Chapter 15.54
RESIDENTIAL CONDOMINIUM CONVERSIONS1

Sections:

15.54.010    Purpose and intent.

15.54.020    Definitions.

15.54.030    General requirements.

15.54.040    Tenant notification.

15.54.050    Standards for condominium conversions.

15.54.060    Tenant purchase option.

15.54.070    Tenant relocation plan.

15.54.080    Consumer protection provisions.

15.54.090    Applications for permit.

15.54.100    Affordable housing.

15.54.110    Tentative map review procedures.

15.54.120    Findings – Conditional use permit.

15.54.130    Modification or waiver of conversion standards.

15.54.140    Public hearing required.

15.54.150    Lapse of permit.

15.54.160    Preexisting variations.

15.54.170    Park fee exemption.

15.54.010 Purpose and intent.

A. Purpose. The purpose of this chapter is to:

1. Provide standards and criteria for regulating the conversion of rental units to condominium, community apartment or stock cooperative types of ownership and for determining when such conversions are appropriate; and

2. Mitigate any hardships to tenants caused by their displacement from rental units converted to owner-occupied units.

B. Intent. The intent of this chapter is as follows:

1. The city council finds that residential condominiums, community apartment and stock cooperative types of ownership, as defined in California Civil Code Section 1351, differ from rental apartments with respect to design, type of construction and maintenance controls, and therefore that the development standards in this chapter are necessary for the protection of the community, existing rental tenants and the purchasers of the converted units. It is also the intent of these regulations to maintain a balanced mix between ownership and rental housing in order to assure the development and retention of a variety of housing types to serve the needs of the community. [Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A)].

15.54.020 Definitions.

For purposes of this section and this code, the following terms shall have the meanings as set out in Chapter 15.94 AVMC, Definitions:

A. Condominium.

B. Condominium conversion project.

C. Organizational documents.

D. Disabled person.

E. Eligible tenant.

F. Senior citizen.

G. Subdivision Map Act.

H. Subdivision ordinance.

I. Unit.

J. Vacancy rate. [Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A)].

Cross-reference: definitions generally, AVMC 1.02.010.

15.54.030 General requirements.

A. Where Permitted. If approved under the provisions of this chapter and this title, condominium conversion projects may be allowed in any district in which residential uses are permitted, including specific plan areas, subject to the approval of a conditional use permit and a tentative map.

B. Review Responsibilities. Condominium conversion projects containing five or more units shall require a conditional use permit approved by the city council. A tentative and final tract map shall be required for all subdivisions creating five or more condominiums, five or more parcels as defined in California Civil Code Section 783, a community apartment project containing five or more parcels, or for the conversion of a dwelling to a stock cooperative containing five or more dwelling units.

C. Applicable Standards. Condominium conversion projects shall conform to: (1) The applicable standards and requirements of the zoning district in which the project is located at the time of approval, and (2) the applicable provisions of the subdivision ordinance. [Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A)].

15.54.040 Tenant notification.

The applicant for a condominium conversion project shall be responsible for notifying existing and prospective rental tenants as follows:

A. Existing Tenants. The applicant shall give notice to tenants residing in units proposed to be converted, at least 90 days prior to the initial filing of the application and in the form set out in Section 66452.9 of the Subdivision Map Act, of the applicant’s intent to file an application for a condominium conversion project. The applicant shall give notice to tenants residing in units proposed to be converted that a final map for the proposed conversion has been approved, within 10 days of such approval, as required by Section 66427.1(b) of the Subdivision Map Act. If the condominium conversion project is approved, the applicant shall give all tenants a minimum of 180 days’ advance written notice of the termination of their tenancies.

B. Prospective Tenants. The applicant shall give notice in the form set out in Section 66452.8 of the Subdivision Map Act to each person applying to rent or lease a unit proposed to be converted of the applicant’s submittal of an application for a condominium conversion project. Pursuant to the Subdivision Map Act, failure of an applicant to provide such notice shall not be grounds to deny the application but shall make the applicant subject to the penalties specified in Section 66452.8 of the Subdivision Map Act.

