extend the Ordinance for up to an additional twelve (12) months beyond the additional ten (10) months and fifteen (15) days of the initial Ordinance extension. Based on the adoption date of May 21, 2024, the Ordinance is scheduled to expire on April 15, 2025.

On April 1, 2025, the City Council issued a report to the public, pursuant to Section 65858(d) of the California Government Code, describing the City’s measures to alleviate conditions that led to the adoption of the moratorium. Subsequently, the City Council also voted 4:0:0 to continue Public Hearing Item No. 22 on that same meeting agenda, regarding proposed amendments to the TZC, to the May 6, 2025, meeting, with recusals from City Council members Phan, Lopez, and Penaloza (due to advisement of a potential conflict of interest that may be related to real property or financial interests).

The City Attorney has requested clarification from the Fair Political Practices Commission (FPPC) regarding Councilmembers' eligibility to participate and vote on the proposed amendment to the TZC at the May 6, 2025, City Council meeting. A response from the FPPC is anticipated before that date.

The City requires an extension of the moratorium, which is scheduled to expire on April 15, 2025, to facilitate the uninterrupted development of permanent regulations addressing industrial business uses within the TZC. This proposed ordinance, pursuant to California Government Code Section 65858(a), would authorize a final extension of the moratorium for a period of up to one year (12 months), effective upon a four-fifths (4/5) vote of the City Council. Specifically, if adopted, the final extension shall commence on April 16, 2025, and end on April 16, 2026, unless automatically repealed upon the adoption and effectiveness of a City-Council adopted permanent ordinance to address the land use conflicts presented by industrial uses in the TZC.

City Council 26 – 2 4/15/2025
Final Extension of Moratorium on the Approval, Commencement, Establishment, Relocation, or Expansion of Industrial Uses in Specific Development No. 84 (Transit Zoning Code)
April 15, 2025

DISCUSSION
Background
On April 16, 2024, the City Council adopted Urgency Interim Ordinance No. NS-3063, establishing a 45-day moratorium on the approval, commencement, establishment, relocation, or expansion of industrial uses within the TZC. The purpose of the moratorium was to immediately offer protection of public health, safety, and welfare from industrial uses significantly causing pollution burden to adjacent residential neighborhoods within the TZC.

On May 7, 2024, the City Council issued a report to the public, pursuant to Section 65858(d) of the California Government Code, describing the City’s measures to alleviate conditions that led to the adoption of the moratorium.

On May 21, 2024, the City Council adopted Ordinance No. NS-3064 to extend the moratorium for an additional ten (10) months and fifteen (15) days pursuant to the Government Code as necessary to provide sufficient time for staff to continue with data tracking and reporting, research appropriate regulations, and coordinate with outside regulatory agencies and City departments to determine whether further, permanent action was necessary and to generate recommendations to the Planning Commission and City Council. During the moratorium period, the City has not issued permits that have resulted in the approval, commencement, establishment, modification, relocation, or expansion of industrial uses in the TZC.

Staff held a work-study session at the Planning Commission on February 10, 2025, which was open to the public. During the work-study session, Planning Commission members and members of the community posed additional questions and provided input on topics of key importance surrounding land use, code violations, the role of outside agencies and their enforcement, and financial and legal implications that required staff to carry out additional research. On February 24, 2025 and March 6, 2025, the Planning Commission held a public hearing and recommended approval of the TZC ordinance and map amendments with clarifying edits. However, this recommendation is advisory and the City Council retains the ultimate authority to approve, modify, or reject the proposed amendments after their own review and consideration of all presented information, including the Planning Commission's recommendations, staff reports, and public input.

Review of City Department Activities
During the initial 45-day moratorium and the moratorium extension of ten (10) month and fifteen (15) days, City staff conducted interagency meetings that included representatives from multiple City departments: the Planning Division, Building Safety City Council 26 – 3 4/15/2025
Final Extension of Moratorium on the Approval, Commencement, Establishment, Relocation, or Expansion of Industrial Uses in Specific Development No. 84 (Transit Zoning Code)
April 15, 2025

Division, Code Enforcement Division, Business License, and Information Technology.

Additionally, engagement with agencies such as the Santa Ana Police Department (SAPD), Public Works Agency, and the Community Development Agency’s Economic Development Division has produced critical information illustrating the extent to which industrial activities interface with residential land uses in the TZC area, specifically and most concentrated in the Logan and Lacy neighborhoods.

Data based on Business License and Economic Development records indicate that application of the moratorium affects up to 127 industrial businesses in the TZC. Of the affected businesses, approximately three have active applications for permits, primarily seeking to legalize unpermitted work on industrial properties. City staff has continued to review public safety data from SAPD and Orange County Fire Authority (OCFA) to assess community concerns regarding emergency responses in the TZC. SAPD records show a total of 18,736 calls for service between March 2023 and July 2024, with 226 of those occurring between April and July 2024 within the Logan and Lacy neighborhoods. These calls encompassed a wide range of incidents, including patrol checks, disturbances, and traffic-related issues. Notably, 1,909 calls involved collisions, vehicle impoundments, domestic violence, and SAMC violations. OCFA data from 2022 to August 2024 indicates 238 calls for advanced life support emergencies. In 2022, 29 calls were related to respiratory issues, chest pain, and cardiac arrest, with a subsequent 7% increase in health-related calls in 2023. While the data reflects a broad spectrum of emergency responses, the concentration of industrial businesses in the TZC raises the possibility that some of these calls, particularly those related to respiratory issues and traffic incidents, may be influenced by industrial operations.

Currently, City staff has an internal process established that continues to track and monitor incoming notices of compliance or notices of violations from outside regulatory agencies issued to a particular business/operator. City Code Enforcement activities and implementation of the City’s Noxious Uses Ordinance continue being monitored at these facilities. Code Enforcement data show enforcement activity within the TZC, where at the time of adoption of the moratorium, 16 active open cases were issued Notice of Violations and administrative citations for the following types of violations: illegal storage, land use, zoning, property and landscape maintenance, unpermitted work, business license, and certificate of occupancy. Such violations include issues of odors, dust, traffic, noise, vibrations, and other documented impacts. Recent code enforcement complaints on properties in the Logan neighborhood involve complaints for recurring unpermitted work and land use violations that involve large commercial vehicles blocking street access and impacting nearby residents. In the past 12 months, the Code Enforcement Division conducted investigations at over 35 commercial and industrial properties within the TZC.

These investigations led to administrative citations, ongoing enforcement actions, and onsite meetings with business owners.

City Council 26 – 4 4/15/2025
Final Extension of Moratorium on the Approval, Commencement, Establishment, Relocation, or Expansion of Industrial Uses in Specific Development No. 84 (Transit Zoning Code)
April 15, 2025

The City of Santa Ana Code Enforcement Division is currently addressing 21 open code enforcement violations or compliance reviews specifically involving industrial businesses within the TZC area. This activity demonstrates the City’s direct involvement in overseeing these businesses to mitigate potential environmental and public health risks.

Review of Records and Activities of External Agencies
To broaden the analysis beyond the City's local land use impacts, City staff have received public records requested of compliance status, violation records, and violation status of outside regulatory agencies, and have contacted staff from external regulatory agencies such as the South Coast Air Quality Monitoring District (SCAQMD), Santa Ana Regional Quality Water Control Board (SARQWCB), the Department of Toxic Substances Control (DTSC), Certified Unified Program Agencies (CUPA), California Environmental Reporting System (CERS), and others responsible for issuing regulatory permits for industrial uses in the TZC. Specifically, these agencies are responsible for permit issuance, compliance activities, and/or monitoring hazardous clean-up sites, or other industrial facility-related activities and have received current data requests for sites located within the TZC zoning district.

Data from outside regulatory agencies assist City staff in further understanding activities between external regulatory agencies and industrial businesses that may place additional impacts on public health, safety, and welfare in affected neighborhoods adjacent to industrial businesses in the TZC. This information would enable City staff to understand the correlation and environmental burdens that may be attributed to permitted activities for industrial businesses in historically environmentally disadvantaged communities, specifically the Logan and Lacy neighborhoods.

Records show SCAQMD issued two notices to comply with one industrial business on August 2023 and April 2024 for failure to maintain records, such as temperature graphs, poundage logs, and source test data. SCAQMD issued several permits to construct and to operate to the new operator of this same facility, which is currently in compliance with SCAQMD. Two notices of violation were issued to one industrial business for operating a paint spray booth without a valid permit to operate from SCAQMD.

The report from the SARWQCB from 2024 shows three (3) active industrial business in the TZC in violation of their permit for providing a late report or incomplete and/or insufficient information for their Stormwater Pollution Prevention Plan (SPPP). In March 2025, one of the three businesses with active violations concluded a financial settlement directly with the SARWQCB agency.

Public records from the CUPA for Orange County, spanning 2022-2024, reveal a pattern of non-compliance with environmental and hazardous materials regulations City Council 26 – 5 4/15/2025
Final Extension of Moratorium on the Approval, Commencement, Establishment, Relocation, or Expansion of Industrial Uses in Specific Development No. 84 (Transit Zoning Code)
April 15, 2025

among industrial businesses within the TZC. While some 2023 violations related to Hazardous Material Business Plan staff training and reporting were later corrected, current records indicate four businesses still have multiple open violations. These ongoing issues include non-compliance with documentation for hazardous waste transportation and disposal, as well as deficiencies in industrial stormwater reporting requirements. These violations highlight potential risks to public health and the environment.

