Loading...
Council Reports for 10-19-09~pW N 0 OS` °G A0 Mike Wasserman, Mayor Diane McNutt, Vice Mayor NOTICE OF SPECIAL MEETING Joe Pirzynski, Council Member Steve Rice, Council Member Barbara Spector, Council Member TOWN OF LOS GATOS TOWN COUNCIL REGULAR COUNCIL MEETING WILL BE TELEVISED BEGINNING AT 7:00 P.M. NOTICE IS HEREBY GIVEN that Mike Wasserman, Mayor of the Town of Los Gatos, called a Special Meeting of the Town Council for October 19, 2009 at 5:30 p.m. to conduct a North 40 Conceptual Plan Study Session in the Council Chambers. Regular Town Council Meeting will begin at 7:00 p.m. in the Council Chambers. Qacki Rose, Clerk Administrator Dated: October 15, 2009 cc: Los Gatos Weekly Times Los Gatos Observer Council Members Posted ~pW N 0 SGAT Mike Wasserman, Mayor Diane McNutt, Vice Mayor Joe Pirzynski, Council Member Steve Rice, Council Member Barbara Spector, Council Member MEETING CALLED TO ORDER ROLL CALL TOWN OF LOS GATOS TOWN COUNCIL STUDY SESSION AGENDA 110 EAST MAIN STREET COUNCIL CHAMBERS (DOWNSTAIRS) OCTOBER 19, 2009 - 5:30 P.M. MEETING WILL BE TELEVISED VERBAL COMMUNICATIONS (Three-minute time limit) Update and Discussion on the General Plan Update Environmental Review Scope, including the North 40 Specific Plan Negative Declaration ND-99-08 Assessor Parcel Numbers: 424-07-009, 010, 024 thru 027, 031 thru 037, 051 thru 054, 057, 060, 063 thru 065, 070, 081 thru 095, and 424-06-047, 087, 115, 116, 120. Applicant: Town of Los Gatos Presenter: David Early of DC&E and staff ADJOURNMENT IN COMPLIANCE WITH THE AMERICANS WITH DISABILITIES ACT, IF YOU NEED SPECIAL ASSISTANCE TO PARTICIPATE IN THIS MEETING, PLEASE CONTACT THE CLERK DEPARTMENT AT (408) 354-6834. NOTIFICATION 48 HOURS BEFORE THE MEETING WILL ENABLE THE TOWN TO MAKE REASONABLE ARRANGEMENTS TO ENSURE ACCESSIBILITY TO THIS MEETING L28 CFR 35.102-.35.904 ~pW N pp !pS'°GAT S Mike Wasserman, Mayor Diane McNutt, Vice Mayor Joe Pirzynski, Council Member Steve Rice, Council Member Barbara Spector, Council Member PARTICIPATION IN THE PUBLIC PROCESS The Town of Los Gatos strongly encourages your active participation in the public process, which is the cornerstone of democracy. If you wish to speak to an item on the agenda, please complete a "speaker's card" located on the back of the chamber benches and return it to the Clerk Administrator. If you wish to speak to an item NOT on the agenda, you may do so during the "verbal communications" period. The time allocated to speakers may change to better facilitate the Town Council meeting The purpose of the Town Council meeting is to conduct the business of the community in an effective and efficient manner. This is done by following meeting guidelines set forth in State law and in the Town Code. Conduct which is considered disruptive during Town Council meetings include, but is not limited to: • Addressing the Town Council without first being recognized; • Interrupting speakers, Town Council, and Town staff; • Continuing to speak after the allotted time has expired; • Failing to relinquish the podium when directed to do so; and • Repetitiously addressing the same subject For the benefit of the community, the Town of Los Gatos asks that you follow the Town's meeting guidelines while attending Town Council meetings and treat everyone with respect and dignity. Town Council Meetings Broadcast Live on KCAT, Channel 15 1st and 3rd Mondays, at 7:00 p.m. Rebroadcast of Town Council Meetings Following Saturday at 12:00 Noon Live & Archived Council Meetings can be viewed by going to: w .los atosca. ov/Councilvideos TOWN OF LOS GATOS JOINT TOWN COUNCIL/PARKING AUTHORITY/ REDEVELOPMENT AGENCY OCTOBER 19, 2009 .110 East Main Street Council Chambers (Downstairs) Los Gatos, CA IN COMPLIANCE WITH THE AMERICANS WITH DISABILITIES ACT, IF YOU NEED SPECIAL ASSISTANCE TO PARTICIPATE IN THIS MEETING, PLEASE CONTACT THE CLERK DEPARTMENT AT (408)354-6834. NOTIFICATION 48 HOURS BEFORE THE MEETING WILL ENABLE THE TOWN TO MAKE REASONABLE ARRANGEMENTS TO ENSURE ACCESSIBILITY TO THIS MEETING X28 CFR §35.102-35.1041 - 1 - TOWN OF LOS GATOS JOINT TOWN COUNCIL/PARKING AUTHORITY/ REDEVELOPMENT AGENCY OCTOBER 19, 2009 7:00 P.M. MEETING CALLED TO ORDER ROLL CALL PLEDGE OF ALLEGIANCE Commendation Los Gatos History Club PRESENTATIONS Commendation George Sampson Proclamation End Polio Day (Los Gatos Morning Rotary) CLOSED SESSION REPORT TOWN COUNCIL COUNCIL/TOWN MANAGER REPORTS ➢ Council Matters ➢ Manager Matters Writings related to an item on the Town Council meeting agenda distributed to members of the Council within 72 hours of the meeting are available for public inspection at the front desk of the Los Gatos Town library, located at 110 E. Main Street, and are also available for review on the official Town of Los Gatos website. Copies of desk items distributed to members of the Council at the meeting are available for review in the Town Council Chambers Note: The Town of Los Gatos has adopted the provisions of Code of Civil Procedure §1094.6; litigation challenging a decision of the Town Council/Redevelopment Agency must be brought within 90 days after the decision is announced unless a shorter time is required by State or Federal law. -2- CONSENT ITEMS (TO BE ACTED UPON BY A SINGLE MOTION) (Before the Town Council/Redevelopment Agency acts on the consent agenda, any member of the public or Town Council/Agency may request that any item be removed from the consent agenda. Consent items will be considered at the discretion of Mayor/Chair) 1. Adopt resolution approving the form and authorizing the execution and delivery of a purchase and sale agreement and related documents with respect to the sale of the seller's Proposition 1A receivable from the State; and directing and authorizing certain other actions in connection therewith 2. Accept Investment Reports for First Fiscal Quarter 09/10 (July through September 2009) 3. Adopt resolution appointing Erik Wilhelmsen, Transportation and Parking Commissioner, as representative to the Santa Clara Valley Transportation Authority County Wide Bicycle and Pedestrian Advisory Committee (BPAC) 4. Adopt an ordinance for a zone change from CM to CM:PD for a three-story self storage building. No significant environmental impacts have been identified as a result of this project and a Mitigated Negative Declaration is recommended. APN 424- 31-065. Planned Development Application PD-08-001 - Negative Declaration ND-08- 05 Property Location: 930 University Avenue Property Owner: Extra Space of Los Gatos, LLC Applicant: Extra Space Storage 5. Adopt resolution granting an appeal of a Planning Commission decision denying an application for construction of a new single family residence zoned R-120. APN 529- 37-042 and remanding application to the Planning Commission: Architecture and Site Application S-04-64. Negative Declaration ND-07-147. Property location: 26 Alpine Avenue Property owner/applicant/appellant: Holiday Drive, LLC 6. Adopt ordinance amending Town Code Chapter 29, Division 6, Sections 29.10.3000 through 29.10.3040 regarding the Housing Assistance Program TOWN COUNCIL/REDEVELOPMENT AGENCY 7. Approve Council/Agency minutes of October 5, 2009 VERBAL COMMUNICATIONS (Up to three minutes maybe allotted to each speaker to address matters that are not on tonight's agenda.) TOWN COUNCIL PUBLIC HEARINGS (Applicants/Appellants and their representatives may be allotted up to a total of ten minutes maximum for opening statements. Members of the public may be allotted up to three minutes to comment on any public hearing item. Applicants/Appellants and their representatives may be allotted up to a total of five minutes maximum for closing statements. Items requested/recommended for continuance are subject to Council's consent at the meeting.) 8. Establishment of Commercial Alarm Permit Fee a. Introduce ordinance revising Town Code Section 14.50.010 regarding Police alarms and introduction of commercial alarm permit fees b. Adopt resolution authorizing the Town Manager to negotiate and execute a contract with PMAM Corporation for professional alarm management consultant services -3- PUBLIC HEARINGS (continued) 9. Consider a request of approval to operate a retail wine establishment with food, beer, and wine service on property zoned C-1. APN 529-07-047. Conditional Use Permit U- 09-007. Property Location: 414-416 N. Santa Cruz Avenue. Property Owner: Jim Zanardi Applicant: Michael Guerra/Joseph Cannistraci 10. Tow Contract Services a. Introduce ordinance rescinding Town Code Section 28.30.030 and 28.30.035 to eliminate Police rotation tows - b. Adopt resolution authorizing Town Manager to negotiate and execute a contract with South Bay Towing to provide towing services for Police initiated tows TOWN COUNCIL/REDEVELOPMENT AGENCY OTHER BUSINESS (Up to three minutes may be allotted to each speaker on any of the following items.) 11. Fiscal Year 2009/10 First Quarter Budget Performance and Status Report for the Period July 1, 2009-September 30, 2009 a. Accept 2009/10 First Quarter Budget Performance Status Report b. Authorize budget adjustments as recommended in the attached First Quarter Budget Performance Report ADJOURNMENT (Council/Redevelopment Agency policy is to adjourn no later than midnight unless a majority of Council/Redevelopment Agency votes for an extension of time) -4- ~p\4 N p~ iosfff' GQTOS COUNCIL AGENDA REPORT DATE: OCTOBER 15, 2009 MEETING DATE: 10/19/2009 STUDY SESSION TO: MAYOR AND TOWN COUNCIL FROM: GREG LARSON, TOWN MANAGER SUBJECT: UPDATE AND DISCUSSION ON THE GENERAL PLAN UPDATE ENVIRONMENTAL REVIEW SCOPE, INCLUDING THE NORTH 40 SPECIFIC PLAN RECOMMENDATION Discuss and provide comments on the proposed General Plan Environmental Review as it pertains to the North 40. BACKGROUND Council has previously directed a limited focus update to the Town's General Plan as well as completion of the North 40 Specific Plan. In addition, the Town is completing its State-mandated update to the Housing Element. Each of these efforts requires varying degrees of environmental review prior to final Council action. Council previously approved a contract and subsequent contract amendments with Design Community & Environment (DC&E) to prepare a consolidated Environmental Impact Report (EIR) addressing the General Plan and Housing Element. Consolidation was recommended for efficiency and to avoid project piecemealing or segmentation, which are prohibited under the California Environmental Quality Act (CEQA). By law, the General Plan EIR must assess potential development in all parts of the Town, including the North 40. Since a Specific Plan will be prepared for the North 40, it is important that the General Plan EIR consider the maximum development on the North 40 that may ultimately be allowed under the Specific Plan. PREPARED BY: GREG LARSON Town Manager GL:pg NAMGR\AdminWorkFiles\2009 Council Reports\10-19-09 North 40 Study Session.doc Reviewed by: Assistant Town Manager Town Attorney Clerk Administrator Finance Community Development PAGE 3 MAYOR AND TOWN COUNCIL SUBJECT: UPDATE AND DISCUSSION ON THE GENERAL PLAN UPDATE ENVIRONMENTAL REVIEW SCOPE, INCLUDING THE NORTH 40 SPECIFIC PLAN OCTOBER 15, 2009 Alternative Development Mixes - Maintain estimated traffic levels of the Basic Development Parameters and/or the Reduced Development Alternative, but reduce the number of residential units and increase the commercial square footage to include broader community and/or regional retail opportunities. Attachments I . Memo to General Plan Committee on North 40 Conceptual Plan Review 2. Summary Minutes of September 23 General Plan Committee Meeting 3. North 40 Specific Plan Guiding Principles .SOWN pp MEMORANDUM u °S^°s COMITY DEVELOPMENT DEPARTMENT To: General Plan Committee From: Bud Lortz, Deputy Town Manager Subject: North 40 Conceptual Plan Review Date: September 17, 2009 BACKGROUND: On August 25, 2008, the Council held a Study Session to provide direction on how to proceed with finalizing the North 40 Specific Plan (N40SP) in light of prospective development proposals in the North 40 area. Specifically, the question was what process to follow: 0 Complete the N40SP; and/or ® Consider specific development proposals in advance of completion of the N40SP. The Town Council voted 5-0 directing staff to finalize the N40SP. The Council indicated the Draft N40SP should be used as the foundation for an updated Plana The Council also specified that the areas of focus for the update would be the following: ® How to fund and maintain infrastructure. ® Review the design standards in the Draft N40SP to address concerns that the design guidelines and images contained in the draft do not clearly reflect the character of Los Gatos. ® Determine an appropriate land use mix that does not compete with the Downtown, including limited residential development and a possible recreation component. The evaluation of residential uses should include an analysis of potential impacts to schools. ® Review the draft development standards, which currently include a 500,000 square foot cap on commercial mixed-use development, limit the size of any single use to a maximum of 70,000 square feet, state the average size of retail uses and structures should not exceed 30,000 square feet, and establish a maximum building height of 35 feet (exceptions can granted through the Planned Development process to permit buildings up to 45 feet). DISCUSSION: On June 15, 2009, the Town Council approved the agreement with Design, Community and Environment (DC&E) to include revisions to the N40SP and provide for consistency with the General Plan. The Council directed staff to work directly with the General Plan Committee and the Town Council on this important planning effort. ATTACHMENT 1 R DRAFT TOWN OF LOS GATOS 1.10 East Main Street, Los Gatos, CA 95030 (408) 354-6872 SUMMARY MINUTES OF A REGULAR MEETING OF THE GENERAL PLAN COMMITTEE OF THE TOWN OF LOS GATOS ON SEPTEMBER 23, 2009, HELD AT THE NEIGHBORHOOD CENTER, LARGE HALL, 110 EAST MAIN STREET, LOS GATOS, CALIFORNIA. The meeting was called to order at 5:20 pm by Jane Ogle. ATTENDANCE Members present: John Bourgeois, Barbara Cardillo, Tom O'Donnell, Jane Ogle, Joe Pirzynski, Chuck Sloan, Barbara Spector Members absent: Marcia Jensen Staff present: Greg Larson, Town Manager; Bud Lortz, Deputy Town Manager; Wendie Rooney, Director of Community' Development; Suzanne Davis, Associate Planner; Joel Paulson, Associate Planner; Jennifer Savage, Assistant Planner; Jessica von Borck, Economic Vitality Manager Consultants present: David Early, Design Community & Environment (DC&E); Peter Calthorpe, Architect Public attendees: Mike Amidi, Lynlee Bischoff, Pete Brutsche, Ray Davis, Kerry Laubach, Milt Mintz, Tom Spilsbury VERBAL COMMUNICATIONS: Ray Davis commented on Monday's Town Council meeting. The Council voted to acquire two acres below. the dain for soccer fields. He disagrees with Bud Lortz's reconnnendation to install two small fields and parking for 60 cars. He also commented that the money from the sale of. Town property in Vasona is not being used for its intended purpose, and he feels it is a fraud. Lastly, he commented on the dust cloud being spread by the cement plant in Cupertino. He encouraged people to protest as the permit is up for renewal. ITEM I REVIEW OF NORTH 40 SPECIFIC PLAN Greg Larson opened the meeting noting that tonight's meeting is the result of Council direction from a meeting held August 2009. At that meeting the Council directed staff to complete the North 40 Specific Plan. The plan was originally developed through a community process and was tabled pending the General Plan update in 2000. There will be an on-going series of discussions over the next six months. The North 40 is the largest ATTACHMENT 2 General Plan Cornrnittee September 23, 2009 Page 2 of S undeveloped area in the Town. Council directed staff to review design standards, to determine an appropriate land use mix that may include residential and will not compete with the Downtown, and to look at the development standards. The primary property owner, the Yuki family, has a representative who will present their thoughts on the development of the North 40. There will be a Town Council study session on October 19, 2009. John Bourgeois clarified that the Committee should be providing a recommendation to the Town Council on the consultant's presentation. David Early, DC&E, noted that the requested action is to include the North 40 program as a component of the General Plan EIR. The goals for the project are to indentify an appropriate mix of uses and the parameters for design and development. There is an existing draft plan that currently supports destination retail and mixed use commercial. The plan no longer matches the Town's vision included in the current General Plan. The goal is to find a project that is smart growth, sustainable, and that reflect today's market. Guiding principles include residential uses to the south, retail mixed use to the north and a variety of types of residential. The Yuki family is working with a developer, Grosvenor, and an architect, Peter Calthorpe, who will be preparing a development proposal in parallel with the General Plan Update. Many of the ideas overlap. Grosvenor controls about 30 acres of the 42 acre site. Barbara Cardillo clarified that the portion of the North 40 that is not being discussed is the parcels that are already developed. David Early noted that for the Specific Plan, the entire area is being included. The development proposal from Grosvenor does not include already developed parcels, a few residences and land not owned by the Yuki family. Peter Calthorpe, Architect, presented four principles that snake a good place that is sustainable and smart growth as follows: • Diversity and balance: inclusive of a civic realm, residential, commercial and neighborhood. • Human and pedestrian scale: building shape, size, not centered around the automobile. There are different types of human scale, but they all have the same components including walkability and vitality. • Conservation and sustainability: no place is an island, sustainability and conservation is more than placing solar panels on the roof and driving a Prius. Single family is sprawl. Green sprawl is when people conserve energy and drive an energy efficient vehicle. Compact housing includes more efficient building envelopes as opposed to large lot single-family development. Compact green is higher density residential (compact) with sustainable design. There is a need for a range of housing types. Housing that fits into the compact green category is a 4:1 savings on carbon emissions. There is currently a regional housing shortage. General Plan Committee September 23, 2009 Page 3 of 5 e Connection and interdependence: proximity to jobs and housing. One of the good things about the location of the North 40 site is its proximity to regional transit. Once the light rail is extended to Los Gatos, a shuttle link between there, the Downtown and the North 40 will interconnect the areas and allow people to travel around town without using their cars. Desirable plan elements: The scale of the site needs to be attended to ® A pedestrian oriented edge along Los Gatos Blvd. is needed ® Minimal parking along the street and in front of buildings ® More of a pedestrian edge along buildings ® Create a more unified landscape for sense of unity and consistent theme m Need to connect through and use as many access points as possible so the site becomes interconnected and traffic is dispersed ® Streets have to designed for pedestrians ® Traffic calming ® Break the scale of the blocks down ® Two characteristics: civic anchors including a park surrounded by residential and a center plaza surrounded by mixed use 0 Create boulevard treatment along the edge (Los Gatos Blvd.) to provide continuity and connectiveness A true compact interconnected community can be achieved without impacting views of the hills and overwhelming its surroundings. 'The predominant residential type would be three-story townhouses. David Early discussed the overall development goal that will be expressed in the General Plan, which is to develop the North 40 with a mix of uses that complements and does not compete with the Downtown and the rest of the community, and to plan for a smart community that is sustainable. Guiding Principles to be included in the General Plan: Mixed use: ® High quality architecture ® Residential uses to south ® Retail mixed use to north ® Variety of types of residential Connected street network: • Connections to existing intersections along Lark & LGV ® Pedestrian orientation General Plan Committee September 23, 2009 Page 4 of 5 Open Space: • Park at center of residential • Plaza at center of mixed use area • Continuation of treatment along LOB • Vegetative screening/buffer along Highway 17 and Route 85 • Pedestrian scale buildings along LOB with minimal parking • Split level buildings • Tuck under parking • Building heights that protect Town character and views: a. 2-story maximum along LOB b. 4-story maximum further back on the site c. possible 5-story hotel Development potential of up to 585,000 square feet of retail and office space and up to 750 residential units to be evaluated in EIR. Tom O'Donnell asked about the numbers and what acreage would be assigned to those uses. He is having difficulty envisioning the density. David Early noted that Grosvenor controls about 31 acres. The entire site'is about 42 acres and the average for residential is about 18 units per acre. Bud Lortz noted that the proposed development potential is about 30% less dense than the Sobrato development. Toni O'Donnell expressed concern that the height limitations will provide enough control. Peter Calthorpe noted that the objective is to shape something that provides a good envelope for development. David Early stated that the development parameters are intended for the entire site and that the density could not be made more compact and proposed for only a portion of the site. Barbara Spector commented that she is concealed about the proposed building heights and potential visibility, how the development may or may not be phased, infrastructure, road intersection congestion. Barbara Cardillo commented on the.goal of complementing and not competing with the Downtown. While it sounds good, it presents the possibility of a Santana Row-like project. David Early noted that the anticipated businesses would be those that would not fit in the Downtown and would provide good that are not available there. Peter Calthorpe noted that it will be important to specify the type of retail that is needed and desired. What types of products are people leaving town to obtain. John Bourgeois commented that he is concerned about view preservation and visual impact. He asked for, clarification on the split between mixed use conunercial and residential and how it was determined. Peter Calthorpe explained that the mixed use area will need its own access and should not be hidden behind the existing commercial area just north of Lark Avenue. General Plan Committee September 23, 2009 Page 5 of 5 John Bourgeois clarified that the proposed numbers are for purposes of study and environmental evaluation. He commented that the parcel is one of the last areas of agricultural use, and if the concept of retaining a portion of the orchard has been considered. Peter Calthorpe noted that project specific details are not being shown at this point. Bud Lortz noted that the history of the Yuki family should be included with preservation of _a component of the existing agricultural use of the site. ' Joe Pirzynski commented that he agrees with 'everything that has been said. An. important consideration is traffic generation. The entrance and egress will be very important because of the existing traffic impact that is there now. The impact on schools will need to be considered. He is not sure there is a nexus with the residential area to the south of Lark Avenue. This has gone a long way to competing the North 40 Plan, and he is very interested to see how the principles are received. He supports the proposal. This is an extremely important piece of the community. It is a chance to do things right. Jane Ogle commented that this is a very important project and she feels uncomfortable making a decision after an hour and a half discussion. Tom O'Donnell and Barbara Spector agreed. David Early said the principles can be revised based on comments that were made tonight. For example, the need for a cultural component and preservation of views of the hills. The matter will be returned to the Committee for farther discussion. NEW BUSINESS None ADJOURNMENT Meeting was adjourned at 6:45 PM. The next meeting of the General Plan Committee is scheduled for October 14, 2009. Prepared by: Suzanne Davis, Associate Planner N:\DEV\GPC\2009 minutes\GPC-092309.doc North 40 Specific Plan Guiding Principles Revised for discussion October 19, 2009 Complement and do not compete with Los Gatos' Downtown and the rest of the community. Sustainable and "smart" development. Mixed use: e Residential uses to the south. ® Retail mixed use to the north. ® Variety of types of residential units. Plaza at center of mixed use area. Park at center of residential area. Connected street network. ® Pedestrian orientation. ® Connections to existing intersections along Los Gatos. Boulevard and Lark Avenue. Architecture and design that reflects the rural and agricultural history of the site. Gateway or landmark features at Los Gatos Boulevard/Lark Avenue and Los Gatos Boulevard/ Highway 85 off ramp. High-quality architecture. Continuation of "Boulevard Treatment" along Los Gatos Boulevard, with interconnections from one parcel's drive aisle to the next, Pedestrian-oriented buildings along the Los Gatos Boulevard frontage, with minimal parking oriented to the street. Vegetative buffer and screening along Highways 17 and 85. Take advantage of the grade change across the site. ® Split-level buildings allowing two floors of retail. ® "Tuck under" parking. Building heights to preserve Town character and views: ® Preserve views of the hills from Highways 17 and 85. ® Two stories maximum along Los Gatos Boulevard. ® Four stories maximum on most of the site. o Possible five story hotel. ATTACHMENT 3 ~pW N OF tos pGA a5 COUNCIL AGENDA REPORT DATE: OCTOBER 14, 2009 MEETING DATE: 10/19/2009 ITEM NO: TO: MAYOR AND TOWN COUNCIL FROM: GREG LARSON, TOWN MANAGER SUBJECT: ADOPT RESOLUTION APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF A PURCHASE AND SALE AGREEMENT AND RELATED DOCUMENTS WITH RESPECT TO THE SALE OF THE SELLER'S PROPOSITION I A RECEIVABLE FROM THE STATE; AND DIRECTING AND AUTHORIZING CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH RECOMMENDATION: It is recommended that the Council adopt the attached resolution (Attachment No. 1) approving the form of and authorizing the execution and delivery of a purchase and sale agreement and related documents (Attachment No. 2) with respect to the sale of the seller's Proposition 1 A Receivable from the State; and directing and authorizing certain other actions in connection therewith. BACKGROUND: Proposition IA was passed by California voters in 2004 to ensure local property tax and sales tax revenues remain with local government thereby safeguarding funding for public safety, health, libraries, parks, and other local services. Provisions can only be suspended if the Governor declares a fiscal necessity and two-thirds of the Legislature concur. On July 28, 2009, as part of the FY 2009/10 State Budget, an emergency suspension of Proposition IA was passed by the Legislature and signed by the Governor as ABX4 14 and ABX4 15. Under the emergency provision, the State will borrow 8% of the amount of property tax revenue apportioned to cities, counties and special districts. The state will be required to repay those obligations plus interest by June 30, 2013. It is anticipated that the State will borrow $800,000 - $1,000,000 in property tax revenue from the Town. ABX4 14 and ABX4 15 authorizes Proposition IA Securitization Program, which was instituted by California Communities, a joint powers authority sponsored by the California State Association of Counties and the League of California Cities. This program enables local agencies to sell their respective Proposition IA Receivables to California Communities, who will then simultaneously purchase the Proposition IA Receivables, issue bonds ("Prop IA Bonds") and provide local agencies with the cash proceeds in two equal installments, on January 15, 2010 and May 3, 2010 (to coincide with the dates that the State will be shifting props . tax from to all agencies). The purchase price paid to the local agencies PREPARED BY: JE PlYA , A SISTANT FINANCE/BUDGET DIRECTOR NAFINANCETrop 1A Securitization 7D- umentsT op t A Securi ' ion.doc Reviewed by: -Fd-a Assistant Town Manager Clerk Administrator of Finance _ Town Attorney Zmunity Development PAGE 2 MAYOR AND TOWN COUNCIL SUBJECT: ADOPT RESOLUTION APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF A PURCHASE AND SALE AGREEMENT AND RELATED DOCUMENTS WITH RESPECT TO THE SALE OF THE SELLER'S PROPOSITION IA RECEIVABLE FROM THE STATE; AND DIRECTING AND AUTHORIZING CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH October 14, 2009 will equal 100% of the amount of the property tax reduction. All transaction costs of issuance and interest will be paid by the State of California. Participating local agencies will have no obligation on the bonds and no credit exposure to the State. If the Town sells its Proposition 1 A Receivable under the Proposition 1 A Securitization Program, California Communities will pledge the Town's Proposition IA Receivable to secure the repayment of a corresponding amount of the Prop IA Bonds. The Town's sale of its Proposition lA Receivable will be irrevocable. Bondholders will have no recourse to the Town if the State does not make the Proposition IA Repayment. Specific aspects of the Proposition 1 A Securitization Program have been clarified as a result of the recent passage of SB 67, a clean up bill to ABX4 14 and ABX4 15. Key changes to the enacted legislation include, but are not limited to: enabling the financing to occur in November; requiring a county auditor certification of the amount of the Proposition 1 A Receivable; creating a tax-exempt structure; making California Communities the only issuer; creating more flexibility regarding the bond structure (interest payments, state payment date and redemption features); and revising the hardship mechanism. Cities, counties, and special districts who choose to participate in the program must adopt the attached Proposition IA Securitization Resolution and Purchase and Sale Agreement by November 6, 2009. DISCUSSION: Based on discussions with local agencies and literature from the League of California Cities, staff has determined that it is in the best interest or Los Gatos to participate in the Proposition I A Securitization Program. At a recent Santa Clara County/Cities Fiscal Officers meeting, all attending agencies confirmed their intent to participate in the Securitization Program. Benefits to participation include: ■ Immediate Cash Relief - The sale of the Town's Proposition IA Receivable will provide the Town with 100% of its Proposition IA Receivable in two equal installments, on January 15, 2010 and May 3, 2010. ■ Mitigates Impact of the 8% Property Tax Withholding in January and May- Per ABX4 14 and ABX4 15 and the recently adopted clean-up legislation SB 67, the State will withhold 8% of property tax receivables due to cities, counties, and special districts under Proposition IA. The financing outlines bond proceeds to be distributed to coincide with the dates that the State will be shifting property tax from local agencies. ■ All Costs of Financing will be Borne by the State of California - The Town will not have to pay any interest cost or costs of issuance in connection with it participation. ■ No obligation on Bonds The Town has no obligation with respect to the payment of the bonds, nor any reporting, disclosure or other compliance obligations associated with the bonds. PAGE 3 MAYOR AND TOWN COUNCIL SUBJECT: ADOPT RESOLUTION APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF A PURCHASE AND SALE AGREEMENT AND RELATED DOCUMENTS WITH RESPECT TO THE SALE OF THE SELLER'S PROPOSITION IA RECEIVABLE FROM THE STATE; AND DIRECTING AND AUTHORIZING CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH October 14, 2009 Should the Council choose to participate in the Proposition lA Securitization Program, it must adopt the attached Resolution and Purchase and Sale Agreement and related exhibits as summarized below: Proposed Proposition IA Receivables Sale Resolution ■ Authorizes the sale of the Town's Proposition lA Receivable to California Communities for 100% of its receivable; ■ Approves the form, and directs the execution and delivery of the Purchase and Sale Agreement with California Communities and related documents; ■ Authorizes and directs any Authorized Officer to send, or to cause to be sent, an irrevocable written instruction required by statute to the State Controller notifying the State of the sale of the Proposition lA Receivable and instructing the disbursement of the Proposition IA Receivable to the Proposition IA Bond Trustee; ■ Appoints certain Town officers and officials as Authorized Officers for purposes of signing documents; and ■ Authorizes miscellaneous related actions and makes certain ratifications, findings