C. Public Report Notification. The applicant shall give 10 days’ written notification to tenants residing in units proposed to be converted that an application for a public report has been or will be made to the Department of Real Estate, as required by Section 66427.1(a) of the Subdivision Map Act.

D. All Other Notices. The applicant shall give all other notices required by applicable federal, state and local law.

E. Evidence of Tenant Notification. The applicant shall submit evidence in writing, certified under penalty of perjury, showing that the notification requirements specified in subsections (A) through (D) of this section have been satisfied. [Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A)].

15.54.050 Standards for condominium conversions.

Condominium conversion projects shall conform to the following requirements and the city council shall make specific findings as to such conformance in any action approving a condominium conversion:

A. Parking. The number, design and location of parking spaces shall be in conformance with the parking regulations of Chapter 15.38 AVMC.

B. Utilities.

1. Gas. Each condominium unit shall have a separate gas service where gas is a necessary utility. If this provision places an unreasonable economic burden on the applicant, the city council may approve an alternative or waive the requirement.

2. Sewer. The sewer lateral for each building within a condominium conversion project shall be retrofitted/fitted with a cleanout in compliance with AVMC Title 13.

3. Car Wash. A dedicated area for car washing shall be provided. The area shall be covered and drainage of the area shall be connected to the sanitary sewer system or acceptable alternative as determined by the city building official. A water line hook-up shall be installed to provide water for car washing.

4. Water. Each unit shall maintain a separate water meter and water meter connection.

5. Electrical. The electrical service connection shall comply with the requirements of AVMC Title 13.

6. Telephone Company Access. The telephone company serving the location proposed for conversion shall have the right to construct and maintain (place, operate, inspect, repair, replace and remove) communications 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 communications service within the project. This provision may not be amended or terminated without the consent of the serving telephone company.

7. Trash Enclosures. All trash enclosures shall conform to the provisions of AVMC 15.14.190.

8. Parking. All required parking spaces shall be maintained free and clear of obstructions and available for parking at all times. No required parking shall be converted for use as storage or other purposes.

C. General Requirements.

1. NPDES. The project shall comply with current water quality requirements as determined by the city building official.

2. Surveying. Permanent lot stakes and tags shall be installed at all lot corners by a California licensed surveyor or civil engineer unless otherwise required by the city engineer.

3. General Plan Consistency. For residential conversions, the project shall be consistent with the adopted goals and policies of the general plan, particularly with regard to the balance and dispersion of housing types within the city.

4. Review of CC&Rs. A declaration of the conditions, covenants and restrictions, and rules and regulations which would be applied on behalf of any and all owners of condominium units within the project, shall be submitted to the planning director prior to approval of a final map for a condominium conversion project. The declaration shall include, but not be limited to: the conveyance of units; the assignment of parking spaces and storage areas; and an agreement for common area maintenance, together with an estimate of any initial assessment fees anticipated for such maintenance and an indication of appropriate responsibilities for the maintenance of all utility lines and services for each unit. The declaration shall be approved as to form by the city attorney and recorded in the office of the county recorder.

5. Fire Detection and Protection. Each living unit shall be equipped with an approved smoke detector, mounted to give access to rooms used for sleeping quarters. All fire protection equipment shall be maintained in an operable condition at all times. All fire protection equipment, including the water delivery system, shall be upgraded as determined by the public works director/city engineer.

6. Roofing Material Fire Rating. The roof is required to have a minimum Class “A” fire-resistant roofing material. [Ord. 2011-136 §§ 25, 26; Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A)].

Cross-reference: buildings and construction, AVMC Title 13.

15.54.060 Tenant purchase option.

The property owner shall provide each tenant of a rental unit to be converted to an owner-occupied unit with an exclusive right to purchase his or her respective unit upon the same or more favorable terms and conditions than those on which such unit will be initially offered to the general public. Such right shall run for a period of not less than 90 days from the date of issuance of the subdivision public report pursuant to California Business and Professions Code Section 11018.2, unless the tenant gives prior written notice of his or her intention not to exercise the right. [Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A)].