Air emission complaints continue to be reported to SCAQMD. These complaints included one involving black smoke and another regarding unpermitted soil vapor extraction equipment onsite. SCAQMD staff has clarified that for air quality complaints they receive, their inspector is required to be physically present to observe the activity from the facility described in the complaint to determine if the complaint warrants further investigation or enforcement action in accordance with SCAQMD Rules 401 (Visible Emissions), 402 (Public Nuisance), and 403 (Fugitive Dust). Therefore, although community members continue to share concerns with City and SCAQMD staff, the turnaround time for an SCAQMD inspector to be physically present at an SCAQMD-permitted facility to investigate an air quality complaint, especially if a complaint is reported after working hours or on weekends, is ineffective in addressing the immediate needs of the community.

Public Engagement and Planning Commission Recommendation Following City Council's extension of the TZC moratorium on May 21, 2024, City staff have been developing permanent regulations for the TZC district for the City Council’s consideration. Leading up to the special Planning Commission meeting held on March 6, 2025, City staff engaged in a comprehensive outreach effort regarding TZC regulations, holding 20 meetings in various formats with affected stakeholders. This included:
• Direct engagement through eight individual and group meetings with business owners and brokers,
• Two focus group meetings with TZC business owners,
• Community outreach involving two neighborhood/resident group meetings, • Two City-hosted TZC (SD-84) meetings: the October 22, 2024 City Informational Meeting and the March 3, 2025 Community Meeting,
• Three site visits at the request of businesses, and
• Three Planning Commission meetings (February 10, 2025 Study Session and February 24/March 6 Public Hearings).

This extensive engagement aimed to gather diverse input for the development of permanent TZC regulations. To proactively ensure important communications reached all stakeholders, City staff mailed notices to all property owners and occupants, comprising 3,599 addresses, within the Transit Zoning Code area for each of the City Council 26 – 6 4/15/2025
Final Extension of Moratorium on the Approval, Commencement, Establishment, Relocation, or Expansion of Industrial Uses in Specific Development No. 84 (Transit Zoning Code)
April 15, 2025

following meetings: the October 22, 2024 City Informational Meeting, the Planning Commission February 10, 2025 Study Session and February 24, 2025 Public Hearing notice, and the City Council April 1, 2025 Public Hearing Notice.

City staff from the Neighborhood Initiatives and Environmental Services (NIES) section of the Planning Division continue to coordinate with City departments, external regulatory agencies, and staff from other federal and state agencies to identify additional resources available to enhance deeper awareness of pollution exposure in disadvantaged communities, long-term health effects, and immediate solutions. The NIES team has held meetings and discussions with staff from the Centers for Disease Control and Prevention/Agency for Toxic Substances and Disease Registry and CalEPA Environmental Justice Team to identify opportunities for linking environmental justice (EJ) resources and support to the Logan and Lacy neighborhoods.

Next Steps
On April 1, 2025, the City Council issued a report to the public, pursuant to Section 65858(d) of the California Government Code, describing the City’s measures to alleviate conditions that led to the adoption of the moratorium. The City requires an extension of the moratorium, which is scheduled to expire on April 15, 2025, to facilitate the uninterrupted development of permanent regulations addressing industrial business uses within the TZC.

This proposed ordinance, pursuant to California Government Code Section 65858(a), would authorize a final extension of the moratorium for a period of up to one year (12 months), effective upon a four-fifths (4/5) vote of the City Council. Specifically, if adopted, the final extension shall commence on April 16, 2025 and end on April 16, 2026. The final extension will be automatically repealed upon the effective date of a permanent ordinance addressing the land use conflicts in the Transit Zoning Code (SD84), if the Council adopts such an ordinance before April 16, 2026.

Without approval of this extension, the existing moratorium would lapse, potentially leading to development proposals and approvals that are inconsistent with the City's long-term planning objectives for the area, as promulgated by the Transit Zoning Code and the General Plan. This urgency justifies the need for immediate City Council action to adopt the proposed ordinance that would extend the moratorium.

ENVIRONMENTAL IMPACT
The extension of the moratorium is not subject to the California Environmental Quality Act (“CEQA”), as the proposed action is not subject to the requirements of CEQA, pursuant to Guidelines Section 15060(c)(2) because the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment and 15060(c)(3) City Council 26 – 7 4/15/2025
Final Extension of Moratorium on the Approval, Commencement, Establishment, Relocation, or Expansion of Industrial Uses in Specific Development No. 84 (Transit Zoning Code)
April 15, 2025

because the activity is not a project as defined in Section 15378 of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly and so is not a project, as the ordinance will temporarily preclude the approval, commencement, establishment, relocation, or expansion of uses in Specific Development No. 84 (the Transit Zoning Code).

FISCAL IMPACTS
There is no fiscal impact associated with this action

EXHIBITS

1. Uncodified Urgency Ordinance Extending Moratorium for Up To One Year (12 Months)

2. Adopted Urgency Interim Ordinance No. NS-3064

3. Ten-Day Written Report – April 1, 2025

4. May 21, 2024 City Council Staff Report (without attachments)

5. Public Notice
Submitted By: Ali Pezeshkpour, AICP, Acting Executive Director, Planning and Building Agency
Approved By: Alvaro Nuñez, City Manager
City Council 26 – 8 4/15/2025
Ordinance No. NS - ____

UNCODIFIED URGENCY ORDINANCE NO. NS-XXXX

AN UNCODIFIED URGENCY ORDINANCE OF THE CITY

COUNCIL OF THE CITY OF SANTA ANA, EXTENDING A

MORATORIUM ON THE APPROVAL, COMMENCEMENT,

ESTABLISHMENT, RELOCATION OR EXPANSION OF

INDUSTRIAL USES WITHIN SPECIFIC DEVELOPMENT
NO. 84 ZONING DISTRICT FOR AN ADDITIONAL ONE (1)

YEAR PURSUANT TO GOVERNMENT CODE SECTION
65858
WHEREAS, the City of Santa Ana has the police power pursuant to Article XI, section 7 of the California Constitution, to make and enforce ordinances to regulate the use of land within its jurisdictional boundaries; and
WHEREAS, Government Code Section 65858 expressly authorizes the City Council, in order to protect the public health, safety and welfare, to adopt an interim urgency ordinance prohibiting a use that is in conflict with a contemplated general plan, specific plan, or zoning proposal that the legislative body, planning commission, or the planning department is considering or studying or intends to study within a reasonable time, provided that the urgency measure shall require a four-fifths vote of the legislative body for adoption, and shall be of no further force and effect forty-five (45) days from its date of adoption, unless duly extended; and
WHEREAS, on April 16, 2024, the City Council adopted a moratorium on the approval, commencement, establishment, relocation or expansion of industrial uses within Specific Development No. 84 (“SD-84”) also known as the Transit Zoning Code (“TZC”) by adoption of Urgency Ordinance No. NS-3063 to immediately offer protection of public health, safety, and welfare from industrial uses significantly causing pollution burden to adjacent residential neighborhoods in the TZC (SD-84) through the following conditions, including: code enforcement active cases; irreconcilable land use conflicts in the TZC; alarming air quality, noise, traffic, proximity to noxious use facilities, and public health concerns; and external regulatory agency responsiveness (“Moratorium”); and WHEREAS, Government Code Section 65858 specifically authorizes the City Council, after notice pursuant to Government Code Section 65090 and a public hearing, to adopt an ordinance extending a moratorium for ten (10) months and fifteen (15) days, upon approval by a fourth-fifths vote, and upon making the same findings required for the adoption of the initial forty-five (45) day moratorium, and then subsequently extend the interim ordinance for one (1) year; and
WHEREAS, Government Code Section 65858(d) also requires the City Council, ten (10) days prior to the expiration of a moratorium or any extension thereof, to issue a written report describing the measures taken to alleviate the condition which led to the adoption of a moratorium; and
Exhibit 1 - Uncodified Urgency Ordinance Extending Moratorium for Up To One Year (12 Months) City Council 26 – 9 4/15/2025
Ordinance No. NS -XXXX

WHEREAS, on May 7, 2024, the City Council issued a report to the public pursuant to Section 65858(d) of the California Government Code, describing the City’s measures to alleviate conditions that led to the adoption of the Moratorium; and WHEREAS, on May 21, 2024, the City Council adopted Urgency Ordinance No.

NS-3064 to extend the Moratorium for an additional ten (10) months and fifteen (15) days pursuant to the Government Code as necessary to provide sufficient time for staff to continue with data tracking and reporting, research appropriate regulations, and to coordinate with outside regulatory agencies and City departments to determine further, permanent action is necessary and to generate recommendations to the Planning Commission and City Council; and
WHEREAS, on April 1, 2025, the City Council issued a report to the public pursuant to Section 65858(d) of the California Government Code, describing the City’s measures to alleviate conditions that led to the adoption of the Moratorium; and WHEREAS, Santa Ana Charter Sections 415 and 417 also expressly authorize the City Council to enact urgency ordinances, which take effect immediately upon introduction, for the immediate preservation of the public peace, health or safety, containing a declaration of the facts constituting the urgency; and WHEREAS, in unanimously adopting the Moratorium on April 16, 2024 and the extension of the Moratorium on May 21, 2024, the City Council of the City of Santa Ana established the following findings, all of which below remain true and applicable and necessary to support extending the Moratorium for one (1) year:
• The TZC, located in the central core of Santa Ana, comprises approximately 450 acres, encompasses the Logan, Lacy, and Downtown neighborhoods, and was adopted by the City Council on June 7, 2010; and
• Upon the initial adoption of the TZC in 2010, the General Plan of the City of Santa Ana was updated with new land use
designations for the areas covered by the TZC to allow for new, mixed-use residential and commercial communities; and
• The goals of the TZC are to provide a transit-supportive, pedestrian-oriented development framework to support the addition of new and enhancement of existing communities through transit infrastructure; to preserve and reinforce the existing character and pedestrian nature of the City by strengthening urban form through improved development and design standards; to encourage alternative modes of
transportation; to provide zoning for the integration of new infill City Council 26 – 10 4/15/2025
Ordinance No. NS - ____

