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Article IV Rental Affordability Covenants Section 4. 01 . Rental Affordability Covenants. During the Rental Affordability Covenants Term, OWNER covenants and agrees that the Affordable Units shall be maintained in accordance with this Article as follows (the "Rental Affordability Covenants"): the Affordable Units shall be made available to "very low income households," as that term is defined by California Health and Safety Code section 50105, or successor statute, whose incomes do not exceed fifty percent (50%) of HUD's Area Median Income for San Mateo County ("AMI ") , as adjusted from time to time ("Qualified Lessees") . The Affordable Units shall be made available at an "affordable rent" as defined in California Health and Safety Code section 50053(b)(2), or successor statute. Annually, on the anniversary date of occupancy of an Affordable Unit by a Qualified Lessee, OWNER shall re-certify the qualifications of the Qualified Lessee in accordance with the requirements of this Article. If, upon recertification, OWNER determines that the Qualified Lessee's income has risen above the then-in-effect allowable income, OWNER shall either terminate the tenancy of the formerly qualified lessee and make the Affordable Unit available and affordable to a new Qualified Lessee, or raise the rent of such tenant to the current rent for a comparable Market Rate Unit and provide an alternative, comparable Affordable Unit in the Project. In no event shall the number of Affordable Units fall below seven (7) . On the termination of the tenancy of an Affordable Unit, the Affordable Unit shall continue to be deemed an Affordable Unit until reoccupied or an alternative, comparable unit is occupied by a new Qualified Lessee. Section 4. 02. Term of Rental Affordability Covenants. OWNER hereby agrees that the Rental Affordability Covenants as described in Section 4.01 above shall be effective as of the date of recordation of this Agreement, and shall remain in effect until the fifty-fifth (551 anniversary of said date. Section 4.03. Compliance with Rental Affordability Covenants. In order to ensure compliance with this Article, each of the following shall occur: (a ) OWNER and its successors shall ensure that each person applying to occupy an Affordable Unit on the Property executes under penalty of perjury an income verification and information form ("Income Verification and Information Form"), in a form reasonably acceptable to the City, certifying the applicant's income. Affordable Units shall be leased only to Qualified Lessees. ( b) OWNER and its successors shall obtain a copy of the federal income tax return for each person applying to occupy an Affordable Unit for the taxable year immediately preceding such applicants initial occupancy in the Project or, if an applicant declares under penalty of perjury that he or she did not file or did not retain a copy of such tax return , or other evidence of income for such year, satisfactory to the City in its sole discretion, such as wage statements or employer records. ATTY/AGR/2016.243/849 VETERANS AFFORDABLE HOUSING AGREEMENT REV: 08-30-16 VR Page 4 of 12