10-02-2018 Item No. 13 Vallco Town Center Specific Plan Ordinances - RedlinesDIU .. FT
ORDINANCE NO. 18-2177
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
CUPERTINO AMENDING THE MUNICIPAL CODE TO ALLOW
ADOPTION AND IMPLEMENTATION OF V ALLCO TOWN
CENTER SPECIFIC PLAN
SECTION I: PROTECT DESCRIPTION
Application No: MCA-2018-01
Applicant: City of Cupertino
Location: 10101 to 10333 N Wolfe Rd
1~ ::ft-13
APN#s: 316-20-080, 316-20-081, 316-20-103, 316-20-107, 316-20-101, 316-20-105,
316-20-106, 316-20-104, 316-20-088, 316-20-092, 316-20-094, 316-20-099,
316-20-100, 316-20-095
SECTION II: RECITALS
WHEREAS, the Housing Element of the Cupertino General Plan identifies the Vallco
Special Area as being appropriate to accommodate at least 389 dwelling units to be
developed pursuant to a specific plan for the Vallco Special Area; and
WHEREAS, the Valko Special Area Specific Plan has been developed pursuant to City
Council direction to initiate a project to prepare a specific plan for the Vallco Special Area,
including any required changes to the adopted goals and objectives for the Special Area,
in order to implement the Housing Element of the Cupertino General Plan and to plan
for anticipated future development activity; and
WHEREAS, pursuant to the City Council direction to conduct extensive public outreach
the City conducted multiple forms of public outreach including 14 small group
Interviews, eight presentations, five open studio times, three brown bags, three EIR
public comment meetings, three open houses, two student/youth outreach sessions, one
online civic engagement survey, one Fine Arts Commission check-in/update, one
Housing Commission check-in/update, one Parks & Recreation Commission check-
in/update, one Teen Commission check-in/update, one Economic Development
Committee check-in/update, one Block Leader Group check-in/update; and
WHEREAS, these Municipal Code Amendments to allow adoption of the Valko Town
Center Specific Plan are part of the Vallco Special Area Specific Plan, all as fully described
and analyzed in the May 2018 Valko Special Area Specific Plan Environmental Impact
Report ("Draft EIR") (State Clearinghouse No. 2018022021), as amended by the July 2018
Vallco Special Area Specific Plan Environmental Impact Report Amendment ("EIR
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Amendment") and by text revisions in the August 2018 Vallco Special Area Specific Plan
Final EIR document which contains Response to Comments to the Draft EIR and the EIR
Amendment, and the August &2018 , September 11, 2018, and September_Ll,_ 2018
Supplemental Text Revisions to the Valko Special Area Specific Plan Final
Environmental Impact Report; (together, the "Final EIR"); and
WHEREAS, the Final EIR was presented to the Environmental Review Committee
("ERC") for review and recommendation on August 31, 2018, and after considering the
Final EIR, and Staff's presentation, the ERC recommended that the City Council certify
the EIR; and
WHEREAS, following necessary public notices given as required by the procedural
ordinances of the City of Cupertino and the Government Code, the Planning Commission
held a public hearing on September 4, 2018 to consider the Municipal Code Amendments;
and
WHEREAS, based on substantial evidence in the administrative record, on September 4,
2018 the Planning Commission recommended on a 5-0 vote that the City Council certify
that the Final EIR has been completed in compliance with the California Environmental
Quality Act, Public Resources Code Section 21000 et seq., and reflects the independent
judgment and analysis of the City, adopt the Findings and Statement of Overriding
Considerations, and implement all of the mitigation measures for the Project that are
within the responsibility and jurisdiction of the City that are identified in Findings, in
substantially similar form to the Resolution presented (Resolution No. 6860); and
WHEREAS, on September 4, 2018, the Planning Commission recommended on a 5-0 vote
that the City adopt the Municipal Code Amendments (MCA-2018-01), in substantially
similar form to the Resolution presented (Resolution no. 6864); and
WHEREAS, following a duly noticed public hearing on September 19, 2018 (continued
from September 18, 2018,1. and prior to the Council's consideration of the Municipal Code
Amendments, the Council adopted: Resolution No. 18-085, approving a General Plan
Amendment to Development Allocations, the General Plan Land Use Map and
development standards related to the Valko Special Area and Resolution No. 18-086,
adopting the Valko Town Center Specific Plan; and
WHEREAS, the Ordinance is consistent with the City's General Plan and the public
health, safety, convenience, and general welfare, and the amendment herein are
necessary to implement the Valko Town Center Specific Plan as adopted; and
WHEREAS, on September 19, 2018 (continued from September 18, 2018) .and October
==1b 2018, upon due notice, the City Council has held at least two public hearings to
consider the Municipal Code Amendments; and;
-2 -
WHEREAS, the City Council of the City of Cupertino is the decision-making body for
this Ordinance; and
WHEREAS, prior to taking action on this Ordinance, the City Council has exercised its
independent judgment in carefully considering the information in the Final EIR and finds
that the scope of this Ordinance falls within the certified Final EIR, in that the aspects of
the Rezoning proposed in this Ordinance that have the potential for resulting in either a
direct physical change in the environment or a reasonably foreseeable indirect physical
change in the environment have been examined in the Final EIR and therefore, no
recirculation of the Final EIR is required; and
. WHEREAS, after consideration of evidence contained in the entire administrative record,
at the public hearing on September 19, 2018 (continued from September 18, 2018,1 the
City Council adopted Resolution No. 18-084 certifying the Final EIR, adopting Findings
and a Statement of Overriding Considerations, adopting Mitigation Measures, and
adopting a Mitigation Monitoring and Reporting Program.
SECTION III
NOW, THEREFORE, BE IT ORDAINED AS FOLLOWS:
That after careful consideration of the facts, exhibits, testimony and other evidence
submitted in this matter, the City Council adopts the Rezoning based upon the findings
described above, the public hearing record-imE:t the Minutes of Planning Commission
Meeting of September 4, 2018, and the Mi nutes of City Council Meeting of September 19,
2018 (continued from September 18, 2018) and subject to the conditions specified below:
Section 1. The recitals set forth above are true and correct, and are hereby
incorporated herein by this reference as if fully set forth in their entirety.
Section 2.
19.152.020.C:
The City Council finds the following as set forth by Municipal Code
1. That the proposed zoning is in accord with Title 19 of the Municipal Code and the
City's Comprehensive General Plan (Community Vision 2040) and the proposed
amendments are internally consistent with Title 19 of the Municipal Code.
The Housing Element of the General Plan calls for the City to enact a specific plan to permit at
least 389 dwelling units in the Vallco Special Area. The General Plan Amendment (adopted at
th e S eptemb er 19, 2018 City Council meeting (continu ed from September 18, 2018) with
Resolution no. 18 -085) modifies the Land Use Element of the General Plan to designate-We and
define development standards that are consistent with the level of development contemplated in
the Vallco Town Center Specific Plan. The proposed municipal code amendments would
incorporate the Vallco Town Center Specific Plan into Title 19 of the Municipal Code to implement
the General Plan and the Vallco Town Center Specific Plan, and therefore the proposed zoning
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regulations are consistent with the General Plan and other relevant portions of the Municipal
Code.
2. The proposed zoning is m compliance with the provisions of the California
Environmental Quality Act (CEQA).
