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CC 03-22-06 APPROVED MINUTES CUPERTINO CITY COUNCIL Regular Adjourned Meeting Wednesday, March 22, 2006 CUPEIQ1NO PLEDGE OF ALLEGIANCE At 5:35 p.m. Mayor Richard Lowenthal called the meeting to order in the Council Chambers, 10350 Torre Avenue, Cupertino, California and led the Pledge of Allegiance. ROLL CALL Present: Mayor Lowenthal, Vice-Mayor Kris Wang and Council members Patrick Kwok, Orrin Mahoney and Dolly Sandoval. Absent: None WRITTEN COMMUNICATIONS · An email dated 3/22 from Michael Pyle sent to City Attorney Charles Kilian regarding item number 2. · An email dated 3/21 from Jim Moore regarding item number I. · An email dated 3/22 from Mahmood Kutubuddin regarding item number 1. · A site plan regarding Val1co ORAL COMMUNICATIONS Lee Song reported on a death camp in Sujiatun, Shenyang City, Liaoning Province, China. He noted that at least 6,000 Falun Gong followers were being subject to death and the harvesting of human organs. Mr. Song urged the Council to issue a resolution condemning the death camp and urging the immediate release of all remaining prisoners. He further urged everyone to contact President Bush, their Senators and Congressmen to request an immediate international investigation. Jennifer Griffin referred to a decision made at the last Council meeting to replace the sycamore tree on the Toll Brothers' property. She urged Council to consider replacing this tree with one of the same species and to put the replacement near the current location of the tree. Shiloh Ballard said that she worked as a housing advocate for the Silicon Valley Leadership Group. She invited all interested parties to attend a tour on Saturday, May 13 to look at affordable housing in the area. Projects of varying densities in the east side of the valley would be included in the tour. For more information call 408-501-7864 or visit www.svlg.net. March 22, 2006 Cupertino City Council Page 2 CONSENT CALENDAR - None PUBLIC HEARINGS 1. Consider an appeal of the Planning Commission's decision to deny a modification to a Tentative Map (TM-2005-03) to provide access for Lot 2 from Lindy Lane, Application No. M-2005-04, Bret Moxley (KnopP residence), 21925 Lindy Lane, APN No. 356-25-014. The appellant is John Knopp. (continued from March 21) City Planner Cynthia Wordell reviewed the staff report. She said if the General Plan policies 2.53 and 2.56 were to be upheld to maintain the rural character of the hillside, this would be best achieved by utilizing the current easement. She said that the Planning Commission believed the Council's direction had been clear that there were to be no new Lindy Lane driveways as a result of subdivision activity, and the Commission had voted 4-0-0 for denial of the subdivision modification request. Appellant John Knopp noted that they had purchased the property 29 years ago and their decision to subdivide the property was part of their retirement plan. Their two options were to use an easement from the Schmidt's property or use access off Lindy Lane. While there was an unrestricted easement on the Schmidt's property, the Schmidt's were opposing the Knopp's use of the easement, citing too much traffic as a concern. Knopp said that without access off Lindy Lane, their property would be landlocked, which was affecting their ability to sell the second lot. He said the only remaining option would be to go to court, which he would prefer not to do, and so he was appealing to Council for Lindy Lane access. Mr. Knopp said there were no technical objections to the proposed driveway, and there would be no damage to the existing trees, and the driveway would provide better access for emergency vehicles. Ron Berti commented that this additional driveway off Lindy Lane would result in three driveways right next to each other. He believed this caused visual clutter and was also a safety issue. Mr. Berti noted that there was another option for a driveway to the west of the proposed driveway, but he acknowledged that this option was steeper and might require a retaining wall. Marion Schmidt stated that they had sold the lot 40 years ago and it was understood that if it was ever subdivided, access would be off Lindy Lane. She further stated that the increased traffic from having three families access their driveway would provide hardship to them. Jennifer Griffin urged protection of the oak trees on the proposed driveway off Lindy Lane. She referred to a new rubber material that had been used in the city for sidewalks and suggested this might be an option for the driveway because it would not negatively impact the existing trees. She also commented that the proposed 18 foot width of the driveway was excessive. John and Julia James did not support another driveway off Lindy Lane and stated their concern about the trees. March 22, 2006 Cupertino City Council Page 3 Simon Ko noted that this was a difficult