and determinations required by law. Proposed Purchase and Sale Agreement ■ Provides for the sale of the Proposition 1 A Receivable to California Communities; ■ Contains representations and warranties of the Town to assure California Communities that the Proposition IA Receivable has not been previously sold, is not encumbered, that no litigation or other actions is pending or threatened to disrupt the transaction and the this is an arm's length "true sale" of the Proposition IA Receivable; and ■ Provides mechanics for payment of the Purchase Price. Proposed Purchase and Sale Agreement Exhibits ■ (B 1): Opinion of Counsel: This is an opinion of the counsel to the local agency (which may be an in-house counsel or an outside counsel) covering basic approval of the documents, litigation, and enforceability of the document against the Seller. It will be dated as of the Pricing date of the bonds (currently expected to be November 10, 2009). ■ (B2): Bringdown Opinion: This simply "brings down" the opinions to the closing date (currently expected to be November 19, 2009). PAGE 4 MAYOR AND TOWN COUNCIL SUBJECT: ADOPT RESOLUTION APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF A PURCHASE AND SALE AGREEMENT AND RELATED DOCUMENTS WITH RESPECT TO THE SALE OF THE SELLER'S PROPOSITION IA RECEIVABLE FROM THE STATE; AND DIRECTING AND AUTHORIZING CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH October 14, 2009 ■ (Cl): Certificate of the Clerk of the Local Agency: A certificate of the Clerk confirming that the resolution was duly adopted and is in full force and effect. ■ (C2): Seller Certificate: A certification of the Seller dated as of the Pricing Date confirming that the representations and warranties of the Seller are true as of the Pricing Date, confirming authority to sign, confirming due approval of the resolution and providing payment instructions. ■ (0): Bill of Sale and Bringdown Certificate: Certificate that brings the certifications of C2 down to the Closing Date and confirms the sale of the Proposition 1 A Receivable as of the Closing Date. ■ Irrevocable Instructions to the Controller: Required in order to let the State Controller know that the Proposition IA Receivable has been sold and directing the State to make payment of the receivable to the Trustee on behalf of the Purchaser. ■ Escrow Instruction Letter: Instructs Transaction Counsel (Orrick) to hold all documents in escrow until closing, and if closing does not occur by December 31, 2009 for any reason, to destroy all documents. CONCLUSION: It is recommended that the Council agree to participate in the Proposition 1 A Securitization Program and adopt the attached resolution and Purchase and Sale Agreement. FISCAL IMPACT: If the Council chooses to participate in the Proposition 1 A Securitization Program, the sale of the Town's Proposition IA Receivable will provide the Town with 100% of its Proposition IA Receivable in two equal installments, on January 15, 2010 and May 3, 2010. The Town will not have to pay any interest cost or costs of issuance in connection with it participation, nor will it have any obligation with respect to the payment of the bonds, reporting, disclosure or other compliance obligations associated with the bonds. Attachments: Attachment No. 1: Resolution Approving the Form of and Authorizing the Execution and Delivery of a Purchase and Sale Agreement and Related Documents with Respect to the Sale of the Seller's Proposition IA Receivable from the State; and Directing and Authorizing Certain Other Actions in Connection Therewith Attachment No. 2: Purchase and Sale Agreement and Related Documents Distribution: Orrick, Herrington & Sutcliffe LLP, 405 Howard Street, San Francisco, CA 94105 RESOLUTION NO. TOWN:COUNCIL OF THE TO«"\T OF LOS GAT.OS A RESOLUTION APPROVING THE FORM OF AND AUTHORIZING THE EXECUTION AND DELIVERY OF A PURCHASE AND SALE AGREEMENT AND RELATED DOCUMENTS WITH RESPECT TO THE SALE OF THE SELLER'S PROPOSITION IA RECEIVABLE FROM THE STATE; AND DIRECTING AND AUTHORIZING CERTAIN OTHER ACTIONS IN CONNECTION THEREWITH WHEREAS, pursuant to Section 25.5 of Article XIII of the California Constitution and Chapter 14XXXX of the California Statutes of 2009 (Assembly Bill No. 15), as amended (the "Act"), certain local agencies within the State of California (the "State") are entitled to receive certain payments to be made by the State on or before June 30, 2013, as reimbursement for reductions in the percentage of the total amount of ad valorem property tax revenues allocated to such local agencies during the State's 2009-10 fiscal year (the "Reimbursement Payments"), which reductions have been authorized pursuant to Sections 100.05 and 100.06 of the California Revenue and Taxation Code; WHEREAS, the To\%,n of Los. Gatos, a local agency within the meaning of Section 6585(f) of the California Government Code he "Seller"), is entitled to and has determined to sell all right, title and interest of the Seller in and to its "Proposition 1 A receivable", as defined in Section 6585(g) of the California Government Code (the "Proposition IA Receivable"), namely, the right to payment of moneys due or to become due to the Seller pursuant to Section 25.5(a)(1)(B)(iii) of Article XIII of the California Constitution and Section 100.06 of the California Revenue and Taxation Code, in order to obtain money to fund public capital improvements or working capital; WHEREAS, the Seller is authorized to sell or otherwise dispose of its property as the interests of its residents require; WHEREAS, the California Statewide Communities Development Authority, a joint exercise of powers authority organized and existing under the laws of the State (the "Purchaser"), has been authorized pursuant to Section 6588(x) of the California Government Code to purchase the Proposition IA Receivable; WHEREAS, the Purchaser desires to purchase the Proposition IA Receivable and the Seller desires to sell the Proposition I A Receivable pursuant to a purchase and sale agreement by and between the Seller and the Purchaser in the form presented to this Town Council (the "Sale Agreement") for the purposes set forth herein; WHEREAS, in order to finance the purchase price of the Proposition IA Receivable from the Seller and the purchase price of other Proposition IA Receivables from other local agencies, the Purchaser will issue its bonds (the "Bonds") pursuant to Section 6590 of the California Government Code and an Indenture (the "Indenture"), by and between the Purchaser and Wells Fargo Bank, National Association, as trustee (the "Trustee"), which Bonds will be payable solely ATTACHMENT I from the proceeds of the Seller's Proposition IA Receivable and other Proposition IA Receivables sold to the Purchaser by local agencies in connection with the issuance of the Bonds; WHEREAS, the Seller acknowledges that (i) any transfer of its Proposition IA Receivable to the Purchaser pursuant to the Sale Agreement shall be treated as an absolute sale and transfer of the property so transferred and not as a pledge or grant of a security interest by jtowin,of Los Gatos to secure a borrowing, (ii) any such sale of its Proposition IA Receivable to the Purchaser shall automatically be perfected without the need for physical delivery, recordation, filing or further act, (iii) the provisions of Division 9 (commencing with Section 9101) of the California Commercial Code and Sections 954.5 to 955.1 of the California Civil Code, inclusive, shall not apply to the sale of its Proposition IA Receivable, and (iv) after such transfer, the Seller shall have no right, title, or interest in or to the Proposition IA Receivable sold to the Purchaser and the Proposition IA Receivable will thereafter be owned, received, held and disbursed only by the Purchaser or a trustee or agent appointed by the Purchaser; WHEREAS, the Seller acknowledges that the Purchaser will grant a security interest in the Proposition 1 A Receivable to the Trustee and any credit enhancer to secure payment of the Bonds; WHEREAS, a portion of the proceeds of the Bonds will be used by the Purchaser to, among other things, pay the purchase price of the Proposition 1 A Receivable; WHEREAS, the Seller will use the proceeds received from the sale of the Proposition IA Receivable for any lawful purpose as permitted under the applicable laws of the State; NOW THEREFORE, the Town Lounail of the 't'own of Los Gatos hereby resolves as follows: Section 1. All of the recitals set forth above are true and correct, and this Tc)« n c'ouncil' hereby so finds and determines. Section 2. The Seller hereby authorizes the sale of the Proposition 1A Receivable to the Purchaser for a price equal to the amount certified as the Initial Amount (as defined in the Sale Agreement) by the County auditor pursuant to the Act. The form of Sale Agreement presented to the Town Council is hereby approved. An Authorized Officer (as set forth in Appendix A of this Resolution, attached hereto and by this reference incorporated herein) is hereby authorized and directed to execute and deliver the Sale Agreement on behalf of the Seller, which shall be in the form presented at this meeting. Section 3. Any Authorized Officer is hereby authorized and directed to send, or to cause to be sent, an irrevocable written instruction to the State Controller (the "Irrevocable Written Instruction") notifying the State of the sale of the Proposition IA Receivable and instructing the disbursement pursuant to Section 6588.6(c) of California Government Code of the Proposition IA Receivable to the Trustee, on behalf of the Purchaser, which Irrevocable Written Instruction shall be in the form presented at this meeting. Section 4. The Authorized Officers and such other Seller officers, as appropriate, are hereby authorized and directed, jointly and severally, to do any and all things and to execute and deliver any and all documents, including but not limited to, if required, appropriate escrow instructions relating to the delivery into escrow of executed documents prior to the closing of the Bonds, and such other documents mentioned in the Sale Agreement or the Indenture, which any of them may deem necessary or desirable in order to implement the Sale Agreement and otherwise to carry out, give effect to and comply with the terms and intent of this Resolution; and all such actions heretofore taken by such officers are hereby ratified, confirmed and approved. Section 5. All consents, approvals, notices, orders, requests and other actions permitted or required by any of the documents authorized by this Resolution, whether before or after the sale of the Proposition IA Receivable or the issuance of the Bonds, including without limitation any of the foregoing that may be necessary or desirable in connection with any default under or amendment of such documents, may be given or taken by an Authorized Officer without further authorization by this Town (_>ouricif, and each Authorized Officer is hereby authorized and directed to give any such consent, approval, notice, order or request, to execute any necessary or appropriate documents or amendments, and to take any such action that such Authorized Officer may deem necessary or desirable to further the purposes of this Resolution. Section 6. The Town Council acknowledges that, upon execution and delivery of the Sale Agreement, the Seller is contractually obligated to sell the Proposition lA Receivable to the Purchaser pursuant to the Sale Agreement and the Seller shall not have any option to revoke its approval of the Sale Agreement or to determine not to perform its obligations thereunder. 3 approval. Section 7. This Resolution shall take effect from and after its adoption and PASSED AND ADOPTED by the Town Councils of the Town of Los Gate,, State of California, this day of , 2009, by the following vote: AYES: NOES: ABSENT: klVor Attest: Clerk Adminisirator Approved as to form : SELLER'S COUNSEL By Dated: 4 APPENDIX A TOWN OVLOS GATO5 Authorized Officers: 'St4phun Conway, Finance Director Jenny Haruyama, Assistant hinance Director: Painela Jacobs, Assistant Town N/Ian4gyer any designee of any of them, as appointed in a written certificate of such Authorized Officer delivered to the Trustee. TOWN OF LO&GATOS, CALIFORNIA, as Seller and CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY, as Purchaser PURCHASE AND SALE AGREEMENT Dated as of November 1, 2009 ATTACHMENT 2 TABLE OF CONTENTS Page 1. DEFINITIONS AND INTERPRETATION 2 2. AGREEMENT TO SELL AND PURCHASE; CONDITIONS PRECEDENT 2 3. PURCHASE PRICE, CONVEYANCE OF PROPOSITION IA RECEIVABLE AND PAYMENT OF PURCHASE PRICE 3 4. REPRESENTATIONS AND WARRANTIES OF THE PURCHASER 4 5. REPRESENTATIONS AND WARRANTIES OF THE SELLER 5 6. COVENANTS OF THE SELLER 7 7. THE PURCHASER'S ACKNOWLEDGMENT 9 8. NOTICES OF BREACH 9 9. LIABILITY OF SELLER; INDEMNIFICATION 9 10. LIMITATION ON LIABILITY 10 11. THE SELLER'S ACKNOWLEDGMENT 10 12. NOTICES 10 13. AMENDMENTS 10 14. SUCCESSORS AND ASSIGNS 10 15. THIRD PARTY RIGHTS 11 16. PARTIAL INVALIDITY 11 17. COUNTERPARTS 11 18. ENTIRE AGREEMENT 11 19. GOVERNING LAW 12 EXHIBIT A - DEFINITIONS A-1 EXHIBIT B 1 - OPINION OF SELLER'S COUNSEL B 1-I EXHIBIT B2 - BRINGDOWN OPINION OF SELLER'S COUNSEL 132-1 EXHIBIT C 1 - CLERK'S CERTIFICATE CI-1 EXHIBIT C2 - SELLER CERTIFICATE C2-1 EXHIBIT C3 - BILL OF SALE AND BRINGDOWN CERTIFICATE C3-1 EXHIBIT D - IRREVOCABLE INSTRUCTIONS TO CONTROLLER D-1 EXHIBIT E - ESCROW INSTRUCTION LETTER E-1 i PURCHASE AND SALE AGREEMENT THIS PURCHASE AND SALE AGREEMENT, dated as of November 1, 2009 (this "Agreement"), is entered into by and between: (1) K-)\ N OF LOS ~GATOS, a local agency of the State of California within the meaning of Section 6585(f) of the California Government Code (the "Seller"); and (2) CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY, a joint exercise of powers authority organized and existing under the laws of the State of California (the "Purchaser"). RECITALS A. Pursuant to Section 25.5 of Article XIII of the California Constitution and Section 100.06 of the California Revenue and Taxation Code, local agencies within the meaning of Section 6585(f) of the California Government Code are entitled to receive certain payments to be made by the State of California (the "State") on or before June 30, 2013, as reimbursement for reductions in the percentage of the total amount of ad valorem property tax revenues allocated to such local agencies during the State's 2009-10 fiscal year, which reductions have been authorized pursuant to Sections 100.05 and 100.06 of the California Revenue and Taxation Code. B. The Seller is the owner of the Proposition IA Receivable (as defined below) and is entitled to and has determined to sell all right, title and interest in and to the Proposition IA receivable, namely, the right to payment of moneys due or to become due to the Seller pursuant to Section 25.5(a)(1)(B)(iii) of Article XIII of the California Constitution and Section 100.06 of the California Revenue and Taxation Code, in order to obtain money to fund any lawful purpose as permitted under the applicable laws of the State. C. The Seller is authorized to sell or otherwise dispose of its property as the interests of its residents require. D. The Purchaser, a joint exercise of powers authority organized and existing under the laws of the State, has been authorized pursuant to Section 6588(x) of the California Government Code to purchase the Proposition 1 A Receivable. E. The Seller is willing to sell, and the Purchaser is willing to purchase, the Proposition IA Receivable upon the terms specified in this Agreement. F. Pursuant to its Proposition IA Receivable Financing Program (the "Program"), the Purchaser will issue its bonds (the "Bonds") pursuant to an Indenture (the "Indenture"), between the Purchaser and Wells Fargo Bank, National Association, as trustee (the "Trustee"), and will use a portion of the proceeds thereof to purchase the Proposition IA Receivable from the Seller. G. The Purchaser will grant a security interest in such Proposition IA Receivable to the Trustee and each Credit Enhancer to secure the Bonds. AGREEMENT NOW, THEREFORE, in consideration of the above Recitals and the mutual covenants herein contained, the parties hereto hereby agree as follows: 1. Definitions and Interpretation. (a) For all purposes of this Agreement, except as otherwise expressly provided herein or unless the context otherwise requires, capitalized terms not otherwise defined herein shall have the meanings ascribed to such terms in Exhibit A attached hereto and which is incorporated by reference herein. (b) The words "hereof," "herein," "hereunder" and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement; section and exhibits references contained in this Agreement are references to sections and exhibits in or to this Agreement unless otherwise specified; and the term "including" shall mean "including without limitation." (c) Any agreement, instrument or statute defined or referred to herein or in any instrument or certificate delivered in connection herewith means such agreement, instrument or statute as from time to time may be amended, modified or supplemented and includes (in the case of agreements or instruments) references to all attachments and exhibits thereto and instruments incorporated therein; and any references to a Person are also to its permitted successors and assigns. 2. Agreement to Sell and Purchase; Conditions Precedent. (a) The Seller agrees to sell, and the Purchaser agrees to purchase, on the Closing Date, for an amount equal to the Purchase Price, all right, title and interest of the Seller in and to the "Proposition 1A receivable" as defined in Section 6585(g) of the California Government Code (the "Proposition 1A Receivable"), namely, the right to payment of moneys due or to become due to the Seller pursuant to Section 25.5(a)(1)(B)(iii) of Article XIII of the California Constitution and Section 100.06 of the California Revenue and Taxation Code. The Purchase Price shall be paid by the Purchaser to the Seller in two equal cash installment payments, without interest (each, an "Installment Payment" and, collectively, the "Installment Payments"), on January 15, 2010, and May 3, 2010 (each a "Payment Date" and, collectively, the "Payment Dates"). The Purchaser shall pay the Purchase Price by wire transfer pursuant to wire instructions provided by the Seller to the Trustee by e-mail to john.deleray@wellsfargo.com or by facsimile to 213-614-3355, Attention: John Deleray. If wire instructions are not provided to the Trustee (or if such wire instructions are invalid) payment will be made by check mailed to the Seller's Principal Place of Business. (b) The performance by the Purchaser of its obligations hereunder shall be conditioned upon: (i) Transaction Counsel receiving on or before the date the Bonds are sold (the "Pricing Date"), to be held in escrow until the Closing Date and then delivered to the Purchaser on the Closing Date, the following documents 2 duly executed by the Seller or its counsel, as applicable: (1) an opinion of counsel to the Seller dated the Pricing Date in substantially the form attached hereto as Exhibit BI, (2) certificates dated the Pricing Date in substantially the forms attached hereto as Exhibit Cl and Exhibit C2, (3) irrevocable instructions to the Controller dated as of the Closing Date in substantially the form attached hereto as Exhibit D, (4) this Agreement, (5) a certified copy of the resolution of the Seller's Tow -1 ('code l approving this Agreement, the transactions contemplated hereby and the documents attached hereto as exhibits, and (6) an escrow instruction letter in substantially the form attached hereto as Exhibit E; (ii) Transaction Counsel receiving on or before the Pricing Date, (1) a bringdown opinion of counsel to the Seller dated as of the Closing Date in substantially the form attached hereto as Exhibit B2, and (2) a bill of sale and bringdown certificate of the Seller (the "Bill of Sale") in substantially the form attached hereto as Exhibit C3; provided that the Purchaser may waive, in its sole discretion, the requirements of Section 2(b)(ii)(1); (iii) the Purchaser issuing Bonds in an amount which will be sufficient to pay the Purchase Price; and (iv) the receipt by the Purchaser of a certification of the County Auditor confirming the Initial Amount of the Proposition ]A Receivable pursuant to the Act. (c) The performance by the Seller of its obligations hereunder shall be conditioned solely upon the Purchaser's issuance of the Bonds its execution and delivery of this Agreement, pursuant to which it is legally obligated to pay the Installment Payments to the Seller on the Payment Dates as set forth in this Agreement, and no other act or omission on the part of the Purchaser or any other party shall excuse the Seller from performing its obligations hereunder. Seller specifically disclaims any right to rescind this Agreement, or to assert that title to the Proposition 1A Receivable has not passed to the Purchaser, should Purchaser fail to make Installment Payments in the requisite amounts on the Payment Dates. 3. Purchase Price, Conveyance of Proposition IA Receivable and Payment of Purchase Price. (a) Upon pricing of the Bonds by the Purchaser, the Purchaser will inform the Seller that it will pay the Purchase Price in Installment Payments on the Payment Dates. (b) In consideration of the Purchaser's agreement to pay and deliver to the Seller the Installment Payments on the Payment Dates, the Seller agrees to (i) transfer, grant, bargain, sell, assign, convey, set over and deliver to the Purchaser, absolutely and not as collateral security, without recourse except as expressly provided herein, and the Purchaser agrees to purchase, accept and receive, the Proposition 1 A Receivable, and (ii) assign to the Purchaser, to the extent permitted by law, all present or future rights, if any, of the Seller to enforce or cause the enforcement of payment of the Proposition 1A Receivable pursuant to the Act and other 3 applicable law. Such transfer, grant, bargain, sale, assignment, conveyance, set over and delivery is hereby expressly stated to be a sale and, pursuant to Section 6588.6(b) of the California Government Code, shall be treated as an absolute sale and transfer of the Proposition IA Receivable, and not as a grant of a security interest by the Seller to secure a borrowing. This is the statement referred to in Sections 6588.6(b) and (c) of the California Government Code. 4. Representations and Warranties of the Purchaser. The Purchaser represents and warrants to the Seller, as of the date hereof, as follows: (a) The Purchaser is duly organized, validly existing and in good standing under the laws of the State of California. (b) The Purchaser has full power and authority to enter into this Agreement and to perform its obligations hereunder and has duly authorized such purchase and assignment of the Proposition IA Receivable by the Purchaser by all necessary action. (c) Neither the execution and delivery by the Purchaser of this Agreement, nor the performance by the Purchaser of its obligations hereunder, shall conflict with or result in a breach or default under any of its organizational documents, any law, rule, regulation, judgment, order or decree to which it is subject or any agreement or instrument to which it is a party. (d) To the best of the knowledge of the Purchaser, no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, public board or body, is pending or threatened in any way against the Purchaser affecting the existence of the Purchaser or the titles of its commissioners or officers, or seeking to restrain or to enjoin the purchase of the Proposition IA Receivable or to direct the application of the proceeds of the purchase thereof, or in any way contesting or affecting the validity or enforceability of any of the Transaction Documents or any other applicable agreements or any action of the Purchaser contemplated by any of said documents, or in any way contesting the powers of the Purchaser or its authority with respect to the Transaction Documents to which it is a party or any other applicable agreement, or any action on the part of the Purchaser contemplated by the Transaction Documents, or in any way seeking to enjoin or restrain the Purchaser from purchasing the Proposition IA Receivable or which if determined adversely to the Purchaser would have an adverse effect upon the Purchaser's ability to purchase the Proposition IA Receivable, nor to the knowledge of the Purchaser is there any basis therefor. (e) This Agreement, and its execution, delivery and performance hereof have been duly authorized by it, and this Agreement has been duly executed and delivered by it and constitutes its valid and binding obligation enforceable against it in accordance with the terms hereof, subject to the effect of bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other similar laws relating to or affecting creditors' rights generally or the application of equitable principles in any proceeding, whether at law or in equity. (f) The Purchaser is a separate legal entity, acting solely through its authorized representatives, from the Seller, maintaining separate records, books of account, assets, bank accounts and funds, which are not and have not been commingled with those of the Seller. 4 (g) All approvals, consents, authorizations, elections and orders of or filings or registrations with any governmental authority, board, agency or commission having jurisdiction which would constitute a condition precedent to, or the absence of which would adversely affect, the purchase by the Purchaser of the Proposition IA Receivable or the performance by the Purchaser of its obligations under the Transaction Documents to which it is a party and any other applicable agreements, have been obtained and are in full force and effect. (h) Insofar as it would materially adversely affect the Purchaser's ability to enter into, carry out and perform its obligations under any or all of the Transaction Documents to which it is a party, or consummate the transactions contemplated by the same, the Purchaser is not in breach of or default under any applicable constitutional provision, law or administrative regulation of the State of California or the United States or any applicable judgment or decree or any loan agreement, indenture, bond, note, resolution, agreement or other instrument to which it is a party or to which it or any of its property or assets is otherwise subject, and, to the best of the knowledge of the Purchaser, no event has occurred and is continuing which with the passage of time or the giving of notice, or both, would constitute a default or an event of default under any such instrument, and the execution and delivery by the Purchaser of the Transaction Documents to which it is a party, and compliance by the Purchaser with the provisions thereof, under the circumstances contemplated thereby, do not and will not conflict with or constitute on the part of the Purchaser a breach of or default under any agreement or other instrument to which the Purchaser is a party or by which it is bound or any existing law, regulation, court order or consent decree to which the Purchaser is subject. 5. Representations and Warranties of the Seller. The Seller hereby represents and warrants to the Purchaser, as of the date hereof, as follows: (a) The Seller is a local agency within the meaning of Section 6585(f) of the California Government Code, with full power and authority to execute and deliver this Agreement and to carry out its terms. (b) The Seller has full power, authority and legal right to sell and assign the Proposition IA Receivable to the Purchaser and has duly authorized such sale and assignment to the Purchaser by all necessary action; and the execution, delivery and performance by the Seller of this Agreement has been duly authorized by the Seller by all necessary action. (c) This Agreement has been, and as of the Closing Date the Bill of Sale will have been, duly executed and delivered by the Seller and, assuming the due authorization, execution and delivery of this Agreement by the Purchaser, each of this Agreement and the Bill of Sale constitutes a legal, valid and binding obligation of the Seller enforceable in accordance with its terms, subject to the effect of bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other similar laws relating to or affecting creditors' rights generally or the application of equitable principles in any proceeding, whether at law or in equity. (d) All approvals, consents, authorizations, elections and orders of or filings or registrations with any governmental authority, board, agency or commission having jurisdiction which would constitute a condition precedent to, or the absence of which would adversely affect, the sale by the Seller of the Proposition IA Receivable or the performance by the Seller of its obligations under the Resolution and the Transaction Documents to which it is a party and any other applicable agreements, have been obtained and are in full force and effect. (e) Insofar as it would materially adversely affect the Seller's ability to enter into, carry out and perform its obligations under any or all of the Transaction Documents to which it is a party, or consummate the transactions contemplated by the same, the Seller is not in breach of or default under any applicable constitutional provision, law or administrative regulation of the State of California or the United States or any applicable judgment or decree or any loan agreement, indenture, bond, note, resolution, agreement or other instrument to which it is a party or to which it or any of its property or assets is otherwise subject, and, to the best of the knowledge of the Seller, no event has occurred and is continuing which with the passage of time or the giving of notice, or both, would constitute a default or an event of default under any such instrument, and the adoption of the Resolution and the execution and delivery by the Seller of the Transaction Documents to which it is a party, and compliance by the Seller with the provisions thereof, under the circumstances contemplated thereby, do not and will not conflict with or constitute on the part of the Seller a breach of or default under any agreement or other instrument to which the Seller is a party or by which it is bound or any existing law, regulation, court order or consent decree to which the Seller is subject. (f) To the best of the knowledge of the Seller, no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, public board or body, is pending or threatened in any way against the Seller affecting the existence of the Seller or the titles of its Council, members or officers to their respective offices, or seeking to restrain or to enjoin the sale of the Proposition IA Receivable or to direct the application of the proceeds of the sale thereof, or in any way contesting or affecting the validity or enforceability of any of the Transaction Documents or any other applicable agreements or any action of the Seller contemplated by any of said documents, or in any way contesting the powers of the Seller or its authority with respect to the Resolution or the Transaction Documents to which it is a party or any other applicable agreement, or any action on the part of the Seller contemplated by the Transaction Documents, or in any way seeking to enjoin or restrain the Seller from selling the Proposition IA Receivable or which if determined adversely to the Seller would have an adverse effect upon the Seller's ability to sell the Proposition lA Receivable, nor to the knowledge of the Seller is there any basis therefor. (g) Prior to the sale of the Proposition IA Receivable to the Purchaser, the Seller was the sole owner of the Proposition IA Receivable, and has such right, title and interest to the Proposition IA Receivable as provided in the Act. From and after the conveyance of the Proposition IA Receivable by the Seller to Purchaser on the Closing Date, the Seller shall have no right, title or interest in or to the Proposition IA Receivable. Except as provided in this Agreement, the Seller has not sold, transferred, assigned, set over or otherwise conveyed any right, title or interest of any kind whatsoever in all or any portion of the Proposition IA Receivable, nor has the Seller created, or to the best knowledge of the Seller permitted the creation of, any lien, pledge, security interest or any other encumbrance (a "Lien") thereon. Prior to the sale of the Proposition IA Receivable to the Purchaser, the Seller held title to the Proposition lA Receivable free and clear of any Liens. As of the Closing Date, this Agreement, together with the Bill of Sale, constitutes a valid and absolute sale to the Buyer of all of the Seller's right, title and interest in and to the Proposition IA Receivable. 6 (h) The Seller acts solely through its authorized officers or agents. (i) The Seller maintains records and books of account separate from those of the Purchaser. 