development into existing neighborhoods; to provide for a range of housing options; and to allow for the reuse of existing structures; and
• Industrial uses were established within the Logan and Lacy neighborhoods in close proximity to sensitive land uses such as residences and schools prior to the adoption of the TZC, as far back as the late 19th century, predating modern zoning
practices that take into account irreconcilable land use conflicts among variegated land uses; and
• The TZC provides new mixed-use zoning for properties
contained within its boundary while creating industrial overlay zones allowing properties being used as industrial uses at the time of its adoption to continue to be governed by industrial zoning districts until such time that properties were converted to the mixed-use zones allowed by the TZC; and
• Senate Bill (SB) 1000 went into effect in 2018, requiring local governments to identify environmental justice communities, called “disadvantaged communities”, in their jurisdictions and address environmental justice in their general plans through facilitating transparency and public engagement in the planning and decision-making processes, reducing harmful pollutants and the associated health risks in disadvantaged communities, and promoting equitable access to health-inducing benefits such as healthy housing options; and
• The City of Santa Ana completed a comprehensive update of its General Plan in April 2022; and
• The Office of the Attorney General of the State of California was actively involved in ensuring Santa Ana’s General Plan update complied with all aspects of SB 1000 prior to its adoption; and • As required by SB 1000, update of the General Plan and its associated land use plan identified and addressed long standing environmental justice issues throughout all of its elements, which include 77 implementation actions aimed at reducing harmful pollutants and associated health risks in disadvantaged communities; and
• Numerous policies of the General Plan are inconsistent with the present, irreconcilable land use pattern of the TZC. Specifically, these policies include Policy LU-1.1 (Compatible Uses), Policy LU-3.8 (Sensitive Receptors), Policy LU-3.9 (Noxious,
City Council 26 – 11 4/15/2025
Ordinance No. NS -XXXX

Hazardous, Dangerous, and Polluting Uses), Policy LU-3.11 (Air Pollution Buffers), Policy LU-4.3 (Sustainable Land Use Strategies), Policy LU-4.6 (Healthy Living Conditions), Policy CM-3.2 (Healthy Neighborhoods), Policy EP-1.9 (Avoid Conflict of Uses), and Policy CN-1.5 (Sensitive Receptor Decisions), which are targeted at correcting past land use planning practices that have placed an unequitable environmental and health burden on certain neighborhoods now termed
disadvantaged communities; and
• The industrial overlay zones in the TZC perpetuate past planning practices of locating industrial uses, or other noxious and unwanted uses, in close proximity to communities of color; and
• The Logan neighborhood is the oldest Mexican and MexicanAmerican neighborhood in Santa Ana and one of the oldest in Orange County, and one of the few places where Mexicans and those of Mexican descent were allowed to buy land due to restrictions and covenants based on race during the first half of the 20th century; and
• The construction of Santa Ana (I-5) Freeway through Santa Ana in the 1950s resulted in a number of families being displaced through the demolition of single-family homes in the
northeastern portion of the Logan neighborhood; and
• In the 1970s a proposed expansion of an arterial highway along Civic Center Avenue would have demolished a significant portion, if not all, of the Logan neighborhood; and
• The Logan and Lacy neighborhoods are within the second and third highest scored census tracts in Santa Ana, each with a composite score of 90 percent or greater, ranking in the 90th percentile or greater of census tracts in the State, and identified as “disadvantaged communities” by the Office of Environmental Health Hazard Assessment (OEHHA) in its CalEnviroScreen model; and
• Assembly Bill (AB) 686 requires local jurisdictions to take deliberate actions to explicitly address, combat, and relieve disparities to disadvantaged communities, such as Logan and Lacy neighborhoods, resulting from past patterns of
segregation, disinvestment, and planning practices; and City Council 26 – 12 4/15/2025
Ordinance No. NS - ____

• The updated land use plan in the Land Use Element of the General Plan does not designate any properties within the TZC, including the Logan or Lacy neighborhoods, as industrial; rather, are designated as varying intensities of District Center or Urban Neighborhood land use designations—both of which are
inconsistent with industrial uses; and
• There are pressing and growing code enforcement complaints stemming from the irreconcilable land use conflicts in the TZC.

Specifically, in the Logan and Lacy neighborhoods, the City’s Code Enforcement Division has investigated over 33
commercial and industrial properties in the past nine months and currently has 17 active open cases that have been issued Notice of Violations and administrative citations for the following types of violations: illegal storage, land use, zoning, property and landscape maintenance, unpermitted work, business
license, and certificate of occupancy. The close proximity of active open industrial cases during a short period of time is creating a public nuisance that is draining City resources and that is harming public health, safety, and general welfare of the TZC’s existing and new residential neighborhoods from the concentration of open code enforcement cases nearby; and • In the Logan neighborhood, 52 industrial facilities (automotive, warehouse/storage, crematory, towing yards, construction) are presently in close proximity to sensitive uses monitored by external regulatory agencies such as South Coast AQMD,
Orange County Health Care Agency – Certified Unified Program Agencies (OC CUPA), Santa Ana Regional Water Quality Board (SARWQB), Orange County Fire Authority. Industrial facilities have caused significant pollution exposure to disadvantaged communities, including lead risk in soil and housing, diesel particulate matter from idling trucks, toxic release from facilities, traffic impacts, noise pollution, and airborne particulate matter or fine inhalable particles of 2.5 (PM2.5) microns or less in diameter. CalEnviroScreen reports higher environmental effects from active facility cleanup sites, hazardous waste facilities, and solid waste locations. Cumulative health impacts in the area include asthma, cardiovascular disease, and low birth weight, in this overburdened disadvantaged community factored by
socioeconomic indicators of poverty, linguistic isolation, housing burden, and education; and
• In the Lacy neighborhood, 76 industrial facilities (automotive, warehouse/storage, towing yards, construction) are presently in close proximity to sensitive uses monitored by external City Council 26 – 13 4/15/2025
Ordinance No. NS -XXXX

regulatory agencies such as South Coast AQMD, Orange
County Health Care Agency – Certified Unified Program
Agencies (OC CUPA), Santa Ana Regional Water Quality Board (SARWQB), Orange County Fire Authority. Industrial facilities have caused significant pollution onto disadvantaged
communities, including lead risk exposure, diesel particulate matter from idling trucks, toxic release from facilities, traffic impacts, noise pollution, vibration impacts, and airborne particulate matter or fine inhalable particles of 2.5 (PM2.5) microns or less in diameter. CalEnviroScreen reports higher environmental effects from active facility cleanup sites, hazardous waste facilities, and solid waste locations.

Cumulative health impacts in the area include asthma,
cardiovascular disease, and low birth weight, in this
overburdened disadvantaged community factored by
socioeconomic indicators of poverty, linguistic isolation, housing burden, and education; and
• There is a recent surge in residential development activity in the TZC that is exacerbating the irreconcilable land use conflicts between residential and industrial land uses. Examples include the Lacy Crossing residential development with over 100 ownership units directly adjacent to existing industrial land uses, for which the City receives regular complaints from residential occupants of disturbances from noise, vibrations, odors, and truck traffic; and the Rafferty mixed-use development with 218 residential units, including 11 onsite units for very-low income households, which is located less than one-fifth of a mile from industrial land uses; and
• There is a marked increase in the pending and active
development applications for industrial land uses in the TZC, including for contractor’s yards, construction debris storage yards, manufacturing operations, expansion of existing industrial businesses, and storage and warehousing operations,
stemming from shifting economic demands for goods and
services emerging from the Covid-19 pandemic; and
• The City Council approved a contract with Moore, Iacofano, Goltsman, Inc. (MIG) on October 17, 2023. To ensure the City’s Zoning Code and General Plan are consistent, and to maintain compliance with state law, comprehensive amendments to the Zoning Code are required; and
• MIG and City staff have conducted extensive community outreach, stakeholder interviews, and reviews of existing City Council 26 – 14 4/15/2025
Ordinance No. NS - ____

zoning-related codes and policies in Santa Ana. These early efforts have indicated that the irreconcilable land use conflicts and land use inconsistencies in the TZC area are among the top, most pressing topics that must be addressed as part of the comprehensive Zoning Code Update process in order to protect the health, safety, and welfare of the most vulnerable
communities that face the impacts of the land use conflicts within the TZC area; and
• The policies and implementation actions in the General Plan also require review, study, and possible revision in order to respond to recent concerns relating to the impacts of these industrial business uses in the TZC; and
• Given these concerns, the City Council directed that a study be undertaken of the current provisions of the TZC to address industrial business uses and determine whether such uses should be permitted in the zoning district, and if not, proceed with an ordinance amendment to preclude such uses from the district; and
• Based on the foregoing, the City Council found that continuing to issue permits, business licenses, or other applicable entitlements to individuals wishing to use their property located in the TZC for the purposes of industrial business use, prior to the City’s completion of its study of the potential impact of such uses, would pose a current and immediate threat to the public health, safety, and welfare, and that a temporary moratorium on the issuance of such permits, licenses, and entitlements in the TZC area is thus necessary; and
• The City Council further found that if an industrial business use is permitted in the TZC without further review and potential regulation, it will pose a serious threat to the public interest, health, safety and welfare for the following reasons:
o Adversely impacts surrounding businesses and
neighborhoods;
o Adversely impacts sensitive uses such as residences,
schools, parks, and places where children congregate;
o Conflicts with the goals and policies of the City's General Plan;
o Long-term incompatibility and inconsistency with
surrounding uses; and
o Risks to the public health, safety and welfare of the City; and
City Council 26 – 15 4/15/2025
Ordinance No. NS -XXXX