As set forth above, the City examined the environmental effects of the Project, including the zoning
amendments adopted herein, in an Environmental Impact Report (EIR) prepared in accordance
with the California Environmental Quality Act. On September 19, 2018 (continued from
September 18, 2018,1 the City Council adopted Resolution no . --18 -084 to certify that the Final
Environmental Impact Report ("Final EIR ") for the Project; and adopting CEQA Findings, a
Statement of Overriding Considerations, Mitigation Measures, and a Mitigation Monitoring and
Reporting Program, which Resolution together with the EIR is incorporated herein by reference.
The significant environmental effects of the project have been fully analyzed and disclosed in
compliance with CEQA. All mitigation measures identified in the Final EIR have been adopted
and incorporated into the project to reduce the impacts of new development to the extent feasible .
Therefore, the proposed zoning complies with the provisions of CEQA.
3. The site is physically suitable (including, but not limited to, access, provision of
utilities, compatibility with adjoining land uses, and absence of physical constraints) for
the requested zoning designation(s) and anticipated land use development(s).
The sites being rezoned have access to utilities and are compatible with adjoining land uses. To the
extent that there are deficient utilities, the City has adopted mitigation measures to ensure that
any future development would need to provide the appropriate utilities to accommodate the
development . In addition, in connection with the Vallco Town Center Specific Plan process, the
site has been analyzed thoroughly to ensure that the site would not constrain future development
proposed under this zoning designation. The proposed zoning would implement the Vallco Town
Center Specific Plan, which includes development standards to require appropriate transitions
from adjoining land uses.
4. The proposed zoning will promote orderly development of the City.
The sites being rezoned will promote orderly development in the City by allowing a critical mass
of development to be proposed along the City's Priority Development Area (PDA) in which future
development is anticipated. This would also allow the easier applicability of zoning regulations
adopted under the Vallco Town Center Specific Plan.
5. That the proposed zoning is not detrimental to the health, safety, peace, morals and
general welfare of persons residing or working in the neighborhood of subject parcels.
The proposed zoning is not detrimental to the health, safety, peace, morals and general welfare
since these are conforming changes that are necessary to implement adopted changes in the Land
Use Element of the City's General Plan. Additionally, where health or safety impacts have been
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need adjacent noticing.
All other Parking Exceptions need notices within three hundred feet of the exterior
boundary of the subject property.
P. Application must be filed prior to expiration date of permit. Permit is extended until
decision of the Approval Body on the extension.
3. That Section 20.04.040 of the Municipal Code, be amended as shown below:
20 .04.040 Zoning District Applicable to a Specific Plan.
The zoning for A£ll areas governed by a specific plan shall be zoned as a planned
development (P) zoning district under Chapter 19.48 identified in Chapter 19.16
of the City's Municipal Ordinance Code and all regulations governing land use
approvals in a planned development zone specific plan area shall be applicable
-te-as identified in that individual specific plans. A proposal for g specific plan
may be combined with any application for land use entitlements in the City~
planned development zoning districts .; and
Section 5. If any portion of this Ordinance or its application is for any reason
held to be invalid, unenforceable or unconstitutional, by a court of competent jurisdiction,
that portion shall be deemed severable, and such invalidity, unenforceability or
unconstitutionality shall not affect the validity or enforceability of the remaining portions
of the Ordinance, or its application to any other person or circumstance. The City Council
hereby declares that it would have adopted each section, sentence, clause or phrase of
this Ordinance, irrespective of the fact that any one or more other sections, sentences,
clauses or phrases of the Ordinance be declared invalid, unenforceable or
unconstitutional.
Section 6. The City Council finds the Municipal Code Amendments are within
the scope of the EIR and directs the Director of Community Development to file a Notice
of Determination with the Santa Clara County Recorder in accordance with CEQA
guidelines.
Section 7.
adoption.
This Ordinance shall be effective thirty (30) days following its
INTRODUCED at a special meeting of the Cupertino City Council the --19th day of
-----20rl-llh"l8 ,September 20 18 (c o ntinued from September 18, 2018) and ENACTED
at a regular meeting of the Cupertino City Council on this --2nd day of
----October 2018 by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
Grace Schmidt
City Clerk
APPROVED:
Darcy Paul, Mayor
City of Cupertino
DRAFT
ORDINANCE NO. 18-2178
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
CUPERTINO REZONING THE PARCELS WITHIN THE V ALLCO
SPECIAL AREA
SECTION I: PROTECT DESCRIPTION
Application No: Z-2018-01
Applicant: City of Cupertino
Location: 10101 to 10333 N Wolfe Rd
APN#s: 316-20-080, 316-20-081, 316-20-103, 316-20-107, 316-20-101, 316-20-105,
316-20-106, 316-20-104, 316-20-088, 316-20-092, 316-20 -094, 316-20-099,
316-20-100, 316-20-095
SECTION II: RECITALS
WHEREAS, the Housing Element of the Cupertino General Plan identifies the Vallco
Special Area as being appropriate to accommodate at least 389 dwelling units to b e
developed pursuant to a specific plan for the Vallco Special Area; and
WHEREAS, the .Valko Special Area Specific Plan has been developed pursuant to City
Council direction to initiate a project to prepare a specific plan for the Valko Special Area,
including any required changes to the adopted goals and objectives for the Special Area,
in order to implement the Housing Element of the Cupertino General Plan and to plan
for anticipated future development activity; and
WHEREAS, pursuant to the City Council direction to conduct extensive public outreach
the City conducted multiple forms of public outreach including 14 small group
Interviews, eight presentations, five open studio times, three brown bags, three EIR
public comment meetings, three open houses, two student/youth outreach sessions, one
online civic engagement survey, one Fine Arts Commission check-in/update, one
Housing Commission check-in/update, one Parks & Recreation Commission check-
in/update, one Teen Commission check-in/update, one Economic Development
Committee check-in/update, one Block Leader Group check-in/update; and
WHEREAS, the Rezoning of parcels within the Vallco Special Area Specific Plan
("Rezoning") is part of the V allco Special Area Specific Plan, all as fully described and
analyzed in the May 2018 Valko Special Area Specific Plan Environmental Impact Report
("Draft EIR") (State Clearinghouse No. 2018022021), as amended by the July 2018 Valko
Special Area Specific Plan Environmental Impact Report Amendment ("EIR
Amendment") and by text revisions in the August 2018 Valko Special Area Specific Plan
Final EIR document which contains Response to Comments to the Draft EIR and the EIR
Amendment, and the August 30, 2018 , September 11, 2018, and September__.1;1 2018
Supplemental Text Revisions to the Valko Special Area Specific Plan Final
Enviromnental Impact Report; (together, the "Final EIR"); and
WHEREAS, the Final EIR was presented to the Environmental Review Committee
("ERC") for review and recommendation on August 31, 2018, and after considering the
Final EIR, and Staff's presentation, the ERC recommended that the City Council certify
the EIR; and
WHEREAS, following necessary public notices given as required by the procedural
ordinances of the City of Cupertino and the Government Code, the Planning Commission
held a public hearing on September 4, 2018 to consider the Rezoning; and
WHEREAS, based on substantial evidence in the administrative record, on September 4,
2018 the Planning Commission recommended on a 5-0 vote that the City Council certify
that the Final EIR has been completed in compliance with the California Enviromnental
Quality Act, Public Resources Code Section 21000 et seq., and reflects the independent
judgment and analysis of the City, adopt the Findings and Statement of Overriding
Considerations, and implement all of the mitigation measures for the Project that are
within the responsibility and jurisdiction of the City that are identified in Findings, in
substantially similar form to the Resolution presented (Resolution No. 6860); and
WHEREAS, on September 4, 2018, the Planning Commission recommended on a 5-0 vote
that the City Council adopt the Zoning Map Amendment (Z -2018-01), in substantially
similar form to the Resolution presented (Resolution no. 6862); and
WHEREAS, immediately prior to the Council's consideration of the Rezoning, following
a duly noticed public hearing on September 19, 2018 (continued from September 18,
2018,1 the Council adopted Resolution No. 18 -085, adopting a resolution to · adopt a
General Plan Amendment to Development Allocations, the General Plan Land Use Map
and development standards related to the Valko Town Center Special Area, adopted
Resolution No. 18-086, adopting a resolution to adopt the Valko Town Center Specific
Plan; and adopted Ordinance No . 18-2177, adopting amendments to the Municipal Code
to allow implementation of the Valko Town Center Specific Plan; and
WHEREAS, the Rezoning will be consistent with the City's General Plan land use map,
proposed uses and surrounding uses as amended and the V allco Special Area Specific
Plan as adopted; and
WHEREAS, on September 19, 2018 (continued from September 18, 2018} and October
==:7b 2018, upon due notice, the City Council has held at least two public hearings to
consider the Rezoning; and;
WHEREAS, the City Council of the City of Cupertino is the decision-making body for
thi s Ordinance;
WHEREAS, after consideration of evidence contained in the entire administrative record,
at the public hearing on September 19, 2018 (continued on September 18, 2018,1. the City
Council adopted Resolution No. 18-084 certifying the Final EIR, adopting Findings and a
Statement of Overriding Considerations, adopting Mitigation Measures, an.d adopting a
Mitigation Monitoring and Reporting Program.