0) The Seller maintains its respective assets separately from the assets of the Purchaser (including through the maintenance of separate bank accounts); the Seller's funds and assets, and records relating thereto, have not been and are not commingled with those of the Purchaser. W The Seller's principal place of business and chief executive office is located at +,I 101'. Main Sptreet. Los Gatos, California ,ic)~030. (1) The aggregate amount of the Installment Payments is reasonably equivalent value for the Proposition IA Receivable. The Seller acknowledges that the amount payable to or on behalf of the Purchaser by the State with respect to the Proposition IA Receivable will be in excess of the Purchase Price and the Initial Amount of the Proposition 1A Receivable and confirms that it has no claim to any such excess amount whatsoever. (m) The Seller does not act as an agent of the Purchaser in any capacity, but instead presents itself to the public as an entity separate from the Purchaser. (n) The Seller has not guaranteed and shall not guarantee the obligations of the Purchaser, nor shall it hold itself out or permit itself to be held out as having agreed to pay or as being liable for the debts of the Purchaser; and the Seller has not received nor shall the Seller accept any credit or financing from any Person who is relying upon the availability of the assets of the Purchaser in extending such credit or financing. The Seller has not purchased and shall not purchase any of the Bonds or any interest therein. (o) All transactions between or among the Seller, on the one hand, and the Purchaser on the other hand (including, without limitation, transactions governed by contracts for services and facilities, such as payroll, purchasing, accounting, legal and personnel services and office space), whether existing on the date hereof or entered into after the date hereof, shall be on terms and conditions (including, without limitation, terms relating to amounts to be paid thereunder) which are believed by each such party thereto to be both fair and reasonable and comparable to those available on an arms-length basis from Persons who are not affiliates. (p) The Seller has not, under the provisions of Section 100.06(b) of the California Revenue and Taxation Code, received a reduction for hardship or otherwise, nor has it requested, made arrangements for, or completed a reallocation or exchange with any other local agency, of the total amount of the ad valorem property tax revenue reduction allocated to the Seller pursuant to Section 100.06(a) of the California Revenue and Taxation Code. 6. Covenants of the Seller. (a) The Seller shall not take any action or omit to take any action which adversely affects the interests of the Purchaser in the Proposition IA Receivable and in the proceeds thereof. The Seller shall not take any action or omit to take any action that shall adversely affect 7 the ability of the Purchaser, and any assignee of the Purchaser, to receive payments of the Proposition IA Receivable. (b) The Seller shall not take any action or omit to take any action that would impair the validity or effectiveness of the Act, nor, without the prior written consent of the Purchaser or its assignees, agree to any amendment, modification, termination, waiver or surrender of, the terms of the Act, or waive timely performance or observance under the Act. Nothing in this agreement shall impose a duty on the Seller to seek to enforce the Act or to seek enforcement thereof by others, or to prevent others from modifying, terminating, discharging or impairing the validity or effectiveness of the Act. (c) Upon request of the Purchaser or its assignee, (i) the Seller shall execute and deliver such further instruments and do such further acts (including being named as a plaintiff in an appropriate proceeding) as may be reasonably necessary or proper to carry out more effectively the purposes and intent of this Agreement and the Act, and (ii) the Seller shall take all actions necessary to preserve, maintain and protect the title of the Purchaser to the Proposition 1 A Receivable. (d) On or before the Closing Date, the Seller shall send (or cause to be sent) an irrevocable instruction to the Controller pursuant to Section 6588.6(c) of California Government Code to cause the Controller to disburse all payments of the Proposition lA Receivable to the Trustee, together with notice of the sale of the Proposition ]A Receivable to the Purchaser and the assignment of all or a portion of such assets by the Purchaser to the Trustee. Such notice and instructions shall be in the form of Exhibit D hereto. The Seller shall not take any action to revoke or which would have the effect of revoking, in whole or in part, such instructions to the Controller. Upon sending such irrevocable instruction, the Seller shall have relinquished and waived any control over the Proposition IA Receivable, any authority to collect the Proposition lA Receivable, and any power to revoke or amend the instructions to the Controller contemplated by this paragraph. Except as provided in Section 2(c) of this Agreement, the Seller shall not rescind, amend or modify the instruction described in the first sentence of this paragraph. The Seller shall cooperate with the Purchaser or its assignee in giving instructions to the Controller if the Purchaser or its assignee transfers the Proposition ]A Receivable. In the event that the Seller receives any proceeds of the Proposition IA Receivable, the Seller shall hold the same in trust for the benefit of the Purchaser and the Trustee and each Credit Enhancer, as assignees of the Purchaser, and shall promptly remit the same to the Trustee. (e) The Seller hereby covenants and agrees that it will not at any time institute against the Purchaser, or join in instituting against the Purchaser, any bankruptcy, reorganization, arrangement, insolvency, liquidation, or similar proceeding under any United States or state bankruptcy or similar law. (f) The financial statements and books and records of the Seller prepared after the Closing Date shall reflect the separate existence of the Purchaser and the sale to the Purchaser of the Proposition IA Receivable. (g) The Seller shall treat the sale of the Proposition IA Receivable as a sale for regulatory and accounting purposes. 8 (h) From and after the date of this Agreement, the Seller shall not sell, transfer, assign, set over or otherwise convey any right, title or interest of any kind whatsoever in all or any portion of the Proposition IA Receivable, nor shall the Seller create, or to the knowledge of the Seller permit the creation of, any Lien thereon. 7. The Purchaser's Acknowledgment. The Purchaser acknowledges that the Proposition IA Receivable is not a debt or liability of the Seller, and that the Proposition IA Receivable is payable solely by the State from the funds of the State provided therefor. Consequently, neither the taxing power of the Seller, nor the full faith and credit thereof is pledged to the payment of the Proposition IA Receivable. No representation is made by the Seller concerning the obligation or ability of the State to make any payment of the Proposition IA Receivable pursuant to Section 100.06 of the Revenue and Taxation Code and Section 25.5 of Article XIII of the California Constitution, nor is any representation made with respect to the ability of the State to enact any change in the law applicable to the Transaction Documents (including without limitation Section 100.06 of the Revenue and Taxation Code or Section 6588.6 of the Government Code). The Purchaser acknowledges that the Seller has no obligation with respect to any offering document or disclosure related to the Bonds. 8. Notices of Breach. (a) Upon discovery by the Seller or the Purchaser that the Seller or Purchaser has breached any of its covenants or that any of the representations or warranties of the Seller or the Purchaser are materially false or misleading, in a manner that materially and adversely affects the value of the Proposition I A Receivable or the Purchase Price thereof, the discovering party shall give prompt written notice thereof to the other party and to the Trustee, as assignee of the Purchaser, who shall, pursuant to the Indenture, promptly thereafter notify each Credit Enhancer and the Rating Agencies. (b) The Seller shall not be liable to the Purchaser, the Trustee, the holders of the Bonds, or any Credit Enhancer for any loss, cost or expense resulting from the failure of the Trustee, any Credit Enhancer or the Purchaser to promptly notify the Seller upon the discovery by an authorized officer of the Trustee, any Credit Enhancer or the Purchaser of a breach of any covenant or any materially false or misleading representation or warranty contained herein. 9. Liability of Seller, Indemnification. The Seller shall be liable in accordance herewith only to the extent of the obligations specifically undertaken by the Seller under this Agreement. The Seller shall indemnify, defend and hold harmless the Purchaser, the Trustee and each Credit Enhancer, as assignees of the Purchaser, and their respective officers, directors, employees and agents from and against any and all costs, expenses, losses, claims, damages and liabilities to the extent that such cost, expense, loss, claim, damage or liability arose out of, or was imposed upon any such Person by the Seller's breach of any of its covenants contained herein or any materially false or misleading representation or warranty of the Seller contained herein. Notwithstanding anything to the contrary herein, the Seller shall have no liability for the payment of the principal of or interest on the Bonds issued by the Purchaser. 9 10. Limitation on Liabilitv. (a) The Seller and any officer or employee or agent of the Seller may rely in good faith on the advice of counsel or on any document of any kind, prima facie properly executed and submitted by any Person respecting any matters arising hereunder. The Seller shall not be under any obligation to appear in, prosecute or defend any legal action regarding the Act that is unrelated to its specific obligations under this Agreement. (b) No officer or employee of the Seller shall have any liability for the representations, warranties, covenants, agreements or other obligations of the Seller hereunder or in any of the certificates, notices or agreements delivered pursuant hereto, as to all of which recourse shall be had solely to the assets of the Seller. 11. The Seller's Acknowledgment. The Seller hereby agrees and acknowledges that the Purchaser intends to assign and grant a security interest in all or a portion of (a) its rights hereunder and (b) the Proposition JA Receivable, to the Trustee and each Credit Enhancer pursuant to the Indenture. The Seller further agrees and acknowledges that the Trustee, the holders of the Bonds, and each Credit Enhancer have relied and shall continue to rely upon each of the foregoing representations, warranties and covenants, and further agrees that such Persons are entitled so to rely thereon. Each of the above representations, warranties and covenants shall survive any assignment and grant of a security interest in all or a portion of this Agreement or the Proposition I A Receivable to the Trustee and each Credit Enhancer and shall continue in full force and effect, notwithstanding any subsequent termination of this Agreement and the other Transaction Documents. The above representations, warranties and covenants shall inure to the benefit of the Trustee and each Credit Enhancer. 12. Notices. All demands upon or, notices and communications to, the Seller, the Purchaser, the Trustee or the Rating Agencies under this Agreement shall be in writing, personally delivered or mailed by certified mail, return receipt requested, to such party at the appropriate notice address, and shall be deemed to have been duly given upon receipt. 13. Amendments. This Agreement may be amended by the Seller and the Purchaser, with (a) the consent of the Trustee, (b) the consent of each Credit Enhancer, and (c) a Rating Agency Confirmation, but without the consent of any of the holders of the Bonds, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement. Promptly after the execution of any such amendment, the Purchaser shall furnish written notification of the substance of such amendment to the Trustee and to the Rating Agencies. 14. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Seller, the Purchaser and their respective successors and permitted assigns. The Seller may not assign or transfer any of its rights or obligations under this Agreement without the prior written consent of the Purchaser. Except as specified herein, the Purchaser may not assign or transfer any of its rights or obligations under this Agreement without the prior written consent of the Seller. 10 15. Third Party Rights. The Trustee and each Credit Enhancer are express and intended third party beneficiaries under this Agreement. Nothing expressed in or to be implied from this Agreement is intended to give, or shall be construed to give, any Person, other than the parties hereto, the Trustee, and each Credit Enhancer, and their permitted successors and assigns hereunder, any benefit or legal or equitable right, remedy or claim under or by virtue of this Agreement or under or by virtue of any provision herein. 16. Partial Invalidity. If at any time any provision of this Agreement is or becomes illegal, invalid or unenforceable in any respect under the law of any jurisdiction, neither the legality, validity or enforceability of the remaining provisions of this Agreement nor the legality, validity or enforceability of such provision under the law of any other jurisdiction shall in any way be affected or impaired thereby. 17. Counterparts. This Agreement may be executed in any number of identical counterparts, any set of which signed by all the parties hereto shall be deemed to constitute a complete, executed original for all purposes. 18. Entire Agreement. This Agreement sets forth the entire understanding and agreement of the parties with respect to the subject matter hereof and supersedes any and all oral or written agreements or understandings between the parties as to the subject matter hereof. 11 19. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California. IN WITNESS WHEREOF, the Seller and the Purchaser have caused this Agreement to be duly executed as of the date first written above. TOWN OF LOS GATQS!, as Seller By: Authorized Officer CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY, as Purchaser By: Authorized Signatory 12 EXHIBIT A DEFINITIONS For all purposes of this Agreement, except as otherwise expressly provided herein or unless the context otherwise requires, capitalized terms not otherwise defined herein shall have the meanings set forth below. "Act" means Chapter 14XXXX of the California Statutes of 2009 (Assembly Bill No. 15), as amended. "Bill of Sale" has the meaning given to that term in Section 2(b)(ii) hereof. "Closing Date" means the date on which the Bonds are issued. The Closing Date is expected to be November 19, 2009, but the Purchaser may change the Closing Date by providing e-mail notification to 'sc onway aLwo, gosca.-ov not later than one day prior to the Closing Date. "Controller" means the Controller of the State. "County Auditor" means the auditor or auditor-controller of the county within which the Seller is located. "Credit Enhancer" means any municipal bond insurance company, bank or other financial institution or organization which is performing in all material respects its obligations under any Credit Support Instrument for some or all of the Bonds. "Credit Support Instrument" means a policy of insurance, a letter of credit, a stand-by purchase agreement, a revolving credit agreement or other credit arrangement pursuant to which a Credit Enhancer provides credit or liquidity support with respect to the payment of interest, principal or purchase price of the Bonds. "Initial Amount" means, with respect to the Proposition IA Receivable, the amount of property tax revenue reallocated away from the Seller pursuant to the provisions of Section 100.06 of the Revenue and Taxation Code, as certified by the County Auditor pursuant to the Act. "Installment Payments" have the meaning set forth in Section 2(a). "Payment Dates" have the meaning set forth in Section 2(a). "Pricing Date" means the date on which the Bonds are sold. The Pricing Date is expected to be November 10. 2009.. but the Purchaser may change the Pricing Date by providing e-mail notification to sconway~Iosgatosca.gov not later than one day prior to the Pricing Date. "Principal Place of Business" means, with respect to the Seller, the location of the Seller's principal place of business and chief executive office located at ) 1 O.F,. Alain Street, ~L©s 'Gatos,, (_'aliforn,i 195030. A-1 "Proposition IA Receivable" has the meaning set forth in Section 2(a). "Purchase Price" means an amount equal to the Initial Amount. "Rating Agency" means any nationally recognized rating agency then providing or maintaining a rating on the Bonds at the request of the Purchaser. "Rating Agency Confirmation" means written confirmation from each Rating Agency that any proposed action will not, in and of itself, cause the Rating Agency to lower, suspend or withdraw the rating then assigned by such Rating Agency to any Bonds. "Resolution" means the resolution adopted by the -own `c'ouncil approving the sale of the Proposition IA Receivable. "State" means the State of California. "Transaction Counsel" means Orrick, Herrington & Sutcliffe LLP. "Transaction Documents" mean this Agreement, the Bill of Sale, the Indenture, the Bonds and the Irrevocable Instructions For Disbursement of Proposition IA Receivable of Town of Los Gatos,, dated as of the Closing Date. A-2 EXHIBIT B1 OPINION OF COUNSEL to TOWN OF LOS GATOS Dated: Pricing Date California Statewide Communities Development Authority Sacramento, California Wells Fargo Bank, National Association Los Angeles, California Re: Sale of Proposition IA Receivable Ladies & Gentlemen: [I have/This Office has] acted as counsel for the l'mvn of Los Gatos (the "Seller") in connection with the adoption of that certain resolution (the "Resolution") of the To« n GOLD ci of the Seller (the "Governing Body") pursuant to which the Seller authorized the sale to the California Statewide Communities Development Authority (the "Purchaser") of the Seller's "Proposition IA Receivable", as defined in and pursuant to the Purchase and Sale Agreement dated as of November 1, 2009 (the "Sale Agreement") between the Seller and the Purchaser. In connection with these transactions, the Seller has issued certain Irrevocable Instructions For Disbursement of the Seller's Proposition IA Receivable to the Controller of the State of California (the "Disbursement Instructions") and a Bill of Sale and Bringdown Certificate of the Seller (the "Bill of Sale" and, collectively with the Sale Agreement and the Disbursement Instructions, the "Seller Documents"). Unless the context otherwise requires, capitalized terms used but not otherwise defined herein shall have the meanings given to such terms in the Sale Agreement. [I/We] have examined and are familiar with the Seller Documents and with those documents relating to the existence, organization, and operation of the Seller, the adoption of the Resolution, and the execution of the Seller Documents, and have satisfied ourselves as to such other matters as [1/we] deem necessary in order to render the following opinions. As to paragraphs numbered 3 and 4 below, [1/we] have relied as to factual matters on the representations and warranties of the Seller contained in the Sale Agreement. Based upon the foregoing, and subject to the limitations and qualifications set forth herein, [1/we] are of the opinion that: B1-I 1. The Seller is a local agency, within the meaning of Section 6585(f) of the California Government Code. The Governing Body is the governing body of the Seller. 2. The Resolution was duly adopted at a meeting of the Governing Body, which was called and held pursuant to law and with all public notice required by law, and at which a quorum was present and acting throughout, and the Resolution is in full force and effect and has not been modified, amended or rescinded since the date of its adoption. 3. To the best of [my/our] knowledge, no action, suit, proceeding, inquiry or investigation, at law or in equity, before or by any court, public board or body, is pending or threatened in any way against the Seller (i) affecting the existence of the Seller or the titles of its Governing Body members or officers to their respective offices; (ii) seeking to restrain or to enjoin the sale of the Proposition 1 A Receivable or to direct the application of the proceeds of the sale thereof, or materially adversely affecting the sale of the Proposition IA Receivable; (iii) in any way contesting or affecting the validity or enforceability of the Resolution, Seller Documents or any other applicable agreements or any action of the Seller contemplated by any of said documents; or (iv) in any way contesting the powers of the Seller or its authority with respect to the Resolution or the Seller Documents or any other applicable agreement, or any action on the part of the Seller contemplated by any of said documents. 4. To the best of [my/our] knowledge, prior to the sale of the Proposition IA Receivable to the Purchaser, the Seller had not sold, transferred, assigned, set over or otherwise conveyed any right, title or interest of any kind whatsoever in all or any portion of the Seller's Proposition lA Receivable, nor had the Seller created, or permitted the creation of, any Lien thereon. 5. The Seller has duly authorized and executed the Seller Documents and, assuming the due authorization execution and delivery of the Sale Agreement by the Purchaser, each Seller Document will be legal, valid and binding against the Seller and enforceable against the Seller in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or laws relating to or affecting creditors' rights, and the application of equitable principles and the exercise of judicial discretion in appropriate areas. No opinion is expressed concerning the obligation or ability of the State of California to make any payment of the Proposition 1A Receivable pursuant to Section 100.06 of the Revenue and Taxation Code and Section 25.5 of Article XIII of the California Constitution, nor is any opinion expressed with respect to the ability of the State to enact any change in the law applicable to the Seller Documents (including, without limitation, Section 100.06 of the Revenue and Taxation Code or Section 6588.6 of the Government Code). Furthermore, [1/we] express no opinion as to the value of the Proposition IA Receivable or as to any legal or equitable remedies that may be available to any person should the Proposition IA Receivable have little or no value. No opinion is expressed with respect to the sale of Bonds by the Purchaser. B 1-2 The legal opinion set forth herein is intended for the information solely of the addressees hereof and for the purposes contemplated by the Sale Agreement. The addressees may not rely on it in connection with any transactions other than those described herein, and it is not to be relied upon by any other person or entity, or for any other purpose, or quoted as a whole or in part, or otherwise referred to, in any document, or to be filed with any governmental or administrative agency other than the Purchaser or with any other person or entity for any purpose without [my/our] prior written consent. In addition to the addressees hereof, each Credit Enhancer and the underwriters of the Bonds may rely upon this legal opinion as if it were addressed to them. [I/We] do not undertake to advise you of matters that may come to [my/our] attention subsequent to the date hereof that may affect the opinions expressed herein. Very truly yours, By: Seller's Counsel B1-3 EXHIBIT B2 OPINION OF COUNSEL to TOWN OF LOS GATOS Dated: Closing Date California Statewide Communities Development Authority Sacramento, California Wells Fargo Bank, National Association Los Angeles, California Re: Sale of Proposition IA Receivable (Bringdown Opinion) Ladies & Gentlemen: Pursuant to that certain Purchase and Sale Agreement dated as of November 1, 2009 (the "Sale Agreement") between the ;,mvn of Los Gatos (the "Seller") and the California Statewide Communities Development Authority (the "Purchaser"), this Office delivered an opinion (the "Opinion") dated the Pricing Date as counsel for the Seller in connection with the sale of the Seller's Proposition IA Receivable (as defined in the Sale Agreement), the execution of documents related thereto and certain other related matters. Capitalized terms used but not defined herein shall have the meanings given to such terms in the Sale Agreement. I confirm that you may continue to rely upon the Opinion as if it were dated as of the date hereof. Each Credit Enhancer and the underwriters of the Bonds may rely upon this legal opinion as if it were addressed to them. This letter is delivered to you pursuant to Section 2(b)(ii)(1) of the Sale Agreement. Very truly yours, By: Seller's Counsel B2-1 EXHIBIT C1 CLERK'S CERTIFICATE CERTIFICATE OF THE GI,I?IZK i1 IM-11NIS I'IZATOR OF TOWN OF LOS GATOS, CALIFORNIA Dated: Pricing Date The undersigned Clerk A(Iminist►atoi; of the TOW1I of Los Gatos (the "Seller"), a local agency of the State of California within the meaning oI' Section 6585(f) of the California Government Code, does hereby certify that the fore`,oing is a full, true and correct copy of Resolution No. duly adopted at a r~gulat meeting of the Town C'ounct,( of said Seller duly and legally held at the regular meeting place thereof on thc day of 2009, of which meeting all of the members of said Town L ouiic had due notice and at which a quorum was present and acting throughout, and that at said meeting said resolution was adopted by the following vote: AYES: NOES: ABSENT: ABSTAIN: I do hereby further certify that I have carefully compared the same with the original minutes of said meeting on file and of record in my office and that said resolution is a full, true and correct copy of the original resolution adopted at said meeting and entered in said minutes and that said resolution has not been amended, modified or rescinded since the date of its adoption and the same is now in full force and effect. I do hereby further certify that an agenda of said meeting was posted at least 72 hours before said meeting at a location in the City of Los Gatos, California freely accessible to members of the public, and a brief general description of said resolution appeared on said agenda. Capitalized terms used but not defined herein shall have the meanings given to such terms in the Purchase and Sale Agreement, dated as of November 1, 2009, between the Seller and the California Statewide Communities Development Authority. WITNESS by my hand as of the Pricing Date. By: Clerk Admints~rotor of the T()wn of Los Gabs, California CM EXHIBIT C2 SELLER CERTIFICATE SELLER CERTIFICATE Dated: Pricing Date We, the undersigned officers of the TTomi of Lqs Gatos (the "Seller"), a local agency of the State of California within the meaning of Section 6585(f) of the California Government Code, holding the respective offices herein below set opposite our signatures, do hereby certify that on the date hereof the following documents (the "Seller Transaction Documents") were officially executed and delivered by the Authorized Officer or Officers whose names appear on the executed copies thereof, to wit: Document 1. Purchase and Sale Agreement, dated as of November 1, 2009 (the "Sale Agreement"), between the Seller and the California Statewide Communities Development Authority (the "Purchaser"). 2. Irrevocable Instructions For Disbursement of Seller's Proposition IA Receivable to the Controller of the State of California, dated the Closing Date. 3. Bill of Sale, dated the Closing Date. Capitalized terms used herein and not defined herein shall have the meaning given such terms in the Sale Agreement. We further certify as follows: 1. At the time of signing the Seller Transaction Documents and the other documents and opinions related thereto, we held said offices, respectively, and we now hold the same. 2. The representations and warranties of the Seller contained in the Seller Transaction Documents are true and correct as of the date hereof in all material respects. 3. The foci n Gouneil duly adopted its resolution (the "Resolution") approving the sale of the Seller's Proposition I A Receivable at a meeting of the f own ~ouncl which was duly called and held pursuant to law with all public notice required by law and at which a quorum was present and acting when the Resolution was adopted, and such Resolution is in full force and effect and has not been amended, modified, supplemented or rescinded. C2-1 Name, Official Title Signature Stephen ColimaN', Financc Direct r C ennv Ha111VaIl r, ;Assistant hinance Director Pamela Jacobs, assistant To\%n Manager genuine. I HEREBY CERTIFY that the signatures of the officers named above are Dated: Pricing Date By: Clerk Adnlimstra.tor of the iFowii of Los C4atc , California C2-2 EXHIBIT C3 BILL OF SALE AND BRINGDOWN CERTIFICATE BILL OF SALE AND BRINGDOWN CERTIFICATE Pursuant to terms and conditions of the Purchase and Sale Agreement (the "Sale Agreement"), dated as of November 1, 2009, between the undersigned (the "Seller") and the California Statewide Communities Development Authority (the "Purchaser"), and in consideration of the obligation of the Purchaser to pay and deliver to the Seller the Purchase Price (as defined in the Sale Agreement), in two equal installment payments to be made on January 15, 2010, and May 3, 2010 (collectively, the "Payment Dates"), the Seller does hereby (a) transfer, grant, bargain, sell, assign, convey, set over and deliver to the Purchaser, absolutely and not as collateral security, without recourse except as expressly provided in the Sale Agreement, the Proposition IA Receivable as defined in the Sale Agreement (the "Proposition IA Receivable"), and (b) assign to the Purchaser, to the extent permitted by law (as to which no representation is made), all present or future rights, if any, of the Seller to enforce or cause the enforcement of payment of the Proposition IA Receivable pursuant to the Act and other applicable law. Such transfer, grant, bargain, sale, assignment, conveyance, set over and delivery is hereby expressly stated to be a sale and, pursuant to Section 6588.6(b) of the California Government Code, shall be treated as an absolute sale and transfer of the Proposition IA Receivable, and not as a grant of a security interest by the Seller to secure a borrowing. Seller specifically disclaims any right to rescind the Agreement, or to assert that title to the Proposition IA Receivable has not passed to the Purchaser, should Purchaser fail to make the installment payments in the requisite amounts on the Payment Dates. The Seller hereby certifies that the representations and warranties of the Seller set forth in the Certificate of the Clcrk AcJmni strato► dated the Pricing Date, the Seller Certificate dated dated the Pricing Date and in the Transaction Documents to which the Seller is a party are true and correct in all material respects as of the date hereof (except for such representations and warranties made as of a specified date, which are true and correct as of such date). Capitalized terms used but not defined herein shall have the meanings given to such terms in the Sale Agreement. Dated: Closing Date TOUT OF LOS Gr1 ros, By: Authorized Officer C3-1 EXHIBIT D IRREVOCABLE INSTRUCTIONS TO CONTROLLER IRREVOCABLE INSTRUCTIONS FOR DISBURSEMENT OF PROPOSITION 1A RECEIVABLE OF TOWN OF l.c )S G:~ I OS Dated: Closing Date Office of the Controller State of California P.O. Box 942850 Sacramento, California 94250-5872 Re: Notice of Sale of Proposition IA Receivable by the To" n of Los Gatos, and Wiring Instructions Information Form Dear Sir or Madam: Pursuant to Section 6588.6(c) of the California Government Code, "Towq of Lo GtALos; (the "Seller") hereby notifies you of the sale by Seller, effective as of the date of these instructions written above, of all right, title and interest of the Seller in and to the "Proposition IA Receivable" as defined in Section 6585(g) of the California Government Code (the "Proposition IA Receivable"), namely, the right to payment of moneys due or to become due to the Seller pursuant to Section 25.5(a)(1)(B)(iii) of Article XIII of the California Constitution and Section 100.06 of the California Revenue and Taxation Code. By resolution, the Seller's Tc)wn Cogilcil, authorized the sale of the Proposition IA Receivable to the California Statewide Communities Development Authority (the "Purchaser") pursuant to a Purchase and Sale Agreement, dated as of November 1, 2009 (the "Purchase and Sale Agreement") and a Bill of Sale, dated the Closing Date (as defined in the Purchase and Sale Agreement). The Proposition IA Receivable has been pledged and assigned by the Purchaser pursuant to an Indenture, dated as of November 1, 2009 (the "Indenture") between the Purchaser and Wells Fargo Bank, National Association, as Trustee (the "Trustee"). The Seller hereby irrevocably requests and directs that, commencing as of the date of these instructions written above, all payments of the Proposition IA Receivable (and documentation related thereto) be made directly to Wells Fargo Bank, National Association, as Trustee, in accordance with the wire instructions and bank routing information set forth below. Please note that the sale of the Proposition lA Receivable by the Seller is irrevocable and that: (i) the Seller has no power to revoke or amend these instructions at any