• The City Council also determined that prevention of detrimental impacts to residents, the public interest, health, safety and welfare required the immediate enactment of the urgency ordinance and that the absence of the urgency ordinance will create a serious threat to the orderly and effective
implementation of any code amendments, general plan
amendments or specific plan amendments which may be
adopted by the City; industrial business uses may be in conflict with or frustrate the contemplated updates and revisions to the Code. Moreover, permitting such uses during said studies and implementation would create impacts on the public health, safety and welfare that the City Council, in adopting the ordinance, found to be unacceptable; and
WHEREAS, since the adoption of the Moratorium, City staff has been in the process of gathering data and researching the impact of these industrial uses in the TZC as set forth in the report issued by the City Council on April 1, 2025; and WHEREAS, there is a need to study further the issues associated with industrial uses in the TZC and the impact that these uses have on the adjacent residential neighborhoods and their residents; and
WHEREAS, City staff, the Planning Commission, and the City Council each require a reasonable period of time to study the existing SD-84/TZC and to evaluate if further, permanent action to address the land use conflicts in the TZC is necessary; and WHEREAS, the City Council wishes to extend the Moratorium for a period of one (1) year, or until the City Council adopts an ordinance addressing the issues raised, whichever occurs first; and
WHEREAS, at a duly noticed public hearing on April 15, 2024, the City Council heard testimonial evidence and all other evidence submitted from members of the public that were present and from City staff. The City Council reviewed, analyzed, considered and studied all oral and written testimony and evidence presented at the public hearing, including staff reports and presentations of City staff.

NOW, THEREFORE, the City Council of the City of Santa Ana does ordain as follows:

Section 1. The recitals above are each incorporated by reference and adopted as findings by the City Council.

Section 2. The City Council finds that there is a current and immediate threat to public health, safety and welfare posed by industrial uses in SD-84, also known as, the TZC. If an industrial business use is permitted in the TZC without further review and City Council 26 – 16 4/15/2025
Ordinance No. NS - ____

potential regulation, it will pose a serious threat to the public interest, health, safety and welfare due to adverse impacts on surrounding businesses and neighborhoods; adverse impacts on sensitive uses such as residences, schools, parks, and places where children congregate; conflicts with the goals and policies of the City’s General Plan; and the effect of long term incompatibility and inconsistency with surrounding uses.

Section 3. In accordance with Government Code Section 65858(d), on April 1, 2025, the City Council issued a written report describing the measures being taken to alleviate the conditions that lead to the adoption of the Moratorium and this extension thereof, attached hereto as Exhibit A and incorporated herein by reference.

Section 4. Government Code Section 65858 authorizes the City Council to adopt an interim Urgency Ordinance, without following the procedures otherwise required for the adoption of an ordinance, to protect the public safety, health and welfare, prohibiting any uses that may be in conflict with a contemplated general plan, specific plan, or zoning proposal that the City Council, Planning Commission of the planning department is considering or studying or intends to study within a reasonable time.

Section 5. Government Code Section 65858(a) provides that the City Council, after notice and a public hearing, may subsequently extend the interim Ordinance for (1) one year after the first extension of ten (10) months and fifteen (15) days. Any extension requires a four-fifths vote.

Section 6. The City Council, in accordance with Government Code Section 65858 and Santa Ana Charter Sections 415 and 417 hereby adopts this uncodified Urgency Ordinance extending the Moratorium on the approval, commencement, establishment, modification, relocation or expansion of industrial uses in the TZC for a period of one (1) year, commencing April 16, 2025. The Moratorium will now expire on April 16, 2026, or upon City Council adoption of an ordinance providing further, permanent action to address the land use conflicts presented by industrial uses in the TZC. For the purposes of this Urgency Ordinance, “industrial uses” includes those specified by Divisions 18 and 19 of Article III of Chapter 41 of the Santa Ana Municipal Code, and by Section 41-2007 of the Santa Ana Municipal Code and Table 2A in the Transit Zoning Code (Specific Development No. 84)
Section 7. This Ordinance shall have no further force and effect after a period of one (1) year, commencing April 16, 2025, and ending April 16 2026, unless automatically repealed upon the adoption and effectiveness of a CityCouncil adopted ordinance to address the land use conflicts presented by industrial uses in the TZC.

Section 8. It shall be unlawful and a misdemeanor for any person to violate or fail to comply with any provision of the ordinance. The violation of any provision of this Ordinance shall be punished as provided in Section 1-8 of Chapter 1 of the Code.

City Council 26 – 17 4/15/2025
Ordinance No. NS -XXXX

Section 9. The City Council finds and determines that this Ordinance is not subject to the California Environmental Quality Act (“CEQA”) pursuant to sections 15061(b)(3) and 15061(b)(5) of the CEQA Guidelines because it will not result in a direct or reasonably foreseeable indirect physical change in the environment, as the ordinance will temporarily preclude the approval, commencement, establishment, relocation or expansion of uses in the zoning district.

Section 10. If any section, subsection, phrase, or clause of this Ordinance is for any reason held to be unconstitutional, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each section, subsection, phrase or clause thereof irrespective of the fact that any one or more sections, subsections, phrases, or clauses be declared invalid or unconstitutional.

Section 11. This Ordinance is introduced, passed and adopted at one and the same meeting and is thereafter immediately effective. The City Council finds that this ordinance is necessary to protect the public safety, health and welfare. The reasons for the emergency are set forth in Section 1 of this Ordinance.

Section 12. The City Clerk shall certify to the adoption of this Ordinance and cause the same to be published in the manner prescribed by law.

ADOPTED this ___ day of ___________________, 2025.
_______________________
Valerie Amezcua
Mayor
APPROVED AS TO FORM:

Sonia R. Carvalho
City Attorney
By:_____________________________
Melissa M. Crosthwaite
Senior Assistant City Attorney
City Council 26 – 18 4/15/2025
Ordinance No. NS - ____

AYES: Councilmembers: ________________________________________ NOES: Councilmembers: ________________________________________ ABSTAIN: Councilmembers: ________________________________________ NOT PRESENT: Councilmembers: ________________________________________

CERTIFICATE OF ATTESTATION AND ORIGINALITY
I, Jennifer L. Hall, City Clerk, do hereby attest to and certify the attached Ordinance No.

NS-XXXX to be the original ordinance adopted by the City Council of the City of Santa Ana on _______________________, 2025.

Date: ________________ ____________________________________ City Clerk
City of Santa Ana
City Council 26 – 19 4/15/2025
Planning and Building Agency
www.santa-ana.org/planning-and-building
Item # 10
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
April 1, 2025
TOPIC: Ten-Day Written Report Pursuant to California Government Code Section 65858(d) Following the Adoption of Urgency Ordinance No. NS-3064 Moratorium Extension (Transit Zoning Code (SD-84) Moratorium)

AGENDA TITLE
Ten-Day Written Report Pursuant to California Government Code Section 65858(d) Following the Adoption of Urgency Ordinance No. NS-3064 Extension of Ten (10) Months and Fifteen (15) Days, Pursuant to California Government Code Section 65858(a), regarding a Moratorium on the Approval, Commencement, Establishment, Relocation, or Expansion of Industrial Uses within Specific Development No. 84 (Transit Zoning Code (SD-84) Moratorium)

RECOMMENDED ACTION
Issue and file a Council report to the public, pursuant to Section 65858(d) of the California Government Code, describing the City’s measures to alleviate conditions that led to the adoption of Urgency Ordinance No. NS-3064 on May 21, 2024, regarding a moratorium extension of ten (10) months and fifteen (15) days on the approval, commencement, establishment, relocation, or expansion of industrial uses within Specific Development No. 84 (the Transit Zoning Code (SD-84) Moratorium).

GOVERNMENT CODE §84308 APPLIES: No

EXECUTIVE SUMMARY
Pursuant to Section 65858(d) of the California Government Code, the purpose of this staff report is to provide a written report no less than ten (10) days prior to the expiration of Urgency Ordinance No. NS-3064 describing the measures the City has taken to alleviate the conditions which led to the adoption of Ordinance No. NS-3064.

On May 21, 2024, the City Council adopted Urgency Ordinance No. NS-3064, which establishes a ten (10) months and fifteen (15) days extension period of a moratorium on the approval, commencement, establishment, modification, relocation, or expansion of industrial uses in Specific Development No. 84 (SD-84), also known as the Transit Zoning Code (commonly referred to as the “Transit Zoning Code” or “TZC”) while City staff researches appropriate permanent regulations and determines whether an additional extension, pursuant to California Government Code Section 65858(a), is necessary.

Exhibit A - Ten-Day Written Report - April 1, 2025
City Council 26 – 20 4/15/2025
Ten-Day Report Describing Measures Taken to Alleviate the Conditions which Led to the Adoption of Urgency Ordinance No. NS-3064 (Transit Zoning Code Moratorium Extension)
April 1, 2025

Urgency Ordinance No. NS-3064 shall have no further force and effect ten (10) months and fifteen (15) days from the date of its adoption, unless, after a report during the TZC moratorium extension period and a public hearing, the City Council members, again by four/fifths (4/5) vote, extend the Ordinance for up to an additional twelve (12) months beyond the additional ten (10) months and fifteen (15) days of the initial Ordinance extension. Based on the adoption date of May 21, 2024, the Ordinance is scheduled to expire on April 15, 2025.

City staff continues to analyze and develop permanent regulations to address industrial business uses within the TZC. Staff continues to research, obtain community feedback, and work with planning and legal environmental consultants to prepare recommendations for the City Council’s consideration, following the Planning Commission’s recommendation to do so on March 6, 2025. Such actions may entail a zoning map amendment, zoning text amendment, or both, which would address industrial land uses in the TZC.