neighborhood situation and he hoped that the neighbors would be able to work something out. He also noted that the 18 foot driveway was excessive. Charlie and Candan Taysi urged that this appeal be denied. They suggested that there was already a fourth driveway off Lindy Lane which could be used. The proposed driveway resulted in a negative impact on the rural atmosphere and the trees. Karen Knopp stated that when they had applied for their subdivision they had been told access off Lindy Lane was possible and would provide good access for emergency vehicles. She noted that this subdivision would result in only one more home and that no further development would take place, so it would still be a rural neighborhood. They had tried to work this situation out with their neighbors but had been unable to do so, and she asked Council to grant the appeal. Council members stated that it was important to maintain the rural atmosphere of Lindy Lane, and it was also important to be consistent because others had been told they could not have access off Lindy Lane when developing. This was a dispute between neighbors which could not be resolved by Council. Wang/Mahoney moved and seconded to deny the appeal of the Planning Commission's decision to deny a modification to a Tentative Map (TM-2005-03) to provide access for Lot 2 from Lindy Lane. The motion passed unanimously. ORAL COMMUNICATIONS (continued) Lloyd Martin referred to the letter sent to the Fair Political Practices Commission concerning Councilmember Mahoney's business relationship with Hewlett Packard. Mr. Martin did not believe that this letter contained all of the facts pertaining to this possible conflict of interest situation such as the length of employment history, pension information, etc. Mr. Martin believed full disclosure was important. Councilmember Mahoney stated that he had made an unbiased decision regarding the Toll Brothers' project and he stood by his decision. PUBLIC HEARINGS (continued) 2. Val1co ordinances (continued from March 21) a) Conduct the second reading of Ordinance No. 1975: "An Ordinance ofthe City Council of the City of Cupertino Rezoning a 5.19-Acre Parcel From Planned Development (Regional Shopping) to Planned Development (Regional Shopping/Residential) at 10123 N. Wolfe Road." (Vallco) March 22, 2006 Cupertino City Council Page 4 b) Conduct the second reading of Ordinance No. 1976: "An Ordinance ofthe City Council of the City of Cupertino Modifying a Development Agreement (I-DA-90) to Encompass the Development Proposed in U-2005-16, ASA-2995-11, Z-2005-05 and TR-2005-04 for a 137 Unit, Two and Three Story Residential Condominium Development at 10123 N. Wolfe Road." (Val1co) Senior Planner Aki Honda reported that the applicant had provided the following items requested by Council at their 2/27/06 meeting: 1) Signed copies of REAs (real estate agreements) between Val1co and Sears and JC Penney; 2) Draft CC&R language, approved by the City Attorney as to form, to maintain the existing sound wall along the western perimeter of the property; and 3) The design for the parking garage showing a maximum height of32 feet, with parking spaces numbering 560 instead of 746. City Planner Cynthia Wordell presented diagrams ofthe parking structure. Director of Administrative Services Carol Atwood presented an overview of the fiscal impact of this project and said that the condos were an integral part of this project to help make it feasible. She said that the developer was projecting retail sales tax at $450 per square foot, and that staff had reevaluated this number to $385 per square foot. This would generate to the city an additional $4.2 million per year into the General Fund, and over the next 30 years the redevelopment project would provide additional tax increments to the city, of which $24 million would be generated for housing set-aside monies (low and very low income housing) and $49 million would be generated back into the regional mall for economic development. Mike Rohde, Val1co Fashion Park Representative, stated that the Vallco project was an innovative mixed use project which would provide an energetic, cosmopolitan experience and connectivity between housing and retail as well as generating sales tax and providing jobs. Mr. Rohde commented that five other developers had already attempted revitalization projects at Val1co and he urged Council to approve the plans for this important part of the city. Emily Chen, Val1co International LLC, stated that in addition to the financial aspects of this project, of primary importance to them was having this opportunity to contribute to the community. She noted that this was a turning point for this project because the condos were the last piece of the total design for Val1co. Ms. Chen noted that this project involved private funding only, and no bonds. The following spoke in favor of the Vallco application for housing: Ann Woo (Director of Art