WHEREAS, prior to taking action on this Ordinance, the City Council has exercised its
independent judgment in carefully considering the information in the Final EIR and finds
that the scope of this Ordinance falls within the certified Final EIR, in that the aspects of
the Rezoning proposed in this Ordinance that have the potential for resulting in either a
direct physical change in the environment or a reasonably foreseeable indirect physical
change in the environment have been examined in the Final EIR and therefore, no
recirculation of the Final EIR is required; and
SECTION III
NOW, THEREFORE, BE IT ORDAINED AS FOLLOWS:
That after careful consideration of the facts, exhibits, testimony and other evidence
submitted in this matter, the City Council adopts the Rezoning based upon the findings
described above, the public hearing record-a:Ra:L the Minutes of Planning Commission
Meeting of September 4, 2018, and the Minutes of City Council Meetings of September
18, 2018 and September 19, 2018, and subject to the conditions specified below:
Section 1. The recitals set for th above are true and correct, and are hereby
incorporated herein by this reference as if fully set forth in their entirety.
Section 2.
19.152.020.C:
The City Council finds the following as set forth by Municipal Code
1. That the proposed zoning is in accord with Title 19 of the Municipal Code and the
City's Comprehensive General Plan (Community Vision 2040).
The Housing Element of the General Plan calls for the City to enact a specific plan to permit at
lea st 389 dwelling units in the Vallco Special Area. The General Plan Amendment (adop te d at
the September 19, 2018 City Cou nc il meeting (continued from September 18, 2018) w it h
Resolution no. 18 -085) modifies the Land Use Element of the Genera l Plan to designate late and
define development standards that are consistent with the level of development contemplated in
th e Vallco Special Area Specific Plan. The proposed zoning amendments would designate land in
the Vallco Special Area as a new Vallco Special Area Specific Plan zone to implement the General
Plan and the Vallco Special Area Specific Plan, and therefore the proposed zoning is consistent
with the General Plan and other relevant portions of the Municipal Code.
2. The proposed zoning is in compliance with the provisions of the California
Environmental Quality Act (CEQA).
As set forth above, the City examined the environmental effects of the Project, including the zoning
amendments adopted herein, in an Environmental Impact Report (EIR) prepared in accordance
with the California Environmental Quality Act. On September 19 , 2018 (continued from
Septemb er 18, 2018 ,1. the City Council adopted Resolution no. --18 -084 to certify that the Final
Environmental Impact Report ("Final EIR ") for the Project; and adopting CEQA Findings, a
Statement of Overriding Considerations, Mitigation Measures , and a Mitigation Monitoring and
Reporting Program, which Resolution together with the EIR is incorporated herein by reference.
The significant environmental effects of the project have been fully analyzed and disclosed in
compliance with CEQA . All mitigation measures identified in the Final EIR have been adopted
and incorporated into the project to reduce the impacts of new development to the extent feasible.
Therefore, the proposed zoning complies with the provisions of CEQA.
3. The site is physically suitable (including, but not limited to, access, provision of
utilities, compatibility with adjoining land uses, and absence of physical constraints) for
the requested zoning designation(s) and anticipated land use development(s).
The sites being rezoned have access to utilities and are compatible with adjoining land uses . To the
extent that there are deficient utilities, the City has adopted mitigation measures to ensure that
any future development would need to provide the appropriate utilities to accommodate the
development. In addition, in connection with the Vallco Special Area Specific Plan process, the
site has been analyzed thoroughly to ensure that the site would not constrain future development
proposed under this zoning designation. The proposed zoning would implement the Vallco Special
Area Specific Plan, which includes development standards to require appropriate transitions from
adjoining land uses.
4. The proposed zoning will promote orderly development of the City.
The sites being rezoned will promote orderly development in the City by allowing a critical mass
of development to be proposed along the City's Priority Development Area (PDA) in which future
development is anticipated. This would also allow the easier applicability of zoning regulations
adopted under the Vallco Special Area Specific Plan.
5. That the proposed zoning is not detrimental to the health, safety, peace, morals and
general welfare of persons residing or working in the neighborhood of subject parcels.
Th e proposed zoning is not detrimental to the health, safety, peace, morals and general welfare
since these are conforming changes that are necessary to implement adopted changes in the Land
Use Element of the City's General Plan. Additionally, where health or safety impacts have been
identified in the Project's EIR, mitigation measures have been identified which would be applicable
to any development on these sites.
Section 3. The City Council approves the following:
1. That the property described in attached Exhibit Z-1 have a zoning designation as
that shown and is incorporated into the Master Zoning Map (Exhibit Z-2) of the
City of Cupertino; and
Section 4. The City Council finds the Rezoning is within the scope of the EIR
and directs the Director of Community Development to file a Notice of Determination
with the Santa Clara County Recorder in accordance with CEQA guidelines.
Section 5.
adoption.
