2011060609 - Staff Report 49 and 51 N. Santa Cruz Avenue - Guardino'sDATE:
TO:
FROM:
SUBJECT:
MEETING DATE: 06/06/2011
ITEM NO: 9
COUNCIL AGENDA REPORT
MAY 23, 2011
MAYOR AND TOWN COUNCIL
GREG LARSON, TOWN MANAGER
CONDITIONAL USE PERMIT U-10-023. PROJECT LOCATION: 49 & 51 N.
SANTA CRUZ AVENUE. PROPERTY OWNER: JENNIFER WHITE
APPLICANT: PETE JILLO.
RECONSIDER A REQUEST TO EXPAND AN EXISTING RESTAURANT
(GARDINO'S) TO ADD SEATING, FULL ALCOHOLIC BEVERAGE
SERVICE, AND MODIFY HOURS OF OPERATION ON PROPERTY ZONED
C-2. APN 510-44-030.
RECONSIDERATION RECOMMENDATION:
After opening and closing the public hearing, it is recommended the Town Council:
1. Deny Conditional Use Permit U-10-023 (motion required); and
2. Adopt the resolution finalizing Council's May 2, 2011 decision (Attachment 3) (motion
required).
ALTERNATIVES:
Instead of the aforementioned actions, the Council may:
• Approve Conditional use Permit application U-10-023 (motion required); and adopt the
resolution (Attachment 2) approving a request to expand the existing restaurant to add
seating, full alcoholic beverage service, and modify hours of operation (motion
required).
• Approve the application subject to the recommended, modified, or additional conditions
of approval (motion required); or
• Continue the project to a date certain with specific direction (motion required).
ti
PREPARED BY: �Wendie R. Rooney, Director of Community Development
Reviewed by: 9 Assistant Town Manager
Clerk Administrator Finance
Town Attorney
mmunity Development
N:\DEV\TC REPORTS\20n\NSC49-51 Reconsideration.docx
Reformatted: 5/30/02
PAGE 2
MAYOR AND TOWN COUNCIL
SUBJECT: 49 & 51 N. Santa Cruz Avenue/U-10-023
May 23, 2011
BACKGROUND:
The subject application was considered by Council on May 2, 2011 (Attachment 7). The
Council approved the request for full alcoholic beverage service and modified hours of
operation, council denied the request to expand into an adjacent retail space and add seating.
The resolution to finalize that decision was considered by Council on May 16, 2011. The
Council moved to reconsider the initial request based on verbal information that the applicant
would be willing to condition the expansion to:
• Prohibit cooking and/or food preparation in the existing retail space (49 N. Santa Cruz
Avenue);
• Prohibit a standalone restaurant in the existing retail space;
• Require the existing retail space to revert back to retail should the subject restaurant
leave;
• Prohibit a formula restaurant from occupying the combined or separate spaces.
The applicant submitted a letter of justification for reconsideration with menus and a revised
floor plan (Attachment 4), newspaper articles regarding the Council's decision (Attachment 5),
and a letter from the property owner agreeing to the restrictions on the subject application being
considered by Town Council (Attachment 6).
DISCUSSION:
A. Project Summary
The applicant is requesting approval of a Conditional Use Permit (CUP) modification to
expand an existing restaurant (Gardino's) to add seating, full alcoholic beverage service, and
modify hours of operation. The following table compares the existing allowable and
proposed operations (without the May 2, 2011, approval; with the letter of justification for
reconsideration — Attachment 4):
Existing
Proposed
Alcohol Service
Beer and wine with
Full alcoholic beverage
service with meal service
only
meal service only
Number of Seats
16
45
Hours of
Operation
Seven days a week,
10:00 a.m. to 11:00
p.m.
Sunday to Thursday,
10:00 a.m. to 11:00 p.m.;
Fridays, Saturdays, and
holidays,
10:00 a.m. to 1:00 a.m.
Address
51 N. Santa Cruz
49 & 51 N. Santa Cruz
Please see Attachment 7 for additional information regarding the project and a full analysis.
PAGE 3
MAYOR AND TOWN COUNCIL
SUBJECT: 49 & 51 N. Santa Cruz Avenue/U-10-023
May 23, 2011
B. New Information
The Council made the decision to deny the request to expand an existing restaurant
(Gardino's at 51 N. Santa Cruz Avenue) into an existing retail space (49 N. Santa Cruz
Avenue) after careful consideration of the Ordinance 2021. The ordinance discourages the
displacement of retail uses with restaurant uses. Members of the public presented new
information at the May 16, 2011, Town Council meeting that the applicant is willing to place
restrictions on the expansion that would increase the ability to revert the existing retail space
back to retail should the approved restaurant leave. In addition, the applicant submitted a
letter of justification for reconsideration (Attachment 4).
On May 16, 2011, the Council discussed two means for restrictions (means are in italics;
staff comments follow):
• Adding conditions to the CUP with specific restrictions. Staff provides new
conditions to consider in the "Additional Conditions Section" below. The
commercial kitchen would not expand into the commercial space at 49 N. Santa
Cruz; however, the expansion does include a food service counter. The limited
improvements of the service counter would make it easier to convert the space at 49
N. Santa Cruz back into a retail space in the future in comparison to a commercial
kitchen expansion. This consideration was similarly made for Restaurant James
Randall (303-305 N. Santa Cruz Avenue) and SB17 (217 N. Santa Cruz Avenue #B).