time, (ii) the Purchaser shall have the power to revoke or amend these instructions only if there are no notes of the Purchaser outstanding under the Indenture and the Indenture has been discharged, and (iii) so long as the Indenture has not been discharged, these instructions cannot be revoked or amended by the Purchaser without the consent of the Trustee. Should D-1 the Purchaser, however, deliver a written notice to the Office of the Controller stating that: (a) the Seller failed to meet the requirements set forth in the Purchase and Sale Agreement, (b) the Purchaser has not waived such requirements, and (c) the Purchaser has not purchased the Proposition IA Receivable as a result of the circumstances described in (a) and (b) above, then these instructions shall be automatically rescinded and the Seller shall again be entitled to receive all payment of moneys due or to become due to the Seller pursuant to Section 25.5(a)(1)(B)(iii) of Article XIII of the California Constitution and Section 100.06 of the California Revenue and Taxation Code. Bank Name: Wells Fargo Bank, N.A. Bank ABA Routing 121000248 Bank Account 0001038377 Bank Account Name: Corporate Trust Clearing Further Credit To: CSCDA Proposition IA Bonds Bank Address: 707 Wilshire Blvd., 17th Floor MAC E2818-176 Los Angeles, CA 90017 Bank Telephone (213) 614-3353 Bank Contact Person: Robert Schneider Please do not hesitate to call the undersigned if you have any questions regarding this transaction. Thank you for your assistance in this matter. Very truly yours, ,TOWN OF 1.OS GATOS By: Authorized Officer D-2 EXHIBIT E ESCROW INSTRUCTION LETTER ESCROW INSTRUCTION LETTER 2009 California Statewide Communities Development Authority 1100 K Street Sacramento, CA 95814 Re: Proposition IA Receivable Financin Dear Sir or Madam: The l'ovvn oI' Los Gatos (the "Seller") hereby notifies you of its agreement to participate in the California Statewide Communities Development Authority Proposition JA Receivable Financing. By adoption of a resolution (the "Resolution") authorizing the sale of its Proposition 1A Receivable, the Seller's 't'own C OLfjlcil has agreed to sell to the California Statewide Communities Development Authority (the "Purchaser"), for a purchase price that meets the conditions set forth in the Resolution, all of its right, title and interest in the Proposition IA Receivable. Enclosed herewith are the following documents which have been duly approved and executed by the Seller and which are to be held in escrow by Orrick, Herrington & Sutcliffe LLP, as transaction counsel ("Transaction Counsel"), as instructed below: 1. certified copy of the Resolution, together with a certificate of the Glerl Administrator, dated the Pricing Date; 2. the Seller Certificate, dated the Pricing Date; 3. the Opinion of Seller's Counsel, dated the Pricing Date; 4. the Opinion of Seller's Counsel (bringdown opinion), dated the Closing Date; 5. the Purchase and Sale Agreement, dated as of November 1, 2009; 6. the Bill of Sale and Bringdown Certificate, dated the Closing Date; and 7. the Irrevocable Instructions to Controller, dated the Closing Date. The foregoing documents are to be held in escrow by Transaction Counsel and shall be delivered on the Closing Date (as defined in the Purchase and Sale Agreement), provided that such Closing Date occurs on or before December 31, 2009. E-1 Should (i) the Closing Date not occur on or berfore December 31, 2009, or (ii) Transaction Counsel receive prior to the Closing Date written notification from Seller or Seller's Counsel stating, respectively and in good faith, that the representations made in the Seller's Certificate are not true and accurate, or the opinions set forth in the Opinion of Seller's Counsel are not valid, in each case as of the Closing Date and provided that the Purchaser may, in its sole discretion, choose to waive receipt of such representations or opinions, then this agreement shall terminate and Transaction Counsel shall destroy all of the enclosed documents. Very truly yours, TOWN,OF LOS GA'I'OS, By: Authorized Officer Enclosures cc: Orrick, Herrington & Sutcliffe LLP E-2 MEETING DATE: 10/19/09 °W N ~ITEM NO. COUNCIL AGENDA REPORT OS GAtO DATE: October 14, 2009 TO: MAYOR AND TOWN COUNCIL FROM: GREG LARSON TOWN MANAGER SUBJECT: INVESTMENT REPORTS FOR FIRST FISCAL QUARTER 09/10 (JULY THROUGH SEPTEMBER 2009) RECOMMENDATION: Accept reports as attached. DISCUSSION: Attached for your review and acceptance are the Investment reports for the first quarter of the current fiscal year 09/10. Investment returns are being affected by the overall general interest rate environment which is experience historic low yields. During the first quarter of FY 2009/10 the Town's weighted average interest rates declined slightly. As is usual for this time of year, treasurer's funds declined due to payment of the RDA pass-through amounts and the acquisition of property approved by council. Treasurer's funds should increase again with the receipt of property taxes in the second quarter. ENVIRONMENTAL ASSESSMENT: Is not a project defined under CEQA, and no further action is required. FISCAL IMPACT: None Attachments: Investment reports for the first fiscal quarter (July through September 2009). PREPARED BY: VE C AY Finance & dministrative Services Director/ Town Treasurer Reviewed by: -Town Manager Assistant Town Manager d)VI Town Attorney ClerkFinance Community Development Revised: 10/14/09 1:21 pm Reformatted: 5/30/02 Town of Los Gatos Investment Report for the month ended September 30, 2009 Prepared by Linda L. Speicher, Project Manager 010/14/09 A Town of Los Gatos Summary Investment Information September 30, 2009 Weighted Average Portfolio Yield: 2.11% Weighted Average Maturity (days) 371 This Month Last Month One Year ago Portfolio Balance $73,931,975 $75,673,488 $70,635,879 Benchmarks/ References: Town's Average Yield 2.11% 2.14% 3.64% LAIF Yield for month 0.70% 0.93% 2.77%0 3 mo. Treasury 0.12% 0.15% 1.18% 6 mo. Treasury 0.19% 0.24% 1.57% 2 yr. Treasury 1.03% 1.11% 2.12% 5 yr. Treasury (most recent) 2.47% 2.49% 3.13% Prime rate 3.25% 3.25% 5.00% Most recent auctions of Freddie Mac or Fannie Mae Reference Notes: 3 yr. Freddie Mac (09/25/09) 2.10% 2 yr. Fannie Mae (04/09/09) 1.50% Compliance: The Town's investments are in compliance with the Town's investment policy dated May 1, 2008 and also in compliance with the requirements of Section 53601 of the California State Code. Based on the information available, the Town has sufficient funds to meet the cash demands for the next six months. Page 1 Town of Los Gatos Portfolio Allocation & Treasurer's rind Balances September 30, 2009 Month YTD Fiend Balances - Beginning of Month/Period $75,673,488,49 $85,021,578.85 Receipts 1,424,655.75 5,423,894.14 Disharsements (3,166,169.29) (16.513.498.04) Fluid Balances - End of MonMeriod $73,931,974.95 $73,931,974.95 Portfolio Allocation; Union MM $87,781.78 US Govt Agencies 44,032,732.04 Local Agency Investment Fund 28,468,836.13 Subtotal - Investments 72,589,349.95 Reconciled Demand Deposit Balances 1,342,625.00 TotalTreastuer's Fund $73,931,974.95 Portfolio Investment Allocation Union MM 0.1% /f{{{{{{~/„frfi{ Local Agency Investment Fund {{{{{{/j{{{{/f., f/f{{{/j{ if ff 39.2% i ! ~ f{f 1f{ f!{{f{{ffflllff%%!~i'% r/%f~%/f% ~ f /f lJJ%%%fl%f%%~1!lllflJFf ~!%!f~{{{{ f/ { {{{{f{fi Treasury, Agencies, & Corp, Notes 57.8% page 2 Town of Los Gatos Non-Treasury Restricted Fund Balances September 30, 2009 Previous Balance Deposits Non-Treasury Funds: Downtown Parking District 12/20/02 Certificates of Participation Reserve Fund (Lot 4) Cert, of Participation Lease Payment Fund (Lot 4) Cert, of Participation 2002 Series A Const. Fund Cert, of Participation 2002 Series A Reserve Fund Cert. Of Participation 2002 Series A Interest Fund Cert. Of Participation 2002 Series A COI Fund Total Restricted Funds: Ending Interest Withdrawals Balance $275,855,97 $380.07 $276,236.04 Note 1 254,136.26 0,00 254,136.26 Note2 21,534.06 20,618.19 0.00 42,152.25 Note3 144,937.57 0.00 144,937.57 Note 4 686,251,00 5.85 5,85 686251,00 Note4 0.00 0.26 0.26 0,00 Note 4 0.00 0.00 0.00 0.00 Note 4 $1,382,714.86 $20,618.19 $386.18 $6.11 $1,403,713.12 These accounts are not part of the Treasurer's fund balances reported elsewhere in this report, as they are for separate and distinct entities. Note 1: This account include redemption accounts set up for the repayment of interest and principal on outstanding bond coupons for Parking Assessment District'3', as well as Reserve Funds set up as required by the original Bond resolution. Note 2: The reserve fund was a requirement of the original certificates of participation agreement when Lot 4 was built. It helps to guarantee payment of the lease payments should the Town not make payment. Note 3: The lease payment fund receives the lease payments from the Town monthly for the lease of Lot 4. It holds the funds until payments on the certificates of participation are due semi-annually. Note 4: The three funds for the Certificates of Participation 2002 Series A consist of construction funds which will be expended over the next few years, reserve funds which will guarantee the payment of lease payments, and a third fund for the disbursement of lease payments and initial delivery costs. Page 3 Town of Los Gatos Statement of Interest Earned September 30, 2009 Current Fiscal Month Year to Date Interest received from Investments Add: Interest accrued at end of period (see page 5) Less: Interest accrued at beginning of period Interest earned on investments July 2009 August 2009 September 2009 October 2009 November 2009 December 2009 January 2010 February 2010 March 2010 April 2010 May 2010 June 2010 $83,405.65 $518,212.93 357,344.90 357,344.90 (314,967.46) (474,569.94) $125,783.09 $400,987.89 400,987.89 137,073.40 138,131.40 125,783.09 Page 4 Town of Los Gatos Inactive Deposits by Instituti on Market to Cost Position Report September 30, 2009 Deposit Amortized Maturity Days Days to Days Yield to Interest Interest Interest histitution Securi Date Cost Date Elapse Maturi Invested Maturi Earned Received Accrued USTreasury Note 11/17/06 748,066.41 11/15/09 1048 46 1094 4.734% 101,680.30 86,527.11 15,153.19 USTreasury Note 06/02/08 1,514,941.41 12/31/09 485 92 577 2.602% 52,378.37 52,500.00 (121,63) FHLMC Coupon Note 06114105 299,331.00 01/25/10 1569 117 1686 4.431% 57,014.26 53,994.79 3,019.47 ML Corp Corporate Note 04/10/07 976,150.00 02/08/10 904 131 1035 5.165% 124,871.25 98,930.56 25,940.69 USTreasury Note 06/24/08 739,921.88 02/28/10 463 151 614 2.819% 26,458.73 17,771.74 8,686.99 USTreasury Note 10119106 976,406.25 04/15/10 1077 197 1274 4.744%0 136,677.83 99,560.44 37,117.39 FHLB Coupon Note 08/22/06 1,507,665.00 06111110 1135 254 1389 4.957% 232,394.99 214,500.00 17,894.99 FHLB CoupouNote 01/12/07 1,487,205.00 08/10/10 992 314 1306 4.960% 200,480.12 181,733.33 18,746.79 FHLB CoupouNote 03/23/09 1,049,400.00 08/16/10 191 320 511 1.284% 7,050.93 19,229.17 (12,178.24) USTreasury Note 05/31/07 737,226.56 10115110 853 380 1233 4.801% 82,715.87 59,743.85 22,972.02 FFCB Coupon Note 12/07/07 2,032,140.00 11/08/10 663 404 1067 3.715% 137,130.20 122,072.22 15,057.98 FHLB Coupon Note 03/23/09 1,040,160.00 12/10/10 191 436 627 1.485% 8,082.90 8,180.56 (97.66) FFCB Coupon Note 01/18/07 756,922.50 01/18/11 986 475 1461 3.175% 64,920.10 39,375.00 25,545.10 FFCB Coupon Note 11/28/07 2,062,000.00 02/18/11 672 506 1178 3.840% 145,779.45 167,916.67 (22,137.22) USTreasury Note 06/12/09 1,987,187.50 03/31/11 110 547 657 0,875% 5,240.19 5,259.56 (19,37) FNMA Coupon Note 09/29/06 1,516,485.00 04/15/11 1097 562 1659 4.874% 222,145.44 195,604.17 26,541,27 FHLB Coupon Note 06/08/09 1,988,018.60 06/03/11 114 611 725 1.432% 8,891.51 8,891.51 FHLMC(1) Coupon Note 07/22/09 1,501,171.88 07/22/11 70 660 730 1.585% 4,563.15 4,563.15 USTreasury Note 08/05/09 1,992,187.50 07/31/11 56 669 725 1.196% 3,655.58 3,655.58 Treasury Note 09/21/09 2,000,000.00 08/31/11 9 700 709 1.032% 508.93 50893 FHLB Coupon Note 09/08/09 2,000,000.00 09/08/11 22 708 730 1.743% 2,101.15 2,101.15 USTreasary Note 10119106 990,078.13 09/30/11 1077 730 1807 4.721% 137,919.70 132,651.10 5,268.60 FFCB Coupon Note 12/12/07 2,025,080.00 11/21/11 658 782 1440 4.000% 146,027.69 125,183.33 20,844.36 FFCB Coupon Note 05/28/09 998,500.00 11/28/11 125 789 914 1.590% 5,437.04 5,437.04 FFCB CoupouNote 02/22/07 986,080.00 12/08/11 951 799 1750 4.959% 127,407.18 106,118.06 21,289.12 FHLMC(4) Coupon Note 06/24/09 998,500.00 01/23/12 98 845 943 2.031% 5,444.92 1,586.94 3,857.98 FNMA(5) Coupon Note 05/21/09 1,004,500.00 02/03/12 132 856 988 1.951% 7,087.42 4,250.00 2,837.42 FHLB Coupon Note 05/09/07 1,509,255.00 03/09/12 875 891 1766 4.743% 171,605,39 175,000.00 (3,394.61) FFCB (6) Coupon Note 09/04/09 1,005,500.00 04/20/12 26 933 959 1.806% 1,293.54 1,293.54 FFCB Coupon Note 07/21/09 1,012,800.00 07/17/12 71 1021 1092 1.472% 2,899.99 2,899.99 FHLB CoupouNote 11/29/07 2,038,360.00 08/15/12 671 1050 1721 4.170% 156,259.56 158,277.78 (2,018.22) FHLMC Coupon Note 09/25/09 999,850.00 09/25/12 5 1091 1096 2.005% 274.62 274.62 GE Corporate Note 01/16/08 1,542,165.00 10/19/12 623 1115 1738 4.587% 120,741,00 99,093.75 21,647.25 Subtotal 44,023,254.62 Union MM 87,781.78 30 30 0.15% 10.82 10.82 Purchased Interest 9,477.42 LAW N/A 06/30/09 28,468,836.13 09/30/09 92 0 92 0.70% 75,254.88 75,254.88 $72,589,349.95 371 2.11% $2,582,405.03 $2,225,060.13 $357,344.90 Maturity Profile Amount Percent 0-1 year $37,865,182.28 52,16% 1-2 years $20,603,577.67 28.38% 2-3 years $12,578,425,00 17,33% 3-5 years $1,542,165.00 2.12% $72,589,349.95 100.00% Market to Cost Position Report Amortized Market Unrealized * Source: Treasury and Agency Obligations - Union Bank of California Iistibrtion Cost Value* Gain Loss LAIF balances per Local Agency Investment Fund monthly statement. Union Bank Assets $44,023,254.62 $45,094,764.50 1,071,509.88 UnnioniMM 87,781.78 87,781.78 0.00 Purchased Interest 9,477.42 9,477.42 0.00 LAIF 28,468,836.13 28,468,836.13 0.00 Totals: $72,589,349.95 $73,660,859.83 $1,071,509.88 (1) Callable quarterly starting 10/22/09 (5) Callable once on 02/03/10 (6) Callable once on 04/20/10 page 5 Town of Los Gatos Investment Report for the month ended August 31, 2009 Prepared by Linda L. Speicher, Project Manager 10/14/09 Town of LOS Gatos Summary Investment. Information August 31, 2009 Weighted Average Portfolio Yield: 2.14% Weighted Average Maturity (days) 333 This Month Last Month One year afro Portfolio Balance $75,673,488 $80,887,202 $74,560,416 Benchmarks/ References Town's Average Yield 2.14% 2,16% 3.56% LAIF Yield for month 0.93% 1.04% 2.78% 3 mo. Treasury 0.15% 0.19% 1.74% 6 mo. Treasury 0.24% 0.28% 1.97% 2 yr. Treasury 1.12% 1.08% 2.38% 5 yr. Treasury (most recent) 2.49% 2.69% 3.13% Prime rate 3.25% 3.25% 5.00% Most recent auctions of Freddie Mac or Fannie Mae Reference Notes: 3 yr. Fannie Mae (08/28/09) 1.82% 2 yr. Freddie Mac (04/22/09) 1.62% Compliance: The Town's investments are in compliance with the Town's investment policy dated May I , 2008 and also in compliance with the requirements ofSection 53601 of the California State Code. Based on the information available, the Town has sufficient: fiords to meet. the cash demands for t.hc next. six months. Page I Torn of Los Gatos Portfolio Allocation & 't'reasurer's Fund Balances August. 31, 2009 Month YTD Fund Balances- Beginning ofMonfl>/Period $80,887,202.47 $85,021,578.85 Receipts 2,043,944.08 3,999,238.3 Disbursements (7,257,658.06) (13,347,328.75) Fund Balances - End of Month/Period $75,673,488.49 $75,673,488.49 Portfolio Allocation: Union MM $3,490,986.25 US Govt Agencies 40,546,255.87 Local Agency Investment Tend 30,468,836.13 Subtotal - Investments 74,506,078,25 Reconciled Demand Deposit Balances 1,167,410.24 Total Treasurer's Fund $75,673,488.49 page 2 Town of Los Gatos Non-Treasury Restricted Pond Balances August 31, 2009 Previous Balance DePosits Non-Treasury Funds Downtown Pai'king District 12/20/02 Certilicales of Participation Reserve Fund (Lot 4) Cat, of Participation Lease Payment Fund (Lot 4) Cert. ol`Parlicipation 2002 Series A ConsL Fund Cert. of Participation 2002 Series A Reserve Fund Ccr1. Of Participation 2002 Scries A Inlcresl Fund Cert. Of Parlicipation 2002 Scries A COI Fund Total Restricted Funds Ending Inlcresl Withdrawals Balance $275,476.42 $379.55 $275,855.97 Noa, t 255,037.10 0.00 900.54 254,136.26 No1c2 227,265.03 21,519.03 0.00 227 250.00 21,534.06 No(, 3 144,937.57 144,937.57 Nou, 4 686,251.00 5.85 5.85 686,251.00 NoW 4 468,081.25 0,00 468,081.25 0.00 Note 4 0.00 0.00 0.00 0.00 Not,- 4 52,057,048.37 $21,519.03 $385.40 $696,237.94 $1,382,714.86 These accounts are not parr of the Treasurer's land balances reported elsewhere in this report, as they are to]. separate and distinct cnltllcs, Note I: This account include redemption accounts set up Ibr the repaymcnl of interest and principal on outstanding bond coupons I'or Parking Assessment Disu'icl '3', as well as Reserve Funds Set up as rcquircd by the original Bond resolution. Note 2: The reserve fund was a requirement ol'lhe original cerlilicates ol'participadon agreement when Lot 4 was built. 11 helps to guarantee payment of the lease payments should the Town not make payment. Note 3: The lease payment fund receives the lease payments from the Town monthly for Ilse lease of Lot 4. It holds the funds until payments on the oertificalcs of participation are duc semi-annually. Note 4: The three funds Fbr the Certilicates ofParlicipalion 2002 Series A consist ol'cons(ruction funds which will be expended over the next I'm years, reserve Funds which will guarantee the payment ol'Iease payments, and a third Fund for the disbursement ol'Icase payments and initial delivery costs. Page 3 Town of Los Gatos Statement of Interest Earned August 31, 2009 Current Fiscal Month Year to DAte Interest received from Investments Add: Interest accrued at end of period (see page 5) Less: Interest accrued at beginning of period Interest earned on investments Interest by Month July 2009 August 2009 September 2009 October 2009 November 2009 December 2009 January 2010 February 2010 March 2010 April 2010 May 2010 June 2010 $199,074.33 $434,807.28 314,967.46 314,967.46 (375,910.39) (474,569.94) $138,131.40 $275,204.80 137,073.40 138.131.40 275,204.80 Page 4 Town of Los Gatos Iuaetive Deposits by InstiNlion Market to Cost Position Report Attgust 31, 2009 Deposit Anlotized Matoity Davs Days to Davs Yield to Interest Interest I» tetesl Institution Secant Date Coll Dale Elapsed Matmit Invested Mattuity Gamed Received Aecmed USTteasmy Note 08/05/09 1,992,187.50 {)7/31/11 26 699 725 1.196% 1697.23 1,697.23 USTteasnrv Note 03/25/08 1,024,062.50 09115/09 524 I5 539 1.709% 25,125.05 32832.88 (7,707.83) USTteasury Note 11/17/06 748,066.41 11/15/09 1018 76 1094 4.734% 98,769.61 86,527.11 12,242.50 USTteasury Note 06/02/08 1,514,941.41 12/31/09 455 122 577 2.602% 49,138.47 52,500,00 (3,361,53) FBLMC Coopon Note 06/14/05 299,331.00 01/25/10 1539 147 1686 4.431% 55,924.13 53,994.79 1929.34 MLCotp CopomteNote 04/10/07 976,150.00 02/08/10 874 161 1035 5.165% 120,727.29 98,930.56 21,796.73 USTreosury Note 06/24/08 739,921.88 02/28/10 433 181 614 2.819% 24,744.35 17.771.74 6.972.61 USTteasmy Note 10/19/06 976,406.25 04/15/10 1047 227 1274 4.744% 132,870.65 99,560,44 33,310.21 FHLB CooponNote 08/22/06 1,507,665,00 06/11/10 1105 284 1389 4.957% 226,252.40 214,500.00 11,752.40 FFILB CooponNote 01/12/07 1,487,205.00 08/10/10 962 344 1306 4.960% 194,417.22 181,733.33 12683.89 FIILB Coupon Note 03/23/09 1,049,400.00 08/16/10 161 350 511 [.284% 5,943.46 19,229.17 (13,285.71 ) FFCB(2) Coupon Note 09/15/08 1,500,000.00 09/15/111 350 380 730 3.3(1(1% 47,465.75 24,750.00 22,715.75 USTreasuty_ Note (15/31/07 737,226.56 10115110 823 410 1233 4.901% 79,806.75 59,743.85 20,062.90 FFCB Coupon Note 12/07/07 2,032,140.00 11/08/10 633 434 1067 3.715% 130,925.21 122072.22 8,85299 FIILB Coupon Note 03/23/09 1,040,160.00 I2/It)/10 161 466 627 1.485'%6 6,813.33 8,180.56 (1,367.23) FFCB Coupon Note 01/18/07 756,922.50 01/18/11 956 505 1461 3.175% 62,944.85 39,375.00 23,569.85 FFCB Coupon Note 11/28/07 2,062,000.00 02/18/11 642 536 1178 3.840"/v 139,271.43 167,916.67 (28,645.24) USTreasuty_ Note 06/12/09 1,987,187.50 03/31/11 80 577 657 0.875% 3,811.04 3,81[.(14 FNMA Coupon Note 09/29/06 1,576,485.00 04/15/11 1067 592 1659 4.874% 216,070.36 195,604.17 20,466.19 FIILB Coupon Note 06/08/09 1,988,018.60 06/03/11 84 641 725 1.432% 6,551.64 6,551.64 FHLMC(l) Coupon Note 07/22/09 1,50 1,17 1.88 07/22/11 40 690 730 1.585% 2,607.51 2,607.51 USTreasmy Note 10/19/06 990,078.13 09/30/11 1047 760 1807 4.721% 134;077.93 110,151.10 23,926.83 FFCB CooponNote 12/12/07 2,025,080.00 11/21/11 628 812 1440 4.000% 139369.89 125,183.33 14,t86.56 FFCB Coopon Note 05/28/09 998,500.00 11/28/1) 95 819 914 1.590% 4,132.15 4,132.15 FFCB Coupon Note 02/22/07 986,080.00 12/08/11 921 829 1750 4.959% 123,388.03 106,118.06 17,269.97 FH1,MC(4) Coupon Note 06/24/09 998,500.00 01/23/12 68 875 943 2.031% 3,778,11 1.586.94 2.191.17 FNMA(5) CooponNote 05/21/09 1,004,500.00 02/03/12 102 886 988 1.951% 5,476.64 4,250.00 1,226.04 FHLB Coupon Note 05/09/07 1,509,255.00 03/09/12 845 921 1766 4.743% 165,721.78 137,500.00 28.221.78 FFCB Coupon Note 07/21/09 1,0 12,800.00 0717/12 41 1051 1092 1.472% 1,674.64 1,674.64 FHL13 Coupon Note 11/29/07 2,038,360.00 08/15/12 641 1080 1721 4.170% 149.273.29 158,277,78 (9;(10449) GE CorponeNote 01/16/08 1,542,165.00 10/19/12 593 1145 1738 4.587'% 114,926.83 99,093.75 15,833.08 Subtotal 40,541,967.12 Union MM 3,490,986.25 30 30 0.15% 430.40 430.40 Pntchascd Tol etest 4,288.75 LAV N/A 06/30/09 30,468,836,13 09/30/09 62 30 92 0,93% 58,223.50 58,223.50 $74.506.078.25 333 2.14% $2,532,350.91 $2,217,383.45 $314,967.46 Mattuity profile Amount Percent 0-1 veal. $44,287,260.58 59.44% 1-2 Yeats $17,113,499.54 22.97% 2-3 veins $11,563,153.13 15.52% 3-5 years $1,542,165.00 2.07% $74,506,078.25 100.00% A4arket to Cost Position Repot Amortized Market Umealized * Source: Tivasmy and Agency Obligations- Union Bank of Calitbrnia Insulation Cost V111110 Gain (Loss) LAIF balances per Local Agency Investment Fund monthly statement. Union Bank Assets $40,541967.12 $41,587,114.00 1,045,146.88 Union MM 3,490,986.25 3,490,986.25 0.00 Purchased Interest 4,288.75 4,288.75 0.00 LAW 30,468,836.13 30,468;836.13 0.00 'fotals: $74,5116,078.25 $75,551,225.13 $1,045,146,88 (1) Callable quarterly starting 10/22/09 (2) Callable once on 9/15/09 (5) Callable once on 02/03/10 page 5 Town of Los Gatos Investment Report for the month ended July 31, 2009 Prepared by Lincla L. Speicher, Project Manager 26-Sep-09 Town of Los Gatos Summary Investment Information July 31, 2009 Weighted Average Portfolio Yield: 2,16% Weighted Average Maturity (days) 330 This Month Last Month One year'_a Portfolio Balance $80,887,202 $85,021,579 $76,014,723 Benchmarks/ References: Town's Average Yield 2.16% 2.50°/ 3.60% LAIF Yield for month 1.04% 1.38% 2.79% 3 mo. Treasury 0.19% 0.20% 1.73% 6 mo. Treasury 0.28% 0.36% 1.92% 2 yr. Treasury 1.08% 1.08% 2.82%n 5 yr. Treasury (most recent) 2.69% 2;69% 3.44%0 Prime rate 3.25%a 3.25% 5.00% Most recent auctions of Freddie Mac or Fannie Mae Reference Notes: 3 yr. Freddie Mae (07/16/09) 1.75% 2 yr. Fannie Mae (04/09/09) 1.50% Compliance; The Town's investments are in compliance with the Town's investment policy dated May 1, 2008 and also in compliance with the requirements of Section 53601 orthe California State Code. Based on the inrormation available, the Town has sufficient rands to meet the cash demands for the next. six months. Page Town of Los Gatos Portfoli o Allocation & ,treasurer's fund Balances July 31, 2009 Month YTD Fund Balances - Beginning ofMonth/Period $85,021,578.85 $85,021,578.85 Receipts 1,955,294.31 1,955,294.31 Disbursements (6,089,670.69) (6,089,670,69) 1?undBalances - Bud ofMontlVPeriod $80,887,202.47 $80,887,202.47 Portfolio Allocation: Union MM $3,262,355.36 US Govt Agencies 40,576,083,11 Local Agency Investment Fund 34,468,836.13 Subtotal - Investments 78,307,274.60 Reconciled Demand Deposit Balances 2,579,927.87 Total Treasurer's fund $80,887,202.47 Treasurer'sFund Balances page 2 Town of Los Gatos Non-Treasury Restricted Fund Balances July 31, 2009 Previous Ending Balance Deposits Inleresl Withdrawals Balance Non-Treasury Funds Downtown Parking District 12/20/02 Certificates of Participation Reserve Fund (Lot 4) Cert. of Participation Lease Payment Fund (Lot 4) Cert. of Participation 2002 Series A Coast. Fund Cert. of Participation 2002 Series A Reserve Fund Cert. Of Participation 2002 Series A Interest Fund Cert. Of Participation 2002 Series A COI Fund $275,109.61 255,037.10 206,517.47 20,747.56 149,937.57 686,251.00 0.00 468,031.25 0.00 $366.81 $275,476.42 Note I 0.00 255,037.10 Note 2 0.00 227,265.03 Nore3 5,000.00 144,937.57 Note4 5.66 5.66 636,251.00 Note 4 0.00 468;081.25 Note 4 0.00 0.00 0.00 Nor, 4 'total Restricted Funds: $ 1,572,852.75 $488,828.31 $372.47 $5,005.66 $2,057,049.37 These accounts arc not part of the Treasurer's Bunt balances reported elsewhere in (his report, as they arc 1,01-sepal-ale and distinct entities. Note 1: This account include redemption accounts set up for (he repayment of interest and principal on outstanding bond coupons for Parking Assessment. District' 3', as well as Rcscrvc Funds set up as required by the original Bond resolution. Note 2: The reserve fund was a requirement ol'the original certificates ol'participation agreement when Lot 4 was built. It helps to guarantee payment of the lease payments should the Town no( make payment. Note 3: The lease payment fund receives the lease payments from the Town monthly Cor the lease of Lot 4. It holds (he I'unds until payments on the certificates ofparticipation are due semi-annually. Note 4: The three rands for the Certificates of Participation 2002 Series A consist ofconstruction Funds which will be expended over (he next few years, reserve funds which will guarantee the payment of (case payments, and a third fund for the disbursemen( of lease payments and inili it delivery costs. Page 3 Town of Los Gatos Statement of Interest Earned July 31, 2009 Current Fiscal Month Year to Date Interest received from Investments $235,732.95 $235,732.95 Add: Interest accrued at end of period (see page 5) 375,910.39 375,910.39 Less: Interest accrued at beginning of period (474,569.94) (474,569.94) Interest earned on investments $137,073.40 $137,073.40 Interest by Month July 2009 August 2009 September 2009 October 2009 November 2009 December 2009 January 2010 February 2010 March 2010 April 2010 May 2010 June 2010 137,073.40 Page 4 Deposit Institution Seentit Date FFCB Coupon Note 04/02/08 USTreosuty Note 03/25/08 UST7ensuty Note 11/17/06 USTreasmy Note 06/02/08 FHLMC Coupon Note 06/14/05 ML Cotp Cotpomte Note 04/10/07 USTtcastav Note 06/24/08 USTreasuty_ Note 10119106 FHLB Coupon Note 09/22/06 FHLB Coupon Note 01/12/07 FHLB Coupon Note 03/23/09 FFCB(2) Coupon Note 09/15/08 USTtcasoty Note 05/31/07 FFCB CouponNole 12/07/07 FHLB Coupon Note 03/23/09 FFCB Coupon Note 01/18/07 FFCB Coupon Note 11/28/07 USTreasury Note 06/12/09 FNnV1A Coupon Note 09/29/06 F141,13 Coupon Note 06/08/09 FFILMC(I) Coupon Note 07/22/09 USTleasuty Note 10119/06 FFCB Coupon Note 12/12/07 FFCB Coupon Note 05/28/09 FFCB Coupon Note 02/22/07 F14LIvIC(4) Coupon Note 06/24/09 FNIVIA(5) Coupon Note 05/21/09 FHLB Coupon Note 05/09/07 FFCB Coupon Note 07/21/09 FHLB Coupon Note 11/29/07 GE CotpouteNole 01116/08 Tour of Los Gatos Inactive Deposits by Institution M.u•ket to Cost Position Report July 31, 2009 Amortized Maturity cost Date 2;010,820.()0 1,024,062.50 748,066.41 1,514,941.41 299,.331.00 976>,15(.00 739,921.88 976,406.25 1,507,665.00 1,487,205.00 1,049,400.00 1,500,000.00 737,226.56 2,03 2,140.00 1,040,160.00 756,922.50 2,062,000.00 1,987,187.50 1,516,485.00 1,988,018.60 1,501,171.88 990,078.13 2,025,080.00 998,500.00 986,080.00 998,500.00 1,004,500.00 1,509,255.00 1,012,800.00 2,038,360.00 1,542,165.00 08/04/09 09/15/09 11/15/09 12/31/09 01/25/10 02/08/1(1 02/28/10 04/15/10 06/11/10 08/10/10 08/16/10 09/15/10 1(1/15/10 11/(18/10 12/1(1/10 01/18/11 02/18/11 03/31 /11 04/15/11 06/03/11 07/22/11 09/30/11 11/21/11 11/28/11 12/08/11 01/23/12 02/03/12 03/09/12 07/17/12 08/15/12 10/19/12 Subtotal 40,560,599.62 Union MM 3,262,355.36 Purchased I temst 15,483.49 LAID N/A (1613(1/09 34,468,836.13 09/30/(19 Days Days to Days Yield to Interest Interest Inletesl Elapsed Moonily Irvested Maturity Eamed Received Accmed 485 4 489 2.286% 61,079.90 45,100,00 15,779.90 493 46 539 1.709% 23,638.65 32,832.88 (9,194.23) 987 107 1094 4.734% 95,761.89 86,527.11 9,234.78 424 153 577 2.602%a 45,790.58 52,500.00 (6,709.42) 1508 178 1686 4.431% 54,797.65 53,994.79 802.86 843 192 1035 5.165% 116,445.20 77,680.56 38,764.64 402 212 614 2.819% 22,972.81 10,271.74 12,701.07 1016 258 1274 4.744% 128,936.56 99,560.44 29 376.12 1074 315 1389 4.957% 219,905.04 214,500.00 5,405.04 931 375 1306 4.960%0 188,152.21 146,483.33 41,668.88 130 381 511 1.284% 4,799.06 4,799.06 319 411 730 3.300% 43,261.64 24,750.00 18,511.64 792 441 1233 4.801% 76,800.67 59,743.85 17,056.82 602 465 1067 3.715% 124,513.39 122,072.22 2,441.17 130 497 627 1.485% 5,501.45 8,180.56 (2,679.11) 925 536 1461 3.175% 60,903.75 39,375.00 21,528.75 611 567 1178 3.840%a 132,546.49 119,166.67 13, 379.82 49 608 657 0.875% 2,334.26 2,334.26 1036 623 1659 4.874% 209392,78 195,604.17 14,188.61 53 672 725 1.432%n 4,133.77 4,133.77 9 721 730 1.585%0 586.69 586.69 1016 791 1807 4.721% 130,108.09 110,151,10 19,956.99 597 843 1440 4.000% 132,490.17 125,183.33 7,306.84 64 850 914 1,590% 2,783,76 2,783.761 890 860 1750 4.959% 119,234.90 106,118.06 13,116.84 37 906 943 2.031% 2,055.73 1,586.94 468.79 71 917 988 1.951%0 3,812.17 3,812.17 814 952 1766 4.743% 159,642.05 137,500.00 22,142.05 10 1082 1092 1.472% 408.45 408.45 610 1111 1721 4.170% 142,054.15 112,027.78 30,026.37 562 1176 1738 4.587% 108,918.85 99,093.75 9,825.10 30 30 1.15% 402.21 402.21 31 61 92 1.04% 31,549.69 31,549.619 $78,307,274.60 330 2.16% $2,456,114.67 $2,080,204.28 $375,910.39 Matauity Profile 0-1 year 1-2 years 2-3 Yeats 3-5 years Amoont Ponent $47,544,039.43 60.71% $17;657,917.04 22.55% $9,524,793.13 12.16% $3,580,525.00 4.57% $78,307,274.60 100.00% Market to Cost Position Repot Amotized Market Utu•calized Institution Cost value* Gain Loss Union Bank Assets $40,560,599.62 $41,584,295.00 1,023,695.38 Union MM 3,262,355.36 3,262,355.34 0.00 Pumhased Interest 15,483.49 15,483.49 0.00 LAIF 34,468,836.13 34,468,836.13 0.00 Totals: $78,307,274.60 $79,330,969.98 $1,023,695.38 (l) Callable quarterly slatting 10/22/09 (2) Callable once on 9/15/09 (5) Callable once on 02/03/10 * Souroe: Treasmy and Agency Obligations - Union Bank of Calilbmia LAIF balances per Local Agency Investment Fund ninthly statement. page 5 ~pW N 0 ~o X05 COUNCIL AGENDA REPORT DATE: OCTOBER 8, 2009 MEETING DATE: 10/19/09 ITEM NO: 3 TO: MAYOR AND TOWN COUNCIL FROM: GREG LARSON, TOWN MANAGER SUBJECT: ADOPT RESOLUTION APPOINTING ERIK WILHELMSEN, TRANSPORTATION AND PARKING COMMISSIONER, AS REPRESENTATIVE TO THE SANTA CLARA VALLEY TRANSPORTATION AUTHORITY COUNTY-WIDE BICYCLE AND PEDESTRIAN ADVISORY COMMITTEE (BPAC) RECOMMENDATION: Adopt resolution appointing Erik Wilhelmsen, Transportation and Parking Commissioner, as representative to the Santa Clara Valley Transportation Authority County-Wide Bicycle and Pedestrian Advisory Committee (BPAC). BACKGROUND: The Santa Clara Valley Transportation Authority is requesting the Town of Los Gatos appoint a representative to serve on the BPAC. The term of Los Gatos' current BPAC representative, Bruce Entin, has expired. Bruce Entin informed the Town's Transportation and Parking Commission that he will not be able to reapply to serve as the representative to the BPAC. DISCUSSION: The Town of Los Gatos held its regular Transportation and Parking Commission meeting on October 8, 2009 and voted for the appointment of Erik Wilhelmsen as the representative to the Santa Clara Valley Transportation Authority County-Wide BPAC. Erik Wilhelmsen has been a member of the Town Transportation and Parking Commission in good standing and is actively involved in a wide range of Bicycle and Pedestrian related improvement projects. PREPARED BY: TODD CAPURSO Director of Parks and Public Works Reviewed by: Assistant Town Manager Town Attorney Cleric Administrator 'finance Community Development N:\PPW\MANAGEMENT\COUNCIL\COUNCIL REPORTS\2009 reports\October 19\scvta bpac.appoint.erik.wilhelmsen.doc PAGE 2 OCTOBER 9, 2009 MAYOR AND TOWN COUNCIL SUBJECT: ADOPT RESOLUTION APPOINTING ERIK WILHELMSEN, TRANSPORTATION AND PARKING COMMISSIONER, AS REPRESENTATIVE TO THE SANTA CLARA VALLEY TRANSPORTATION AUTHORITY COUNTY WIDE BICYCLE AND PEDESTRIAN ADVISORY COMMITTEE (BPAC) CONCLUSION: Staff is recommending the Town Council appoint Erik Wilhelmsen, Transportation and Parking Commissioner, as representative to the Santa Clara Valley Transportation Authority County- Wide Bicycle and Pedestrian Advisory Committee (BPAC). Attachments: Resolution appointing Erik Wilhelmsen to the Santa Clara Transportation Authority County- Wide Bicycle and Pedestrian Advisory Committee, Distribution, Kurt Evans, Government Affairs Manager, Santa Clara Valley Transportation Agency, 3331 North First Street, San Jose, CA 95134-1906 Erik Wilhelmsen, 112 Elmwood Court, Los Gatos, CA 95032 Attachment 1 RESOLUTION RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF LOS GATOS APPOINTING ERIK WILHELMSEN TO THE SANTA CLARA VALLEY TRANSPORTATION AUTHORITY COUNTY-WIDE BICYCLE AND PEDESTRIAN ADVISORY COMMITTEE (BPAC) WHEREAS, the Santa Clara Valley Transportation Authority is in need of a Town representative to serve on the Santa Clara Transportation Authority County Wide Bicycle and Pedestrian Advisory Committee (BPAC); and WHEREAS, the term of Bruce Entin has expired on the Santa Clara Transportation Authority's County Wide Bicycle and Pedestrian Advisory Committee (BPAC); WHEREAS, Erik Wilhelmsen is a member in good standing of the Transportation and Parking Commission and involved in Bicycle and Pedestrian related projects. NOW, THEREFORE BE IT RESOLVED, that Erik Wilhelmsen, Transportation and Parking Commissioner, be appointed to serve as the representative to the Santa Clara Transportation Authority County Wide Bicycle and Pedestrian Advisory Committee (BPAC). PASSED AND ADOPTED at a regular meeting of the Town Council of the Town of Los Gatos, California, held on the 191' day of October, 2009, by the following vote: COUNCIL MEMBERS: AYES: NAYS : ABSENT: ABSTAIN: SIGNED: ATTEST: MAYOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA CLERK ADMINISTRATOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA IoW N 0 cos aajos COUNCIL AGENDA REPORT DATE: October 14, 2009 TO: MAYOR AND TOWN COUNCIL ~ FROM: ORRY P. KORB, TOWN ATTORNEYW~/ MEETING DATE: 10-19-2009 AGENDA ITEM: C SUBJECT: ADOPT AN ORDINANCE FOR A ZONE CHANGE FROM CM TO CM:PD FOR A THREE STORY SELF STORAGE BUILDING. NO SIGNIFICANT ENVIRONMENTAL IMPACTS HAVE BEEN IDENTIFIED AS A RESULT OF THIS PROJECT AND A MITIGATED NEGATIVE DECLARATION IS RECOMMENDED. APN: 424-31-065. PROPERTY LOCATION 930 UNIVERSITY AVENUE. PROPERTY OWNER: EXTRA SPACE OF LOS GATOS, LLC• APPLICANT: EXTRA STORAGE SPACE FILE. RECOMMENDATION: Adopt an ordinance to amend a zone change from CM to CM:PD for a three story self storage building. DISCUSSION: On October 5, 2009, Council considered the Planning Commission's recommendation to approve a planried development application for an existing 1.31 acre site located at 930 University Avenue. This parcel was created in October of 2006, when a two parcel subdivision was approved for property previously own by Verizon. The applicant seeks approval of a zone change to allow development of a 86,345 square foot commercial self storage building with and on-site caretaker residence located within the proposed building and a reduced front yard setback. Council acted to introduce the ordinance. Adoption of the attached ordinance finalizes that decision. The ordinance would become effective 30 days thereafter. Attachment: Ordinance. introduced October 5, 2009. PREPARED BY: ORRY P. KORB, TOWN AT-TOR [N 1 -S\okorb\AppDntn\Locnl\•I'emp\CWViewer\Report930 UniversilyZoneChgwj)d Reviewed by: Town Manager Assistant Town Maiiager Clerk Finance Community Development Rev: 10/14/09 5:29 pm Reformatted: 7/19/99 File/! 