This Ordinance shall be effective thirty (30) days following its
INTRODUCED at a special meeting of the Cupertino City Council the --19th day of
-----20H-111-A8September 2018 (continued from September 18, 2018) and ENACTED
at a regular meeting of the Cupertino City Council on this --2n d day of
-----October 2018 by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST:
Grace Schmidt
City Clerk
APPROVED:
Darcy Paul, Mayor
City of Cupertino
DRAFT
ORDINANCE NO. 18-2179
ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CUPERTINO
APPROVING A DEVELOPMENT AGREEMENT BY AND BETWEEN
THE CITY OF CUPERTINO AND V ALLCO PROPERTY OWNER LLC
FOR THE DEVELOPMENT OF V ALLCO TOWN CENTER
SECTION I: PROTECT DESCRIPTION
Application No: DA~2015-02
Applicant: City of Cupertino Valko Property Owner LLC
Location: 10101 to 10333 N Wolfe Rd
APN#s: 316-20-080, 316-20-081, 316-20-103, 316-20-107, 316-20-101, 316-20-105,
316-20-106, 316-20-104, 316-20-088, 316 20 092, 316 20 094, 316-20-099,
316-20-100, 316-20-095
SECTION II: RECITALS
WHEREAS, Valko Property Owner, LLC ("Valko") has a legal and equitable
interest in certain real property consisting of approximately 50.82 acres located within the
City and generally bordered by Perimeter Road on the north, Perimeter Road on the east,
Valko Parkway and Stevens Creek Boulevard on the south, and Perimeter Road on the
west, as more particularly described in Exhibit DA-1, the Development Agreement
("Property"); and
WHEREAS, Government Code Sections 65864 through 68569.5 provide the
statutory authority for development agreements between municipalities and parties with
a fee or equitable interest in real property; and
WHEREAS, Chapter 19.144 of Cupertino Municipal Code ("CMC,") establishes
additional procedures for review and approval of proposed development agreements by
the City of Cupertino ("City"); and
WHEREAS, in October 2017, Valko requested that the City initiate the process for
preparation and adoption of a specific plan for the Vallco Special Area; and
WHEREAS, the Vallco Special Area Town Center Specific Plan has been developed
pursuant to City Council direction to initiate a project to prepare a specific plan for the
Valko Special Area, including any required changes to the adopted goals and objectives
for the Special Area, in order to implement the Housing Element of the Cupertino General
Plan and to plan for anticipated future development activity; and
WHEREAS, the Valko Town Center Specific Plan sets forth two tiers of
development capacity as follows: (1) Tier 1 sets forth a basic program of development of
the Specific Plan area (750,000 square feet of office, 1,779 residential units, and a minimum
of 600,000 square feet of retail) without provision of above-standard community benefits;
and (2) Tier 2 allows for a greater amount of office and residential development, as
described in the Valko Town Center Specific Plan, provided the Developer enters into a
Development Agreement with the City which provides for certain above-standard
community benefits (collectively, the "Project"); and
WHEREAS, Vallco has proposed to provide certain communfty benefits and to
develop the Tier 2 program in accordance with the Specific Plan; and
WHEREAS, the City and V allco have negotiated the terms of a Development
Agreement to vest the Tier 2 program in consideration of the community benefits and
provide limited vesting of the Tier 1 program; and
WHEREAS, the terms of the Development Agreement include the following
community benefits to be provided by Vallco, which are described in more detail in the
proposed Development Agreement:
• Performing Arts Center -Valko would either, at City's option: (i) build and
lease to City a 60,000 square foot "warm shell" space suitable for a performing
arts center (PAC), or (ii) pay the City a $22,800,000 in lieu payment.
• City Hall -Vallco would either (i) demolish the existing City Hall building and
then build and deliver to City a 40,000 square foot "warm shell" new City Hall
including underground parking, substantially consistent with the City's 2015
civic center master plan, or (ii) pay the City a $30,000,000 in lieu payment.
• School District Benefits -
o FUHSD -Valko would commit to either (i) build and lease to FUHSD a
25,000 square foot "warm shell" space, or (ii) pay FUHSD a $9,500,000
in lieu payment, with terms to be set forth in a separate agreement to be
entered into b etween Developer and FUHSD.
o CUSD -Vallco would make a payment to CUSD in the amount of
$14,250,000 pursuantto a separate agreement, which would decrease to
$9,500,000 if there is a challe nge to the Project.
• Affordable Housing -Valko would agree that 20% of the residential units
would be provided as affordable housing at the following percentages: 15% at
extremely low, very low and low income levels and 5% at moderate income
level.
• Transportation Benefits -
o Valko would implement a TDM Program.
o Valko would pay $11 million to City to fund work in connection with
the Wolfe Road/I-280 and the Junipero Serra Bike/Pedestrian Trail. This
would decrease to $5.5 million if there is a challenge to the Project.
o Valko would fund up to $1 Million for a 1-year pilot shuttle program
and, if successful $750,000 thereafter for 9 years, which would decrease
if there is a challenge to the Project.
o Valko would provide a mobility/bike hub within the project.
• Co-working/Incubator Space -Valko would make good faith efforts to provide
40,000 square feet of co working or incubator space.
WHEREAS, the Development Agreement will be consistent with the City's
General Plan land use map, proposed uses and surrounding uses as amended and the
applicable zoning designations and the Valko Special AreaTown Center Specific Plan as
adopted; and
WHEREAS, approval of the Development Agreement will provide Valko with
assurances that its development of the Property in connection with the Project can
proceed without disruption caused by a change in City planning and development
policies and requirements, which assurance will thereby reduce the actual or perceived
risk of planning, financing and proceeding with construction and use of the development
and promote the achievement of the private and public objectives of the development;'
and
WHEREAS, the Development Agreement is envisioned by and consistent with the
Valko Special AreaTown Center Specific Plan, all as fully described and analyzed in the
FiRa!May 2018 Valko Special Area Specific Plan Environmental Impact Report ter("Draft
EIR") (State Clearinghouse No. 2018022021), as amended by the Ju ly 2018 Valko Special
Area Specific Plan Enviromnental Impact Report (State Clearinghoase No. 2018022021),
r.vhich consists of the May 2018 Draft Environmental Impact Report ("Draft EIR"), the
July 2018 Environmental Impact Report Amendment ("EIR Amendment'4,") and by text
revisions in the August 2018 Va l ko Special Area Specific Plan Final EIR volumedocument
which contains Response to Comments to the Draft EIR and the EIR Amendment, and
the August 30, 2018, September 11, 2018, and September 13, 2018 Supplemental Text
Revisions to the Valko Special Area Specific Plan Final Environmental Impact Report;
(together, the "Final EIR"); and
WHEREAS, following necessary public notices given as required by the
procedural ordinances of the City of Cupertino and the Government Code, the Planning
Commission held a public hearing on September 4, 2018 to consider the Development
Agreement; and
WHEREAS, the Final EIR was presented to the Environmental Review Committee
("ERC") for review and recommendation on August 31, 2018, and after considering the
Final EIR, and Staff's presentation, the ERC recommended on a 5-0 vote that the City
Council certify the EIR; and
WHEREAS, based on substantial evidence in the administrative record, on
September 4, 2018 the Planning Commission recommended on a 5-0 vote that the City
Council certify that the Final EIR has been completed in compliance with the California
Environmental Quality Act, Public Resources Code Section 21000 et seq., and reflects the
independent judgment and analysis of the City, adopt the Findings and Statement of
Overriding Considerations, and adopt and incorporate into the project all of the
mitigation measures that are identified in the Final EIR, and implement all of the
mitigation measures that are within the responsibility and jurisdiction of the City in
substantially similar form to the Resolution presented (Resolution No. 6860); and
WHEREAS, on September 4, 2018, the Planning Commission recommended on a
4-1 vote (Liu: no) that the City Council adopt amendments to the General Plan to .allow
implementation of the Valko Town Center Specific Plan (Resolution No. 6861), adopt the
Valko Town Center Specific Plan (Resolution No. 6863), and an ordinance approving the
Development Agreement (Re solution No. 6865) with additional recommendations to
amend Strategy LU-19.1.2, correct Table LU-1, and consider a middle tier Development
Allocation for the Valko Town Center Special Area as more particularly described in
Resolution nos. 6861, 6863 and 6865. The Planning Commission also recommended on a
5-0 vote that the City Council adopt Municipal Text Amendments (Resolution No. 6864)
and Zoning Map Amendments (Resolution No. 6862) to allow implementation of the
Valko Town Center Specific Plan and therefore, allow adoption of this Development
Agreement; and
WHEREAS, on September 18, 2018 and September 19, 2018 , upon due notice, the
City Council held a public hearing to consider the Development Agreement; and
WHEREAS, the City Council of the City of Cupertino is the decision-making body
for this Ordinance; and
WHEREAS, after consideration of evidence contained in the entire administrative
record, at the public hearing on September 19, 2018 (continued from September 18, 2018,1.