However, it is important to note that these other establishments are located outside
the downtown core. The service counter for the subject application would consist of
considerable improvements, including sinks and floor drains, which would hinder a
retail use from readily re -occupying the space. In addition, the restaurant triggers
restroom modifications that would result in no separate restroom access for the 51 N.
Santa Cruz space. While conditions can require that the space at 49 N. Santa Cruz
Avenue will not operate as a standalone eating or drinking establishment, contain
food preparation and cooking facilities, and/or convert back to retail if the subject
restaurant vacates, restaurant space is limited in the downtown and once the space is
used for a restaurant use, it is unlikely to convert back to retail. Additionally, the
ability to enforce reversion back to retail could prove to be legally implausible
absent an agreement with the property owner who voluntarily agrees to such a
reversion to retail.
• Requiring an operational agreement. An operational agreement is a new
requirement the Town has used on three recent applications — two involving
entertainment and alcohol, one involving a wine bar use. An operational agreement
would allow the Town to more closely monitor the details of business operation and
any changes that existing or new owners may make to it. However, as stated above,
once the space is used for a restaurant use, it is unlikely to convert back to retail and
requiring the space to revert back to retail would prove difficult.
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MAYOR AND TOWN COUNCIL
SUBJECT: 49 & 51 N. Santa Cruz Avenue/U-10-023
May 23, 2011
C. Additional Staff Remarks
Staff contacted California jurisdictions with comparable downtown areas to inquire about
their process and conditions for similar types of applications. In addition, staff also polled
colleagues from around the state. The table below reflects this comparative information.
Carmel
CUP Required fo
Restaurant?
Yes1
Condition to convert
back to retail?
No
Los Altos
No
N/A
Mountain View
Yes2
No
Danville
No
N/A
Saratoga
Yes
No
Santa Barbara
No
N/A
Menlo Park
No
N/A
Tiburon
Yes3
No
St. Helena
Yes3
No
Arroyo Grand
Yes4
No
San Marino
Yes
No
Ross
Yes
No
Hermosa Beach
Nos
No
Only 15 restaurants are allowed along Ocean Avenue; diversity finding required for approval.
2Discorages conversion.
3Required for any change in type of use.
4Administrative Use Permit required; formula prohibited.
5If alcohol is served, a CUP is required; discourages conversion.
Staff has not received a response from Sausalito and will verbally report at the Town Council
meeting if it is received.
At the May 16, 2011, Town Council meeting, the issue of the type of restaurant that could
occupy the subject restaurant space was raised: The letter of justification for reconsideration
(Attachment 4) also discusses what restaurants could occupy the existing restaurant space.
The approved use at 51 N. Santa Cruz Avenue is a high -turnover sit-down restaurant as
defined by Town Code. Although Subway, which was mentioned, would typically be
categorized as a fast food restaurant, the approved Subways in Town (540 N. Santa Cruz
Avenue and 14777 Los Gatos Boulevard) were approved as high -turnover sit-down
restaurants based on traffic data provided by Subway. El Polio Loco would be categorized as
a fast food restaurant; Hooters would be categorized as a high -turnover sit-down restaurant.
A new high -turnover sit-down restaurant could operate in the space at 51 N. Santa Cruz
Avenue if the new restaurant could operate under the existing conditions. Town Code
PAGE 5
MAYOR AND TOWN COUNCIL
SUBJECT: 49 & 51 N. Santa Cruz Avenue/U-10-023
May 23, 2011
Section 29.20.200 defines changes to an existing use that require a CUP modification. A
change from high -turnover sit-down to fast food restaurant would require a CUP
modification.
D. Additional Conditions
The additional and modified conditions to the May 2, 2011, decision are included below and
in the attached resolution to approve the request to expand an existing restaurant (Gardino's)
to add seating, full alcoholic beverage service, and modify hours of operation (Attachment
2). (Additions to existing conditions are underlined; additional conditions are noted as new.)
APPROVAL: This application shall be completed in accordance with all of the conditions of
approval listed below and in substantial compliance with the development plans noted as
received by the Town on February 25, 2011. Any changes or modifications made to the
approved plans shall be approved by the Director of Community Development, the
Development Review Committee, the Planning Commission, or the Town Council depending
on the scope of the change(s).
APPROVED USE: The approved use is for a single high turnover (sit-down) non -formula
restaurant at 49 and 51 N. Santa Cruz Avenue. Formula restaurant, using the definition of
formula retail, means a restaurant business which, along with seven or more other business
locations, is required by contractual or other arrangement to maintain any of the following:
standardized menus, merchandise services, decor uniforms, architecture, colors signs or
other similar features. The approved used shall be subject to property owner written consent
and to any regulation or policy changes subsequently adopted by the Town Council.