DISCUSSION
Background
On April 16, 2024, the City Council adopted Urgency Interim Ordinance No. NS-3063, establishing a 45-day moratorium on the approval, commencement, establishment, relocation, or expansion of industrial uses within the TZC. The purpose of the moratorium was to immediately offer protection of public health, safety, and welfare from industrial uses significantly causing pollution burden to adjacent residential neighborhoods within the TZC.

On May 7, 2024, the City Council issued a report to the public, pursuant to Section 65858(d) of the California Government Code, describing the City’s measures to alleviate conditions that led to the adoption of the moratorium.

On May 21, 2024, the City Council adopted Ordinance No. NS-3064 to extend the moratorium for an additional ten (10) months and fifteen (15) days pursuant to the Government Code as necessary to provide sufficient time for staff to continue with data tracking and reporting, research appropriate regulations, and coordinate with outside regulatory agencies and City departments to determine whether further, permanent action was necessary and to generate recommendations to the Planning Commission and City Council. During the moratorium period, the City has not issued permits that have resulted in the approval, commencement, establishment, modification, relocation, or expansion of industrial uses in the TZC.

Staff held a work-study session at the Planning Commission on February 10, 2025, which was open to the public. During the work-study session, Planning Commission members City Council 26 – 21 4/15/2025
Ten-Day Report Describing Measures Taken to Alleviate the Conditions which Led to the Adoption of Urgency Ordinance No. NS-3064 (Transit Zoning Code Moratorium Extension)
April 1, 2025

and members of the community posed additional questions and provided input on topics of key importance surrounding land use, code violations, the role of outside agencies and their enforcement, and financial and legal implications that required staff to carry out additional research. On February 24, 2025 and March 6, 2025, the Planning Commission held a public hearing and recommended approval of the TZC ordinance and map amendments with clarifying edits. However, this recommendation is advisory and the City Council retains the ultimate authority to approve, modify, or reject the proposed amendments after their own review and consideration of all presented information, including the Planning Commission's recommendations, staff reports, and public input.

Measures Taken
Review of City Department Activities
During the initial 45-day moratorium and the moratorium extension of ten (10) month and fifteen (15) days, City staff conducted interagency meetings that included representatives from multiple City departments: the Planning Division, Building Safety Division, Code Enforcement Division, Business License, and Information Technology. Additionally, engagement with agencies such as the Santa Ana Police Department (SAPD), Public Works Agency, and the Community Development Agency’s Economic Development Division has produced critical information illustrating the extent to which industrial activities interface with residential land uses in the TZC area, specifically and most concentrated in the Logan and Lacy neighborhoods.

Data based on Business License and Economic Development records indicate that application of the moratorium affects up to 127 industrial businesses in the TZC. Of the affected businesses, approximately three have active applications for permits, primarily seeking to legalize unpermitted work on industrial properties.

City staff has continued to review public safety data from SAPD and Orange County Fire Authority (OCFA) to assess community concerns regarding emergency responses in the TZC. SAPD records show a total of 18,736 calls for service between March 2023 and July 2024, with 226 of those occurring between April and July 2024 within the Logan and Lacy neighborhoods. These calls encompassed a wide range of incidents, including patrol checks, disturbances, and traffic-related issues. Notably, 1,909 calls involved collisions, vehicle impoundments, domestic violence, and SAMC violations. OCFA data from 2022 to August 2024 indicates 238 calls for advanced life support emergencies. In 2022, 29 calls were related to respiratory issues, chest pain, and cardiac arrest, with a subsequent 7% increase in health-related calls in 2023. While the data reflects a broad spectrum of emergency responses, the concentration of industrial businesses in the TZC raises the possibility that some of these calls, particularly those related to respiratory issues and traffic incidents, may be influenced by industrial operations.

City Council 26 – 22 4/15/2025
Ten-Day Report Describing Measures Taken to Alleviate the Conditions which Led to the Adoption of Urgency Ordinance No. NS-3064 (Transit Zoning Code Moratorium Extension)
April 1, 2025

Currently, City staff has an internal process established that continues to track and monitor incoming notices of compliance or notices of violations from outside regulatory agencies issued to a particular business/operator. City Code Enforcement activities and implementation of the City’s Noxious Uses Ordinance continue being monitored at these facilities. Code Enforcement data show enforcement activity within the TZC, where at the time of adoption of the moratorium, 16 active open cases were issued Notice of Violations and administrative citations for the following types of violations: illegal storage, land use, zoning, property and landscape maintenance, unpermitted work, business license, and certificate of occupancy. Such violations include issues of odors, dust, traffic, noise, vibrations, and other documented impacts. Recent code enforcement complaints on properties in the Logan neighborhood involve complaints for recurring unpermitted work and land use violations that involve large commercial vehicles blocking street access and impacting nearby residents. In the past 12 months, the Code Enforcement Division conducted investigations at over 35 commercial and industrial properties within the TZC.

These investigations led to administrative citations, ongoing enforcement actions, and onsite meetings with business owners.

The City of Santa Ana Code Enforcement Division is currently addressing 21 open code enforcement violations or compliance reviews specifically involving industrial businesses within the TZC area. This activity demonstrates the City’s direct involvement in overseeing these businesses to mitigate potential environmental and public health risks.

Review of Records and Activities of External Agencies
To broaden the analysis beyond the City's local land use impacts, City staff have received public records requested of compliance status, violation records, and violation status of outside regulatory agencies, and have contacted staff from external regulatory agencies such as the South Coast Air Quality Monitoring District (SCAQMD), Santa Ana Regional Quality Water Control Board (SARQWCB), the Department of Toxic Substances Control (DTSC), Certified Unified Program Agencies (CUPA), California Environmental Reporting System (CERS), and others responsible for issuing regulatory permits for industrial uses in the TZC. Specifically, these agencies are responsible for permit issuance, compliance activities, and/or monitoring hazardous clean-up sites, or other industrial facility-related activities and have received current data requests for sites located within the TZC zoning district.

Data from outside regulatory agencies assist City staff in further understanding activities between external regulatory agencies and industrial businesses that may place additional impacts on public health, safety, and welfare in affected neighborhoods adjacent to industrial businesses in the TZC. This information would enable City staff to understand the correlation and environmental burdens that may be attributed to permitted activities for industrial City Council 26 – 23 4/15/2025
Ten-Day Report Describing Measures Taken to Alleviate the Conditions which Led to the Adoption of Urgency Ordinance No. NS-3064 (Transit Zoning Code Moratorium Extension)
April 1, 2025

businesses in historically environmentally disadvantaged communities, specifically the Logan and Lacy neighborhoods.

Records show SCAQMD issued two notices to comply with one industrial business on August 2023 and April 2024 for failure to maintain records, such as temperature graphs, poundage logs, and source test data. SCAQMD issued several permits to construct and to operate to the new operator of this same facility, which is currently in compliance with SCAQMD. Two notices of violation were issued to one industrial business for operating a paint spray booth without a valid permit to operate from SCAQMD.

The report from the SARWQCB from 2024 shows three (3) active industrial business in the TZC in violation of their permit for providing a late report or incomplete and/or insufficient information for their Stormwater Pollution Prevention Plan (SPPP). In March 2025, one of the three businesses with active violations concluded a financial settlement directly with the SARWQCB agency.

Public records from the CUPA for Orange County, spanning 2022-2024, reveal a pattern of non-compliance with environmental and hazardous materials regulations among industrial businesses within the TZC. While some 2023 violations related to Hazardous Material Business Plan staff training and reporting were later corrected, current records indicate four businesses still have multiple open violations. These ongoing issues include non-compliance with documentation for hazardous waste transportation and disposal, as well as deficiencies in industrial stormwater reporting requirements. These violations highlight potential risks to public health and the environment.

Air emission complaints continue to be reported to SCAQMD. These complaints included one involving black smoke and another regarding unpermitted soil vapor extraction equipment onsite. SCAQMD staff has clarified that for air quality complaints they receive, their inspector is required to be physically present to observe the activity from the facility described in the complaint to determine if the complaint warrants further investigation or enforcement action in accordance with SCAQMD Rules 401 (Visible Emissions), 402 (Public Nuisance), and 403 (Fugitive Dust). Therefore, although community members continue to share concerns with City and SCAQMD staff, the turnaround time for an SCAQMD inspector to be physically present at an SCAQMD-permitted facility to investigate an air quality complaint, especially if a complaint is reported after working hours or on weekends, is ineffective in addressing the immediate needs of the community.

Public Engagement and Planning Commission Recommendation Following City Council's extension of the TZC moratorium on May 21, 2024, City staff have been developing permanent regulations for the TZC district for the City Council’s consideration. Leading up to the special Planning Commission meeting held on March 6, City Council 26 – 24 4/15/2025
Ten-Day Report Describing Measures Taken to Alleviate the Conditions which Led to the Adoption of Urgency Ordinance No. NS-3064 (Transit Zoning Code Moratorium Extension)
April 1, 2025

2025, City staff engaged in a comprehensive outreach effort regarding TZC regulations, holding 20 meetings in various formats with affected stakeholders. This included:
• Direct engagement through eight individual and group meetings with business owners and brokers,
• Two focus group meetings with TZC business owners,
• Community outreach involving two neighborhood/resident group meetings, • Two City-hosted TZC (SD-84) meetings: the October 22, 2024 City Informational Meeting and the March 3, 2025 Community Meeting,
• Three site visits at the request of businesses, and
• Three Planning Commission meetings (February 10, 2025 Study Session and February 24/March 6 Public Hearings).