the City Council adopted Resolution No. 18-084 certifying the Final EIR, adopting the
Findings and a Statement of Overriding Considerations, adopting the Mitigation
Measures, and adopting a Mitigation Monitoring and Reporting Program; and
WHEREAS, prior to taking action on this Ordinance, the City Council has
exercised its independent judgment in carefully considering the information in the Final
EIR and finds that the scope of this Ordinance falls within the certified Final EIR, in that
the aspects of the Development Agreement proposed in this Ordinance that have the
potential for resulting in either a direct physical change in the environment or a
reasonably foreseeable indirect physical change in the environment have been examined
in the Final EIR; therefore, no recirculation of the Final EIR is required; and
WHEREAS, a-t=after a duly noticed public hearing, on September 19, 2018
(continued from September 18, 2018,1 prior to consid eration of the Development
Agreement, the Council adopted Resolution No. 18-085,-approving a General Plan
Amendment to Development Allocations, the General Plan Land Use Map and
development standards related to the Valko Special Area, adopted Resolution No. 18-
086, approving the Vallco Special Area Town Center Specific Plan, Ordinance No. 18-2177,
amending the Municipal Code text to allow implementation of the Valko Town Center
Specific Plan and Ordinance No . 18-2178, rezoning the parcels within the Valko Special
Area Specific Plan.
NOW, THEREFORE, BE IT ORDAINED AS FOLLOWS:
Section 1. The recitals set forth above are true and correct, and are hereby
incorporated herein by this reference as if fully set forth in their entirety.
Section 2. The City Council, having considered the staff report to the City
Council for the meeting of September 19, 2018 (continued from September 18, 2018;1
evidence received at the public hearing duly noticed and held for the proposed
Development Agreement, and all other facts, exhibits, testimony, information and other
evidence submitted in this matter or in the record of this proceeding, finds as follows:
A. The proposed Development Agreement is consistent with the
objectives, policies, general land uses and programs specified in the General Plan, as
amended.
B. The proposed Development Agreement is compatible with the uses
authorized in, and th e regulations prescribed for, the land use district in which the Proj ec t
is located.
C. The proposed Development Agreement is in conformity with and
will promote public convenience, general welfare, and good land use practice.
D. The proposed Development Agreement will not be detrimental to
the health, safety, or general welfare.
E. The proposed Development Agreement will not adversely affect the
orderly development of property or the preservation of property values.
F. The proposed Development Agreement will promote and encourage
the development of the Project by providing a greater degree of requisite certainty.
Section 3. The City Council hereby approves the Development Agreement in
the form attached subject to such minor technical conforming changes as may be
approved by the City Attorney. This approval is based on the City Council's
consideration of and reliance on the Final EIR and in accordance with the plans, details
and descriptions contained therein, and in the Resolution certifying the Final EIR.
Section 4. The City Council hereby authorizes the City Manager to execute the
Devleopment AgreernntDevelopment Agreement on behalf of the City.
Section 5. The City Council directs the Director of Community Development
to file a Notice of Determination with the Santa Clara County Recorder in accordance
with CEQA guidelines.
Section 6.
adoption.
This Ordinance shall be effective thirty (30) days following its
INTRODUCED at a Special Meeting of the City Council of the City of Cupertino
the .:J:.&tl:l19th day of September 2018, (continued from September 18, 2018), and
ENACTED at a Regular Meeting of the City Council of the City of Cupertino the 2nd day
of October, 2018, by the following vote:
Vote: Members of the City Council:
AYES:
NOES:
ABSTAIN:
ABSENT:
RECUSE:
ATTEST: APPROVED:
Grace Schmidt, City Clerk Darcy Paul, Mayor, City of Cupertino
TABLE OF CONTENTS
( continued)
Page
4.3 Other AgencyFees ................................................................................................. 22
4.4 Taxes and Assessinents .......................................................................................... 22
4.5 Connection Fees ..................................................................................................... 22
4.6 Right to Challenge Fees ......................................................................................... 22
ARTICLE 5 PUBLIC BENEFITS .............................................................................................. 22
5 .1 Performing Arts Center .......................................................................................... 22
5.2 City Hall. ................................................................................................................ 24
5 .3 Benefits to School Districts ................................................................................... 28
5.4 Transportation and Transportation Demand Management (TDM) Program ......... 29
5.5 Housing Plan .......................................................................................................... 30
ARTICLE 6 ANNUAL REVIEW .............................................................................................. 30
6 .1 Annual Review ....................................................................................................... 30
ARTICLE 7 COOPERATION AN D IMPLEMENTATION ..................................................... 32
7.1 Subsequent Approvals ........................................................................................... 32
7.2 Scope of Review of Subsequent Approvals ........................................................... 32
7 .3 Processing Applications for Subsequent Approvals .............................................. 33
7.4 Other Agency Subsequent Approvals; Authority of City ...................................... 34
7.5 Consents ............................................................................................................. ~34
7.6 Subdivision .................................... : ............................................................ : .......... 35
7.7 Existing, Continuing Uses and Interim Us es ..................................................... J.+16
ARTICLE 8 AMENDMENT OF AGREEMENT AND PROJEC T APPROVALS .................. 37
8.1 Amendment by Written Consent ........................................................................... 37
8.2 Project Approval Amendments .............................................................................. 37
8 .3 Amendment of th is Agreeinent .............................................................................. 38
8.4 Amendments to Development Agreement Statute ................................................. 38
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TABLE OF CONTENTS
( continued)
ARTICLE 9 INSURANCE, INDEMNITY AND COOPERATION IN THE EVENT
Page
OF LEGAL CHALLENGE ............................................................................... :1-9 38
9 .1 Insurance Requirements ..................................................................................... :1-9 J 8
9.2 Indemnity and Hold Harmless .............................................................................. .39
9 .3 Defense and Cooperation in the Event of a Litig~tion Challenge ......................... 39
ARTICLE 10 ASSIGNMENT, TRANSFER AND NOTICE ................................................ ..4-+4 0
10.1 Gen eral ............................................................................................................... 4-l:4 0
10 .2 Notice of Assignment ........................................................................................... .41
10.3 Assignment Processing ......................................................................................... .41
10.4 Expedited Financial Capability Review ................................................................ .42
10.5 Affiliated Party ....................................................................................................... 42
10 .6 Partial Assignment ............................................................................................. 4.J.4 2
10.7 Release of Transferring Developer ........................................ .' ............................... 43
10.8 Assignment to Financial Institutions or Mortgagee ............................................. ..43
10.9 Successive Assignment .......................................................................................... 43
10.10 Rights of Developer .............................................................................................. .43
ARTICLE 11 MORTGAGEE PROTECTION ........................................................................... .44
11 .1 Mo-rtgagee Protection ............................................................................................. 44
11 .2 Mortgagee Not Obligated ...................................................................................... 44
11.3 Notice of Default to Mortgagee ............................................................................. 44
11.4 No Supersedure .................................................................................................. 4:)44
11. 5 Mortgagee Requested Amendments .................................................................. #44
ARTICLE 12 DEFAULT; REMEDIES ; TERMINATION ........................................................ .45
12.1 Breach and Default ................................................................................................ 45
12 .2 No Cross-D e fault ................................................................................................... 45
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TABLE OF CONTENTS
( continued)
Page
12 .3 Termination ............................................................................................................ 45