15.54.070 Tenant relocation plan.

The applicant shall submit a tenant relocation plan containing and complying with the following:

A. A detailed report describing the relocation and moving assistance information to be given to each tenant, and the steps the applicant will take to ensure the successful relocation of each tenant. The report should state in detail what assistance will be provided for special category tenants, including a discussion of long-term or life-term leases and provisions to allow such tenants to continue renting after conversion until comparable housing is located and their move can be completed.

B. A survey of all the tenants in the project to be converted indicating how long each tenant had been a resident of the project, how long each tenant had planned to live in the project, whether or not each tenant would be interested in purchasing a unit, to which area would each tenant choose to relocate if the conversion took place and the tenant did not purchase a unit, and the extent of tenant approval in principle of the conversion. This survey shall include the applicant’s best estimate of the sales price for each unit, not including inflation and adjustments.

C. The applicant shall provide a tenant rights handout and a questionnaire, in a form approved by the city, to each tenant with an envelope, postage prepaid, addressed to the planning department. The questionnaire shall direct the tenant to return the completed form directly to such department. [Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A)].

15.54.080 Consumer protection provisions.

In addition to the tenant protection provisions set out in the Subdivision Map Act, the applicant shall comply with the following provisions, as conditions of any conditional use permit for a condominium conversion project approved pursuant to this chapter:

A. Relocation Assistance. The applicant shall offer to each eligible tenant a plan for relocation to comparable housing, as approved by the city. The relocation plan shall provide, at a minimum, for the following:

1. Assistance to each eligible tenant in locating comparable housing, including, but not limited to, providing availability reports and transportation, where necessary.

2. Payment of a relocation fee to each eligible tenant who does not choose to stay. The payment shall be a cash payment of at least $1,500. A tenant is not entitled to a relocation fee pursuant to this subsection if the tenant has been evicted for just cause. Cash payment minimums will be adjusted annually, in accordance with the Consumer Price Index for all urban consumers published by the United States Bureau of Labor Statistics for the Los Angeles-Long Beach-Anaheim metropolitan area. In addition, a cash payment of actual deposit costs not to exceed $100.00 shall be made for utility deposits and hook-up costs.

B. Special Assistance for Senior Citizens and Disabled Persons. In the case of eligible tenants who are senior citizens, disabled persons, or qualified low income, the following additional provisions shall apply:

1. The applicant shall provide to the displaced tenant payment, not to exceed $1,000, of the first month’s rent in the comparable housing, if required upon moving in; and the transfer to the new complex of all key, utility, and pet deposits to which the tenant is entitled upon vacating the unit. Cleaning and security deposits, minus damages, shall be refunded to the tenant upon vacating the unit.

2. The applicant’s offer to each eligible tenant of a plan for relocation shall be free of any coercion, intimidation, inducement or promise not herein specified and shall not cause the tenant to vacate in advance of a timetable or schedule for relocation as approved in the application for approval of conversion.

C. Antidiscrimination. The applicant or owner of any condominium unit within a project shall not discriminate in the sale, or in the terms and conditions of sale, of any dwelling unit against any person who is or was a lessee or tenant of any such dwelling unit because such person opposed, in any manner, the conversion of such building into a condominium. In a like manner, the applicant or owner shall not discriminate in the sale, or in the terms and conditions of sale, of any dwelling unit against any person or family based upon age or family size, when family size does not exceed HUD’s standard for overcrowding of one and one-fourth persons per room. This antidiscrimination section shall be included in the conditions, covenants and restrictions for the project. [Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A)].