(new) INTENT OF APPROVAL: It is the intent of the Town Council to support the
expansion of Gardino's restaurant with the commitment that the space at 49 N. Santa Cruz
Avenue will eventually revert back to retail.
(new) NON-SEVERABILITY: The Conditional Use Permit (U-10-023) for 49 and 51 N.
Santa Cruz Avenue is non -severable. Both spaces shall operate under the same restaurant
with shared staffing, menus, advertising, and operating hours. The spaces shall operate with
unhindered movement between them, with the exception that 49 N. Santa Cruz Avenue can
revert back to retail use at any time, excluding wine or other alcohol retail.
(new) IMPROVEMENTS AND USE AT 49 N. SANTA CRUZ: The additional tenant space
located at 49 N. Santa Cruz Avenue shall be improved as shown on plans noted as received
by the Town on February 25, 2011. No kitchen, cooking, food preparation, including the use
of microwave ovens or other food cooking, warming or heating, or food storage
improvements or uses are allowed in this space so it may easily be reverted to retail use at a
future date. Only food and beverage service is allowed in the additional tenant space.
PAGE 6
MAYOR AND TOWN COUNCIL
SUBJECT: 49 & 51 N. Santa Cruz Avenue/U-10-023
May 23, 2011
SEATS: The maximum number of seats shall not exceed 45, with no more than five seats at
the food service counter in the expanded seating area at 49 N. Santa Cruz Avenue. Should
the expanded area revert to retail, then original restaurant seating will remain at 16.
(new) SEATING CONFIGURATION: The food service counter and high stool seating shall
be reduced by at least half of the area shown on the development plans noted as received by
the Town on February 25, 2011. Removed food service counter seating may be converted
into table top dining and/or waiting area seating. Modifications shall be shown on building
permit plans at the time of building permit application submittal.
ALCOHOLIC BEVERAGE SERVICE: The service of alcoholic beverages is permitted only
with meals for all seating areas including at the food service counter. A meal is defined as a
combination of food items selected from a menu (breakfast, brunch, lunch, or dinner).
Appetizers such as popcorn, nachos, pretzels, potato skins, relish trays, etc. (hot or cold) are
not meals.
(new) OPERATIONAL AGREEMENT: Prior to the issuance of any building permits or the
initiation of any operational changes permitted under this approval, the applicant shall enter
into an operational agreement with the Town guaranteeing the performance of the business
per the representations of the application and the applicant at the public hearings as well as
the observance of the conditions of approval. Said agreement shall be subject to approval of
the Chief of Police, the Director of Community Development Department, and the Town
Attorney, and will be signed by the applicant. Operators who are successors in interest to the
restaurant business and CUP shall be required to meet with the Town CDD Director and
Chief of Police and agree to all the terms of the Operational Agreement by executing a copy
of the Agreement. The Operational Agreement shall be reviewed by the Director of
Community Development Department and the Town Attorney, biannually for the first five
years and then annually thereafter, to ensure compliance with the Conditional Use Permit and
operating covenants, including the detailed description of expanded restaurant operations.
(new) PROPERTY OWNER AGREEMENT AND COMMITMENT: The property owner
shall sign, agree, and commit to the Operational Agreement prior to issuance of building
permits or commencement of use, whichever comes first. The property owner shall submit,
in writing, agreement and commitment to the Conditional Use Permit prior to issuance of
building permits or commencement of use, whichever comes first. -
(new) COMMUNITY BENEFIT: The applicant has offered the following community benefit
to offset traffic impacts created by the proposed project: two public benches to be placed in
front of Los Gatos Cinema. If the proposed location does not have adequate space to
accommodate the benches to the satisfaction of the Director of Parks and Public Works, then
the applicant shall choose an alternative location to provide public street benches. The
benches shall be installed prior to final occupancy.
PAGE 7
MAYOR AND TOWN COUNCIL
SUBJECT: 49 & 51 N. Santa Cruz Avenue/U-10-023
May 23, 2011
PUBLIC COMMENTS:
Please see the report to Town Council for May 2, 2011, (Attachment 7) for public comments
regarding the initial application.
CONCLUSION:
The project would allow an existing restaurant to expand into a retail space, increase the number
of seats and hours of operation, and allow full alcoholic beverage service. The Council should
consider whether they fmd merit with the initial application with the new information discussed
in this report.
ENVIRONMENTAL ASSESSMENT:
The project is Categorically Exempt according to Section 15061 of the State Environmental
Guidelines as adopted by the Town because the project consists of permitting an activity where it
can be seen with certainty that there is no possibility that the activity may have a significant
effect on the environment.
FISCAL IMPACT:
None
Attachments:
1. Required Findings
2. Resolution approving the Conditional Use Permit modification (with Exhibits A and A.1)
3. Resolution approving the Council decision made on May 2, 2011
4. Applicant's letter of justification for reconsideration
5. Newspaper articles
6. Letter from property owner
7. Report to the Town Council for the meeting of May 2, 2011
Distribution:
cc: Pete Jillo, 51 N. Santa Cruz Avenue, Los Gatos, CA 95030
Jennifer White, PO Box 695, Los Gatos, CA 95031
WRR:JLS:cgt
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