This extensive engagement aimed to gather diverse input for the development of permanent TZC regulations. To proactively ensure important communications reached all stakeholders, City staff mailed notices to all property owners and occupants, comprising 3,599 addresses, within the Transit Zoning Code area for each of the following meetings:
the October 22, 2024 City Informational Meeting, the Planning Commission February 10, 2025 Study Session and February 24, 2025 Public Hearing notice, and the City Council April 1, 2025 Public Hearing Notice.

City staff from the Neighborhood Initiatives and Environmental Services (NIES) section of the Planning Division continue to coordinate with City departments, external regulatory agencies, and staff from other federal and state agencies to identify additional resources available to enhance deeper awareness of pollution exposure in disadvantaged communities, long-term health effects, and immediate solutions. The NIES team has held meetings and discussions with staff from the Centers for Disease Control and Prevention/Agency for Toxic Substances and Disease Registry and CalEPA Environmental Justice Team to identify opportunities for linking environmental justice (EJ) resources and support to the Logan and Lacy neighborhoods.

Next Steps
To address polluting industrial uses in the TZC during the ten (10) month and fifteen (15) day extension of the moratorium approved by Urgency Ordinance No. NS-3064, staff continues interagency coordination efforts, stakeholder outreach, and data analysis to inform permanent code amendments to the TZC zoning district that will be presented to City Council for their consideration. Permanent code amendments to address incompatible land uses in the TZC may include a zoning map amendment, zoning text amendment, or both, which would permanently address industrial land uses in the TZC (SD-84).

City Council 26 – 25 4/15/2025
Ten-Day Report Describing Measures Taken to Alleviate the Conditions which Led to the Adoption of Urgency Ordinance No. NS-3064 (Transit Zoning Code Moratorium Extension)
April 1, 2025

ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.

FISCAL IMPACTS
There is no fiscal impact associated with this action.

EXHIBITS

1. Adopted Urgency Interim Ordinance No. NS-3063

2. April 16, 2024 City Council Staff Report (without attachments)

3. Ten-Day Written Report – May 7, 2024

4. Adopted Urgency Interim Ordinance No. NS-3064

5. May 21, 2024 City Council Staff Report (without attachments) Submitted By: Ali Pezeshkpour, AICP, Acting Executive Director, Planning and Building Agency
Approved By: Alvaro Nuñez, City Manager
City Council 26 – 26 4/15/2025
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 City Council 26 – 34 4/15/2025
Planning and Building Agency
www.santa-ana.org/planning-and-building
Item # 28
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
April 16, 2024
TOPIC: Transit Zoning Code Urgency Interim Ordinance (Moratorium)

AGENDA TITLE
Urgency Interim Ordinance Pursuant to Section 65858(a) of the California Government Code Adopting a 45-day Moratorium on the Approval, Commencement, Establishment, Relocation, or Expansion of Industrial Uses within Specific Development No. 84

RECOMMENDED ACTIONS

1. Adopt an urgency ordinance by four-fifths (4/5) vote, pursuant to California Government Code Section 65858(a), adopting a 45-day moratorium on the approval, commencement, establishment, relocation, or expansion of industrial uses within Specific Development No. 84 zoning district.

ORDINANCE NO. NS-XXXX entitled AN URGENCY INTERIM ORDINANCE OF

THE CITY OF SANTA ANA PURSUANT TO GOVERNMENT CODE SECTION 65858 ADOPTING A 45-DAY MORATORIUM ON THE APPROVAL,

COMMENCEMENT, ESTABLISHMENT, RELOCATION OR EXPANSION OF INDUSTRIAL USES WITHIN SPECIFIC DEVELOPMENT NO. 84 ZONING

DISTRICT

2. Find that, in accordance with the California Environmental Quality Act (CEQA), the proposed action is not subject to the requirements of the California Environmental Quality Act, pursuant to (Guidelines) Section 15060(c)(2) because the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment and 15060(c)(3) because the activity is not a project as defined in Section 15378 of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly and so is not a project.

GOVERNMENT CODE §84308 APPLIES: No

EXECUTIVE SUMMARY
Staff is recommending adoption of an urgency interim ordinance, pursuant to Government Code Section 65858(a), also known as a moratorium, to address current and immediate threats to public health, safety, and welfare, due to growing code ([KLELW$SULO&LW\&RXQFLO6WDII5HSRUW
ZLWKRXWDWWDFKPHQWV

City Council 26 – 35 4/15/2025
Transit Zoning Code Urgency Interim Ordinance (Moratorium) April 16, 2024

enforcement complaints stemming from the irreconcilable land use conflicts within the Specific Development No. 84 zoning district (commonly referred to as the “Transit Zoning Code” or “TZC”). Specifically, in the Logan and Lacy neighborhoods, and surrounding areas, the City’s Code Enforcement Division has investigated over 33 commercial and industrial properties in the past nine months and currently has 17 active open cases that have been issued Notice of Violations and administrative citations for the following types of violations: illegal storage, land use, zoning, property and landscape maintenance, unpermitted work, business license, and certificate of occupancy. The close proximity of active open industrial cases during a short period is creating a public nuisance that is straining City resources and that is harming public health, safety, and general welfare of the TZC’s existing and new residential neighborhoods.

If adopted, the urgency ordinance would establish a 45-day moratorium on the approval, commencement, establishment, modification, relocation, or expansion of industrial uses in the TZC while City staff researches appropriate regulations and determines whether an extension pursuant to the Government Code is necessary. The urgency ordinance shall have no further force and effect 45-days from the date of its adoption, unless, after a report on the first 45 days and a public hearing, the City Council members, again by four/fifths (4/5) vote, extend this ordinance for an initial extension period of ten (10) months and fifteen (15) days.

DISCUSSION
Background
Specific Development No. 84 (the Transit Zoning Code)
The Specific Development No. 84 zoning district, also known as the Transit Zoning Code (“TZC”), is located in the central urban core of the City and comprises over 100 blocks and 450 acres. The TZC includes the Civic Center, Downtown, and the Logan and Lacy neighborhoods, which are among the City’s most historic in age and in established residential communities. As shown in Exhibit 2, the TZC is generally bounded by First Street, Flower Street, Civic Center Drive, Grand Avenue, and the Santa Ana (I-5) Freeway. Prior to the implementation of the TZC, the area consisted of a wide range of civic, commercial, industrial, and residential land uses under a variegated amalgamation of zoning districts and their regulations.

In June 2010, the City Council adopted Ordinance No. NS-2804, adopting various entitlements approving the creation of the TZC. The TZC established a transitsupportive, pedestrian-oriented development framework to support the addition of new transit infrastructure; preserve and reinforce the existing character and pedestrian nature of the City by strengthening urban form through improved development and City Council 26 – 36 4/15/2025
Transit Zoning Code Urgency Interim Ordinance (Moratorium) April 16, 2024

design standards; encourage alternative modes of transportation; provide for a range of housing options; and allow for the reuse of existing structures.

Moreover, the TZC provided new zoning for all of the properties contained within its boundary with the exception of those properties zoned Light Industrial (M1) or Heavy Industrial (M2). These M1 and M2 properties retained their existing zoning, but were covered by two overlay zones that allows for the option of future mixed-use development to be exercised at the discretion of the property owner. In support of the TZC, the City Council also approved a General Plan amendment, establishing numerous mixed-use General Plan land use designations for the entirety of the TZC. In these industrial overlay areas, however, the resulting new General Plan land use designations immediately resulted in zoning inconsistencies and land use conflicts between the new General Plan land use designations and the industrial overlays.

Since 2010, and specifically in the Logan and Lacy neighborhoods, these industrial uses have remained, changed ownership, undergone expansions or intensifications, and created numerous land use conflicts and disturbances that affect surrounding residential communities. Specifically, in the Logan neighborhood alone, these land uses create quality of life, health and safety, and other trespass issues for residential properties that often directly abut these industrial land uses. These issues include odors, dust, traffic, noise, vibrations, and other documented impacts that have taken place for nearly a decade and a half, despite the change in underlying General Plan land use designation.

Comprehensive Zoning Code Update
The City Council approved a contract with Moore, Iacofano, Goltsman, Inc. (MIG) on October 17, 2023. To ensure the City’s Zoning Code and General Plan are consistent, and to maintain compliance with state law, comprehensive amendments to the Zoning Code are required. Necessary amendments include the creation of new zoning district designations and corresponding development standards; updates to the definitions, signage, nonconforming, and parking sections; reorganization of the entire Zoning Code to a more user-friendly format; and new standards to reflect new land use trends, economic development trends, and land use goals of the City.

MIG and City staff have conducted extensive community outreach, stakeholder interviews, and reviews of existing zoning-related codes and policies in Santa Ana. These early efforts have indicated that the irreconcilable land use conflicts and land use inconsistencies in the TZC area are among the top, most pressing topics that must be addressed as part of the comprehensive Zoning Code Update process in order to protect the health, safety, and welfare of the most vulnerable communities that face the impacts of the land use conflicts within the TZC area.

City Council 26 – 37 4/15/2025
Transit Zoning Code Urgency Interim Ordinance (Moratorium) April 16, 2024

Historically Disadvantaged Communities
Prior to the adoption of the City’s Transit Zoning Code (TZC), the City permitted industrial uses within the Logan and Lacy neighborhoods in close proximity to sensitive land uses such as residences and schools. By way of context, the Logan neighborhood represents the oldest Mexican and Mexican-American neighborhoods of Santa Ana and one of the oldest barrios in Orange County, and one of the few places where Mexicans and those of Mexican descent were allowed to buy land due to restrictions and covenants based on race during the first half of the 20th century. Moreover, as a neighborhood, the area was established before the modern practice of separating impactful land uses, also known as zoning. The Logan neighborhood itself originated as early as 1886 and was largely settled by 1900, before the practice of zoning was enshrined by Village of Euclid v. Ambler Realty Co. in 1926. By then, the neighborhood comprised residential, industrial, commercial, and related land uses, with issues further exacerbated by rail lines, fuel storage depots, and the construction of the Santa Ana Freeway between 1947 and 1956.