15.54.090 Applications for permit.

Recognizing that the conversion of existing structures which have been previously occupied and constructed as rental units presents unique problems to present tenants and future buyers, the application for a conditional use permit for a condominium conversion project shall include the following information in addition to that required by other sections of this code:

A. Property Report. A property report shall be prepared by a California-licensed structural or civil engineer, which shall describe the condition and estimated remaining useful life of each of the following elements of each structure situated within the project proposed for conversion: roofs, foundations, exterior paint, insulation, paved surfaces, mechanical systems, electrical systems, plumbing systems, sewage systems, sprinkler systems for landscaping, utility delivery systems, central or community heating and air conditioning systems, fire protection systems including any automatic sprinkler systems, alarm systems, standpipe systems, structural elements, drainage systems, condition of refuse disposal facilities, swimming pools, saunas, gyms and recreation rooms, tennis courts, fountains, hardscape, fireplaces and exterior lighting.

B. Pest Inspection Report. A report by a California-licensed structural termite and pest control specialist certifying whether or not all attached and detached structures are free of infestation and structural damage caused by pests and dry rot.

C. Building History Report. A building history report identifying the date of construction of all elements of the project and permit history.

D. Building Inspection. The applicant for a condominium conversion shall request a special inspection from the building department for the purpose of identifying any building safety violations for each unit. The applicant shall correct all identified safety violations prior to approval of a final map for the condominium conversion.

E. Plot Plans. Plot plans and elevations, fully dimensioned, indicating the type and location of all buildings and structures, parking and landscape areas and signs. Screening, landscape and irrigation plans shall be included in the plans.

F. Rental History Report. A rental history report detailing the size, in square footage, of the building or buildings and each unit; the current or last rental rate; the name and address of each present tenant; and the average monthly vacancy over the preceding three years.

G. Households Eligible for Affordable Housing. The identification of low, very low, and moderate income households residing in units that are proposed to be converted in connection with a condominium conversion project and whether any are receiving federal or state rent subsidies.

H. Planned Financing Programs. A statement of intent as to the types of financing programs to be made available, including any incentive programs for existing residents.

I. Other Materials. Such other plans and data as deemed necessary by the planning director or city building official.

The Orange County fire authority shall cause an inspection to be made of the property to determine the sufficiency of fire protection systems serving the property and report on any deficiencies.

After reviewing the property report required pursuant to this section, and after inspecting the structures within the project, the building official shall identify and make available to the city council all items evidenced by the documents submitted or by inspection to be in noncompliance with applicable building and housing codes or to be hazardous to the life, health or safety of any occupant of the units within the project or the general public. Once such items have been corrected, a report shall be prepared depicting conformance with the current building codes. All such items shall be corrected to the satisfaction of the building official. An appropriate fee to cover the cost of the review and inspection by the city will be collected pursuant to Chapter 15.90 AVMC. [Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A)].

Cross-reference: buildings and construction, AVMC Title 13.

15.54.100 Affordable housing.

A. In addition to the provisions in this chapter regarding condominium conversion projects, the city shall, in connection with the approval of a tentative or final map, require a written agreement with the subdivider mandating that 15 percent of the total number of units be set aside for the provision of affordable housing for families of low and very low income levels.

B. Not less than 15 percent of the subdivided units shall be set aside for sale to income-qualified households as described herein (“affordable unit”). Of the affordable units, a minimum of one-third of the units shall be set aside and sold to households whose income does not exceed 50 percent of the then-current area median household income of the county of Orange adjusted for family size by the State Department of Housing and Community Development in accordance with adjustment factors adopted and amended from time to time by the United States Department of Housing and Urban Development pursuant to Section 8 of the United States Housing Act of 1937 (“very low income”). The balance of the affordable units shall be set aside and sold to households whose income does not exceed 80 percent of the then-current area median household income of the county of Orange adjusted for family size by the State Department of Housing and Community Development in accordance with adjustment factors adopted and amended from time to time by the United States Department of Housing and Urban Development pursuant to Section 8 of the United States Housing Act of 1937 (“low income”).

C. The maximum sales price of each low income and very low income unit shall be calculated by the planning director and made available to the applicant within 30 days of receipt of a complete application for conversion.

D. For the purpose of calculating maximum household size for any unit, the city shall apply a standard of the number of bedrooms plus one.