301-05 ORDINANCE OF THE TOWN OF LOS GATOS AMENDING THE TOWN CODE EFFECTING A ZONE CHANGE FROM CM TO CM:PD FOR PROPERTY AT 930 UNIVERSITY AVENUE (APN 424-31-065) THE TOWN COUNCIL OF THE TOWN OF LOS GATOS DOES ORDAIN AS FOLLOWS: SECTION I The Town Code of the Town of Los Gatos is hereby amended to change the zoning on property at 930 University Avenue (Santa Clara County Assessor Parcel Number 424-31-065) as shown on the map attached hereto as Exhibit A, and is part of this Ordinance, from CM (Controlled Manufacturing) to CM:PD (Controlled Manufacturing, Planned Development). SECTION II The PD (Planned Development Overlay) zone established by this Ordinance authorizes the following: 1. Construction of an 86,345 square foot (three stories above grade and one story below grade) self storage facility with an on-site caretaker residence. 2. Landscaping, parking, and other site improvements shown and required on the Official Development Plan. 3. Uses permitted are those specified in the underlying CM (Controlled Manufacturing) zone by Sections 29.70.220 (Permitted Uses) and 29.20.185 (Conditional Uses) of the Zoning Ordinance, as those sections exist at the time of the adoption of this Ordinance, or as they may be amended in the future, subject to any restrictions or other requirements specified elsewhere in this ordinance including, but not limited to, the Official Development Plan. However, no use listed in Section 29.20.185 is allowed unless specifically authorized by this Ordinance, or by Conditional Use Permit. SECTION III COMPLIANCE WITH OTHER DEVELOPMENT STANDARDS All provisions of the Town Code apply, except when the Official Development Plan specifically shows otherwise. SECTION IV Architecture and Site approval is required before construction and site improvement construction work is performed, whether or not a permit is required for the work and before any permit for construction is issued. Construction permits shall only be in a manner complying with Section 29.80.130 of the Town Code. Paige 1 of 13 SECTION V The attached Exhibit A(Map), and Exhibit B (Official Development Plans), are part of the Official Development Plan. The following conditions must be complied with before issuance of any grading, or construction permits: TO THE SATISFACTION OF THE DIRECTOR OF COMMUNITYDEVELOPMENT: Planning Division 1. APPROVAL: This application shall be completed in accordance with all of the conditions of approval listed below and in substantial compliance with the plans approved and noted as Exhibit 18 of the report to the Plain-ling Commission for the June 24, 2009 meeting. Any changes or modifications made to the approved plans shall be approved by the Director of Community Development, Development Review Committee, Planning Commission or the Town Council, depending on the scope of the change(s). 2. TOWN INDEMNITY: Applicants are notified that Town Code Section 1.10.115 requires that any applicant who receives a permit or entitlement from the Town shall defend, indemnify, and hold harmless the Town and its officials in any action brought by a third party to overturn, set aside, or void the permit or entitlement. This requirement is a condition of approval of all such permits and entitlements whether or not expressly set forth in the approval, and may be secured to the satisfaction of the Town Attorney. 3. ARCHITf:CTURE AND SITE REQUIRED: An Architecture and Site application and approval i:s required for the proposed building, parking lot improvements, and other site improvements. The Development Review Committee shall be the deciding body for the Architecture and Site application. 4. ON-SITE CARETAKER RESIDENCE: An on-site caretaker residence is permitted. 5. FRONT SETBACK: The front setback shall not be less than twelve feet three inches. 6. COMMUNITY BENEFIT: The applicant has offered the following Community Benefit to offset traffic impacts created by the proposed project: replacing existing incandescent light bulb tree lights with LED tree lights for E. Main Street east of the Highway 17 bridge (approximately 26 trees). Alternately, at the discretion of the Town, the applicant will provide $40,000 for on-site or off site access or other improvements for the proposed adjacent public recreation facility as determined by the Town. The community benefit must be satisfied prior to the final occupancy. 7. FINAL LANDSCAPE PLAN. A final landscape plan shall be reviewed by the Town's Consulting Arborist and approved as part of the Architecture and Site process. Minimum tree size at time of planting shall be 24-inch box. 8. TREE PRESERVATION. All recommendations of the Town's Consulting Arborist shall be Page 2 of 13 followed throughout all phases of construction. Refer to the report prepared by Arbor Resources dated August 14, 2008 and June 3, 2009 for details. Tree protection specifications shall be printed on the construction plans. 9. *BIOLOGICAL RE, SOURCES MITIGATION MEASURE #1: All recommendations made by Arbor Resources (August 14, 2008) will be implemented to eliminate or minimize the construction-related impacts on the trees to be retained. These include recommendations under the Design Guidelines section addressing tree location mapping, protective fencing, building setback, trenching, drainage facilities, and installation of new trees (including installation of three new trees of 24-inch box size). The report also provides recommendations for Protection Measures before and during construction, encompassing fencing, removal of hardscape, demolition, work within tree canopies, etc. The report's recommendations are included as Attachment 1 of the Initial Study. 10. *CULTURAL RESOURCES MITIGATION MEASURE #1: Construction personnel shall be alerted to the potential for archaeological materials, especially during trenching operations. Archaeological indicators include, but not be limited to the following: dancer than surrounding soils of a friable nature, concentrations of stone, bone or fresh water shellfish, artifacts of these materials, and evidence of fire (ash, charcoal, fire alerted earth or rock) and of course human burials. 11. *CULTURAL RESOURCES MITIGATION MEASURE 42: In the event that archaeological traces are encountered, all construction within a 20-foot radius of the find shall be halted, the Community Development Director shall be notified, and an archaeologist shall be retained to examine the find and make appropriate recommendations. 12. * CULTURAL RESOURCES MITIGATION MEASURE #3: In the event that it appears further earthinoving will affect a resource eligible for the California Register of Historic Resources (CRHR), a plan for evaluation of the resource through limited hand excavation should be submitted to the Town's Community Development Department for approval. If evaluative testing demonstrates that the project will affect a CRHR eligible resource, a plan for the mitigation of impacts to the resource should be submitted to the Community Development Director for approval before construction is allowed inside the zone designated as archaeologically sensitive. 13. *CULTURAL RESOURCES MITIGATION MEASURE #4: If testing determines that an archaeological site is eligible for listing, a plan shall be submitted to the Community Development Director for consideration and approval, which outlines the process of mitigating impacts on the resource. Assuming that the project could not be redesigned to prevent further damage, mitigation can take the form of additional hand excavation to retrieve additional data and materials from the deposit, combined with continued archaeological monitoring inside the archaeologically sensitive zone to ensure that significant data and materials are retrieved for analysis and final report preparation. Page 3 of 13 14. *HAZARDS AND HAZARDOUS MATERIALS MITIGATION MEASURE #1: The project applicant and/or Town shall prepare a management plan to identify all suspected hazardous materials and specify applicable regulations that would determine appropriate handling and disposal of these materials. For suspected hazardous materials (contaminated soil and groundwater) that may be encountered during construction, the management plan shall include contingency plans for site safety, worker protection, sampling and investigation, and disposal and remediation; these shall be based on soil and groundwater sampling and testing that have been completed to date. The management plan shall be filed with the Town of Los Gatos and all other jurisdictional agencies prior to issuance of the demolition and grading permits. 15. *HAZARDS AND HAZARDOUS MATERIALS MITIGATION MEASURE #2: If groundwater is encountered during project construction and dewatering is required, the project applicant shall undertake sampling and testing of the encountered groundwater in accordance with the contingency sampling and investigation plan. If groundwater is found to contain contaminants that exceed regulatory action levels, it may not be discharged into the existing storm drainage system. Removal and handling of the contaminated groundwater shall be done in a mamler acceptable to the RWQCB, the Town, and other jurisdictional agencies. 16. *NOISE MITIGATION MEASURE 41: Noise attenuation measures shall be included in the proposed caretaker's unit to ensure that noise levels on the proposed balcony do not exceed 65 dBA (Ldn) and the unit's interior noise levels do not exceed 45 dBA (Ldn). Provision of mechanical ventilation may be adequate to achieve this interior level, but a qualified acoustical consultant shall provide appropriate design recommendations to ensure these interior and exterior noise levels are met. 17. COMPLIANCE MEMORANDUM: A memorandum shall be prepared and submitted with the building permit and/or final subdivision map detailing how the Conditions of Approval will be addressed. Building Division 18. PERMITS REQUIRED: A building permit shall be required for the new commercial building. Separate permits are required for electrical, mechanical, and plumbing work as necessary. 19. CONDITIONS OF APPROVAL: The Conditions of Approval must be blue-lined in full on the cover sheet of the construction plans. A Compliance Memorandum shall be prepared and submitted with the building permit application detailing how the Conditions of Approval will be addressed. 20. SIZE OF PLANS: For sets of construction plans, maximum size 24" x 36." 21. STREET NAMES, HOUSE & SUITE NUMBERS: Submit requests for new street names and/or house numbers/suite numbers to the Building Division prior to submitting for the building permit Page 4 of 13 application process. 22. SOILS REPORT: A soils report, prepared to the satisfaction of the Building Official, containing foundation and retaining wall design recommendations, shall be submitted with the building permit application. This report shall be prepared by a licensed civil engineer specializing in soils mechanics. California Building Chapter 18. 23. SHORING: Shoring plans and calculations will be required for all excavations which exceed four (4) feet in depth or which remove lateral support from any existing building, adjacent property or the public right-of-way. Shoring plans and calcuilations'shall be prepared by a California licensed engineer and shall conform to Cal/OSHA regulations. 24. BACKWATER VALVE: The scope of this project may require the installation of a sanitary sewer backwater valve per Town Ordinance 6.50.025. Please provide information on the plans if a backwater valve is required and the location of the installation. The Town of Los Gatos Ordinance and West Valley Sanitation District (WVSD) requires backwater valves on drainage piping serving fixtures that have flood level rims less than 12-inches above the elevation of the next upstream manhole. 25. TOWN FIREPLACE STANDARDS: New wood burning fireplaces shall be an EPA Phase II approved appliance as per Town Ordinance 1905. Tree limbs shall be curt within 10-feet of chimneys. 26. SPECIAL INSPECTIONS: When a special inspection is required by CBC Section 1701, the architect or engineer of record shall prepare an inspection program that shall be submitted to the Building Official for approval prior to issuance of the building permit. The Town Special Inspection form must be completely filled-out, signed by all requested parties, and be blue-lined on the construction plans, Special Inspection forms are available from the Building Division Service Counter or online at www.los atg osea.gov/building. 27. NONPOINT SOURCE POLLUTION STANDARDS SHEET: The Town standard Santa Clara County Valley Nonpoint Source Pollution Control Program Sheet (or Clean Bay Sheet 2406) shall be part of the plan submittal as the second page. The specification sheet is available at the Building Division Service Counter for a fee of $2 or at San Jose Blue Print for a fee. 28. PLANS: The construction plans shall be prepared under the direct supervision of a licensed architect or engineer. (Business and Professionals Code Section 5538) 29. APPROVALS REQUIRED: The project requires the following departments and agencies approval before issuing a building permit: a. Community Development- Planning Division: Joel Paulson at (408) 354-6879 b. Engineering/Parks & Public Works Department: Fletcher Parsons at 395-3460 c. Santa Clara County Fire Department: (408) 378-4010 Page 5 of 13 d. West Valley Sanitation District: (408) 378-2407 e. Local School District: The Town will forward the paperwork to the appropriate school district(s) for processing. A copy of the paid receipt is required prior to permit issuance. 30. TITLE 24 - COMMERCIAL: The building shall comply with the latest California Title 24 Accessibility Standards. 31. FOUNDATION INSPECTIONS: A pad certificate prepared by a licensed civil engineer or land surveyor shall be submitted to the project building inspector at foundation inspection. This certificate shall certify compliance with the recommendations as specified in the soils report; and, the building pad elevation, on-site retaining wall locations and elevations are prepared according to approved plans. Horizontal and vertical controls shall be set and certified by a licensed surveyor or registered civil engineer for the following items: a. Building pad elevation b. Finish floor elevation c. Foundation corner locations d. Retaining Walls TO THE SATISFACTION OF THE DIRECTOR OF PARKS AND PUBLIC WORKS: Engineering Division 32. *GEOLOGY AND SOILS MITIGATION MEASURE #l: The recommendations of the PSI geotechnical investigation (August 2, 2007 and February 22, 2009) shall be incorporated in the final construction plans for the proposed project (Attachment 2 of the Initial Study). These recommendations address site preparation, earthwork operations, drainage, and foundations. 33. *HYDROLOGY AND WATER QUALITY MITIGATION MEASURE #1: Prior to the issuance of a building permit, the project applicant shall incorporate landscape-based stormwater treatment systems (e.g., bio-swales, bio-retention, etc.) into the project design. In the event that such treatment facilities are determined to be infeasible, the applicant will demonstrate to the Town's satisfaction that such measures would preclude the project implementation. 34. *TRANSPORTATION AND TRAFFIC MITIGATION MEASURE #1: The applicant shall contribute to the Town's future capital improvement project of installing a signal at the Lark Avenue/University Avenue intersection for its incremental share of impact as determined by the Town Engineer. 35. GENERAL. All public improvements shall be made according to the latest adopted Town Standard Drawings and the Town Standard Specifications. All work shall conform to the applicable Town ordinances. The adjacent public right-of=way shall be kept clear of all job related dirt and debris at the end of the day. Dirt and debris shall not be washed into storm drainage facilities. The storing of goods and materials on the sidewalk and/or the street will not Page 6 of 13 be allowed unless a special permit is issued. The developer's representative in charge shall be at the job site during all working hours. Failure to maintain the public right-of-way according to this condition may result in the Town performing the required maintenance at the developer's expense. 36, ENCROACHMENT PERMIT, All work in the public right-of-way will require a Construction Encroachment Permit. All work over $5,000 will require construction security. 37. GRADING PERMIT. A grading permit is required for site grading and drainage. The grading permit application (with grading plans) shall be made to the Engineering Division of the Parks & Public Works Department located at 41 Miles Avenue. The grading plans shall include final grading, drainage, retaining wall location, driveway, utilities and interim erosion control. Grading plans shall list earthwork quantities and a table of existing and proposed impervious areas. Unless specifically allowed by the Director of Parks and Public Works, the grading permit will be issued concurrently with the building permit. The grading permit is for work outside the building footprint(s). A separate building permit, issued by the Building Department on E. Main Street is needed for grading within the building footprint. 3 8. PAD CERTIFICATION. A letter from a licensed land surveyor shall be provided stating that the building foundation was constructed in accordance with the approved plans shall be provided subsequent to foundation construction and prior to construction on the structure. The pad certification shall address both vertical and horizontal foundation placement. 39. PRECONSTRUCTION MEETING. Prior to issuance of any permit or the commencement of any site work, the general contractor shall: a. Along with the project applicant, attend a pre-construction meeting with the Town Engineer to discuss the project conditions of approval, working hours, site maintenance and other construction matters; b. Acknowledge in writing that they have read and understand the project conditions of approval, and will make certain that all project sub-contractors have read and understand there prior to commencing work and that a copy of the project conditions of approval will be posted on site at all times during construction. 40. RETAINING WALLS. A building permit, issued by the Building Department at 110 E. Main Street, may be required for site retaining walls, Walls are not reviewed or approved by the Engineering Division of Parks and Public Works during the grading permit plan review process. 41. SOILS REPORT. One copy of the soils and geologic report shall be submitted with the grading permit application. A geotechnical review to determine the potential for fault ground rupture is required. Geotechnical Engineer must review and submit a report on the mapped faults in the area of the project and evaluate the potential for fault ground rupture and seismically induced liquefaction. The soils report shall include specific criteria and standards governing site grading, drainage, pavement design, retaining wall design and erosion control. The reports shall be Page 7 of 13 signed and "wet stamped" by the engineer or geologist, in conformance with Section 6735 of the California Business and Professions Code. 42. SOILS REVIEW. Prior to issuance of any permit, the applicant's soils engineer shall review the final grading and drainage plans to ensure that designs for foundations, retaining walls, site grading, and site drainage are in accordance with their recommendations and the peer review comments. The applicant's soils engineer's approval shall then be conveyed to the Town either by letter or by signing the plans. 43. DESIGN CHANGES. The Applicant's registered Engineer shall notify the Town Engineer, in writing, at least 72 hours in advance of all differences between the proposed work and the design indicated on the plans. Any proposed changes shall be subject to the approval of the Town before altered work is started. Any approved changes shall be incorporated into the final "as- built" drawings. 44. TRAFFIC IMPACT MITIGATION FEE (COMMERCIAL). The developer shall pay a fee proportional to the project's share of transportation improvement needed to serve cumulative development within the Town of Los Gatos. The fee amount will be based upon the Town Council resolution in effect at the time the building permit applications are made. The fee shall be paid before,the building permit is issued. The traffic.impact mitigation fee for this project, using the current fee schedule and the preliminary plans is $18,352. The final fee shall be calculated from the final plans using the rate schedule in effect at the time of the building permit application, using a trip generation rate based on Mini Warehouse use. 45. EASEMENT: Ingress/Egress/Utility easement will be required. Recorded Document will need to be provided to the Town Engineering Department prior to releasing Certificate of Occupancy. 46. PUBLIC WORKS INSPECTIONS. The developer or his representative shall notify the Engineering Inspector at least twenty-four (24) hours before starting any work pertaining to on- site drainage facilities, grading or paving, and all work in the Town's right-of-way. Failure to do so will result in rejection of work that went on without inspection. 47. EROSION CONTROL. Interim and final erosion control plans shall be prepared and submitted to the Engineering Division of the Parks & Public Works Department. A Notice of Intent(NOI) and Storm Water Pollution Prevention Plan (SWPPP) shall be submitted to the San Francisco Bay Regional Water Quality Control Board for projects disturbing more than one acre. A maximum of two weeks is allowed between clearing of an area and stabilizing/building on an area if grading is allowed during the rainy season.. Interim erosion control measures, to be carried out during construction and before installation of the final landscaping shall be included. Interim erosion control method shall include, but are not limited to: silt fences, fiber rolls (with locations and details), erosion control blankets, Town standard seeding specification, filter berms, check dams, retention basins, etc. Provide erosion control measures as needed to protect downstream water quality during winter months. The grading, drainage, erosion control plans and SWPPP Page 8 of 13 shall be in compliance with applicable measures contained in the amended provisions C.3 and C.14 of Order No. R2-2005-0035 of the amended Santa Clara County NPDES Permit. 48, STORM WATER MANAGEMENT PLAN, A storm water management shall be included with the grading permit application for all Group 1 and Group 2 projects as defined in the amended provisions C.3.d. of Order No. R2-2005-0035 of the amended Santa Clara County NPDES Permit No. CAS029718. The plan shall delineate source control measures and BMP's together with the sizing calculations. The plan shall be certified by a professional pre-qualified by the Town. In the event that storm water measures proposed on the Planning approval differ significantly from those certified on the Building/Grading Permit, the Town may require a modification of the Planning approval prior to release of the Building Permit. The applicant may elect to have the Planning submittal certified to avoid this possibility. 49. AGREEMENT FOR STORMWATER BEST MANAGEMENT PRACTICES INSPECTION AND MAINTENANCE OBLIGATIONS, The property owner shall enter into an agreement with the Town for maintenance of the stormwater filtration devices, required to be installed on this project by Town's Stormwater Discharge Permit No. CAS029718 and modified by Order No. R2-2005-0035. The agreement will specify that certain routine maintenance shall be performed by the property owner and will specify device maintenance reporting requirements. The agreement will also specify routine inspection requirements, permits and payment of fees. The agreement shall be recorded prior to release of any occupancy permits. 50. DUST CONTROL. Blowing dust shall be reduced by timing construction activities so that paving and building construction begin as soon as possible after completion of grading, and by landscaping disturbed soils as soon as possible. Further, water trucks shall be present and in use at the construction site. All portions of the site subject to blowing dust shall be watered as often as deemed necessary by the Town, or a minimum of three times daily, or apply (non-toxic) soil stabilizers on all unpaved access roads, parking areas, and staging areas at construction sites in order to insure proper control of blowing dust for the duration of the project. Watering on public streets shall not occur. Streets will be cleaned by street sweepers or by hand as often as deemed necessary by the Town Engineer, or at least once a day. Watering associated with on-site construction activity shall take place between the hours of 8 a.m. and 5 p.m. and shall include at least one late-afternoon watering to minimize the effects of blowing dust. All public streets soiled or littered due to this construction activity shall be cleaned and swept on a daily basis during the workweek to the satisfaction of the Town. Demolition or earthwork activities shall be halted when wind speeds (instantaneous gusts) exceed 25 MPH. All trucks hauling soil, sand, or other loose debris shall be covered. 51. CONSTRUCTION STREET PARKING. No vehicle having a manufacturer's rated gross vehicle weight exceeding ten thousand (10,000) pounds shall be allowed to park on the portion of a street which abuts property in a residential zone without prior approval from the Town Engineer 15.40.070). 52. SITE DRAINAGE. Rainwater leaders shall be discharged to splash blocks. No through curb Page 9 of 13 drains will be allowed. 53. NPDES. On-site drainage systems shall include a filtration device such as a bio-swale or permeable pavement. 54. SILT AND MUD IN PUBLIC RIGHT-OF-WAY. It is the responsibility of contractor and home owner to make sure that all dirt tracked into the public right-of-way is cleaned up on a daily basis. Mud, silt, concrete and other construction debris SHALL NOT be washed into the Town's storm drains. 55. RESTORATION OF PUBLIC IMPROVEMENTS. The developer shall repair or replace all existing improvements not designated for removal that are damaged or removed because of developer's operations. Improvements such as, but not limited to: curbs, gutters, sidewalks, driveways, signs, pavements, raised pavement markers, thermoplastic pavement markings, etc. shall be repaired and replaced to a condition equal to or better than the original condition. Existing improvement to be repaired or replaced shall be at the direction of the Engineering Construction Inspector, and shall comply with all Title 24 Disabled Access provisions. Developer shall request a walk-through with the Engineering Construction Inspector before the start of construction to verify existing conditions, 56. SIDEWALK/CURB IN-LIEU FEE. A curb and sidewalk in-lieu fee of $4,464 shall be paid prior to issuance of a building permit. This fee is based on a 0 LF of curb at $57/LF and 279-square Feet of 4.5-foot wide sidewalk at $16/SF in accordance with Town policy. 57. CURB AND GUTTER. The developer shall repair and replace to existing Town standards any curb and gutter damaged now or during construction of this project. New curb and gutter shall be constructed per Town Standard Details. The limits of curb and gutter repair will be determined by the Engineering Construction Inspector during the construction phase of the proj ect. 58. DRIVEWAY APPROACH. The developer shall install one (1) Town standard commercial driveway approach. The new driveway approach shall be constructed per Town Standard Details. 59. DEBRIS CLEANUP. The developer shall remove all debris and regrade the existing area at the base of the slope and the existing fence along University Avenue. The limits of cleanup will be determined by the Engineering Construction Inspector during the construction phase of the project. 60. AS-BUILT PLANS. An AutoCAD disk of the approved "as-built" plans shall be provided to the Town prior to issuance of a Certificate of Occupancy. The AutoCAD file shall include only the following information and shall conform to the layer naming convention: a) Building Outline, Layer: BLDG-OUTLINE; b) Driveway, Layer: DRIVEWAY; c) Retaining Wall, Layer: Page 10 of 13 RETAINING WALL; d) Swimming Pool, Layer: SWIMMING-POOL; e) Tennis Court, Layer: TENNIS-COURT; f) Property Line, Layer: PROPERTY-LINE; g) Contours, Layer: NEWCONTOUR. All as-built digital files must be on the same coordinate basis as the Town's survey control network and shall be submitted in AutoCAD version 2000 or higher. 61. SANITARY SEWER LATERAL. Sanitary sewer laterals are televised by West Valley Sanitation District and approved by the Town of Los Gatos before they are used or reused. Install a sanitary sewer lateral clean-out at the property line. 62. CONSTRUCTION NOISE. Between the hours of 8:00 a.m, to 8:00 p.m., weekdays and 9:00 a.m. to 7:00 p.m, weekends and holidays, construction, alteration or repair activities shall be allowed. No individual piece of equipment shall produce a noise level exceeding eighty-five (85) dBA at twenty-five (25) feet. If the device is located within a structure on the property, the measurement shall be made at distances as close to twenty-five (25) feet from the device as possible. The noise level at any point outside of the property plane shall not exceed eighty-five (85) dBA. 63. HAULING OF SOIL. Hauling of soil on or off site shall not occur during the morning or evening peak periods (between 7:00 a.m. and 9:00 a.m. and between 4:00 p.m. and 6:00 p.m.). Prior to the issuance of a building permit, the developer shall work with the Town Building and Engineering Department Engineering Inspectors to devise a traffic control plan to ensure safe and efficient traffic flow under periods when soil is hauled on or off the project site. This may include, but is not limited to provisions for the developer/owner to place construction notification signs noting the dates and time of construction and hauling activities, or providing additional traffic control. Cover all trucks hauling soil, sand, and other loose debris or require all trucks to maintain at least two feet of freeboard. 64. MAINTENANCE ACCESS. The applicant shall propose maintenance access improvements for the Town Engineer to review, comment on, and approve. The Engineering Division shall approve the surface materials over each public easement. 65. PERMIT ISSUANCE: Permits for each phase; reclamation, landscape, and grading, shall be issued simultaneously. 