Center in V al1co) Hamid Abtaini (speaking also for Sung Kim and Choong Kim) Robert Dejpour Bobby Montanye Jian Chen (Director of New Concepts day care) March 22, 2006 Cupertino City Council Page 5 Linh N ging Paul Mahamongkol Frank Ho John Laine Yuan-Sing Chang Daniel Friedeberg Rich Tygerson Anna Tang Tenny Tsai Mark McKenna (representing the Cupertino Chamber of Commerce) Jerry Nelson Their comments included: · City will benefit from Val1co revitalization · Local shopping important; it will help the business community · Creates jobs and provides local entertainment · Well located, well designed · Portion of the site will be dedicated for day care center · Mixed use (housing and retail) good idea, and an urban living environment is a trend of the times · Supported by many residents (petitions circulated) - those at meeting are not representative of all in the city · Wall could be totally landscaped for mitigation · Parking issues had been resolved · Condos are one piece of the project - without condos the project is in jeopardy · Brings housing to jobs · Builds community in Cupertino The following spoke against the Val1co application for housing: Rahul Vadodkar Jennifer Griffin Eleanor Incerpi Edith Pedersen Carol Bunn Rajeev Joshi Lawrence Luk Eric Sun Veronica Lam Linda Chui Shilpa Joshi Al DiFranceso Arthur Lu Linda Soohoo Vipin Samar Ardith West Tom Roellig Helam Luk Lloyd Martin Michael Pyle Chris Hsu William Huang Eva Chow Sherry Ren Michael Chui Juan Chin Julie Bay Danny Luk Shnkar Iyer Lisa Warren March 22, 2006 Cupertino City Council Page 6 Ed Puccinelli Sue Chang Martin Yu Eric Yang Shuyi Chen Sean Huang Bei-Shen Sywe Michel Gerin Alok Gupta Lucy Tuttle Steven Scharf Rich McGrath Paul Lin Kaw Stuart Chessen Janice Ishii Kathy DiFrancesco Nelson D'Souza Linda Cheung Connie Zhang Edward Deng Varsha Joshi Yi-ke Wang Matt Kernahan Margaret Wang Their comments included: · Cupertino growing too fast - slow down and scale back · Creates an isolated community, not a good location for families · Lack of communication between developer and neighborhoods; the developer will benefit and not the city · Possible conflict of interest on the part of council members · Should not be compared to Santana Row · There is clear opposition to this project - it will be put to a referendum · Loss of property values and negative impacts on the community · It is the developer's responsibility to deal with their financial issues. The condos should not be the break point for the success of this project · Against high density housing, and opposed to condos next to single family homes · Current parking spaces needed for retail · Negative impact on schools, traffic, crime, and the quality of life · Council should be listening to residents; there is frustration with the public hearing process. This is not a financially sound proposal, and the plan is piecemeal · Covenant regarding wall should include a guarantee for perpetuity that the wall could not be removed. · Supported revitalization of Vall co but opposed to housing because it leaves no room for retail expansion in the future · Is Val1co violating the agreement with AMC? (parking and pedestrian bridge issues) - The AMC lease prohibits housing It was also noted that Patty Chi had submitted a DVD to Council which included statements by 31 residents in opposition to this project. March 22, 2006 Cupertino City Council Page 7 Three issues were raised during the public hearing that Council clarified. First, there seemed to be a misconception that the housing issue was new to this project. Council confirmed with staff that the 1991 development agreement for this land included a residential entitlement. Thus, there has been some expectation of housing on Vallco land for 15 years. Second, the possibility of a conflict of interest was raised. In response Councilmember Kwok stated that he was not related in any way to Emily Chen nor has he received any campaign monies from her. Third, a city-wide mailing had been sent regarding this project. Council discussed various issues related to this project including the covenant for the wall. It was agreed that the City Attorney would work with resident Michael Pyle and the developer's attorney Mr. Wong on language that would strengthen this covenant, and if agreement could not be reached this matter would come back to Council. Emily Chen, Vallco International LLC, responded to questions raised by Council concerning the financing of this project. She stated that the bank looked at the entire project when considering the financial backing for this project and the entitlement for 137 condos was needed to give the developers the needed additional $15-$20 million to put into the revitalization. Currently the theatre costs were approximately $60 million and the garage costs $37 million to $45 million. The theatre was not a money-maker for the developer but was critical to the project because it