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Chapter 8.54
CONDO CONVERSION REGULATIONS

8.54.010 Purpose.

The purpose of this Chapter is to:

A.    Maintain a supply of affordable and market rate rental housing.

B.    Provide a reasonable balance of ownership and rental housing in the community and a variety of choices in the type and price of housing.

C.    Establish criteria for the conversion of existing multi-family rental housing to condominiums.

D.    Reduce the impact of conversion on residents of rental housing that may be required to relocate due to the conversion of rental housing to condominiums.

E.    Provide the opportunity for very low-, low-, and moderate-income persons to participate in the ownership process and to maintain a supply of rental housing for very low-, low-, and moderate-income persons; and

F.    Ensure that converted housing achieves a high degree of appearance, quality and safety. Ord. 11-05 (May 2005)

8.54.020 Condominium Conversion Defined.

A “condominium conversion” means the conversion of the ownership of the units in a residential housing project containing twenty-one or more units that are or were previously occupied as rental units from a single ownership to an ownership in which the residential units may be sold individually. Such condominium conversions may include, but are not limited to, the conversion of existing multiple unit residential housing projects to any of the following, all as defined in Civil Code section 1351 (a) a community apartment project, (b) a condominium project, and (c) a stock cooperative. Ord. 11-05 (May 2005)

8.54.030 Condominium Conversion Permit.

A.    Permit Required. No condominium conversion may take place in the City without the owner first obtaining a Condominium Conversion Permit pursuant to this Chapter and, where applicable, an approved subdivision map.

B.    Exemptions. A Condominium Conversion Permit shall not be required prior to the sale of individual units to the public for any of the following residential housing projects:

1.    Projects that had recorded subdivision maps for a community apartment project, a condominium project, or a stock cooperative on or before September 7, 2004.

2.    Projects in which none of the units have been occupied as rental units. Ord. 11-05 (May 2005)

8.54.040 Preliminary Application Process.

A.    Preliminary Applications. Prospective applicants for Condominium Conversion Permits shall initially submit a preliminary application on forms provided by the City. Preliminary applications shall identify the owner or the owner’s authorized agent and the location and number of units in the building to be converted. The preliminary application shall be accompanied by a preliminary application fee, the amount of which shall be as set forth from time to time by resolution of the City Council.

B.    Department Review. The Community Development Director shall review preliminary applications for condominium conversions. The Community Development Director shall authorize the submittal of a Condominium Conversion Permit application if both of the following criteria are met:

1.    Notice of Intent to Convert Provided. The applicant provides satisfactory evidence to the Community Development Director that the Notice of Intent to Convert required by section 8.54.050 was received by all tenants of the project proposed for conversion and that 60 days have elapsed since the applicant made the last such notification.

2.    Conversion Would Not Exceed Annual Maximum. The approval of the proposal would not result in the conversion of units in excess of the Annual Maximum. The “Annual Maximum” for the purposes of this Chapter shall be equal to seven percent (7%) of the total number of multiple-family units in developments of twenty one (21) or more rental units in the City, as determined by the City as of January 1 of each year. Notwithstanding the foregoing, if the number of units in a project proposed for conversion by itself exceeds the Annual Maximum, the Community Development Director shall authorize the submittal of a Condominium Conversion Permit application for the proposed project, unless the Community Development Director has during that year authorized the submittal of a Condominium Conversion Permit application and that authorization has not expired. If the Community Development Director authorizes the submittal of an application to convert a project that exceeds the Annual Maximum, the total number of units in excess of the Annual Maximum shall be subtracted from the Annual Maximum for the next year (and if necessary for each subsequent year).

Preliminary applications for each year may be submitted no earlier than January 1. Preliminary applications shall be processed in the order that completed applications are submitted. If a preliminary application is rejected because it fails to meet the requirements of subdivision B.1 of this Section, the preliminary application may be resubmitted. If the preliminary application is rejected because it fails to meet the requirements of subdivision B.2 of this Section, the preliminary application may not be resubmitted until no sooner than January 1 of year following the preliminary application’s submittal. In either case, the resubmittal will not be entitled to priority over preliminary applications submitted between the original submittal and the resubmittal. Notwithstanding anything to the contrary in the foregoing, no Condominium Conversion Permit application shall be accepted for projects that propose to convert only a portion of the units in an existing multiple unit residential project.