E. The applicant shall pay all costs associated with testing and qualifying eligible households for the initial purchase of the affordable units. The applicant shall conduct all testing and qualification of eligible households, and shall make the affordable units available to eligible households in accordance with the terms set out in California Code of Regulations Title 25, Division 1, Chapter 6.5, Subchapter 2. All testing and qualification criteria are subject to the approval of the planning director and shall be submitted to the planning director 30 days in advance of the first sale or lease of an affordable unit.

F. All affordable units shall be sold with an affordability covenant that restricts the sale of the unit to a low income or very low income buyer in accordance with the terms set out in California Code of Regulations Title 25, Division 1, Chapter 6.5, Subchapter 2. Such covenants shall be drawn by the city attorney with reimbursement by the applicant, and shall be recorded superior to all liens, as determined necessary by the planning director to preserve the affordability covenant.

G. The applicant may satisfy the requirements of this section by paying an in-lieu fee for each affordable unit not sold. The in-lieu fee shall be equal to the difference between the median market sales price of the dwelling unit with the largest number of bedrooms in the project and the maximum sales price of that same dwelling to a qualified low income or very low income buyer, as the case may be. The median market sales price shall be determined by the planning director, based upon the most recent sales of comparable housing units in Aliso Viejo, and then upon consultation with a knowledgeable real estate sales professional.

H. The planning director may impose additional conditions and requirements as part of the agreement as may be reasonable and appropriate. [Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A)].

Cross-reference: affordable housing incentives, Chapter 15.58 AVMC.

15.54.110 Tentative map review procedures.

A. List of Tenants. In addition to the standard application requirements for tentative maps, the applicant shall submit a complete mailing list of all tenants occupying the subject property and two corresponding sets of stamped addressed envelopes. The director shall mail a public hearing notice for the tentative map hearing to each tenant on the mailing list in accordance with the procedures of the Subdivision Map Act.

B. Tentative Map Review. Tentative maps shall be approved or denied by the decision-making body charged with reviewing tentative maps pursuant to this code. Decisions on the condominium conversion projects shall be governed by the Subdivision Map Act and this chapter.

C. Council Findings for Residential Conversions. A final map for a condominium conversion shall not be approved unless the city council makes all of the findings set out in Section 66427.1 of the Subdivision Map Act regarding tenant notification, right to purchase and other requirements. [Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A)].

15.54.120 Findings – Conditional use permit.

The decision-making authority shall not approve a conditional use permit for a conversion unless it finds:

A. That the establishment, maintenance or operation of the use or building applied for shall not, under the circumstances of the particular case, be detrimental to the health, safety, peace, comfort and general welfare of persons residing or working in the neighborhood of such proposed use or be detrimental or injurious to property and improvements in the neighborhood or the general welfare of the city.

B. That the proposed location of the condominium conversion is in accord with the objectives of this code and the purpose of the zone in which the site is located.

C. That the proposed conversion is consistent with the general plan and any applicable specific plan.

D. That the proposed conversion will not displace a significant percentage of low, very low, or moderate income, permanently disabled, or senior citizen tenants or delete a significant number of low, very low and moderate income rental units from the city’s housing stock at a time when no equivalent housing is readily available in the city of Aliso Viejo.

E. That the average rental vacancy rate in multiple-family units of similar size within the city during the 12 months preceding the filing of the application is greater than five percent. In accordance with general plan policies, if the average rental vacancy rate in the city during the 12 months preceding the filing of the application is equal to or less than five percent, the condominium conversion project shall be denied unless the city council determines that either of the following overriding considerations exist:

1. The project will minimize the effect on the dwelling unit vacancy rate because the applicant has proposed measures which the city council finds would effectively mitigate the displacement of tenants and any adverse effects upon the housing stock in the city which would be caused by the proposed condominium conversion project, and the project otherwise substantially complies with the intent of this chapter;

2. Evidence has been submitted that at least two-thirds of the existing tenants have voted to recommend approval of the conversion;

3. In evaluating the average rental vacancy rate in the city and in the building proposed for conversion, the city council shall consider the rental history of the building. The city will conduct an annual survey, either in writing or verbally, of not less than 25 percent of the rental units in the city to determine the average rental vacancy rate in the city. Notwithstanding any other provision of this chapter, the city council may deny a condominium conversion project if it finds that vacancies in the building have been created by unjust evictions and unreasonable rent increases in order to qualify a project for conversion under this chapter; or

4. That the applicant unconditionally offered to each eligible tenant an adequate plan for relocation to comparable housing. [Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A)].