12.4 Specific Performance for Vio lation of a Condition ........................................... %:15.
12.5 Legal Actions ......................................................................................................... 46
12.6 Rights and Remedies Are Cumulative .................................................................. .46
12.7 No Damages ........................................................................................................... 46
12.8 Resolution of Disputes .......................................................................................... .47
12.9 Surviving Provisions ............................................................................................. .47
ARTICLE 13 GENERAL PROVISIONS ................................................................................... .47
13.1 Condernnation ........................................................................................................ 47
13 .2 Covenants Binding on Successors and Assigns and Run with Land .................... .48
13.3 Notice ..................................................................................................................... 48
13 .4 Permitted Delays ..................................................................................................... 49
13 .5 Counterparts ........................................................................................................... 49
13.6 Waivers .................................................................................................................. 49
13.7 Constrnction of Agreement.. .............................................................................. .W 49
13 .8 Headings ................................................................................................................ 50
13. 9 Severability ............................................................................................................ 5 0
13.10 Time is of the Essence ........................................................................................... 50
13 .11 Extension of Time Limits ...................................................................................... 50
13 .12 Other Necessary Acts ............................................................................................. 5 0
13 .13 Signatures ........................................................................................................... g iQ
13 .14 Entire Agreement ......... : ..................................................................................... g _iQ
13.15 Estoppel Certificate ............................................................................................ g 50
13 .16 Recordation of Termination ................................................................................... 51
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TABLE OF CONTENTS
( continued)
Page
13 .1 7 City Approvals and Actions .................................................................................. .51
13 .18 Negation of Partnership ..................................................................................... £5 I
13.19 No Third Party Beneficiaries ............................................................................. £5 l
13.20 Governing State Law ......................................................................................... £5 l
13.21 Exhibits .............................................................................................................. £5 l
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City subsequently commenced the Vallco Specific Plan process in early 2018. The purpose of
the Vallco Specific Plan is to specify the allowed land uses, design standards and other
requirements and guidelines for development in the Specific Plan area .
F . On September 29, 2017 Governor Brown signed Senate Bill 3 5 into law, which is
aimed at addressing the State of California's housing shortage and affordability crisis ("SB 35").
SB 35 became effective as of January 1, 2018. On March 27, 2018 Developer submitted a
mixed-u se development application under SB 35 ("SB 35 Application") consisting of 2,402
residential units (after a 35% bonus allowed under the State Density Bonus Law), including fifty
percent of the units affordable to low income households, together with 1,981,768 sq. ft. of office
and 485,912 sq. ft. of retail uses ("SB 35 Project"). Developer separately requested that the City
continue to process the City in itia ted Vallco Specific Plan concurrent with the SB 35
Application.
G. City continued to process the Vallco Specific Plan by holding numerous
charrettes , scoping sessions and community outreach meetings as part df the "Envision Vallco: A
Co ll aborative Design Process." The City additionally prepared a draft environmental impact
report for the Vallco Specific Plan ("Valko DEIR") and held hearings pursuant to the California
Environmental Quality Act ("CEQA") (Public Resources Code section 21000 et seq.). On May
25, 2018 , the City circulated the Vallco DEIR for public review and comment for a period
through July 9, 2018.
H . On June 22, 2018, the City issued a letter to Developer confirming that the SB 35
Project is eligible for streamlined ministerial review under SB 35. The deadline for approval of
the SB 35 Project is not later than 180 days after submittal of the application on March 27, 20 18.
I. Based on community input and City Council direction to provide a project
alternative with greater residential use and community amenities , the City sought information,
analysis and studies about another Specific Plan alternative that would increase the residential
housing on the Property ("Housing Rich Alternative"). To address these considerations the
City circulated the Vallco DEIR Amendment analyzing under CEQA the Housing Rich
Alternative ("EIR Amendment"). The EIR Amendment was circulated for an additional 45 day
period commencing July 6, 2018 and ending on August 20, 2018.
J. City published the Vallco Final Environmental Impact Report consisting of the
Vallco DEIR, EIR Amendment, the comments submitted on both the Vallco DEIR and the EIR
Amendment, and the City's Responses to Comments on the Vallco DEIR and EIR Amendment
on --Au gus t 27 , 2018 ("Valko FEIR").
K. On August 24, 2018, the City released a draft of the Vallco Specific Plan for
public review. The Specific Plan sets forth two tiers of development capacity. Tier 1 sets forth a
basic program of development of the Specific Plan area (750 ,000 square feet of office, 35
residential units per acre, and a minimum of 600,000 square feet of retail) without provision of
above-standard community benefits. Tier 2 allows for a greater amount of office and residential
development, as described in the Vallco Specific Plan, provided the Developer enters into a
Development Agreement with the City which provides for certain above-standard community
benefits . This Development Agreement satisfies the requirements to qualify for Tier 2 , and also
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provides limited vesting for Tier 1. The Valko Specific Plan provides the zoning criteria for the
Property and the balance of the Vall co Specific Plan area, which require certain amendments to
the General Plan.
L. On September_, 2018, in advance of the overall 180-day streamlined approval
process deadline set forth in SB 35, the City issued a letter approving the SB 35 Project.
M. The Planning Commission on September 4,-~2018, recommended the following
action by adoption of Resolutions Nos. 6860, 6861, 6863 and 6865to 6 865 to the City Council:
certification of the Vallco FEIR, approval of a General Plan amendment, approval of the Vallco
Specific Plan, and approval of this Development Agreement.
N. Prior to or concurrently with approval of this Agreement, the City has taken or
will take the following actions (collectively, the "Specific Plan Approvals"):
1. Certification of the Valko FEIR by Resolution No . 18-08 4,=adopted by
the City Council on September 19 , 2018 ;
2. Approval of General Plan amendments by Resolution No. 18-085, adopted
by the City Council on September 19 , 2018;
3 . Approval of the Vallco Specific Plan by Resolution No. -l-8-8-6 18-086 ,
adopted by the City Council on September l 9 , 2018; and
4. Approval of rezoning by Ordinance No . 18-2178,=adopted by the City
Council on _______ , 2018.
0. In accordance with the Specific Plan Approvals, Develop er has proposed to
provide community benefits and develop the Tier 2 program on the Property as follows (the
"Project"):
1. Up to 2 ,668 residential units, including 20% affordable units, 40 of which
shall be designated for Extremely Low Income Households that Developer has proposed to rent
with a preference for individuals with developmen tal deve lopmen t disabilities , and 80 marke,t-
rate senior housing units, as more particularly described in the Housing Plan;
2. Up to 1,750,000 square feet of office uses, at least 250,000 square feet of
which is limited to Office Amenity Space, as described in the Specific Plan Approvals ;
3. At least 485,000 square feet of retail uses, as described in the Vallco
Specific Plan, including up to 85,000 sf of civic and education uses , as more particularly
described in Article 5 (Community Benefits);
4. A hotel , as such use is defined in the Specific Plan, with up to 191 rooms ,
and ancillary uses and amenities as described in the Vallco Specific Plan;
5 . Parking and loading as described in the Vall co Specific Plan;
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10. Transportation Infrastrncture Contributions, Bike/Pedestrian Trail.