The Condominium Conversion Permit application shall be submitted no later than 60 days following the Community Development Director’s authorization. Ord. 11-05 (May 2005)

8.54.050 Notice of Intent to Convert.

A.    At least sixty (60) days prior to submitting an application for a Condominium Conversion Permit pursuant to section 8.54.070, the applicant shall provide notice substantially in the form outlined in subdivision B to each tenant in the project proposed for conversion.

B.    The notice shall be substantially as follows:

“To the occupant(s) of [address]:

The owner(s) of this building, at [address], plan(s) to file an application for a Condominium Conversion Permit with the City of Dublin to convert this building to condominiums, community apartments, or a stock cooperative project. You will be provided with notice of each hearing held by the City on the proposed conversion, and you have the right to appear and the right to be heard at any such hearing. Be advised that Chapter 8.56 of the Dublin Municipal Code may give you, as a tenant of a structure proposed for conversion to condominiums, certain rights.

_____________________

[signature of owner or owner’s agent]

_____________________

[date]

C.    In the event that the applicant is simultaneously applying for a tentative map and a Condominium Conversion Permit, the notice required by this section may be combined with the notice required by Government Code section 66452.9. Ord. 11-05 (May 2005)

8.54.060 Site Development Review Required.

Any condominium conversion shall also be subject to Site Development Review, pursuant to Chapter 8.104, to provide the City with a mechanism to evaluate issues related to maintenance of the property and consistency with prior site and architectural approvals and, if necessary, require modifications to existing site conditions. The applicant shall submit an application for Site Development Review concurrently with the application for a Condominium Conversion Permit. The decision maker shall impose such conditions as are necessary to require that buildings, structures, fences, patio enclosures, carports, accessory buildings, sidewalks, driveways, landscaped areas and utility facilities are refurbished and restored as necessary to ensure that the proposed conversion project is and remains orderly and attractive. Ord. 11-05 (May 2005)

8.54.070 Condominium Application Requirements.

An application for a Condominium Conversion Permit shall be accompanied by the following items:

A.    A report on the physical elements of each structure and facility, which shall include, but not be limited to, the following:

1.    A report detailing the condition of each element of the property, including foundation, structural, electrical, plumbing, utilities, walls, ceilings, windows, recreational facilities, sound transmission of each building, mechanical equipment, parking facilities, and appliances. Regarding each element, the report shall state to the best knowledge or estimate of the applicant when the element was constructed or installed, when the element was last replaced, the approximate date upon which the element will require replacement, the cost of replacing the element, and any variation of the physical condition of the element from the applicable zoning and building code. The report shall identify each known defective or unsafe element and set forth the proposed corrective measures to be employed;

2.    A report from a licensed structural pest control operator on each structure and each unit within the structure;

3.    A report on the condition of the common area improvements, including landscaping, lighting, utilities and streets;

4.    A report on any known soil and geological conditions regarding soil deposits, rock formation, faults, groundwater and landslides in the vicinity of the project, and a statement regarding any known evidence of soils problems relating to the structure. Reference shall be made to any previous soils report for the site and a copy submitted with the report; and

5.    A statement of repairs and improvements necessary to refurbish and restore the project to achieve a high degree of appearance, quality and safety.

B.    A site/development plan;

C.    Specific information concerning the characteristics of the project, including, but not limited to, the following:

1.    Square footage and number of rooms in each unit;

2.    Estimated sales price range of units; and

3.    Names and mailing address of all tenants.

D.    A detailed list of rents for each unit to be converted for the twelve (12) months prior to the application;

E.    Economic and demographic information regarding the current tenants as required by the Community Development Director;

F.    A Tenant Relocation Assistance plan as required by Section 8.54.110;

G.    A declaration of covenants, conditions and restrictions (CC&Rs) that would be recorded and would apply to each owner of a condominium unit within the project. The declaration shall include, but not be limited to, pertinent information regarding the conveyance of units and the assignment of parking, an agreement for common area maintenance, including facilities and landscaping, together with an estimate of any initial assessment fees anticipated for maintenance, and an indication of appropriate responsibilities for maintenance of all improvements and utility systems for each unit. The city has the right to review and approve the CC&Rs to ensure that (1) the appropriate conditions of approval are included in them and (2) those provisions reflecting the city’s conditions may not be amended without city approval; and

H.    Such additional information as the Community Development Director deems necessary to ensure the compliance with this Chapter. Ord. 11-05 (May 2005)