66. COVERED TRUCKS: All trucks transporting materials to and from the site shall be covered. Parks Division 67. WATER EFFICIENCY. This project is subject to the Town's Water Efficient Landscape Ordinance, Chapter 26, Article IV of the Town Code. Required fees shall be paid when the landscape, irrigation plans and water calculations are submitted for review. 68. NEW TREES. All newly planted trees are required to be double staked to Town standards. 69. GENERAL. All newly planted trees shown on the plan are specific subjects of approval of this Page 11 of 13 plan and must remain on the site. 70. IRRIGATION. All newly planted landscaping shall be irrigated by an in-ground irrigation system. Special care shall be taken to avoid irrigation which will endanger existing native trees and shrubs, TO THE SATISFACTION OF THE SANTA CLARA COUNTY FIRE DEPARTMENT: 71. REQUIRED FIRE FLOW: The fire flow for this project is 6,250 gpm at 20 psi residual pressure. As an automatic fire sprinkler system will be installed, the fire flow has been reduced by 75% establishing an adjusted fire flow of 1,500 gpm at 20 psi residual pressure. The adjusted fire flow is available from area water mains and fire hydrant(s) which are spaced at the required spacing. 72. AUTOMATIC FIRE SPRINKLER SYSTEM REQUIRED: All new and existing modified buildings when gross floor area exceeds 3,600 square feet shall be protected throughout by an approved automatic fire sprinkler system, hydraulically designed per National Fire Protection Association (NFPA) Standard #13. A State of California licensed (C-16) Fire Protection Contractor shall submit plans, calculations, a completed permit application and appropriate fees to this department for review and approval prior to begimiing their work. 73. NEW COMMERCIAL BUILDINGS: All new commercial buildings shall comply with standard specification SI-7 for construction site fire safety. 74. FIRE DEPARTMENT KEY BOX REQUIRED: The building shall be equipped with a permanently installed emergency access key lock box (Knox) conforming to Fire Department Standard Details and Specification sheet K-1. At time of final inspection keys shall be provided to the fire department. 75. FIRE APPARATUS (ENGINE) ACCESS ROADS REQUIRED: Provide access roadways with a paved all-weather surface with a minimum unobstructed width of 20 feet, vertical clearance of 13 feet 6 inches, minimum circulating turning radius of 36 feet outside and 23 feet inside, and a maximum slope of 15%. Installations shall conform with Fire Department Standard Details and Specifications sheet A-1. 76. FIRE DEPARTMENT (ENGINE) ROADWAY TURN-AROUND REQUIRED: Provide an approved fire department engine roadway turn around with a minimum radius of 36 feet outside and 23 feet inside. Installations shall conform with Fire Department Standard Details and Specification sheet A-1. Cul-de-sac diameters shall be no less than 72 feet. All fire department access/turnaround areas must be properly marked and dedicated solely to such use. SECTION VI Page 12 of 13 This Ordinance was introduced at a regular meeting of the Town Council of the Town of Los Gatos on October 5, 2009, and adopted by the following vote as an ordinance of the Town of Los Gatos at a meeting of the Town Council of the Town of Los Gatos on October 19, 2009 and becomes effective 30 days after it is adopted. COUNCIL MEMBERS: AYES: NAYS: ABSENT: ABSTAIN: SIGNED: ATTEST: MAYOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA CLERK ADMINISTRATOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA N:V)6V\OIIDS\930UNI VGRSI'I'Y.DOC Page 13 of 13 ~pW N 0 G , N COUNCIL AGENDA REPORT ~o DATE: October 12, 2009 TO: MAYOR AND TOWN COUNCIL FROM: ORRY P. KORB, TOWN ATTORNEYO~ MEETING DATE: 10-19-2009 AGENDA ITEM: SUBJECT: ADOPT RESOLUTION GRANTING AN APPEAL OF A DECISION OF THE PLANNING COMMISSION DENYING AN APPLICATION FOR CONSTRUCTION OF A NEW SINGLE FAMILY RESIDENCE ZONED R-120. APN: 529-37-042 AND REMANDING APPLICATION TO THE PLANNING COMMISSION: ARCHITECTURE APPLICATION: S-04-64. NEGATIVE DECLARATION: ND-07-147. PROPERTY LOCATION: 26 ALPINE AVENUE. PROPERTY OWNER/APPLICANT/APPELLANT: HOLIDAY DRIVE LLC. RECOMMENDATION: Adopt resolution granting an appeal of a decision of the Planning Commission denying an application for a new single family residence on property zoned R-120 and remanding the application to the Planning Commission. DISCUSSION: On October 5, 2009, Council decided to grant an appeal of a decision of the Planning Commission denying an application for a new single family residence on property zoned R-120. Council and remanding the application to the P1amling Commission. The attached resolution finalizes that decision. Attaclunent: Proposed Resolution PREPARED BY: ORRY P. KORB TOWN ATTORNEY OPK:pg N \MGR\Town Attoimey\Council Reports\10-19-09 26 Alpinempd Reviewed by: wn Manager Assistant Town Manager Clerk Finance C Community Development Rev: 10/14/09 3:14 pin Reformatted: 7/19/99 File# 301-05 RESOLUTION RESOLUTION GRANTING AN APPEAL OF A DECISION OF THE PLANNING COMMISSION DECISION DENYING AN APPLICATION FOR CONSTRUCTION OF A NEW SINGLE FAMILY RESIDENCE ZONED R-120 AND REMANDING APPLICATION TO THE PLANNING COMMISSION APN: 529-37-042 ARCHITECTURE APPLICATION: S-04-64 NEGATIVE DECLARATION: ND-07-147 PROPERTY LOCATION: 26 ALPINE AVENUE PROPERTY OWNER/APPLICANT/APPELLANT: HOLIDAY DRIVE, LLC WHEREAS: A. This matter came before the Town Council for public hearing on October 5, 2009, and was regularly noticed in conformance with state and Town law. B. Council received testimony and documentary evidence from the applicant/appellant and all interested persons who wished to testify or submit documents. Council considered all testimony and materials submitted, including the record of the Planning Commission proceedings and the packet of material contained in the Council Agenda Report dated September 23, 2009, along with any and all subsequent reports and materials prepared concerning this application. C. The appeal concerns a decision of the Planning Commission denying an application to build a new single family residence. The subject is the remaining undeveloped lot of a three-lot subdivision approved by the Planning Commission in 1991. The project site is located at 26 Alpine Avenue on the west side of the street, southeast of East Main Street. The subject lot also has frontage on Jackson Avenue. D. The application was considered by the Planning Commission on May 27, 2009. The Commission continued the matter to the meeting of July 8, 2009, with the direction that the applicant consider staff's suggestions or other alternatives to reduce the mass of the structure and the height of the auto court. At the July 8, 2009 meeting, the Planning Commission continued the matter at the applicant's request, with no discussion, to the meeting of August 12, 2009. The applicant modified the auto court area, which reduced the mass of the retaining wall. No changes were made to reduce the mass of the house. On August 12, 2009, the Commission denied the application since the mass of the house was not reduced and the applicant did not provide justification for ignoring the Commission's concerns in that regard. E. The Planning Commission's decision was appealed on August 24, 2009. The basis for the appeal was that the Commission erred or abused it discretion because of undue influence and false information allegedly received by them and the Planning Department, from a property that adjoining the north property line of the appellant/applicant. The neighbor is a member of the Town Council. N:\MGR\Town Attorneffouncil Reports\10-19-09 26 Alpine Resolution.wpd F. The appellant/applicant provided no evidence of undue influence by the neighbor. The staff report demonstrates that the Community Development Department was concerned about the mass of the right elevation of the proposed structure when the application was first reviewed in 2007, that this same concern was reiterated to the applicant numerous time during the application process, and that the concern was communicated to the Planning Commission by Town staff. G. Pursuant to Town Code section 29.20.300, Council finds that new information was presented that was not readily or reasonably available for submission to the Planning Commission at the time the applicant/appellant's application was denied.; to wit, that the appellant/applicant desires a remand in order to work with staff to address the issues of concern in order to obtain approval by the Planning Commission. Specifically, the appellant/applicant will work with staff to reduce the mass and scale of the right elevation and to ensure that the project is compatible and will blend with the scale and rhythm of the neighborhood and the natural features in the area. RESOLVED: That the appeal of the decision of the Planning Commission denying architecture and site application 5- 04-64 is granted and the application is remanded to the Planning Commission for further review consistent with this resolution. PASSED AND ADOPTED at a regular meeting of the Town Council of the Town of Los Gatos, California on the day of October, 2009, by the following vote. COUNCIL MEMBERS: AYES: NAYS: ABSENT: ABSTAIN: SIGNED: MAYOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA ATTEST: CLERK ADMINISTRATOR TOWN OF LOS GATOS, CALIFORNIA N:\MGR\Town Attorney\Council Reports\10-19-09 26 Alpine Resolution.wpd ~pW N 0 COUNCIL AGENDA REPORT S G AS DATE: October 13, 2009 TO: MAYOR AND TOWN COUNCIL FROM: ORRY P. KORB, TOWN ATTORNEY SUBJECT: ADOPT AN ORDINANCE AMENDING THE TOWN CODE CHAPTER 29, DIVISION 6, SECTIONS 29.10.3000 THROUGH 29.10.3040 REGARDING THE HOUSING ASSISTANCE PROGRAM RECOMMENDATION: Adopt an ordinance to amend the Town Code Chapter 29, Division 6, Sections 29.10.3000 through 29.10.3040. DISCUSSION: On October 5, 2009, Council voted to introduce an ordinance amending Town Code Chapter 29, Division 6 Sections 29.10.3000 through 29.10.3040 regarding the Housing Assistance Program and adopted a resolution approving revised Below Market Price (BMP) Program Guidelines. Adoption of the attached ordinance finalizes the decision to amend the Town Code provisions regarding the Housing Assistance Program. Attachment: Ordinance introduced October 5, 2009. PREPARED BY: ORRY P. KORB, TOWN ATTORNEY oPKncUwp [NSA Y\Rcsos&o«i5uzc,)on5\BMPOrd]o-i3-o9 ivpd] Reviewed by: own Manager Assistant Town Manager Clerk Finance "Community Development Rev: 10/14/09 5:43 pm Reformatted: 7/19/99 MEETING DATE: 10-19-2009 AGENDA ITEM: File# 301-05 ORDINANCE AN ORDINANCE OF THE TOWN OF LOS GATOS AMENDING TOWN CODE CHAPTER 29, DIVISON 6, SECTIONS 29.10.3000 THROUGH 29.10.3040 HOUSING ASSISTANCE PROGRAM THE TOWN COUNCIL OF THE TOWN OF LOS GATOS DOES ORDAIN AS FOLLOWS: SECTION I Town Code Chapter 29, Division 6 (Sections 29.10.3000 through 29.10.3040, Housing Assistance Program) is deleted in its entirety. SECTION II Town Code Chapter 29, is hereby amended to read as follows: ZONING REGULATIONS Article I. In General DIVISION 6. HOUSING ASSISTANCE PROGRAM Sec, 29.10.3000. Intent. Sec. 29.10.3005. Below market price program - Established. Sec. 29.10.3010. Same - Intent. Sec. 29.10.3015. Application. Sec. 29.10.3020. Definitions. Sec. 29.10.3025 Scope. Sec. 29.10.3030. Price. Sec. 29.10.3035. Project denial. Sec. 29.10.3040. Administration. Page 1 of 5 SECTION III Town Code Chapter 29, Division 6 is replaced as follows: DIVISION 6. HOUSING ASSISTANCE PROGRAM Sec. 29.10.3000. Intent. This division is adopted to meet housing needs shown in the housing element of the general plan. (Ord. No. 1316, § 3.90.010, 6-7-76; Ord. No. 1430, 6-4-79) See. 29.10.3005. Below market price program--Established. This division establishes the below market price program (BMP). (Ord. No. 1316, § 3.90.100, 6-7-76; Ord. No. 1430, 6-4-79) Sec. 29.10.3010. Same--Intent. The below market price (BMP) program requires the provision of dwellings that persons and families of moderate income can afford to buy or rent, and assures to the extent possible that the resale prices of those dwellings, and rents if they are rented, will be within the means of persons and families of moderate income. (Ord. No. 1316, § 3.90.105, 6-7-76; Ord. No. 1430, 6-4-79; Ord. No. 1685, 6-2-86) Sec. 29.10.3015. Application. This division shall apply to all multiple-family dwelling projects, residential condominium projects, condominium conversions, and to all residential plamled development projects (division 2 of article VIII of this chapter) either approved after July 4, 1979, or whose approval includes a condition requiring the provision of BMP dwellings. Projects in the R-1 and HR zones are excepted from BMP participation. The exception does not apply if the project is built under the rules of an overlay zone unless the rules of the overlay zone provide otherwise. (Ord. No. 1316, § 3.90.110, 6-7-76; Ord. No. 1430, 6-4-79; Ord. No. 1685, 6-2-86) Sec. 29.10.3020. Definitions. For the purposes of this division the following definitions shall apply: BMP dwelling means any residential dwelling unit designated for very low, low, and moderate income under the rules of this section. Person of moderate income means one whose income falls within the range specified by the Town Council in the resolution authorized by section 29.10.3040. (Ord. No. 1316, § 3.90.115, 6-7-76; Ord. No. 1430, 6-4-79; Ord. No. 1685, 6-2-86; Ord. No. 2115, § II, 9-15-03) Page 2 of 5 Sec. 29.10.3025. Scope. The Below Market Price Program requirements shall apply to all residential development projects that include five (5) or more residential units or parcels which involve: 1. New construction of ownership or rental housing units, including mixed use developments and addition of units to existing projects, or 2. Subdivision of property for single family or duplex housing development, or 3. Conversion of rental apartments to condominiums or other common interest ownership, or 4. Conversion of non-residential use to residential use. The residential developments consisting of five or more units are required to provide the following number of BMP units: (1) Projects containing five (5) or more but less than twenty (20) market rate units must provide a number of BMP units equal to ten (10) percent of the number of market rate units. (2) Projects with from twenty (20) to one hundred (100) market rate units must provide BMP units as determined by the following formula: Number of BMP units = .225 (total # of market rate units) - 2.5 (3) All projects in excess of one hundred (100) market rate units must provide a number of BMP units equal to twenty (20) percent of the market rate units. (4) Whenever the calculations of BMP units result in a fraction of one-half or more, the number of units to be reserved is increased to the next whole number. (5) The Town, at its sole discretion, may consider an in-lieu payment alternative to the required BMP unit in the case of Plamled Unit development with an underlying zone of HR or a residential developments with five (5) to nine (9) units. Prior to approving the in-lieu fee alternative, the applicant must demonstrate to the satisfaction of the Town why a BMP unit cannot be (1) developed on the same site as the market rate units, and if it cannot be provided on the same site then, (2) develop at an appropriate off-site location within the Town limits. If the developer provides sufficient justification that both of these alternatives are not viable, then a fee in-lieu option may be considered. The required in-lieu fee is as established by a separate resolution and is to be paid to the Town prior to issuance of the certificate of occupancy for the market rate residential unit that triggered the BMP requirement. The provision for a BMP unit applies if the project is built under the rules of an overlay zone unless the rules of the overlay zone provide otherwise. BMP units shall be constructed and Certificate of Occupancies secured concurrently with or prior to the construction of the market-rate units. The BMP requirement will be calculated on the basis of the whole development. The Town Council may grant an exception to the phasing requirements during the project approval process. Page 3 of 5 (Ord. No. 1316, § 3.90.120, 6-7-76; Ord. No. 1430, 6-4-79; Ord. No. 1685, 6-2-86; Ord. No. 1687, 8-4-86; Ord. No. 1838, § I, 11-5-90) Sec. 29.10.3030. Price. The price of BMP units is controlled for the first buyer and for future buyers by the BMP Guidelines as adopted and amended from time to time by Council resolution and as follows: (1) The initial price is limited to direct construction cost and a proportionate share of the costs of preparing working drawings and specifications and providing on-site and off- site improvements, determined according to rules set by the Council. (2) The initial price does not include the cost of land, profit, or marketing costs. (3) Each BMP unit will be subjected to recorded title restrictions concerning manner of future sales, occupancy and leasing. (4) Each buyer of a BMP unit must agree to sell the unit to a moderate income buyer designated by the Town. The Town will designate moderate income persons according to rules adopted by the Council in effect at the time the seller purchased the unit. (5) The resale price carmot exceed the original selling price plus the value at the time of sale of improvements added by the owner, and plus an amount equal to the increase in cost of living or housing during the owner's tenure. The index or method to be used in calculating the increase is established by the Council. (6) If a BMP unit to be resold has not been properly maintained or for any other reason is in poor condition and in need of cleaning or repair, the Town may elect to do the work or have it done and recover the cost from the sale price limited as provided in subsection (5). (7) The regulations will specify the period for controlled resales. The time period will be in perpetuity or for as long as is practical. (Ord. No. 1316, § 3.90.125, 6-7-76; Ord. No. 1430, 6-4-79) Sec. 29.10.3035. Project denial. If an applicant for zoning approval declines to provide BMP units required by ordinance, the zoning approval shall be denied. (Ord. No. 1316, § 3.90.130, 6-7-76; Ord. No. 1430, 6-4-79) Sec. 29.10.3040. Administration. The Council shall adopt by resolution regulations concerning all aspects of the BMP program, including the elements of location of the units, price, buyer eligibility standards, rent, the length of the period during which a unit will be subject to BMP restrictions, the form of recorded instruments and any other matter consistent with the provisions of this section. (Ord. No. 1316, § 3.90.135, 6-7-76; Ord. No. 1430, 6-4-79; Ord. No. 1685, 6-2-86) Page 4 of 5 SECTION IV If any of the provisions of this ordinance or the application thereof to any person or property is held invalid, such invalidity shall not affect the other provisions of this ordinance which can be given effect without the invalid provision or application, and to this end the provisions of this ordinance are declared to be severable. SECTION V Any judicial review of this ordinance shall be by writ of mandate, under Code of Civil Procedure 1085. Any action or proceedings seeking to attack, review, set aside, void or annul this ordinance shall be commenced within 90 days after adoption of this ordinance. This Ordinance was introduced at a regular meeting of the Town Council of the Town of Los Gatos on October 5, 2009, and adopted by the following vote as an ordinance of the Town of Los Gatos at a meeting of the Town Council of the Town of Los Gatos on , 2009. This ordinance takes effect 30 days after it is adopted. COUNCIL MEMBERS: AYES: NAYS: ABSENT: ABSTAIN: SIGNED: MAYOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA ATTEST: CLERK ADMINISTRATOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA Page 5 of 5 DRAFT Council/Agency Meeting Item # MINUTES OF THE TOWN COUNCIL/PARKING AUTHORITY/REDEVELOPMENT AGENCY OCTOBER 5, 2009 The Town Council of the Town of Los Gatos conducted a Regular Meeting on Monday, October 5, 2009 at 7:00 P.M. CLOSED SESSION BEGAN AT 5:30 P.M. TOWN COUNCIL/PARKING AUTHORITY/REDEVELOPMENT AGENCY ROLL CALL Present: Mayor Mike Wasserman, Vice Mayor Diane McNutt, Council Member Joe Pirzynski, Council Member Steve Rice, Council Member Barbara Spector Absent: None. PLEDGE OF ALLEGIANCE Youth Park "Citizens of the Year" Jakob Jolley, Ubah Dimbil, Molley Macierz, Grace Peterson, and LaurenJean Rice, Youth Citizens of the Year led the Pledge of Allegiance. The audience was invited to participate. Mayor Mike Wasserman introduced Boy Scout Troop 539. The Troop was attending the meeting for a Scout project. PRESENTATIONS Commendations Harley Crock, Los Gatos-Saratoga Community Education & Recreation • Mayor Mike Wasserman presented Harley Crock with a commendation for his service to Los Gatos-Saratoga Recreation and to the community. • Mr. Crock thanked the Town and the community for all their support. Nick Johnson, Eagle Scout • Mayor Mike Wasserman presented a commendation to Nick Johnson for his service to the Town and to the Boy Scouts of America. • Mr. Johnson completed a project which he designed and built 12 emergency backboards for the CERT program for the Town of Los Gatos to earn his Eagle Scout award. • Mr. Johnson thanked the Town Council and community for their support. Proclamation - Los Gatos Prepared • Mayor Mike Wasserman presented a proclamation to Sergeant Kerry Harris proclaiming the month of October as Los Gatos Prepared Month. • Commented that the Town of Los Gatos is preparing for the 20 year anniversary of the Loma Prieta Earthquake and urged all residents to be prepared. CLOSED SESSION REPORT CONFERENCE WITH REAL PROPERTY NEGOTIATORS (Government Code Section 54956.8) Property: 123 and 208 E. Main Street Negotiating Parties: Town of Los Gatos (Negotiator: Regina Falkner, Community Services Director) Los Gatos-Saratoga Community Education & Recreation District (Negotiator: Steve Rauwolf, Director) Under Negotiation: Price and terms of payment Mr. Korb stated that direction was given and no final action was taken. Property: 17 Fiesta Way Negotiating Parties: Town of Los Gatos (Negotiator: Pamela Jacobs, Assistant Town Manager) currently unknown potential purchasers Under Negotiation: Price and terms of payment Mr. Korb stated that direction was given and no final action was taken. TOWN COUNCIL COUNCIL/TOWN MANAGER REPORTS Council Matters There were no Council matters for this meeting. 2 Council/Manager Reports - Continued Manager Matters Mr. Larson • Commented that the Town is recruiting applicants to fill seats on the Town's Boards and Commissions. The deadline to submit applications is October 16, 2009. • Commended Town staff, Los Gatos Recreation Department, Fisher Middle School, and Billy Jones Railroad for the success of the Town's annual Screen on the Green event. • Commented that there were 120 homes participating in the Town's annual garage sale. Second Chance Week starts this week and on Saturday, October 10, 2009, residents are encouraged to drop off goods to be used by families which are in need over the winter months. Items will be donated to seven non-profits and they are requesting warm outer wear for men, women, and children, blankets and towels, ladies professional attire, eye glasses, sun glasses, and new toiletries to provide to those in need in the broader Los Gatos community. • Thanked the sponsors, residents, and visitors who participated in the Town wide garage sale. • Commented that the slurry seal project was delayed due to weather and to finish the project, the Town scheduled work over the weekend which did cause some traffic delays. • Thanked the community for being patient and commended the Police Department for providing extra traffic control during the project. • Commented that the Town will not have to do another slurry seal project for two years. • Commented that Bud Lortz, Deputy Town Manager, has announced his retirement from the Town of Los Gatos. Mr. Lortz has contributed over 20 years to the Town of Los Gatos, the Community Development Department, and the Redevelopment Agency. CONSENT ITEMS (TO BE ACTED UPON BY A SINGLE MOTION) 1. Adopt ordinance revising Town Code Section 14.110.015 regarding the passage of Senate Bill 731 which regulates massage therapy practitioners and therapists. ORDINANCE 2177 2. Accept Fiscal Year 2008-09 Annual Report. TOWN COUNCIL/REDEVELOPMENT AGENCY 3. PPW Job No. 07-16 - Parking Lot 6 Reconstruction Adopt resolution approving plans and specifications for the Parking Lot 6 reconstruction project and authorize staff to advertise the project for bid. RESOLUTION 2009-107 4. Approval of Special Gift Opportunities List to be used by the Friends of the Los Gatos Library in the Capital Campaign for the new Los Gatos Library. 5. Approve Council/Agency minutes of September 21, 2009. Mr. Davis pulled Consent Item #5. Mayor Mike Wasserman requested that Mr. Davis speak on the pulled consent Item prior to Council's motion to approve the Consent Item Calendar. Mr. Davis Commented that his public comments for Item #6 of the October 5, 2009 Town Council meeting did not reflect his correct statement. Commented that he said that he took objection to Mr. Larson's comment about the fact that the kids of Los Gatos would have continued use of the 13 acres of Vasona property. He felt that there were approximately 8 out of the 13 acres that were buildable for sports use for the Town to utilize and that once the County purchased the land the passive use policy would restrict sports use on the property. MOTION: Motion by Council Member Joe Pirzynski to approve Consent Items # 1-5. Seconded by Council Member Barbara Spector. VOTE: Motion passed unanimously. 4 VERBAL COMMUNICATIONS Mr. Davis • Commented that the naming of the mountain in Los Gatos should reflect the natural beauty of the Town and suggested calling the Mountain "Monte del Sol" to reflect that natural beauty of the sun rising over the mountain. • Expressed concerns that Mayor Mike Wasserman cuts speakers off from the podium. • Expressed concerns about the proposed North 40 Plan and that he does not like the policies set by the Town. Mr. Reichwein Commended the Town for purchasing land to build a sports use facility and requested that the Town build a skate park at the proposed site. Suggested that the Town hold classes at the sports facility to teach kids to build ramps and skate parks and that he is willing to build a skate park at the facility. Dr. Ronen • Stated that he has applied for a business license and has experienced difficult challenges with the classification of his business and parking for that classification. Ms. Rooney, Director of Community Development • Commented that staff did meet with Dr. Ronen and had explained to him that the space that he has rented has insufficient parking for a chiropractic business. • Commented that six spaces are required by Town policy for the amount of space rented by Dr. Ronen. Closed Verbal Communications 5 OTHER BUSINESS - TOWN COUNCIL 6. Adopt an Interim Ordinance of the Town of Los Gatos imposing as an urgency measure a moratorium on the approval, commencement, establishment, or operation of medical marijuana dispensaries. Staff report made by Greg Larson, Town Manager. Open/Closed Public Comments MOTION: Motion by Council Member Joe Pirzynski to adopt an Interim Ordinance of the Town of Los Gatos imposing as an urgency measure a moratorium on the approval, commencement, establishment, or operation of medical marijuana dispensaries. Seconded by Council Member Steve Rice. Council Discussions • Requested information as to what the League of California Cities and other jurisdictions might be doing to address the issue. • Commented that the League of California Cities may have input that would be applicable to all jurisdictions. • Commented on seeking the views from the League of California Cities as well as reflecting the values of the community. • Suggested that the 480 cities in California are very diverse and that the Town should drive the issue primarily by local community interest. VOTE: Motion passed unanimously. PUBLIC HEARINGS - TOWN COUNCIL/REDEVELOPMENT AGENCY 7. Introduction of an ordinance amending Town Code Chapter 29, Division 6, Sections 29.10.3000 through 29.10.3040 Housing Assistance Program and adoption of the resolution repealing resolution 2008-121 and approving the revised BMP Guidelines (continued from 9/21/09) RESOLUTION 2009-108 Staff report made by Wendie Rooney, Director of Community Development. 6 Public Hearing Item #7 - Continued Council Comments • Requested clarification on the Planning Commission's recommendation to change the in-lieu fee. • Questioned the qualifications for a first time buyer and if Santa Cruz County is one of the nine bay area counties. • Questioned the reality to incorporate BMP housing within a hillside development. • Questioned why the Community Services Commission thought two years would be fair as the BMP requirement. Ms. Rooney • Commented that the Planning Commission felt that you could integrate a BMP unit into a hillside development, but their major concern was that hillside developments tend to have larger lots and larger homes which may make it economically infeasible to develop a BMP unit into that type of hillside development. • Clarified that Santa Cruz County is one of the bay area counties in the BMP Guidelines. Clarified that there should be some type of concession for people affected by condo conversions and the Community Services Commission thought that the two year time frame would be sufficient. Open/Closed Public Hearing Council Discussions • Questioned how an applicant would demonstrate that a site is infeasible for BMP units. • Questioned if the same solution was discussed regarding small residential projects with 5 to 9 units. • Commented that the General Plan Committee had expressed that they would like to have BMP units scattered throughout the Town rather than funding the in-lieu fee account. • Commented that it was General Plan's recommendation to eliminate the in-lieu fee for the smaller projects with 5 to 9 units and that staff has researched why the Town might need an in-lieu fee fund. • Commented on supporting building a BMP unit verses the in-lieu fee. • Commented that it would be to the Town's benefit to produce BMP units and that the in-lieu fee would be a last option. • Requested clarification on the consistency of the General Plan Committee and the Planning Commission's recommendation for BMP units. • Commented that the goal is to create BMP units throughout the community. Public Hearing Item #7 - Continued Ms. Rooney • Commented that the Planning Commission was looking at a tiered process for hillside residential, because in hillside residential the overall intent is to keep the density lower and that an applicant should be able to demonstrate why a BMP should not be constructed on site. Mayor Mike Wasserman directed Jackie Rose, Clerk Administrator to read the title of the ordinance. MOTION: Motion by Council Member Steve Rice to waive the reading of the ordinance. Seconded by Council Member Joe Pirzynski. VOTE: Motion passed unanimously. MOTION: Motion by Mayor Mike Wasserman to introduce an ordinance amending Town Code Chapter 29, Division 6, Sections 29.10.3000 through 29.10.3040 Housing Assistance Program with the change to apply the current rule proposed for hillside residential to small residential projects with 5 to 9 units. Seconded by Council Member Steve Rice. Council Discussions • Expressed concerns that there is an inconsistency in fairness across the board if the motion was only relating to smaller projects with 5 to 9 units. • Commented that the rules have not changed for larger developments and that the change would only mean that the smaller projects would have to follow the same guidelines. • Expressed concerns that the goal, as part of the General Plan, was to scatter BMP units across Town and feels that the motion does not reflect that recommendation. • Suggested maintaining the Planning Commission's recommendation and to move forward with the language that accommodates the elimination of the in-lieu fee for the 5 to 9 units. • Commented that the motion leaves room for BMP units to be proposed at another site if the current development is not reasonable. • Commented that the statement relating to the phrase "if the on-site option is infeasible" is a pretty clear direction to future Planning Commissioners. • Commented that it would be the responsibility of the applicant to prove that the BMP unit would not be feasible on site. Public Hearing Item #7 - Continued Mr. Korb Clarified that the challenge may arise when trying to phase projects in a manner that ensures development of an off-site BMP unit and regulates that the BMP unit gets built. VOTE: Motion passed 3/2. Vice Mayor Diane McNutt and Council Member Barbara Spector voted no. Mayor Mike Wasserman directed Jackie Rose, Clerk Administrator to publish the ordinance. MOTION: Motion by Council Member Joe Pirzynski to approve the resolution repealing Resolution 2008-121 and approving the revised BMP Program Guidelines in staff report as Attachment 1. Seconded by Council Member Steve Rice. VOTE: Motion passed 3/2. Vice Mayor Diane McNutt and Council Member Barbara Spector voted no. PUBLIC HEARINGS - TOWN COUNCIL 8. Consider a request for a zone change from CM to CM:PD for a three- story self storage building. No significant environmental impacts have been identified as a result of this project and a Mitigated Negative Declaration is recommended. APN 424-31-031. Planned Development Application PD-08-001 - Negative Declaration ND-08-05 Property Location: 930 University Avenue Property Owner: Extra Space of Los Gatos, LLC Applicant: Extra Space Storage. Staff report made by Joel Paulson, Associate Planner. Council Comments • Questioned if there is a document showing which trees are being removed along the University Avenue side of the site. • Questioned if any thought was given to a community benefit for traffic mitigation along University Avenue or the intersection of University Avenue and Lark Avenue. • Questioned if the Oaks that are on the site would be removed. • Questioned the community benefit for LED lights and requested clarification on the traffic impact fee and the traffic and transportation mitigation under performance standard #32. 