Contribution to City of Eleven Million Dollars ($11,000,000) ((subject to reduction per Section
9.3.4)) for study, design and constmction of two critical transportation infrastrnctme projects
(a) the I-280/Wolfe Road interchange; and (b) potential future bicycle and pedestrian trail along
I-280, immediately north of the Project, commonly known as the Junipera Serra Trail.
Q. Under this Development Agreement, Developer will provide substantial public
benefits for the Tier 1 Project. In furtherance of the General Plan Land Use Goals [LU-1 , LU-2,
LU-3, LU-4, LU-5, LU-6, LU-7, LU-8, LU-9, and LU-19], and the Vallco Specific Plan Goals
[as defined in Chapter 1, Purpose and Intent], the Tier 1 development program would result in
the following community-wide social benefits:
Q Housing: 1,779 residential units inclusive of 15% Below Market Rate units, per
Specific Plan,
• Open Space, per Specific Plan, including :
e Multi-use pathway on the western edge, per the Specific Plan
• Public park and plazas, six acres of which must be provided at At Grade.
c, Construct and dedicate to the City three new segments of the public 1ight of way
frontage road on its Property immediately adjacent to North Wolfe.
R. It is the intent of City and Developer to establish certain conditions and
requirements related to review and development of the Project, which are or will be the subject
of subsequent development applications and land use entitlements and this Agreement.
S. City specifically finds , as required by Municipal Code section 19 .144.110, and as
reflected in Ordinance No.==::, 18-2179 that approving this Agreement for the Project, and for
limited purposes a Tier 1 alternative, will promote orderly growth and quality development in
accordance with the goals and policies set forth in the General Plan; is compatible with the uses
authorized in, and the regulations prescribed for, the district in which the Property is located ; will
promote the public convenience, general welfare, and good land use practice; will promote
development which is not detrimental to the health, safety and general welfare ; will not
adversely affect the orderly development of property or the preservation of property value; and
will promote and encourage the development of the Project, by providing a greater degree of
requisite certainty .
T. City and Developer have reached mutual agreement and desire to voluntarily
enter into this Agreement to facilitate development of the Project, subject to the conditions .and
requirements set forth herein .
U. City has given the required no t ic e of its intention to adopt this Agreement and has
conducted public hearings thereon pursuant to Government Code section 65867 and Municipal
Code section 19.144.090. City has reviewed and evaluated this Agreement in accordance with
the Development Agreement Law and found that the provisions of this Agreement and its
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fees are imposed upon Developer and are in excess of those allowed by Applicable Law and
Developer wishes to object to such fees, Developer may pay such fees under protest. City agrees
not to delay issuance of permits or other Subsequent Approvals and entitlements under these
circumstances, provided Developer provides City with proof of payment of such fees .
3 .13 Public Infrastmcture. City shall use good faith, diligent efforts to work with
Developer to ensure that all public infrastructure required in connection with the Project is
expeditiously reviewed and considered for acceptance by City on a phased basis as discrete
components of the public infrastmcture is completed . Developer's obligation to construct the
public improvements shall be set forth in one or more public improvement agreements to be
entered into by the Parties on or before approval of final subdivision maps for the Project7
3 .14 Sanitary Sewer Capacity. As of the Effective Date, City believes, based on
existing sewer capacity studies, that Cupertino Sanitary District's contractual capacity limits with
respect to use of the City of Santa Clara sanitary sewer system are adequate to serve the Project
as well as all other development contemplated by the City's General Plan in e ffec t a s o f th e
E ffec ti ve Da te . Accordingly, subject to continued accuracy of those capacity studies and
assumptions and subject to the limits of its authority, City agrees to reserve sanitary sewer
capacity for the Project as follows:
~ Eat-For the first five (5) years following the Effective Date, City agrees to
act in good faith to ensure that new development projects being considered for approval by City
within such time period will not, in combination with the Project, cause permitted peak wet
weather flow to exceed Cupertino Sanitary District 's contractual sanitary sewer capacity limits.
hl fet-Ifupon the fifth (5th) anniversary of the Effective Date, Developer has
pulled building permits for 33% of the total number of residential units and 33% of the total
commercial square footage within the Project, then until the 8th anniversary of the Effective
Date, City agrees to act in good faith to ensure that new development projects being considered
for approval by City will not, in combination with the remaining un-built portion of the Project,
cause permitted peak wet weather flow to exceed Cupertino Sanitary District's contractual
sanitary sewer capacity limits. If Developer fails to meet the foregoing 5th anniversary
development milestone, then City shall have no obligation to continue reserving for the Project
any of Cupertino Sanitary District's contractual sanitary sewer capacity limits.
£2 f-61-If upon the eighth (8th) anniversary of the Effective Date , Developer
has pulled building permits for 66% of the total number of residential units and 66% of the total
commercial square footage within the Project, then until the expiration of the Initial Term, City
agrees to act in good faith to ensure that new development projects being considered for approval
by City will not, in combination with the remaining un-built portion of the Project, cause
permitted peak wet weather flow to exceed Cupertino Sanitary District 's contractual sanitary
sewer capacity limits. If Developer fails to meet the foregoing gth anniversary development
milestone , then City shall have no obligation to continue reserving for the Project any of
Cupertino Sanitary District's contractual sanitary sewer capacity. limits .
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ill fe}In all events, following expiration of the Initial Term, City shall have
no obligation to reserve for the Project any of Cupertino Sanitary District's contractual sanitary
sewer capacity limits.
Notwithstanding any other provision hereof to the conh·ary, if, following the Effective Date,
updated upd a tes o f ex isting sanitary sewer capacity studies reveal that there is insufficient
in adeq ua te capacity to serve both the Project and all other development projects contemplated
under the City's General Plan in effect as of the Effective Date, then t he sanitary sewer capacity
amounts to be reserved by City under this Section 3.14 shall be reduc ed proportionately based on
the amount of the capacity shortfall as identified in the updated study.
ARTICLE4
FEES
4.1 Impact Fees. Except as otherwise expressly provided herein, for eight (8) years
from the Effective Date, subject to no more than a cumulative two-year extension for Permitted
Delays ("Impact Fee Lock Period"), City shall have the right to impose and Developer shall
pay only thos e Impact Fees, as adopted as of the Effective Date , as and when due under those
existing adopted Impact Fees. During the Impact Fee Lock Period, the City may increase the
existing adopted Impact Fees by the amount of any built in escalators, or in the absence of a built
in escalator, by the annual increase in the cumulative Consumer Price Index for All Urban
Consumers ("CPI-U"), as defined in Cupertino's CMC Section 5 .04.460 (and as reflected in the
most recent report of consumer prices for the San Francisco/Bay Area Standard Metropolitan
Statistical Area as published by the U.S. Department of Labor, Bureau of Labor Statistics) or if
such index is no longer available by a comparable index as reasonably selected by City. Except
as otherwise provided in this Agreement, during the Impact Fee Lock Period no other incre ases
to Impact Fees in existence on the Effective Date and no new City Impact Fees imposed after the
Effective Date shall apply to the Project. Absent agreement of the Parties, Impact Fees will be
· paid when specified under this Agreement or, in the absence of any specified time frame, when
due under the City Municipal Code. Developer will have the right, at any time during the Impact
Fees Lock Period to pre-pay any future Impact Fees at the then applicable rate. Following
expiration of the Impact Fee Lock Period, Developer shall pay all applicable Impact Fees,
including Impact Fees adopted by City after the Effective Date, at the rates in effect when due .