generated business, increased foot traffic and gave interested parties confidence in the project. Ms. Chen noted that the city had required that a theatre had to be built before the Rosebowl project, which had been approved a year earlier, and which was collateral for the bank loan. Councilmember Kwok's comments included: The revitalization of Vall co would bring many public benefits including new jobs, and new entertainment venues; The quality-of life-issues must be weighed for the immediate neighborhood as well as the entire community. Councilmember Mahoney's comments included: It was the Council's responsibility to promote economic development in the city, not the developer's; if the condos were not approved it put the Val1co project in jeopardy, and the momentum for revitalization project could be lost; he believed the impact from traffic would be minimal with the wall remaining in place, and that the visual impact was minimal with mitigation measures such as landscaping. Vic-Mayor Wang's comments included: Condos can't support retail because they would not generate enough shoppers; Cupertino was a suburb, and shouldn't be compared to Santana Row; housing is not a long-term solution to the success of the mall; a day care center would generate even more traffic; and a parking analysis is needed to identify sufficient parking for each venue. Wang also said the increased housing numbers approved in the revised General Plan were for a 10 year period and should not be used all at once. Councilmember Sandoval's comments included: She had voted against this issue at an earlier meeting; she was not in support of a walled-in community and believed there should be pedestrian/bicycle access to provide a safer environment for the children going to school; She believed there was a need for housing in the Cupertino and that this project was good for the economic development of the city and would benefit the entire community. March 22, 2006 Cupertino City Council Page 8 Mayor Lowenthal comments included: it was in the best interest of the community to revitalize Vallco and the addition of condos was needed to achieve this 'goal; there would be a much greater impact on traffic from the 3500-seat theatre than from 137 condos; there had been consensus to revitalize Vallco and Council had requested the theatre be part of this project; and Cupertino had to comply with ABAG housing requirements and this proposed housing helped meet those goals. Mahoney/Lowenthal moved and seconded to read Ordinance No. 1975 by title only and that the Acting City Clerk's reading would constitute the second reading thereof. Ayes: Mahoney, Lowenthal, Sandoval. Noes: Kwok and Wang Sandoval requested that the BMR units be increased from the regular 15% to 20% and that park fees be increased to supplement the General Park Fund. It was noted that the current park dedication fees to be paid by the developer were $1,077,300. Emily Chen, Val1co International LLC, volunteered to add an additional 5% of all BMR one- bedroom units and to pay an additional sum beyond the normal park dedication fees in the amount of $423,000 to be paid in 2010. She also agreed to amend the use permit for this project to reflect these changes. (As a point of clarification it was noted that the regular 15% BMR units were a mix of one - three bedrooms. The 5% increase specifically related to one- bedroom units.) Mahoney/Lowenthal moved and seconded to enact Ordinance No. 1976. Ayes: Mahoney, Lowenthal, Sandoval. Noes: Kwok and Wang Mahoney/Sandoval moved and seconded to continue the second reading of Ordinance No. 1976 to the April 4, 2006, City Council meeting. Motion carried with Kwok voting no. UNFINISHED BUSINESS NEW BUSINESS 3. Consider Application Nos. U-2006-02, ASA2006-04 (EA-2006-04) for Val1co restaurants, Mike Rohde (Vallco Fashion Park), 10123 N. Wolfe Road, APN No.3 16-20-064 (continued from March 21) a) Negative Declaration b) Use Permit and Architectural and Site approval applications to construct a 5,910 square foot restaurant (Islands Restaurant) and a 6,020 square foot restaurant (California Pizza Kitchen) on the northwest corner of Stevens Creek Boulevard and N. Wolfe Road Wang/Kwok moved and seconded to continue Item 3 to the April 4, 2006, City Council meeting. The motion passed unanimously. March 22, 2006 Cupertino City Council Page 9 ADJOURNMENT The meeting was adjourned at 1: 1 0 a.m. id For more information: Staff reports, backup materials and items distributed at the meeting are available for review at the City Clerk's Office, 777-3223, and also on the Internet at www.cupertino.org.Click on Agendas and Minutes/City Council/Packets. Most Council meetings are shown live on Cable Channel 26 and are available at your convenience from our web site. Visit www.cupertino.org and click on Watch Meetings. Videotapes are available at the Cupertino Library or may be purchased from the Cupertino City Channel, 777-2364.