8.54.080 Building Code Requirements.

The building proposed for conversion and each unit within the building shall comply with the current Housing Code as defined by section 7.48 of the Dublin Municipal Code. The Building Official shall, if deemed necessary, inspect the project. Upon completion of the inspection, if any, the Building Official shall identify all items evidenced by the application or the inspection to be in noncompliance with applicable building and housing standards. All such items shall be corrected to the satisfaction of the Building Official, prior to granting the Condominium Conversion Permit. Ord. 11-05 (May 2005)

8.54.090 Tenant’s Right to Purchase Units.

A.    All Units. The applicant shall, as a condition of approval of the Condominium Conversion Permit and before offering the unit for sale to the general public, be required to provide tenants with an exclusive right to contract for the purchase of the unit occupied by the tenant upon the same terms and conditions that such unit will be initially offered to the general public or on terms more favorable to the tenant. The right shall run for a period of 90 days from the date of issuance of the subdivision public report pursuant to section 11018 of the Business and Professions Code, unless the tenant gives prior written notice of his or her intention not to exercise the right. At least ten days prior to the submission of an application to the Department of Real Estate for a public report, the applicant shall provide notice to each tenant in the project of the fact that the application for a public report will be submitted and that upon the issuance of the public report the tenant will be granted an exclusive right to contract for the purchase of the unit occupied by the tenant upon the same terms and conditions that such unit will be initially offered to the general public or on terms more favorable to the tenant. The notice shall further indicate the project will be subject to conditions, covenants, and restrictions that establish a homeowners’ association to manage the project, that may restrict how the property is used, and that impose certain financial obligations on the owners of units within the project, such as the payment of monthly homeowners’ association dues. In addition, within 10 days of the issuance of the public report, the applicant shall by mail notify each tenant in writing that the public report has been issued and shall in writing grant the tenant the right to purchase the unit as provided in this section. If the notice is not mailed within 10 days of the issuance of the public report, the tenant’s right to purchase granted pursuant to this section shall be extended for a period equal to 80 days from mailing of the notification.

B.    Affordable Units. If a tenant occupies an inclusionary unit pursuant to the City’s inclusionary zoning program, all of the provisions of Subsection A shall apply except as otherwise provided in this Subsection B. The applicant shall initially determine the income category (i.e. very low, low, or moderate income) under Section 8.68.030 at which the inclusionary unit is being rented to the tenant. The applicant shall thereupon offer the unit to the tenant at the sales price that a unit in the unit’s income category could be sold under Chapter 8.68, subject to the City’s certification of the tenant’s qualifications to purchase the unit. Should the City determine that the tenant’s household income is such that the tenant does not qualify to purchase the unit within the income category at which it is offered, the applicant shall:

1.    Offer the unit to the tenant pursuant to Subsection A. If the tenant accepts the offer, the applicant shall convert a unit within the project not previously designated as an inclusionary unit to an inclusionary unit in the income category of the unit purchased by the tenant. The number of bedrooms in the converted unit shall be equal to or greater than the number of bedrooms in the unit purchased by the tenant.

2.    If the City determines that the tenant’s household income is such that it meets one of the other income categories set forth in Section 8.68.020.D (i.e. very low, low, and moderate incomes), and provided that there are available inclusionary units within the project at that income category, offer the unit to the tenant at a sales price that a unit in the tenant’s income category could be sold under Chapter 8.68, subject to the City’s certification of the tenant’s qualifications to purchase the unit. If the tenant accepts the offer, the available unit shall be designated as an inclusionary unit at the income category at which the unit purchased by the tenant was previously rented. Ord. 11-05 (May 2005)

8.54.100 Limitations on Rent Increases Pending Conversion.

Rents shall not be increased from the date of issuance of the Notice of Intent to Convert pursuant to Section 8.54.050 until twelve months following the approval of the Condominium Conversion Permit or six months following the issuance of a public report by the Real Estate Commissioner pursuant to Business and Professions Code section 11018, whichever occurs later. If the applicant withdraws an application for a Condominium Conversion Permit, this section shall have no further effect. Ord. 11-05 (May 2005)

8.54.110 Tenant Protections.

A.    Requirement. The applicant shall, as a condition of approval of the Condominium Conversion Permit, be required to implement the Tenant Relocation Assistance Plan that is approved by the City in conjunction with the issuance of the Condominium Conversion Permit. The Tenant Relocation Assistance Plan shall be prepared by the applicant and shall indicate the applicant’s commitment to provide the tenant benefits required by this section.