4.1.1 Transportation Impact Fee . City shall give credit to Developer for (i) the
reduction of existing non-residential uses and (ii) any transportation improvements Developer
funds and constructs that are capital projects identified by the Transportation Impact Fee
Program ("TIF"). Credit given under clause (ii) above shall be based on the engineer's cost
estimate used as a basis for establishing the TIF. If Developer still owes a TIF after accounting
for the credits , Developer will pay the applicable TIF, upon issuance of each building permit.
City agrees that no TIF will be charged for Office Amenity Space, or for BMR Units or for the
PAC or Adult School and Innovation Center (to the extent City and/or FUHSD elect to accept
delivery of the PAC or Adult School and Innovation Center spaces for the designated civic uses).
4.1.2 Parkland Fees. Developer will satisfy park and open space requirements
and no park fees will be required, provided the Project includes a minimum of 11.5 acres of
privately maintained open space and parks , which meet the design standards, guidelines and
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Adult School and Innovation Center is located; and (g) provide for FUHSD to elect at its sole
discretion, in lieu of the leased space, to receive a one-time payment of Nine Million Five
Hundred Thousand Dollars ($9,500,000), including the terms on which Developer shall make the
payment; provided, however, in no event shall the payment be made later than issuance of the
last residential building certificate of occupancy. If Developer and FUHSD are unable to reach
agreement on the construction of the Adult School and Innovation Center after good faith efforts,
Developer shall have the option of making the payment described above. Developer's
obligations under this Section 5.3.1 are in addition to Developer's obligation to pay Other
Agency Fees imposed by the-FUHSD.
5.3.2 Payment to CUSD. Developer will enter into a separate agreement with
the Cupertino Unified School District ("CUSD") setting forth the following terms, or te1ms
acceptable to CUSD: Developer will make a one-time payment to CU SD in the total amount of
Fourteen Million Two Hundred Fifty Thousand Dollars ($14,250,000) (subject to reduction as
provided in Section 9.3.4) as directed by CUSD but in any event by no later than issuance of the
last residential building certificate of occupancy. Developer's obligations under this Section
5.3 .2 are in addition to Developer's obligation to pay Other Agency Fees imposed by CUSD .
5.3.3 Co-Working/Incubator Space. Developer will use good faith efforts to
provide approximately forty thousand (40,000) square feet in co-working (e.g., NeueHouse,
Bespoke, HanaHaus, We Work, Nextspace, Regus , etc.) or incubator space, in one or more
locations, as dete1mined by Developer. Such space, at Developer's election, may be counted
against the minimum retail use requirement under the Vallco Specific Plan, provided that the
credit shall not exceed 40,000 sq. ft. of the total retail use requirement.
5.4 Transportation and Transportation Demand Management (TDM) Program.
5.4.1 TDM. Developer shall fund and fully implement the TDM Program as
required by the Vallco FEIR MMRP .incorporated herein by this reference . The further
particulars of the TDM program and its ongoing implementation shall be set forth in a recordable
TDM Agreement the form of which shall be prepared and mutually agreed upon by the Parties
no later than issuance of the first certificate of occupancy for any building . The TDM
Agreement shall be recorded against each parcel no later than issuance of the first building
permit for vertical construction within that parcel. The term of the TDM Agreement shall
continue as required in the Vested Approvals.
5.4.2 Mobility/Bike Hub. Developer shall include in the Project a mobility
hub , which may include a transit stop, community shuttle stop, a help station, bike hub and/or
cafe ("Mobility Hub"). Developer and City shall cooperate to establish a location, design and
program for the Mobility Hub that is reasonably acceptable to the Parties . The size and capacity
of Mobility Hub will vary depending on anticipated demand and location context, but shall be at
least 1,000 sq . ft . Uses may include a concierge station, bike hub staffed for bicycle-re lated
services including secured bike storage, peak-hour staff availability, folding bike or scooter
rentals, same-day repairs, bike and associated equipment sales and bike-related classes and/or a
bike share pod operated by Bay Area Bike Share, and bike racks in the public space , reserved
loading area for drop off/pick up of car shares or autonomous vehicles, and a cafe as part of a
retail program to serve a cyclist meeting . The Mobility Hub shall be located generally near
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consistent with the City's BMR Manual, provided that the Developer may substitute 2-bedroom
Moderate Income Residential Units for Market Rate Units with three or more bedrooms . The
number of bedrooms per unit shall be "generally proportional" if the Moderate Income
Residential Unit bedroom mix is within 10% of the Market Rate Unit bedroom mix. The
bedroom mix for Extremely Low Income, Very Low Income and Low Income Residential Units
may be flexible to optimize the unit mix for a competitive LIHTC application.
c. Unit sizes of Moderate Income Residential Units may be flexible,
provided that the bedroom requirements establishing in Paragraph 7(b) are satisfied . Unit sizes
may be reduced for Ex tr e me ly L ow t ncome , Very Low Income and Low Income Residential
Units that are provided in separate buildings .
· d. For all BMR Units, automobile parking spaces shall be provided
consistent with the Specific Plan, with the Developer retaining flexibility to assign such spaces
based on household requirements, and if parking for the Market-Rate Units is unbundled, then
Developer may do the same for Moderate Income Residential Units. In Moderate Income
Residential Units distributed throughout the Project, Developer shall allocate and assign bicycle
storage, storage lockers, and other spaces reserved for use by individual units to the Moderate
Income Residential Units on the same basis as for the Market Rate Units.
e. Tenants of all BMR Units shall generally have equal access to the
Project's common areas as is given to the residents of the Market Rate Units, provided that (i)
residents of one building are not required to be given access to amenities in other buildings
where such amenities are limited for the use of residents of that building and (ii) residents of
BMR units, as well as residents of ce1tain types of Market Rate Units, will not have access to
certain common area amenities offered exclusively to (a) residents of premium Market Rate
Units or (b) residents of senior Residential Units , at the sole discretion of Developer.
8 . Affordable Housing Agreement. Prior to issuance of the first buildi ng permit,
Developer and City shall enter into and record an Affordable Housing Agreement, which shall
address, among other things: BMR Unit delivery schedule and locations, a definition of what is
included in rent, unit comparability, marketing guidelines, tenant selection and income
certification processes, affordability covenants and enforcement provisions, occupancy
requirements, income monitoring, provisions regarding termination of occupancy, forms of lease
or key lease provisions, records and reporting, operation, management, use and maintenance of
property, including with respect to landscaping and open space and participation in Project
owners' /tenants' association and transportation program. The Affordable Housing Agreement
shall have priority over the liens of any Mortgages, and Developer shall use good faith diligent
efforts to cause any Mortgagees with Mortgages in place at the time the Affordable Housing
Agreement is recorded to execute, acknowledge and deliver to City subordination agreements in
a form reasonably acceptable to the City Attorney subordination the liens of such Mortgages to
the Affordable Housing Agreement.
9. Senior Housing. The pennitted Market-Rate Residential Units include at least 80
senior Residential Units, whether for rent or for sale at Developer's discretion , provided that any
for-sale senior units elected to be provided shall count towards the maximum number of
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