9 Public Hearing Item #8 - Continued Mr. Paulson • Clarified that there are five trees slated to be removed and that the Town arborist had indicated that the Eucalyptus trees were a hazard. • Commented that the Walnut tree is not on the endangered tree list. • Clarified that the Oaks will not be removed from the site. • Clarified that staff did not persue any community benefit for traffic issues. • Clarified that the Town consultant has recommended that the developer pay a percentage of the traffic signal fees for a signal at Lark Avenue and University Avenue. Mr. Korb • Clarified that the applicant is already paying traffic mitigation fees per the requirements by Town policies and the applicant is offering the LED lighting as a community benefit. Open Public Hearing Mr. Wyckoff, Applicant • Commented that the proposed building has 360 degree architecture. • Commented that the buffer from the trees shields most of the unit and property. • Requested the zone change from controlled manufacturing to controlled manufacturing, Planned Development. • Clarified the purpose for the caretaker's quarters. • Commented that the current public right-of-way is 65 feet and requested a reduction from that setback which would be comparable to the existing neighbors. • Commented that the trees slated for removal have health issues and are a hazard, but they are willing to leave any trees that Council recommends. • Commented that the Pine trees would need to be removed or pruned to avoid a hazard. • Commented that a community benefit comparable to the cost for LED lighting at the site could be used for any other benefit that the Council would suggest. • Commented on the low vehicle trip rate for the proposed project. • Commented that the size of the facility is economically suitable for the use and the height is lower than the surrounding buildings. • Commented that the site is buffered from the community trail and fits in well with the neighbors. 10 Public Hearing Item #8 - Continued Council Comments • Questioned if all of the staging and construction for the proposed building would be done on site. • Questioned if the applicant would be willing to offer the community benefit to assist the Town with needs for the sport facility site. • Questioned when Council would need to determine what the community benefit would be used for at the proposed sports facility site. Mr. Wyckoff • Clarified that they will be doing all construction and staging on site. • Clarified that they are willing to donate the community benefit to use for the sports facility site. • Commented that the community benefit could be donated and used at the discretion of the Town. Mr. Larson • Recommended that Condition #6 be expanded to reflect the offering of the applicant, but to provide an alternative at the Town's discretion for the receipt of the equivalent value to be applied to a traffic site or other improvement for the sports facility adjacent to the applicant's property. Mr. Davis • Commented that the idea for neighborhood compatibility and community benefit is a great idea. • Questioned if the setback is sufficient enough on the side adjacent to the sports facility. • Commented that the traffic studies were discussed during the first Planning Commission meeting, but never discussed again. • Commented that there are 200 car trips a day listed in the current traffic study done on the proposed project. • Expressed concerns that the study was not in the Council's staff report. Mr. Larson Clarified that the Planning Commission at its first hearing did not send back to staff any further consideration of the traffic analysis. They viewed that the work had been completed at the first Planning Commission hearing. All that was returned to the Planning Commission for the second hearing were the issues that had been continued. Commented that Council has the staff reports from the first and second Planning Commission meeting including the full traffic analysis. 11 Public Hearing Item #8 - Continued Mr. Wyckoff • Commented that if they utilize the front setback it would allow further setbacks on the creek side and sports facility side. • Commented on the parking uses for the proposed property and the neighboring sites. • Commented that they are required to have 14 spaces, but usually only four or five cars are at the facility at any given time. Closed Public Hearing Council Discussions • Questioned the reason for the large Floor Area Ratio (FAR) for the proposed site. • Questioned if there was any discussion during Planning Commission relating to the Floor Area Ratio (FAR) issue. • Questioned the limitations on the property given the Planned Development if the owners were to sell the property at a later time. • Questioned if the applicant understands the requirements associated with the Planned Development for the property. Mr. Wyckoff • Clarified that the proposed project does have a higher Floor Area Ratio (FAR) and the primary reason for that is because of the parking requirements. Also the proposed project has less intensive use, less vehicle trips, and low impacts to the neighbors. • Commented that the facility is a local facility and that they have other locations within a three mile radius. • Commented that the modeling for the proposed project was designed using the current zoning policies of the Town. Mr. Paulson • Clarified that the Floor Area Ratio (FAR) issues were discussed with staff and that staff had provided information to the Planning Commission regarding why they felt that for this project the height, mass, and scale were appropriate given the site's characteristics. Clarified that there are health issues with the Ash and Walnut trees located on the property. 12 Public Hearing Item #8 - Continued Mr. Korb • Clarified that when you place a Planned Development on a property it creates an alternative land use zone. The limitations are the uses allowed by the Planned Development. • Commented that the Planned Development use for the proposed site is extremely limited and allows a storage use with a caretaker unit. • Commented that any subsequent user would need to seek an amendment to the Planned Development application in order to change the use. MOTION: Motion by Council Member Joe Pirzynski to make the Mitigated Negative Declaration as stated in Attachment 1. Seconded by Vice Mayor Diane McNutt. VOTE: Motion passed unanimously. MOTION: Motion by Council Member Joe Pirzynski to approve Mitigated Monitoring Plan as indicated in Exhibit 15 of Attachment 2. Seconded by Vice Mayor Diane McNutt. VOTE: Motion passed unanimously. MOTION: Motion by Council Member Joe Pirzynski to waive the reading of the ordinance. Seconded by Vice Mayor Diane McNutt. VOTE: Motion passed unanimously. Mayor Mike Wasserman directed Jackie Rose, Clerk Administrator to read the title of the ordinance. MOTION: Motion by Council Member Joe Pirzynski to make the required findings for the zone change (Exhibit 2 of Attachment 2) and approve the application subject to the conditions included in the Planned Development Ordinance (Exhibit 18 of Attachment 2) with Condition #6 amended to read: Alternately, at the discretion of the Town, the applicant will provide $40,000 for on-site or off-site access or other improvements for the proposed adjacent public recreation facility as determined by the Town. Seconded by Vice Mayor Diane McNutt. VOTE: Motion passed unanimously. 13 Public Hearing Item #8 - Continued MOTION: Motion by Council Member Joe Pirzynski to introduce a zone change from CM to CM:PD for a three-story self storage building. No significant environmental impacts have been identified as a result of this project and a Mitigated Negative Declaration is recommended. APN 424-31-031. Planned Development Application PD-08-001 - Negative Declaration ND-08-05 Property Location: 930 University Avenue Property Owner: Extra Space of Los Gatos, LLC Applicant: Extra Space Storage. Seconded by Vice Mayor Diane McNutt. VOTE: Motion passed unanimously. Mayor Mike Wasserman to direct Jackie Rose, Clerk Administrator to publish ordinance. 9. Consider an appeal of a Planning Commission decision denying Architecture and Site Application S-04-64 and the Mitigated Negative Declaration ND-07-147 on property zoned R-1:20. APN 529-37-042 Property location: 26 Alpine Avenue Property ownerlapplicantlappellant: Holiday Drive, LLC. Vice Mayor Diane McNutt and Council Member Steve Rice recused themselves from Item #9 due to the location of their residence. Staff report made by Sandy Baily, Interim Assistant Planning Director. Council Comments Requested clarification on the process to remand the application back to the Planning Commission. Mr. Korb • Clarified that it would be appropriate given the appeal, that the applicant would like the opportunity to revise the project in an effort to obtain Planning Commission approval which would be new information and that would be a basis to reverse the decision and remand it back to the Planning Commission. 14 Public Hearing Item #9 - Continued Open Public Hearing Mr. Barnes, Applicant • Requested that the issue be remanded back to the Planning Commission. • Commented that he would like to work with staff and the Planning Commission to obtain Planning Commission approval. Closed Public Hearing MOTION: Motion by Council Member Barbara Spector to move that the Planning Commission decision be modified relative to the appeal and return the item back to the Planning Commission because of new information received by Council. The new information as stated below and in Attachment 13 which was provided as a Desk Item as well as the applicant's testimony. New Information: 1. The project can be modified as the Planning Commission requested to reduce the mass of the right elevation; and 2. Applicant would like the opportunity to work with staff and the Planning Commission to obtain Planning Commission approval. Seconded by Council Member Joe Pirzynski. VOTE: Motion passed unanimously. ADJOURNMENT Attest: Jackie D. Rose, Clerk Administrator 15 ~rj N 0 COUNCIL AGENDA REPORT ~S GAgO DATE: September 30, 2009 TO: MAYOR AND TOWN COUNCIL FROM: GREG LARSON, TOWN MANA SUBJECT: MEETING DATE: 10/19/09 ITEM NO: '::2~ PERMIT FEE A. INTRODUCTION OF AN ORDINANCE REVISING TOWN CODE SECTION 14.50.010 REGARDING POLICE ALARMS AND INTRODUCTION OF COMMERCIAL ALARM PERMIT FEES B. ADOPT RESOLUTION AUTHORIZING THE TOWN MANAGER TO NEGOTIATE AND EXECUTE AN AGREEMENT WITH PMAM CORPORATION FOR PROFESSIONAL ALARM MANAGEMENT CONSULTANT SERVICES RECOMMENDATION: 1. Open and hold the public hearing. 2. Close the public hearing. 3. Direct the Clerk Administrator to read the title of the ordinance (no motion required). 4. Move to waive the reading of the ordinance (motion required). 5. Introduce the ordinance to effectuate the Zoning Code amendment (motion required). 6. Direct the Clerk Administrator to publish the ordinance within 15 days after adoption (no motion required). 7. Adopt resolution authorizing the Town Manager to negotiate and execute an agreement with PMAM Corporation for professional alarm management consultant services. BACKGROUND: The ordinance regulating police alarms was written in 1968 and revised most recently in 2001. The Town Council approved a resolution on April 6, 2009 establishing fees for FY09-10, which included a second false alarm fee of $50 and a commercial alarm permit fee of $50. PREPARED BY: Scott R. Seaman, Chief of Police Cttl /j, O-A'~-" " U:ALARMcoucnilreport 10.19.09v.2.doc Reviewed by: v'l Jl Assistant Town Manager tvl' Town Attorney Clerk A m>nlstrator Finance -IIN-Mmunity Development PAGE 2 MAYOR AND TOWN COUNCIL SUBJECT: AMENDMENT TO POLICE ALARM ORDINANCE DISCUSSION: The Town of Los Gatos police alarm ordinance section 14.5 addresses police alarm fees for false alarms, payment, appeals and no response status. The Town Council action on April 6, 2009 established a charge of $50 for each second false alarm, $110 for a third and so on to the sixth and subsequent alarm service charge which increases by $300 per activation. Prior to this action, there was no charge for a second false alarm at a residence or business. One of the strategies used by other jurisdictions to minimize the impact of false alarms, increase the amount of cost recovery associated to the responding of false alarms and ensure the department has accurate contact information for alarm customers is to implement an alarm permit registration process. Based on a survey of California cities through the California Police Chief's Association (CPCA), it was determined that approximately forty-one cities throughout California have alarm registration programs. Four jurisdictions in Santa Clara County have such a program (Morgan Hill, Santa Clara, Mountain View and Los Altos). The common theme for registration is that most jurisdictions require a registration for both commercial and residential alarms, the fees range from $54100 and the majority of cities require an annual renewal with a fine for non-compliance. The revised ordinance will not change how officers respond to alarms. The ordinance has been revised to reflect Town Council's direction to implement permits for only a commercial business alarm permit fee and to reduce the number of false alarms requiring a charge from three to two for residential and commercial properties. It is well established that the overwhelming majority (approximately 94%) of residential and commercial alarms are false, requiring a diversion of resources to these locations, sometimes requiring response to these alarms on average 10 times during a 24 hour shift. Additionally, several cities in California (Rocklin, Lincoln, Newark, Woodland and Santa Maria) have entered into an agreement with PMAM Corporation, an alarm management consulting firm out of Irving, Texas to manage all aspects of the alarm permit and false alarm process, including: O a web based solution for business owners to obtain their permit, pay renewals, fines and access their account; O identify and maximize the number of businesses with alarms; O electronically upload calls for service regarding false alarms from the Police Department Record Management System; O provide training and education to citizens and business owners in Town concerning alarm operations; O the ability for the Police Department or PMAM to run monthly or specialized reports; O provide annual audits; and 13 collect all fees PAGE 3 MAYOR AND TOWN COUNCIL SUBJECT: AMENDMENT TO POLICE ALARM ORDINANCE PMAM will collect 35% of the revenue generated by the new commercial alarm permit fee and false alarm fees. All of the cities in California were contacted and expressed positive feedback regarding the consultant in addition to higher revenue being generated. Staff has reviewed PMAM's product/services and recommends use of this service instead of utilizing existing staff to perform these functions. CONCLUSION: In order to reduce the number of false alarm responses, recover costs and increase accurate contact information, staff is recommending the Town Council approve the revised ordinance and authorize the Town Manager to enter into an agreement with PMAM Corporation for alarm management. ENVIRONMENTAL ASSESSMENT: This is not a project defined under CEQA and no further action is required. FISCAL IMPACT: Based on approximately 300 commercial businesses in Town in which the Police Department has received an alarm in the last year, the revenue was estimated at $10,000 for FY 09-10. The low estimate was due to the unknown time frame of implementation of this program and potential difficulty initially in compliance. It is anticipated that there will be more commercial business locations identified by PMAM and revenue could increase significantly. Revenue for the second alarm fee could rise slightly but was not included in the revenue estimate for FY 09-10. Attachments: 1. Ordinance 2. Agreement with PMAM Corporation 3. Resolution ORDINANCE ORDINANCE OF THE TOWN OF LOS GATOS THE TOWN COUNCIL OF THE TOWN OF LOS GATOS DOES ORDAIN AS FOLLOWS: SECTION I Sections 12.50.010 through and including 14.050.240 of Article V of Chapter 14 of the Los Gatos Town Code are hereby repealed in their entirety and replaced with the following: Sec. 14.50.010. Findings and purpose. The Town Council hereby finds as follows: (1) The public is malting increasing use of police alarms, and the Police are therefore being called to respond to such alarms with increasing frequency. (2) More than ninety (90) percent of the alarms received and responded to turn out to be false. (3) False alarms not only impose a financial burden on the Town, but also, by demanding fast Police response, cause substantial risk both to Police personnel and the public. (4) It is therefore necessary to regulate the use of police alarm systems in the Town and to establish service charges to be assessed in the event of repeated false alarms. Sec. 14.50.015. Definitions. The following words, terms and phrases, when used in this article, shall have the meanings ascribed to them in this section, except where the context clearly indicates a different meaning: Alarm Permit. Documentation that a commercial establishment has filed the appropriate form and paid applicable fees to the Town of Los Gatos to operate an alarm system at a specified location. Alarm permits are non-transferable. Calendar Year. January 1 through December 31 of the current year. False alarm. Activation of a police alarm system, to which personnel of the Police Department respond, in circumstances where no Police emergency exists; provided, that such activation shall not be deemed a false alarm if the owner thereof establishes, by a preponderance of evidence, that the alarm was activated by matters entirely beyond the owner's control, including but not limited to acts of God or utility failures. Notice. A written notice, given by personal service, or by the United States mail, postage prepaid, addressed to the person to be notified at the person's last known address. Service of such notice shall be effective upon the completion of personal service, or upon the placing of the notice into the custody of the United States Postal Service. ATTACHMENT 1 Owner. The person who owns or controls a police alarm system, including but not limited to a lessee, tenant, or other agent of the legal owner of the premises wherein the alarm system is installed, provided that such agent had actual control of and responsibility for the operation of the premises at the time of any false alarm. Police alarm system. Any mechanical or electrical device which is designated or used for the detection or warning of unauthorized entry into a building, structure, or facility, or for alerting others of the commission of an unlawful act within a building, structure, or facility, or both, and which emits a sound or transmits a signal or message when activated. Police alarm systems include but are not limited to direct-dial telephone devices, audible alarms, and proprietor alarms. Devices which are not designated or used to register alarms perceptible from outside of the protected building, structure, or facility are excluded from this definition, as are auxiliary devices installed to protect the telephone system from damage or disruption by the use of an alarm system. Police emergency. The unauthorized violent breaking, and/or entering, damaging or burglary of a building, structure, vehicle, or other facility, or the commission of a violent act likely to produce immediate bodily harm, or an attempt or serious threat of any of the acts described herein. Premises. Those buildings, structures, vehicles or other facilities protected by a police alarm system and shall not include smaller or discrete subdivisions within such buildings, structures or facilities. DIVISION 2. OUTSIDE ALARMS Sec. 14.50.080. Requirements. (a) Notices required to be posted. Every person maintaining an outside audible alarm shall post a notice containing the names and telephone numbers of the persons to be notified in order to render repairs and service or secure the premises during any hour of the day or night if the alarm is activated. Such notice shall be posted near the alarm in such a position as to be legible from the ground level adjacent to the building where the alarm is located. The wording "Police Alarm--Call Los Gatos/Monte Sereno Police Department" shall be placed in a visible location next to the alarm device (b) Siren sounds prohibited It shall be unlawful for any person to install or use a police alarm system which upon activation emits a sound similar to sirens in use on public emergency vehicles or for public disaster warning purposes. (c) Timing devices. All local exterior bells, gongs, noise-making devices or pulsating lights shall have a timing device that will silence or turn off such devices or lights within ten (10) minutes following initial activation. Sec. 14.50:085. Investigation. One (1) of the law enforcement officers responding to each alarm shall attempt to ascertain by investigation whether such alarm was a false alarm. If the investigation indicates to the investigating officer that the alarm was a false alarm, the officer shall forward a report of this investigation to the Chief of Police or designee setting forth the findings. Sec. 14.50.090. Notice to owner and review. (a) Upon receipt of the report of a false alarm, the Chief of Police or designee shall review the report and may overrule, affirm, or modify the findings of the officer as can be determined from the facts and this article. If the Chief or designee determines that a false alarm occurred as defined by this article, the Chief will cause a written notice to be served upon the owner of the alarm system. The notice will state the following: (1) A false alarm was apparently made from the described property and the circumstance involved in the false alarm; and (2) The suggested steps that should be taken to prevent future false alarms; and (3) A warning that if two (2) or more false alarms occur on the premises within a six- month period within a calendar year, an escalating service charge may be assessed by the Town against the owner; and (4) A statement that the owner may file a written response to the notice with the Chief within thirty (30) days of the date of the notice for the Chief or designee to consider in mitigation of the determination that a false alarm occurred, and a warning that the filing of a response is a necessary prerequisite to any current or future contention that the alarm was not false in either a judicial or administrative proceeding; and (5) If the false alarm will subject the owner to an assessment pursuant to section 14.50.225, a statement of the charge to be assessed and the basis for the charge. (b) The owner may respond in writing to the notice from the Chief within thirty (30) days of the notice. If such a response is filed, the Chief or designee will review the response and may conduct additional investigation as appropriate to determine whether a false alarm as defined in this article occurred. The determination of the Chief or designee following such a review shall be final, unless the determination of a false alarm would subject the owner to a false alarm assessment under section 14.50.225 because it would be the third or more false alarm within a six-month period within a calendar year, in which case, the appeal rights under 14.50.105 apply. If no response, or appeal if applicable, is timely filed, the original determination shall be final. Sec. 14.50.095. Notice of right to appeal. In any case where the false alarm will subject the owner to an assessment pursuant to section 14.50.225, the written decision of the Chief of Police will state that the owner may appeal the decision to the Town Manager by filing a notice of appeal with the Town Manager pursuant to section 14.50.100, and a warning that the filing of an appeal is a necessary prerequisite to any current or future contention that the alarm was not false in either a judicial or administrative proceeding. Sec. 14.50.100. Appeals. Any person who has filed a response to the Chief of Police and has received an adverse decision regarding a second or more false alarm within a six-month period within a calendar year or a notice of a "no response status" pursuant to section 14.50.110 may appeal by filing a written notice of appeal with the Town Manager within fifteen (15) days after service of the notice of Chiefs decision. The written notice of appeal shall specify the grounds for the appeal, and the stated grounds shall constitute the scope of review for the appeal. Filing of a notice of appeal shall stay an assessment until the appeal has been heard by the Town Manager. The appeal shall be set for hearing within thirty (30) days from the filing of the notice of appeal. The Town Manager may overrule, affirm, or modify the decision of the Chief of Police regarding the false alarm or assessment amount, and the decision of the Town Manager shall be final and conclusive. Sec. 14.50.105. Payment. Within thirty (30) days of the service of the notice of assessment described in section 14.50.095, the owner of the subject alarm shall remit to the Tax and License Collector the full amount of the service charge. Sec. 14.50.110. No response status. After the police department has recorded more than five (5) false alarms within the calendar year, and after the responsible party of the location has been notified by first class mail that false alarms have occurred, the Chief of Police may authorize that the site be placed on a "no response status." The effective date of any no response status shall be twenty (20) days from the date of the notification, subject to an appeal filed pursuant to section 14.50.100. Once established, a no response status shall remain in effect until the Chief of Police is satisfied that adequate measures have been taken to eliminate the occurrence of false alarms, in which event the no response status shall be provisionally stayed for a maximum period of twelve (12) months. The occurrence of any additional false alarms during that provisional stay shall result in an immediate and non appealable reinstatement of the no response status. When completed, without additional false alarms, the provisional stay shall terminate. A responsible party whose alarm system has been placed on no response status may appeal that decision as prescribed in section 14.50.100. DIVISION 3. AUTOMATIC CALLS Sec. 14.50.160. Prohibited without prior written consent. (a) No person, except a public utility engaged in the business of providing communications services and facilities shall use or operate, attempt to use or operate, or cause to be used or operated, or arrange, adjust, program or otherwise provide or install any device or combination of devices that will, upon activation either mechanically, electronically or by other automatic means, initiate an intrastate call and deliver a recorded message to any telephone number without the prior written consent of such subscriber. (b) The term telephone number includes any additional numbers assigned by a public utility company engaged in the business of providing communications services and facilities to be used by means of a rotary or other system to connect with the subscriber to such primary number when the primary telephone number is in use. Sec. 14.50.165. Registration. Owners of police alarm systems which operate in the manner described in section 14.50.160 shall register them with the Chief of Police or designee and shall provide the following information: (1) Name of alarm system owner. (2) Business name, if any. (3) Address where alarm system is located. (4) Billing address. (5) Alternate responsible parties (6) Such other pertinent information as is required by the Chief of Police. DIVISION 4. FALSE ALARMS Sec. 14.50.225. Service charge. There is hereby imposed a service charge upon every owner who reports, causes to be, or permits to be reported two (2) or more false alarms within a six-month period within a calendar year. Such service charge shall be set by the Town Council by resolution. A separate charge shall be imposed for each false alarm beyond two (2) within a six-month period within a calendar year Sec. 14.50.230. Exemptions. For thirty (30) days after completion of an installation, new installations shall be exempt from this division. Sec. 14.50.235. Collection. If any person fails to pay the charges assessed pursuant to the provisions of this article, the Town may institute an action in any court of competent jurisdiction to collect any charges which may be due and payable in the same manner as any other debts owing to the Town and placed on a "no response status" until all past due debts are received. DIVISION 5. ALARM PERMIT REQUIREMENT Sec. 14.050.240 - Alarm Permit Process (a) Permits. No commercial building owner or operator shall operate or cause to be operated any alarm system within the Town of Los Gatos without a permit. Alarm system permits are not transferable. (b) Exemptions. The provisions of this chapter are not applicable to residential alarms, motor vehicles or facilities of the Town of Los Gatos. (c) Obtaining alarm system permits and renewal. Application for an alarm system permit and renewal required under this chapter shall be made by the Chief of Police on forms provided by the Police Department, along with the payment of an alarm system permit fee. Permit fees are collected at the time of application and will not be pro-rated. The alarm system permit must be renewed annually by the last business day in December for the next calendar year. Such permit and renewal fees shall be established by Council Resolution. (d) Contents of the form. The completed form for an alarm system permit or renewal form shall state the name, address and telephone number of the applicant, the address and telephone number of the applicant's property serviced by any alarm system, as well as the name and address of at least three responsible parties who can render service to the alarm system at any hour of the day or night and such other information as the Chief of Police may deem appropriate. (e) Permit display at alarm site. Alarm system permits issued pursuant to this chapter shall be kept at the alarm site. No person shall use an alarm system in the Town of Los Gatos without posting the alarm system permit in a visible location or be able to be produced to any Town official upon request. (f) Penalty. If the Police Department responds to an alarm at any business operating in the Town of Los Gatos without a permit pursuant to Section 14.050.240 (a) such business shall be charged double the annual permit fee. This fee is payable within 30 days to the Town of Los Gatos. If the alarm additionally was determined to be false, the business shall also incur one false alarm violation pursuant to Section 14.050.225. (g) Any alarm business registered with the Police Department shall immediately report in writing to the Police Chief any change in the address or ownership of the business, name of the business, address of the manager of operations or responsible party list. SECTION II In the event that any part of this ordinance is held to be invalid, the invalid part or parts shall be severed from the remaining portions which shall remain in full force and effect. SECTION III This ordinance was introduced at a regular meeting of the Town Council of the Town of Los Gatos on , 20^ and adopted by the following vote as an ordinance of the Town of Los Gatos at a regular meeting of the Town Council of the Town of Los Gatos on , 20 This ordinance takes effect 30 days after it is adopted. COUNCIL MEMBERS: AYES: NAYS: ABSENT: ABSTAIN: SIGNED: MAYOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA ATTEST: CLERK ADMINISTRATOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA Rev. 6/2/04 Professional Services Agreement for Alarm Management TOWN OF LOS GATOS PROFESSIONAL SERVICES AGREEMENT FOR ALARM MANAGEMENT This Agreement is entered into this day of , 20_, by and between the Town of Los Gatos, a California municipal town ("Town"), and PMAM Corporation, 105 Decker Court #675, Irving, Texas 75062 ("Consultant") RECITALS A. Consultant desires to perform and assume responsibility for the provision of professional alarm management consultant services required by the Town on the terms and conditions set forth in this Agreement. B. Consultant has presented a proposal for such services to the Town, dated August 13, 2009, (attached hereto and incorporated herein as Exhibit "D") and is duly licensed, qualified and experienced to perform those services. C. Consultant agrees it has satisfied itself by its own investigation and research regarding the conditions affecting the work to be done and labor and materials needed, and that its decision to execute this Agreement is based on such independent investigation and research. D. Town desires to engage Consultant to render such services as set forth in this Agreement. AGREEMENT I. SCOPE OF SERVICES. 