B.    Eligible Tenant. As used in this section, the term “Eligible Tenant” means any tenant that has a disability as defined in Section 54 of the California Civil Code, that was a resident of the property both on the date of the filing of the application for a Condominium Conversion Permit and on the date of approval of the permit, and that does not intend to purchase a unit in the conversion project.

C.    Notice of Termination of Tenancy. Each tenant of a project proposed for conversion shall be given 365 days’ written notice of intention to terminate tenancy due to the conversion. The notice shall indicate that the tenant may terminate his or her tenancy upon 30 days’ notice. The notice shall also provide the tenant with a summary description of the City-approved Tenant Relocation Assistance Plan and information on where to obtain a copy. The notice shall also indicate that the tenant will be granted a right to purchase the unit the tenant occupies. Each person who becomes a tenant of a conversion project after the date of such 365 days’ written notice shall be given a copy of the notice of intention to terminate tenancy before entering into any written or oral rental agreement but shall not be entitled to 365 days’ written notice prior to termination of tenancy due to the conversion.

D.    Financial Relocation Assistance. The Plan shall include a provision that requires the applicant to provide financial assistance equal to the rent for the three-month period prior to the filing of the application for the Condominium Conversion Permit to any Eligible Tenant that relocates after the issuance of the Condominium Conversion Permit. The financial assistance payment shall be made 30 days prior to the termination of the Eligible Tenant’s tenancy, if the Eligible Tenant provides notice to the applicant of the Eligible Tenant’s termination of the lease, or 30 days prior to the expiration of 365-day Notice of Termination of Tenancy period, whichever is earlier. Notwithstanding Subsection B of this Section, a tenant shall be deemed an Eligible Tenant and eligible for the financial assistance payment if the Condominium Conversion Permit has not yet been granted but 335 days have elapsed since the tenant was provided a Notice of Termination of Tenancy. A tenant is not entitled to financial assistance pursuant to this subsection if the tenant has been evicted for just cause or has not made rental payments to which the applicant is legally entitled. Ord. 11-05 (May 2005)

8.54.120 Notification of New Tenants.

All prospective tenants of a project for which a Notice of Intent to Convert has been issued to tenants pursuant to section 8.54.050 shall be provided with a copy of the Notice of Intent to Convert prior to their execution of a lease. If provided with such notice, prospective tenants shall not be entitled to tenant relocation assistance provided to Eligible Tenants pursuant to section 8.54.110. Ord. 11-05 (May 2005)

8.54.130 Compliance with Inclusionary Zoning Regulations.

Condominium conversions shall be treated as “new residential development projects” under and shall be required to comply with the then-current Inclusionary Zoning Regulations in Chapter 8.68. The decision maker shall include conditions in the Condominium Conversion Permit approval sufficient to ensure compliance with the provisions of Chapter 8.68. Notwithstanding the foregoing, if the project was required to comply with the Inclusionary Zoning Regulations at the time the project was constructed, the project shall receive a credit for the number of affordable units required at the time the project was constructed. Any existing affordable units within the project created pursuant to the City’s Inclusionary Zoning Regulations shall remain affordable units. If fees were paid in lieu of creating affordable units, the credit may only be used to satisfy that portion of the obligation under the then-current Inclusionary Zoning Regulations that may be satisfied by payment of fees in lieu of creation of affordable units.

By way of illustration, if at the time a 40-unit rental project was constructed, the Inclusionary Zoning Regulations required 5% of the units in the project to be affordable, and the developer paid fees in lieu of constructing one affordable unit and built a moderate-income affordable unit to meet the project’s obligations under the Inclusionary Zoning Regulations, then, upon the event of a conversion of the 40-unit project, the converter would be entitled to a two-unit credit against its Inclusionary Zoning obligations. Thus, if the then-current Inclusionary Zoning Regulations require that 12.5% of the units be affordable and provide that at least 7.5% of the units must be constructed, then the converter’s Inclusionary Zoning Obligation would be 3 units, which is 5 units minus the two-unit credit. One unit of credit would be associated with the moderate-income affordable unit that would remain affordable. As the other unit of credit was created by the payment of in-lieu fees and is equal to 2.5% of the total units in the project, only one unit of the remaining inclusionary obligation of 3 units could be satisfied through the payment of in-lieu fees. Pursuant to the income-level allocations and rounding conventions set forth in section 8.68.030.B, the project’s 3 affordable units are required to be distributed to the three income categories as follows: 1 moderate-income unit, 1 low-income unit, and 1 very low-income unit. Since the existing unit is a moderate-income unit, the two additional affordable units would have to be provided in the very low- and low-income categories. Ord. 11-05 (May 2005)

8.54.140 Development Standards - Utilities.

A.    Gas. Each condominium unit shall have a separate gas service where gas is a necessary utility. If this provision places unreasonable economic burden on the applicant, the Building Official may approve an alternative method.