Comprehensive data analysis and mapping tools generated by the California EPA (CalEPA), the Center for Diseases Control/Agency for Toxic Substances and Disease Registry (CDC/ATSDR), the U.S. EPA (EPA), and California Healthy Places Index (HPI), present concerning information regarding environmental conditions impacting residents in the Logan and Lacy neighborhoods. Exhibit 3 of this report references EJ maps showing rankings of at least 90% or higher in heavy air pollution attributed to indicators describing exposure to Particulate Matter (PM) 2.5, Diesel Particulate Matter, Air Toxics Cancer Risk, Toxic Releases to Air, and Hazardous Water Proximity exposures. Multiple sources of environmental exposure and pollution burden into communities of color, including the Logan and Lacy neighborhoods, presents an alarming set of challenges and decline in healthy community conditions that will impact their quality of life and life expectancy with continued heavy industrial uses nearby.

Implementation of Senate Bill (SB 1000), City General Plan Update (GPU), and new Environmental Justice (EJ) Policies and Actions
SB 1000 went into effect in 2016, requiring local governments to address pollution and other hazards that disproportionately impact low-income and communities of color within their jurisdiction as a way to proactively plan for and address environmental concerns when developing and updating components of the General Plan. During this period, the City began and extended its comprehensive public engagement process for the General Plan Update through its adoption in April 2022. The City and community worked to ensure that the new General Plan included SB 1000 requirements of addressing environmental justice in local general plans through facilitating transparency and public engagement in the planning and decision-making processes, reducing City Council 26 – 38 4/15/2025
Transit Zoning Code Urgency Interim Ordinance (Moratorium) April 16, 2024

harmful pollutants and the associated health risks in disadvantaged communities, and promoting equitable access to health-inducing benefits such as healthy housing options.

Of note, the new General Plan mixed-use land use designations in the TZC area were largely left intact, including those in the Lacy and Logan neighborhoods, when the General Plan Update was adopted in 2022.

Santa Ana’s current General Plan champions implementation policies, including 77 EJ actions that address air quality, noxious uses, water safety, residential lead exposure in the soil, and other environmental public health conditions. City staff, over the past year, have worked on a process to create an EJ Action Committee of EJ cluster area residents, community-based organizations (CBOs), and County and City staff representatives, to guide implementation and resource investments to protect neighborhoods from experiencing any further environmental harm. For the Logan and Lacy neighborhoods, incompatible land uses allowed from past zoning decisions, including the industrial overlay zones, have perpetuated the practices of locating industrial uses or other noxious and unwanted uses, in close proximity to communities of color.

Code Enforcement and Immediate Ongoing Issues
In the Lacy and Logan neighborhoods within the TZC, the Code Enforcement Division has investigated over 33 commercial and industrial properties in the past nine months and currently has 17 active open cases that have been issued Notice of Violations and administrative citations for the following types of violations: illegal storage, land use, zoning, property and landscape maintenance, unpermitted work, business license, and certificate of occupancy. These violations include issues of odors, dust, traffic, noise, vibrations, and other documented impacts. The close proximity of active open industrial cases during a short period is creating a public nuisance that is harming public health, safety, and general welfare of the two residential neighborhoods from the concentration of open code enforcement cases nearby.

Since June 2023, the TZC communities have experienced a marked increase in impacts stemming from the irreconcilable industrial and residential land use conflicts in the Logan and Lacy neighborhoods. Residents in the TZC have increased their reporting of complaints and public health concerns to City staff regarding emitted contaminants and zoning violations from industrial businesses in the neighborhoods. Concerns that range from air pollution and smoke, toxic release exposures, idling trucks on residential streets, lead exposure, illegal storage, unpermitted uses, loud noise at night, and other property maintenance pose an immediate public health threat that is straining public resources to continuously investigate and address these matters. Six months ago, a fire incident at Macera Crematory, located at 1020 Fuller Street, alarmed neighbors at 9:18 p.m. on August 29, 2023. Neighbors shared with City officials disturbing video of high flames escaping the stack on the rooftop, the screeching noise that went nonstop for 10 minutes, and what they described as a foul odor attributed to the fire. As City staff City Council 26 – 39 4/15/2025
Transit Zoning Code Urgency Interim Ordinance (Moratorium) April 16, 2024

followed up with external regulatory agencies issuing permits to operate this facility, and quickly, staff observed the limitations from regulatory agencies and their compartmentalized processes to investigate and act on enforcement measures.

Since 2022, the City has enhanced community services by restructuring its Planning Division to contain a Neighborhood Initiatives and Environmental Services (NIES) section, which oversees, among other functions, environmental justice efforts in Santa Ana and regional coordination to address such issues. Despite this restructuring, it is now well documented that the NIES section’s coordination with external regulatory agencies has not resulted in a favorable outcome in enforcement by responsible external agencies such as South Coast Air Quality Management District (SCAQMD), California Department of Consumer Affairs Cemetery and Funeral Bureau (CFB), and Orange County Fire Authority (OCFA) in many of these investigations. In response, the City has adopted new regulations such as a Noxious Uses Ordinance (Ordinance No.

NS-3044, adopted June 20, 2023), which amends Zoning Ordinance No. 2023-01 that includes: a notification requirement to the City by the property owner to obtain a permit from a regulatory public agency; a requirement of a 1,000 linear foot distance buffer measured from the outermost boundary of the subject property; and a conditional use permit requirement from a regulatory public agency to handle, store, emit, or discharge particulate materials, exhaust emissions, or regulated compounds, or chemicals near a public park, school (K-12), or property zoned for residential purposes.

City staff have also researched commercial real estate acquisition data and current for sale properties to identify any trends that could potentially generate an increase in the application of the City’s Noxious Uses Ordinance for proposed or expanded industrial uses. From September 2022 to date, seven properties, primarily industrial businesses, sold and three of those businesses (800-808 E. Washington Avenue, 1045 Fuller Street, and 923 N. Logan Street) are located in the Logan neighborhood. Currently, two large properties are in the market for multifamily and land types located in the TZC.

Environmental Justice (EJ)/Disadvantaged Communities (DACs) Profile: Logan and Lacy neighborhood impacts
A demographic profile of the Lacy and Logan neighborhoods combined represent a population of 5,907, which encompass 1,564 households, a median household income of $56,864, average household size is nearly four persons, median age is 27 years, percapita income is $23,495, and 74% comprise renter-occupied units based on demographic forecasts for 2023. Nearly 25% of the population is under 14 years of age and 14% are 55 years of age and older. Nearly 3% of the population attended up to 12th grade with no diploma, over 31% are high school graduates, and nearly 97% of the working population over 16 years of age are employed.

This data illustrates that the Logan and Lacy neighborhoods are within the second and third highest scored census tracts in Santa Ana, each with a composite score of 90% or City Council 26 – 40 4/15/2025
Transit Zoning Code Urgency Interim Ordinance (Moratorium) April 16, 2024

greater, ranking in the 90th percentile or greater of census tracts in the State, and identified as “disadvantaged communities” by the Office of Environmental Health Hazard Assessment (OEHHA) in its CalEnviroScreen model. Failure to address ongoing irreconcilable land use conflicts that are the target of this moratorium will further exacerbate the ongoing demographic and environmental justice challenges that these two neighborhoods within the TZC have grappled with since their founding.

General Plan Inconsistency with Present Land Uses
Numerous policies of the General Plan are inconsistent with the present, irreconcilable land use pattern of the TZC. Specifically, these policies include Policy LU-1.1 (Compatible Uses), Policy LU-3.8 (Sensitive Receptors), Policy LU-3.9 (Noxious, Hazardous, Dangerous, and Polluting Uses), Policy LU-3.11 (Air Pollution Buffers), Policy LU-4.3 (Sustainable Land Use Strategies), Policy LU-4.6 (Healthy Living Conditions), Policy CM-3.2 (Healthy Neighborhoods), Policy EP-1.9 (Avoid Conflict of Uses), and Policy CN-1.5 (Sensitive Receptor Decisions), which are targeted at correcting past land use planning practices that have placed an unequitable environmental and health burden on certain neighborhoods now termed disadvantaged communities.

The purpose of the interim ordinance is to immediately offer protection of public health, safety, and welfare from these irreconcilable land use conflicts in the TZC, during the time that City staff analyzes and prepares an evaluation of industrial business uses within the TZC. Such an evaluation will enable staff to generate recommendations to the Planning Commission and City Council to determine whether industrial uses should be permitted in the zoning district, and, if not, proceed with an ordinance and zoning map amendment to the district. During the interim moratorium period, City staff will not issue permits, business licenses, or other applicable entitlements to individuals wishing to use their property for the purposes of industrial business use in the TZC.

ENVIRONMENTAL IMPACT
This ordinance is not subject to the California Environmental Quality Act (“CEQA”), as the proposed action is not subject to the requirements of CEQA, pursuant to Guidelines Section 15060(c)(2) because the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment and 15060(c)(3) because the activity is not a project as defined in Section 15378 of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly and so is not a project, as the ordinance will temporarily preclude the approval, commencement, establishment, relocation, or expansion of uses in the zoning district.

FISCAL IMPACTS
There is no fiscal impact associated with this action.

