Land Use Covenants
The Planning and Land Use Unit of the Los Angeles Housing + Community Investment Department (HCIDLA) is charged with preparing and recording Affordable Housing Land Use Covenants (Covenant) when an owner has received a land use concession from the City of Los Angeles or is subject to a City ordinance or law that requires an affordable housing set-aside.
The Covenant obligates an owner to designate a specified number and type of dwelling units for occupancy by very low, low, or moderate income households, usually for a term of 30 - 55 years. The Covenant runs with the land and is binding on all current and future owners of the site. Covenants are signed by the project owner, HCIDLA, City Attorney, and City Clerk, and then recorded with the County Assessor’s office by HCIDLA. Subordination agreements are required to ensure that the Covenant is in the first lien position.
Land Use Covenant Application Forms:
- Land Use Covenant Application requirement checklist
- Land Use Covenant Application
- Land Use Table of Purchase Units
- Land Use Table of Purchase Units - Large Projects
- Land Use Table of Rental Units
- Land Use Table of Rental Units - Large Projects
- Sample Letter of Application
- Sample Signature Block
- Sample Subordination Agreement
- Schedule of Land Use Fees
Land use concessions and laws that require an affordable housing covenant:
- Density Bonus
- Parking Variances or Reductions
- Zone Changes
- Conversion of illegal units to legal units
- Mello Act/Interim Administrative Procedures for Complying with the Mello Act
- Greater Downtown Housing Incentives Ordinance
- Discretionary determinations by the Department of City Planning or City Council.
The land use covenant process begins at the Los Angeles Department of Building & Safety (LADBS) and/or the Los Angeles Department of City Planning (LADCP), not at HCIDLA. HCIDLA has no discretion to determine how many units are to be set aside or how many parking spaces must be built on the property. This determination is made either through LADBS, the Planning Conditions letter, City Council action, or as dictated in City ordinance or law.
Covenant Preparation Requirements by HCIDLA
It takes approximately 8 - 12 weeks upon receipt of all the required documents to prepare and execute a Covenant, although a complex project may take longer. Please keep this in mind when planning your timeline. If a Density Bonus project is subject to AB 2222, an additional 8 – 12 will be required to research the replacement unit(s) required.
- The project owner or owner’s representative must provide the following documents to the HCIDLA Planning and Land Use Unit for a covenant to be prepared:
- Land Use Covenant Application – will be available on HCIDLA’s website
- Application for Building Permit – from LADBS
- Clearance Summary Worksheet – from LADBS
- Planning Conditions/Planning Determination - from Zoning Administrator/Planning Dept, if applicable
- Planning Referral Form – from City Planning Dept, if applicable
- AB 2222 Application and required documents, if applicable.
- Building plans showing the building/unit layout and square footage and bedroom count of each unit
- Grant Deed (recorded copy)
- Lot Tie (recorded copy), if applicable
- Award letter for project-based rental subsidy (such as Project Based Sec 8), if applicable
- HCIDLA prepares the Covenant with the required number and type of income-restricted units based on the documentation submitted. Affordable set-aside units must:
- be dispersed within a project and cannot be grouped together;
- reflect the same percentage of types and sizes as the non-affordable units (i.e., if 30% of market rate units are 2 bedroom, 30% of the affordable units must be 2-bedroom);
- offer the same amenities as non-affordable units, with the exception of floor coverings and quality of appliances.
- The draft Covenant is reviewed and approved by the City Attorney then forwarded to the owner for review. The owner is required to sign and notarize four (4) signature pages and return them to HCIDLA. Staff will route the Covenant for all additional signatures -- by the HCIDLA General Manager, City Attorney, and City Clerk -- and file a copy of the fully executed Covenant with the City Clerk’s Office.
- HCIDLA electronically signs the Los Angeles Department of Building and Safety Clearance Summary Worksheet after the Covenant has been signed by the HCIDLA General Manager.
- HCIDLA submits a copy of the fully executed Covenant to the County Assessor’s office for recordation. When the County sends proof of the recordation to HCIDLA, a copy of the recorded document is mailed to the owner.
Covenant Requirements: Income Certification, Lease Addendum, & Monitoring
HCIDLA is charged with certifying the incomes of all households who will occupy an affordable housing unit, prior to move-in. The owner or owner’s representative must collect and review income source documentation from the household that verifies their income is within the limits stated in the Covenant. The income-source documentation must be submitted to HCIDLA for review and certification before the household can move into the unit. There is a 10-day turn-around allowance for HCIDLA to certify the income or deny the household. Information on income certification is available on HCIDLA’s website or by contacting Occupancy Monitoring at 213-808-8806 or HCIDLA.OccMonitor@LACity.org.
HCIDLA or its contractor annually monitors all Land Use Covenants for the entire term to ensure that affordable units are occupied by income-qualified tenants and that rent levels are in compliance with Covenant restrictions. Owners or their representatives are required to accurately prepare and submit the following documents: Certificate of Continuing Compliance signed under penalty of perjury, Tenant Income and Rent Certification form for each household in an affordable unit, Occupancy Summary that lists information about the tenants in the affordable units (name, unit number, bedroom size, income, rent, date of initial occupancy, etc.), and income source documentation for new tenants every 6th year from the date the building was occupied for all affordable units. Documents are reviewed for accuracy and adherence to the restrictions in the covenants. Owners who fail to submit the annual monitoring documentation or submit incomplete or inaccurate information may be determined to be in non-compliance and subject to sanctions and/or action by the City Attorney. For more information on Land Use Covenant monitoring, please contact Occupancy Monitoring at 213-808-8806 or HCIDLA.OccMonitor@LACity.org.
The fee for the preparation and filing of a Land Use Covenant is $5,813 per project. For Covenant Assumptions and Terminations, the fee is $1,214 per project. For Covenant Amendments, the fee is $5,770 per project. Additionally, please note that there is an annual monitoring fee of $173 per restricted unit upon receipt of the CofO (all fees are subject to change).
How to find existing Covenants?
- Please click this link to the LA City Clerk Connect system where you can find covenants.
- Once you're in LA City Clerk Connect, Follow the instructions below to search for covenants.
HOW TO SUBMIT YOUR APPLICATIONS
Please submit your applications to:
MAIL: Los Angeles Housing + Community Investment Dept. (HCIDLA)
ATTN: Land Use Unit
1200 W. 7th Street, 8th Floor
Los Angeles, CA 90017
HAND-DELIVERED: The HCIDLA Public Counter – first floor at the address above
To speak with HCIDLA staff about your covenant application, please call (213) 808-8843, or 3-1-1 for TTY.