B.    Electricity. Each condominium unit shall have a separate electrical service, with separate meters and disconnects.

C.    Telephone Company Access. The telephone company serving the location under conversion shall have the right to construct and maintain (place, operate, inspect, repair, replace, and remove) communication facilities as it may from time-to-time require (including access) in or upon any portion of the common area, including the interior and exterior of the buildings as necessary to maintain communication service within the project. This provision may not be amended or terminated without the consent of the serving telephone company. Ord. 11-05 (May 2005)

8.54.150 Findings Required for Approval.

The decision maker shall not approve a Condominium Conversion Permit unless it finds:

A.    That the proposed conversion is consistent with the General Plan and any applicable specific plans, in particular with the objectives, policies, and programs of the Housing Element of the General Plan designed to provide for the housing needs of all economic segments of the community.

B.    That the proposed conversion, as conditioned, conforms to the requirements of this Chapter.

C.    That the approval would not result in the conversion of units in excess of the Annual Maximum, as defined in section 8.54.040. The Annual Maximum shall be based on the year in which the Community Development Director authorized the filing of a Condominium Conversion Permit application. Notwithstanding the foregoing, if the number of units in a project proposed for conversion by itself exceeds the Annual Maximum, the decision maker shall not refuse to approve application because it would result in the conversion of units in excess of the Annual Maximum. Ord. 11-05 (May 2005)

8.54.160 Term and Lapse of Condominium Conversion Permit.

A Condominium Conversion Permit shall lapse 1 year following the date on which the permit became effective, if the applicant has not yet received a subdivision public report from the Real Estate Commissioner pursuant to Business and Professions Code section 11018 authorizing the sale of the units proposed for conversion to the public. The permit shall be extended for a period of not more than one year, if the Community Development Director finds that the applicant is diligently pursuing but has not yet received a subdivision public report from the Real Estate Commissioner pursuant to Business and Professions Code section 11018 authorizing the sale of the units proposed for conversion to the public. Upon receipt of the subdivision public report from the Real Estate Commissioner authorizing the sale of the units proposed for conversion to the public, the Condominium Conversion Permit shall be automatically extended so long as the subdivision public report remains in effect. Ord. 11-05 (May 2005)

8.54.170 Action.

The decision maker for Condominium Conversion Permits shall be the Planning Commission. The Planning Commission shall hold a public hearing, and after the public hearing is closed may, by resolution and based on evidence in the public record and the findings above approve, conditionally approve, or deny a Condominium Conversion Permit. Ord. 11-05 (May 2005)

8.54.180 Adjustments and Waivers.

A.    Authority to Waive or Adjust Requirements. The requirements of this Chapter may be adjusted or waived if the property owner demonstrates to the City Manager that applying the requirements of this Chapter would take property in violation of the United States or California Constitutions. A person seeking an adjustment or waiver shall apply to the City Manager and provide such information as the City Manager finds is necessary to determine whether applying the requirements of this Chapter would take property in violation of the United States or California Constitutions.

B.    Consideration and Decision. In making a determination on an application to adjust or waive the requirements of this Chapter, the City Manager shall consider all relevant evidence submitted by the applicant. The burden shall be on the applicant to demonstrate that applying the requirements of this Chapter would take property in violation of the United States of California Constitutions. The City Manager, upon legal advice provided by the City Attorney, will make a determination on the application and issue a written decision. The City Manager’s decision shall be final.

C.    Adjustment or Waiver of Requirements. If the City Manager, upon legal advice provided by the City Attorney, determines that the application of the provisions of this Chapter would take property in violation of the United States or California Constitutions, the requirements of this Chapter shall be modified, adjusted or waived to reduce the obligations under this Chapter to the extent necessary to avoid an unconstitutional result. If the City Manager determines no violation of the United States or California Constitutions would occur through application of this Chapter, the requirements of this Chapter remain applicable. Ord. 11-05 (May 2005)