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Transit Zoning Code Urgency Interim Ordinance (Moratorium) April 16, 2024

EXHIBITS

1. Interim Ordinance (Moratorium)

2. Transit Zoning Code (TZC) Map

3. Logan and Lacy Community Summary Infographic and Environmental Justice (EJ) Data Maps City General Plan Environmental Justice Implementation Actions

4. City General Plan Environmental Justice (EJ) Implementation Actions Submitted By: Ali Pezeshkpour, AICP, Planning Manager
Approved By: Alvaro Nuñez, Acting City Manager
City Council 26 – 42 4/15/2025
Planning and Building Agency
www.santa-ana.org/planning-and-building
Item # 15
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
May 7, 2024
TOPIC: Ten-Day Written Report Pursuant to California Government Code Section 65858(d) Following the Adoption of Urgency Interim Ordinance No. NS-3063

AGENDA TITLE
Ten-Day Written Report Pursuant to California Government Code Section 65858(d) Following Adoption of Urgency Interim Ordinance No. NS-3063, a 45-day Moratorium on the Approval, Commencement, Establishment, Relocation, or Expansion of Industrial Uses within Specific Development No. 84

RECOMMENDED ACTION
Issue and file a Council report to the public, pursuant to Section 65858(d) of the California Government Code, describing the City’s measures to alleviate conditions that led to the adoption of Urgency Interim Ordinance No. NS-3063, on April 16, 2024, regarding a 45-day moratorium on the approval, commencement, establishment, relocation, or expansion of industrial uses within Specific Development No. 84 (the Transit Zoning Code).

GOVERNMENT CODE §84308 APPLIES: No

EXECUTIVE SUMMARY
Pursuant to Section 65858(d) of the California Government Code, the purpose of this staff report is to provide a written report no less than ten days prior to the expiration of Urgency Interim Ordinance No. NS-3063 describing the measures City staff has taken to alleviate the condition which led to the adoption of the Ordinance.

On April 16, 2024, the City Council adopted Urgency Interim Ordinance No. NS-3063, which establishes a 45-day moratorium on the approval, commencement, establishment, modification, relocation, or expansion of industrial uses in Specific Development No. 84, also known as the Transit Zoning Code (commonly referred to as the “Transit Zoning Code” or “TZC”) while City staff researches appropriate regulations and determines whether an extension pursuant to the Government Code is necessary.

Urgency Interim Ordinance No. NS-3063 shall have no further force and effect 45 days from the date of its adoption, unless, after a report on the first 45 days and a public hearing, the City Council members, again by four/fifths (4/5) vote, extend the Ordinance ([KLELW7HQ'D\:ULWWHQ5HSRUW0D\
City Council 26 – 43 4/15/2025
Ten-Day Report Describing Measures Taken to Alleviate the Condition which Led to the Adoption of Urgency Interim Ordinance No. NS-3063 (Transit Zoning Code Moratorium) May 7, 2024

for an initial extension period of ten (10) months and fifteen (15) days. Based on the adoption date of April 16, 2024, the Ordinance is scheduled to expire on June 1, 2024.

As City staff begins to analyze and prepare an evaluation of industrial business uses within the TZC, the evaluation will enable staff to generate recommendations to the Planning Commission and City Council to determine whether further, permanent action is necessary. Such action may entail a zoning map amendment, zoning text amendment, or both, which would address industrial land uses in the TZC.

DISCUSSION
Background
On April 16, 2024, the City Council adopted Urgency Interim Ordinance No. NS-3063 to immediately offer protection of public health, safety, and welfare from industrial uses significantly causing pollution burden to adjacent neighborhoods through the following conditions, including: code enforcement active cases; irreconcilable land use conflicts in the TZC; alarming air quality, noise, traffic, proximity to noxious use facilities, and public health concerns; and external regulatory agency responsiveness. During the urgency interim moratorium period, the City will not issue permits that result in the approval, commencement, establishment, modification, relocation, or expansion of industrial uses in the TZC.

Measures Taken
Review of City Department Activities
Immediately following the adoption of the 45-day moratorium, staff conducted an interagency meeting, which included representatives from multiple City departments.

These departments include the Planning Division, Building Safety Division, Code Enforcement Division, Business License, and Information Technology. Moreover, engagement with additional agencies such as the Police Department, Public Works Agency, and the Community Development Agency’s Economic Development Division has produced critical information illustrating the extent to which industrial activities are intertwined with residential land uses in the TZC area, specifically and most concentrated in the Logan and Lacy neighborhoods.

Data based on Business License and Economic Development records indicate that the application of Urgency Interim Ordinance No. NS-3063 affects up to 130 industrial businesses in the TZC. Of these, over one-dozen have active applications for permits, the majority of which are to legalize unpermitted work on industrial properties and address ongoing Code Enforcement Division notices of violation.

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Ten-Day Report Describing Measures Taken to Alleviate the Condition which Led to the Adoption of Urgency Interim Ordinance No. NS-3063 (Transit Zoning Code Moratorium) May 7, 2024

City staff continues to gather, review, and analyze information regarding affected industrial businesses within the TZC. Specific data and reporting pertains to applications submitted by industrial businesses for permits, entitlements, certificates of occupancy, business licenses, and other relevant records immediately prior to and following the adoption of the Urgency Interim Ordinance and currently being reviewed by City staff.

Requests for information on calls for service and incident activities responded to by public safety departments of the Santa Ana Police Department and Orange County Fire Authority (OCFA) are being reviewed by City staff to understand and validate public safety concerns or impacts shared by neighbors in disadvantaged communities with actual calls and emergencies reported.

In addition, City staff continues to monitor Code Enforcement Division activities and implementation of the City’s Noxious Uses Ordinance pertaining to these facilities. Code Enforcement staff will broaden data reports that show enforcement activity beyond the Lacy and Logan neighborhoods within the TZC, where at the time of adoption of the Urgency Interim Ordinance on April 16, 2024, 17 active open cases were issued Notice of Violations and administrative citations for the following types of violations: illegal storage, land use, zoning, property and landscape maintenance, unpermitted work, business license, and certificate of occupancy. Such violations include issues of odors, dust, traffic, noise, vibrations, and other documented impacts. The close proximity of active open industrial cases during a short period is creating a public nuisance that is harming public health, safety, and general welfare of the two residential neighborhoods from the concentration of open code enforcement cases nearby.

Review of Records and Activities of External Agencies
To broaden the analysis beyond the City's local land use impacts, City staff have initiated public records requests of violation records and violation status of outside regulatory agencies, and have contacted staff from external regulatory agencies such as the South Coast Air Quality Monitoring District (SCAQMD), Santa Ana Regional Quality Water Control Board, the Department of Toxic Substances Control, and others responsible for issuing supportive permits for industrial uses in the TZC. Specifically, these agencies are responsible for permit issuance, compliance activities, and/or monitoring hazardous clean-up sites, or other industrial facility-related activities and have received current data requests for sites located within SD No. 84.

Data from external regulatory agencies would assist City staff in further understanding activities between external regulatory agencies and industrial businesses that may place additional impacts on public health, safety, and welfare in affected neighborhoods adjacent to industrial businesses in the TZC. This information would enable City staff to understand the correlation and environmental burdens that may be attributed to permitted activities for industrial businesses in historically environmentally disadvantaged communities, specifically the Logan and Lacy neighborhoods. In City Council 26 – 45 4/15/2025
Ten-Day Report Describing Measures Taken to Alleviate the Condition which Led to the Adoption of Urgency Interim Ordinance No. NS-3063 (Transit Zoning Code Moratorium) May 7, 2024

response to the City’s request, SCAQMD clarified the need to process the records request by larger geographic areas, not specifically matching the boundaries of the TZC. When reports become available to the City, additional time will be needed for City staff to carefully review and analyze other internal data to understand all activities (internal and external) and affected industrial businesses.

Comprehensive Zoning Code Update and Neighborhood Engagement City staff continues to work with Project Consultant Moore, Iacofano, Goltsman, Inc. (MIG) to ensure the City’s Zoning Code and General Plan are consistent and, to maintain compliance with state law, comprehensive amendments to the Zoning Code are required.

MIG and City staff have already conducted extensive community outreach, stakeholder interviews, and reviews of existing zoning-related codes and policies in Santa Ana. These early efforts have indicated that the irreconcilable land use conflicts and land use inconsistencies in the TZC area are among the top, most pressing topics that must be addressed as part of the comprehensive Zoning Code Update process in order to protect the health, safety, and welfare of the most vulnerable communities that face the impacts of the land use conflicts within the TZC area.

City staff from the Neighborhood Initiatives and Environmental Services (NIES) section of the Planning Division will continue to coordinate with City departments, external regulatory agencies, and staff from other federal and state agencies to identify additional resources available to enhance deeper awareness of pollution exposure in disadvantaged communities, long-term health effects, and immediate solutions. The NIES team has held meetings and discussions with staff from the Centers for Disease Control and Prevention/Agency for Toxic Substances and Disease Registry and CalEPA Environmental Justice Team to identify opportunities for linking environmental justice (EJ) resources and support to the Logan and Lacy neighborhoods. In addition, the NIES team has been working with the residents selected to represent the City’s EJ Clusters to complete the formation of the EJ Action Committee, the community-led EJ advocacy group, to guide the prioritization and resource investments to implement the City’s General Plan EJ Policies and Implementation Actions.

Next Steps
Staff implements the 45-day moratorium established by Urgency Interim Ordinance No.

NS-3063 through ongoing interagency coordination. Moreover, staff will continue to analyze and prepare an evaluation of industrial business uses within the TZC, which will enable staff to generate recommendations to the Planning Commission and City Council to determine whether an extension of the 45-day moratorium is recommended.

If an extension is recommended, it would be placed on the May 21, 2024 City Council agenda as a public hearing item, which is prior to the June 1 expiration date.

City Council 26 – 46 4/15/2025
Ten-Day Report Describing Measures Taken to Alleviate the Condition which Led to the Adoption of Urgency Interim Ordinance No. NS-3063 (Transit Zoning Code Moratorium) May 7, 2024