15.54.130 Modification or waiver of conversion standards.

The city council may modify or waive the development standard requirements set out in AVMC 15.54.050, if it finds that the modification or waiver will not be materially detrimental to the residents or tenants of the property or surrounding properties, nor to public health or safety, and if the requirements of AVMC 15.54.050 place an unreasonable economic burden on the applicant. [Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A)].

15.54.140 Public hearing required.

A. City Council Determination. The city council shall hold a public hearing on a conditional use permit and tentative and final subdivision map, as prescribed in AVMC 15.54.090 and 15.54.110 and shall thereupon approve or deny the permit. The decision of the city council shall be final.

B. Conditions of Approval. In approving a conditional use permit, the city council may impose such conditions as it deems necessary to fulfill the purpose and intent of this chapter. Such conditions may include but are not limited to:

1. Requiring special yards, open spaces, buffers, fences and walls.

2. Requiring installation and maintenance of landscaping.

3. Requiring street dedications and improvements.

4. Regulation of points of vehicular ingress and egress.

5. Regulation of traffic circulation.

6. Regulation of signs, type of construction and methods of operation.

7. Control of potential nuisances.

8. Prescribing standards for maintenance of buildings and grounds.

9. Prescription of development schedules and development standards and such other conditions as the city council may deem necessary to ensure compatibility of the use with surrounding developments and uses to preserve the public health, safety and welfare. [Ord. 2013-147 § 14; Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A). Formerly 15.54.150].

15.54.150 Lapse of permit.

A. A conditional use permit for a condominium conversion shall lapse and shall become void two years following the date on which the conversion permit became effective, unless prior to the expiration of two years, either: (1) separate property interests have been created and recorded for each unit; (2) a building permit has been issued and reconstruction or other work necessary as a result of the conversion is commenced and diligently pursued toward completion on the site which was the subject of the conversion permit application; or (3) a certificate of occupancy has been issued for the structure(s) which was the subject of the conversion permit application.

B. A conversion permit subject to lapse may be renewed for an additional period of one year at the discretion of the city council; provided, that 30 days prior to the expiration date, an application for renewal of the conversion permit is filed with the city council. [Ord. 2013-147 § 14; Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A). Formerly 15.54.160].

15.54.160 Preexisting variations.

Deviations from regulations prescribed elsewhere in this title for fences, walls, site area, width and depth; front, rear and side yards; coverage; height of structures; distance between structures; usable open space; signs, off-street parking facilities or frontage on a public street shall be within the discretion of the city council to either approve or disapprove as part of the conditional use permit for the conversion project if they are legally preexisting prior to the application for a condominium conversion project. [Ord. 2013-147 § 14; Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A). Formerly 15.54.170].

15.54.170 Park fee exemption.

For residential developments, the conversion of existing rental housing to a condominium project shall be exempt from the requirements of parkland dedication or in-lieu fees if, on the date of conversion, the rental units are at least five years of age and no additional dwelling units are to be added as part of the conversion. [Ord. 2013-147 § 14; Ord. 2010-126 § 1 (Exh. A); Ord. 2010-123 § 3 (Exh. A). Formerly 15.54.180].

Cross-reference: dedication of land for park facilities and payment in lieu of fees, Chapter 14.16 AVMC.


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Cross-references: subdivisions, AVMC Title 14; planned residential development overlay district, AVMC 15.10.040; supplemental residential regulations, Chapter 15.14 AVMC.