1.1 General Scope of Services. Consultant promises and agrees to furnish to the Town all labor, materials, tools, equipment, services and incidental and customary work necessary to fully and adequately supply the necessary professional alarm management consultant services ("Services"), The Services are more particularly described in Exhibit "A." 2. SCHEDULE OF SERVICES. 2.1 Schedule of Services. The Services of Consultant are to commence upon execution of this Agreement by the Town and shall be undertaken and completed in a prompt and timely manner, pursuant to the schedule outlined in the Scope of Work, more particularly Town of Los Gatos Alarm Management Date Printed: September 21, 2009 WPD-PMAM Contract.doc ATTACHMENT2 Professional Services Agreement for Alarm Management described in Exhibit "A." With regards to the responsibilities of the Town in order for Consultant to begin this Project, such responsibilities are specified in Exhibit "C". 2.2 Extension of Time. Consultant may, for good cause, request extensions of time to perform the Services required hereunder. Such extensions shall be authorized in advance by the Town in writing and shall be incorporated in written amendments to this Agreement. 3. FEES AND PAYMENTS. 3.1 Compensation. Consultant shall receive compensation, including authorized reimbursements, for all Services rendered under this Agreement at the rates set forth in Exhibit "B." The total compensation shall not exceed 35% of all fees collected as specified in Exhibit "B" without Town's prior written approval. Extra Work may be authorized, as described below, and if authorized, will be compensated at the rates and manner set forth in this Agreement. 3.2 Payment of Compensation. Consultant shall submit to Town a monthly itemized statement which indicates work completed and an itemized list of Services rendered by Consultant. The statement shall describe the amount of Services and supplies provided since the initial commencement date, or since the start of the subsequent billing periods, as appropriate, through the date of the statement. Payment will be processed as described in Exhibit B. 3.3 Extra Work. At any time during the terns of this Agreement, Town may request that Consultant perform Extra Work. As used herein, "Extra Work" means any work which is determined by Town to be necessary for the proper completion of the Project, but which the parties did not reasonably anticipate would be necessary at the execution of this Agreement. Consultant shall not perform, nor be compensated for, Extra Work without written authorization from Town's Representative. 4. CHANGES. 4.1 The Parties may, from time to time, request changes in the scope of the Services of Consultant to be performed hereunder. Such changes, including any increase or decrease in the amount of Consultant's compensation and/or changes in the schedule must be authorized in advance by the Town in writing. Mutually agreed changes shall be incorporated in written amendments to the Agreement. 5. RESPONSIBILITIES OF CONSULTANT. 5.1 Independent Contractor; Control and Payment of Subordinates. Consultant enters into this Agreement as an independent contractor and not as an employee of the Town. Consultant shall have no power or authority by this Agreement to bind the Town in any respect. Nothing in this Agreement shall be construed to be inconsistent with this relationship or status. All employees, agents, contractors or subcontractors hired or retained by the Consultant are Town of Los Gatos 2 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Management employees, agents, contractors or subcontractors of the Consultant and not of the Town. The Town shall not be obligated in any way to pay any wage claims or other claims made against Consultant by any such employees, agents, contractors or subcontractors, or any other person resulting from performance of this Agreement. 5.2 Conformance to Applicable Requirements. All work prepared by Consultant shall be subject to the approval of the Town. 5.3 Project Manager. The Consultant shall designate a project manager who at all times shall represent the Consultant before the Town on all matters relating to this Agreement. The project manager shall continue in such capacity for the Town unless and until he or she is removed at the request of the Town, is no longer employed by Consultant or replaced with the written approval of the Town which shall not be unreasonably withheld. 5.4 Coordination of Services. Consultant agrees to work closely with Town staff in the performance of Services and shall be available to Town staff, consultants and other staff at all reasonable times. The Town agrees to work closely with Consultant's staff in the performance of Services and shall be available to Consultant's staff at all reasonable times. 5.5 Warranty. Consultant agrees and represents that it is qualified to properly provide the Services set forth in Exhibit "A" in a manner which is consistent with the generally accepted standards of Consultant's profession. Consultant further represents and agrees that it will perform said Services in a legally adequate manner in conformance with applicable federal, state and local laws and guidelines. 5.6 Interest in Contract. Consultant covenants that neither it, nor any of its employees, agents, contractors, sub-contractors has any interest, nor shall they acquire any interest, direct or indirect, in the subject of the Contract, nor any other interest which would conflict in any manner or degree with the performance of its services hereunder. Consultant shall make all disclosures required by the Town's conflict of interest code in accordance with the category designated by the Town, unless the Town Manager determines in writing that Consultant's duties are more limited in scope than is warranted by the category designated by the Town code and that a narrower disclosure category should apply. Consultant also agrees to malce disclosure in compliance with the Town conflict of interest code if, at any time after the execution of this agreement, the Town determines and notifies Consultant in writing that Consultant's duties under this agreement warrant greater disclosure by Consultant than was originally contemplated. Consultant shall make disclosures in the time, place and manner set forth in the conflict of interest code and as directed by the Town. 6. INSURANCE. 6.1 Time for Compliance. Consultant shall not commence Services under this Agreement until it has provided evidence satisfactory to the Town that it has secured all Town of Los Gatos 3 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Management insurance required under this section. In addition, Consultant shall not allow any sub-consultant to commence work on any subcontract until it has provided evidence satisfactory to the Town that the sub-consultant has secured all insurance required under this section. 6.2 Types of Required Coverages. As a condition precedent to the effectiveness of this Agreement for work to be performed hereunder and without limiting the indemnity provisions of the Agreement, the Consultant in partial performance of its obligations under such Agreement, shall procure and maintain in full force and effect during the term of the Agreement, the following policies of insurance. 6.2.1 Commercial General Liability: Commercial General Liability Insurance which affords coverage at least as broad as Insurance Services Office "occurrence" form CG 0001, with minimum limits of at least $1,000,000 per occurrence. Defense costs shall be paid in addition to the limits. The policy shall contain no endorsements or provisions limiting coverage for (1) products and completed operations; (2) contractual liability; (3) third party action over claims; or (4) cross liability exclusion for claims or suits by one insured against another. 6.2.2 Automobile Liability: Automobile Liability Insurance with coverage at least as broad as Insurance Services Office Form CA 0001 covering "Any Auto" (Symbol 1) with minimum limits of $1,000,000 each accident. 6.2.3 Workers' Compensation: Workers' Compensation Insurance, as required by the State of California and Employer's Liability Insurance with a limit of not less than $1,000,000 per accident for bodily injury and disease. 6.2.4 Professional Liability: Professional Liability insurance for errors and omissions with minimum limits of $1,000,000. Covered Professional Services shall specifically include all work to be performed under the Agreement. If coverage is written on a claims-made basis, the retroactive date shall precede the effective date of the initial Agreement and continuous coverage will be maintained or an extended reporting period will be exercised for a period of at least three (3) years from termination or expiration of this Agreement. 6.3 Endorsements. 6.3.1 The policy or policies of insurance required by Sections 6.2.1 Commercial General Liability and 6.2.2 Automobile Liability shall be endorsed to provide the following: 6.3.1.1 Additional Insured: The indemnified parties shall be additional insureds with regard to liability and defense of suits or claims arising out of the performance of the Agreement. Additional Insured Endorsements shall not (1) be Town of Los Gatos 4 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doe Professional Services Agreement for Alarm Management restricted to "ongoing operations"; (2) exclude "contractual liability"; (3) restrict coverage to "sole" liability of Consultant; or (4) contain any other exclusions contrary to the Agreement. 6.3.1.2 Primary Insurance and Non-Contributing Insurance: This insurance shall be primary and any other insurance, deductible, or self-insurance maintained by the indemnified parties shall not contribute with this primary insurance. 6.3.1.3 Severability: In the event of one insured, whether named or additional, incurs liability to any other of the insureds, whether named or additional, the policy shall cover the insured against whom claim is or may be made in the same manner as if separate policies had been issued to each insured, except that the limits of insurance shall not be increased thereby. 6.3.1.4 Cancellation: The policy shall not be canceled or the coverage suspended, voided, reduced or allowed to expire until a thirty (30) day prior written notice of cancellation has been served upon the Town except ten (10) days prior written notice shall be allowed for non-payment of premium. 6.3.1.5 Duties: Any failure by the named insured to comply with reporting provisions of the policy or breaches or violations of warranties shall not affect coverage provided to the indemnified parties. 6.3.1.6 Applicability: That the coverage provided therein shall apply to the obligations assumed by the Consultant under the indemnity provisions of the Agreement, unless the policy or policies contain a blanket form of contractual liability coverage. 6.3.1.7 The policy or policies of insurance required by Section 6.2.3 Workers' Compensation shall be endorsed, as follows: 6.3.1.1 Waiver of Subrogation: A waiver of subrogation stating that the insurer waives all rights of subrogation against the indemnified parties. 6.3.1.2 Cancellation: The policy shall not be canceled or the coverage suspended, voided, reduced or allowed to expire until a thirty (30) day prior written notice of cancellation has been served upon the Town except ten (10) days prior written notice shall be allowed for non-payment of premium. 6.3.1.3 The policy or policies of insurance required by Section 6.2.4 Professional Liability shall be endorsed, as follows: 6.3.1.1 Cancellation: The policy shall not be canceled or the coverage suspended, voided, reduced or allowed to expire until a thirty (30) day prior written Town of Los Gatos 5 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Management notice of cancellation has been served upon the Town except ten (10) days prior written notice shall be allowed for non-payment of premium. 6.4 Deductible. Any deductible or self-insured retention must be approved in writing by the Town and shall protect the indemnified parties in the same manner and to the same extent as they would have been protected had the policy or policies not contained a deductible or self- insured retention. 6.5 Evidence of Insurance. The Consultant, concurrently with the execution of the Agreement, and as a condition precedent to the effectiveness thereof, shall deliver either certified copies of the required policies, or original certificates and endorsements on forms approved by the Town. The certificates and endorsements for each insurance policy shall be signed by a person authorized by that insurer to bind coverage on its behalf. At least fifteen (15) days prior to the expiration of any such policy, evidence of insurance showing that such insurance coverage has been renewed or extended shall be filed with the Town. If such coverage is cancelled or reduced, Consultant shall, within ten (10) days after receipt of written notice of such cancellation or reduction of coverage, file with the Town evidence of insurance showing that the required insurance has been reinstated or has been provided through another insurance company or companies. 6.6 Failure to Maintain Coverage. Consultant agrees to suspend and cease all operations hereunder during such period of time if the required insurance coverage is not in effect and evidence of insurance has not been furnished to the Town. The Town shall have the right to withhold any payment due Consultant until Consultant has fully complied with the insurance provisions of this Agreement. In the event that the Consultant's operations are suspended for failure to maintain required insurance coverage, the Consultant shall not be entitled to an extension of time for completion of the Work because of production lost during suspension. 6.7 Acceptability of Insurers. Each such policy shall be from a company or companies with a current A.M. Best's rating of no less than ANII and authorized to do business in the State of California, or otherwise allowed to place insurance through surplus line brokers under applicable provisions of the California Insurance Code or any federal law. 6.8 Insurance for Subconsultants. All sub-consultants shall be included as additional insureds under the Consultant's policies, or the Consultant shall be responsible for causing sub- consultants to purchase the appropriate insurance in compliance with the terms of this Agreement, including adding the Town as an Additional Insured to the sub-consultant's policies. 7. OWNERSHIP OF MATERIALS AND CONFIDENTIALITY. 7.1 Documents & Data• Licensing of Intellectual Property. This Agreement creates a non-exclusive and perpetual license for Town to copy, use, modify, reuse or sublicense any and Town of Los Gatos 6 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Management all copyrights, designs and other intellectual property embodied in plans, specifications, studies, drawings, estimates and other documents or works of authorship fixed in any tangible medium of expression, including but not limited to, physical drawings or data magnetically or otherwise recorded on computer diskettes, which are prepared or caused to be prepared by Consultant under this Agreement ("Documents & Data"). Consultant shall require all sub-consultants to agree in writing that Town is granted a non-exclusive and perpetual license for any Documents & Data the sub-consultant prepares under this Agreement. Consultant represents and warrants that Consultant has the legal right to license any and all Documents & Data. Consultant makes no such representation and warranty in regard to Documents & Data which were prepared by design professionals other than Consultant or provided to Consultant by the Town. Consultant shall provide electronic copies of the finished products in the original software format at the conclusion of the respective phases of work. Complex documents such as reports that utilize more than one type of software shall also be provided in a common format such as Adobe Acrobat (*.pdf). Files of construction drawings shall be provided in a current version of AutoCAD. Town shall not be limited in any way in its use or modification of the Documents and Data at any time, provided that any such use or modification not within the purposes intended by this Agreement shall be at the Town's sole risk. 7.2 Confidentiality. All Documents & Data are confidential and Consultant agrees that they shall not be made available to any individual or organization without the prior written approval of the Town, except by court order. 8. ACCOUNTING RECORDS. 8.1 Maintenance and Inspection. Consultant shall maintain and make available for inspection by the Town and its auditor's accurate records of all its costs, disbursements and receipts with respect to any work under this Agreement. Such inspections may be made during regular office hours at any time until one (1) year after the final payments under this Agreement are made to the Consultant. 9. SUBCONTRACTING. 9.1 Prior Approval Required. Consultant shall not subcontract any portion of the work required by this Agreement, except as expressly stated herein, without prior written approval of the Town. Subcontracts, if any, shall contain a provision making them subject to all provisions stipulated in this Agreement. Town of Los Gatos 7 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Management 10. TERMINATION OF AGREEMENT. 10.1 Grounds for Termination. The Town may, by written notice to Consultant, terminate all or any part of this Agreement at any time and without cause by giving written notice to Consultant of such termination, and specifying the effective date thereof, at least thirty (30) days before the effective date of such termination. Upon termination, Consultant shall be compensated only for those Services which have been adequately rendered to Town, and Consultant shall be entitled to no further compensation. Consultant may not terminate this Agreement except for cause. 10.2 Effect of Termination. If this Agreement is terminated as provided herein, the Town may require Consultant to provide all finished or unfinished Documents and Data and other information of any kind prepared by Consultant in connection with the performance of Services under this Agreement. Consultant shall be required to provide such document and other information within fifteen (15) days of the request. Specifically, in the event the Town shall terminate this Agreement: 10.2.1 Consultant shall deliver copies of all writings prepared by it pursuant to this Agreement. The term "writings" shall be construed to mean and include: handwriting, typewriting, printing, photostating, photographing, and every other means of recording upon any tangible thing any form of communication or representation, including letters, words, pictures, sounds, or symbols, or combinations thereof. 10.2.2 All data relating to alarm permits shall be owned by the Town. Upon termination of this agreement, PMAM shall deliver to the Town all data in MS-SQL format. 10.2.3 PMAM retains all right and title to the Application software, including but not limited to, all publication rights, all development rights, all reproductions rights, and all rights that may follow from the commercial development of the software. The Town does not acquire any ownership rights to the Application software. The Software is protected in favor of PMAM, as well as any future registered trademarks, are trademarks of PMAM. 10.2.4 The proprietary software will be loaned to the Town during the duration of this agreement as laid out in this contract and the Town will not have any access to our proprietary software after the conclusion of the contract. 10.2.5 The Town shall pay Consultant the reasonable value of services rendered by Consultant to the date of termination pursuant to this Agreement not to exceed the amount documented by Consultant and approved by the Town as work accomplished to date; provided, however, that in no event shall any payment hereunder exceed 35% of all revenues collected as per EXHIBIT B. The foregoing is cumulative and does not affect any right or remedy which Town may have in law or equity. Town of Los Gatos 8 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Management 10.2.6 Consultant may terminate its services under this Agreement upon thirty (30) working days written notice to the Town, without liability for damages, if it is not compensated according to the provisions of the Agreement or upon any other material breach of the Agreement by Town. 10.3 Additional Services. In the event this Agreement is terminated in whole or in part as provided herein, Town may procure, upon such terms and in such manner as it may determine appropriate, services similar to those terminated. 11. GENERAL PROVISIONS. 11.1 Delivery of Notices. All notices permitted or required under this Agreement shall be given to the respective parties at the following address, or at such other address as the respective parties may provide in writing for this purpose: Town: Consultant: Town of Los Gatos 110 E. Main Street Los Gatos, CA 95031 Attn: Captain Alana Forrest, Police Department [INSERT NAME, ADDRESS & CONTACT PERSON] Such notice shall be deemed made when personally delivered or when mailed, forty-eight (48) hours after deposit in the U.S. Mail, first class postage prepaid and addressed to the party at its applicable address. Actual notice shall be deemed adequate notice on the date actual notice occurred, regardless of the method of service. 11.2 Indemnification. To the fullest extent permitted by law, Consultant shall defend, indemnify and hold the Town, its elected officials, officers, employees, agents and volunteers free and hannless from any and all claims, demands, causes of action, costs, expenses, liability, loss, damage or injury, in law or equity, to property or persons, including wrongful death, to the extent arising out of or caused by the negligence, recklessness or willful misconduct of Consultant, its officials, officers, employees, agents, subcontractors and sub-consultants, including without limitation the payment of all consequential damages and attorneys' fees and other related costs and expenses except such loss or damage which was caused by the active negligence, sole negligence, or willful misconduct of the Town. Town of Los Gatos 9 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Management Consultant shall pay and satisfy any judgment, award or decree that may be rendered in any and all such aforesaid suits, actions or other legal proceedings of every kind that are brought or instituted against Town, its elected officials, officers, employees, agents or volunteers. Consultant shall reimburse the Town and its elected officials, officers, employees, agents and/or volunteers, for any and all legal expenses and costs incurred by each of them in connection therewith or in enforcing the indemnity herein provided. Consultant's obligation to indemnify shall not be restricted to insurance proceeds, if any, received by the Town, its elected officials, officers, employees, agents or volunteers. 11.3 Laws and Regulations. Consultant shall keep itself fully informed of and in compliance with all local, state and federal laws, rules, regulations and ordinances in any manner affecting the performance of the Project or the Services, including without limitation the Town business license requirements and all Cal/OSHA requirements, and shall give all notices required by law. 11.4 Prohibited Interests. Consultant covenants that neither it, nor any of its employees, agents, contractors or subcontractors has any interest, nor shall they acquire any interest, direct or indirect, in the subject of the Agreement, nor any other interest which would conflict in any manner or degree with the performance of the Services hereunder. 11.5 Prevailing Wages. Consultant is aware of the requirements of California Labor Code section 1720, et SeMc and 1770, et seq., as well as California Code of Regulations, Title 8, section 16000, et SeMc ("Prevailing Wage Laws"), which require the payment of prevailing wage rates and the performance of other requirements on "public works" and "maintenance" projects. If the Services are subject to the Prevailing Wage Laws, Consultant agrees to fully comply with such Prevailing Wage Laws. 11.6 Equal Opportunity Einployment. Consultant shall not engage in unlawful employment discrimination. Such unlawful employment discrimination includes, but is not limited to, employment discrimination based upon a person's race, religious creed, color, national origin, ancestry, physical handicap, medical condition, marital status, gender, citizenship or sexual orientation. 11.7 Labor Certification. By its signature hereunder, Consultant certifies that it is aware of the provisions of Section 3700 of the California Labor Code which require every employer to be insured against liability for Worker's Compensation or to undertake self- insurance in accordance with the provisions of that Code, and agrees to comply with such provisions before commencing the performance of the Services. 11.8 Attorneys' Fees. If either party commences an action against the other party, either legal, administrative or otherwise, arising out of or in connection with this Agreement, the prevailing party in such litigation shall be entitled to reasonable attorneys' fees and all other costs of such action. Town of Los Gatos 10 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Management 11.9 Assignment or Transfer. Consultant shall not assign or transfer any interest in this Agreement whether by assignment or novation, without the prior written consent of the Town, which will not be unreasonably withheld. Provided, however, that claims for money due or to become due Consultant from the Town under this Agreement may be assigned to a financial institution or to a trustee in bankruptcy, without such approval. Notice of any assignment or transfer, whether voluntary or involuntary, shall be furnished promptly to the Town. 11.10 Successors and Assigns. This Agreement shall be binding on the successors and assigns of the Parties. 11.11 Amendment; Modification. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing and signed by both Parties. 11.12 Waiver. No waiver of any default shall constitute a waiver of any other default or breach, whether of the same or other covenant or condition. No waiver, benefit, privilege or service voluntarily given or performed by a Party shall give the other Party any contractual rights by custom, estoppel or otherwise. 11.13 Entire Agreement. This Agreement constitutes the entire agreement between the Parties relative to the Services specified herein. There are no understandings, agreements, conditions, representations, warranties or promises with respect to this Agreement, except those contained in or referred to in the writing. 11.14 Governing Law. This Agreement shall be governed by the laws of the State of California. Venue shall be in Santa Clara County. 11.15 Time of Essence. Time is of the essence for each and every provision of this Agreement. 11.16 Interpretation. Since the Parties or their agents have participated fully in the preparation of this Agreement, the language of this Agreement shall be construed simply, according to its fair meaning, and not strictly for or against any Party. 11.17 No Third Party Beneficiaries. There are no intended third party beneficiaries of any right or obligation assumed by the Parties. 11.18 Authority to Enter Agreement. Each Party warrants that the individuals who have signed this Agreement have the legal power, right and authority to make this Agreement and bind each respective Party. 11.19 Invalidity; SeverabilitX. If any portion of this Agreement is declared invalid, illegal or otherwise unenforceable by a court of competent jurisdiction, the remaining provisions shall continue in full force and effect. Town of Los Gatos 11 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Management 11.20 Counterparts. This Agreement may be signed in counterparts, each of which shall constitute an original. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written. TOWN OF LOS GATOS By: Greg Larson Town Manager Attest: By: Jackie Rose Clerk Administrator PMAM Corporation By: Mr. Pankaj Kumar CEO Notary public S MARL®WE Attest: *'r M~~e~1971ti®Icol Of Taxes "'e ;F K.t;~. ros By: N me] [Title] /V0 Town of Los Gatos Alarm Management 12 Date Printed: September 21, 2009 Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Management EXHIBIT "A" SCOPE AND SCHEDULE OF SERVICES PMAM shall provide a false alarm tracking software and web based management utility which shall include at a minimum, the following components: 1. Creation of database and website interface A. PMAM shall provide a web-based solution that will provide the Town an opportunity to direct Internet users to the established PMAM website via the Town's website or other means directly to do at least the following actions: 1. Allow citizens and business owners to enter infonnation initially for their permit, pay renewals, pay fines, and access their accounts on the Internet. 2. The website will also provide information, including text, video training, and education for citizens and business owners. B. On a weekly basis, PMAM shall access directly into the Los Gatos/Monte Sereno Police Department's Records Management Database and electronically upload the calls for service related to false alarms. On a weekly basis, PMAM shall download new and updated information for residences, businesses, alarm companies, and responsible information into the premise files of the Los Gatos/Monte Sereno Police Department's Records Management System. C. PMAM shall provide CD-ROM discs to citizens and business owners in the Town with training and educational information concerning operating an alarm in the Town. PMAM will personalize the CD-ROM with graphics and symbols representing the Town and the Los Gatos/Monte Sereno Police Department. II. Enforcement of the False Alarm Ordinance A. During the term of this agreement, PMAM Corporation will deploy a proprietary software package that maintains and tracks false alarm data and generate related reports. 1. This software package and associated website shall do at a minimum, the following functions: Town of Los Gatos 13 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Management a) Send alarm permit applications to residents and businesses who may have alarms but are not registered in their system. b) Maintain a method to track permits that have been revoked. c) Send alann permit applications for renewals d) Send letters and invoices to the residences/businesses for false burglar and robbery alarms as per the False Alarm Ordinance and conduct any follow-up necessary. e) Collect all associated fees and conduct all interactions either via letters or telephone calls with permit holders concerning collection of fees and reconcile accounts on a monthly basis. f) Respond to all queries from citizens and businesses and send out renewal notices when appropriate. 2. All data relating to alarm permits shall be owned by the Town and upon termination of this agreement, PMAM shall deliver to the Town of Los Gatos all data in Town's selected format. a) PMAM retains all rights and title to the Application software, including but not limited to, all publication rights, all development rights, all reproductions rights, and all rights that may follow from the commercial development of the software. The Town does not acquire any ownership rights to the Application software. The Software is protected by copyright in favor of PMAM, as well as any future registered trademarks, are trademarks of PMAM. b) All information from the Town will be considered confidential and will not be shared with anybody outside of a designated list without the express permission of the Chief of Police. c) All members of PMAM, who will have access to the information from the Town of Los Gatos, will be designated by PMAM to the Town and will undergo a background check conducted by the Los Gatos/Monte Sereno Police Department. d) Dedicated personnel who will be responsible for answering calls, educating residents on the existing ordinance, explaining invoices and all other related issues will be located at PMAM's site. e) Printing of all stationery, postage and other related overhead costs that involves correspondence with permit holders will be undertaken by PMAM. f) PMAM Corporation will produce an educational multi media CD at their cost. g) Under this agreement, the software that is deployed and all related IP (Intellectual Property) will remain with PMAM h) A dedicated telephone # will paid for and provided by PMAM Corporation Town of Los Gatos 14 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Management III. Report Generation 1. PMAM shall provide the following information to the Town upon request at any time. a) Provide a monthly report detailing all funds received and an associated detail of monies distributed to both PMAM and the Town. b) Specialized reports with any variables as required by the Town. Some of the reports shall include: 1) Annual permit renewals billed and fees collected. 2) Permits inactivated and reason for inactivation. 3) Permits reactivated and reason for reactivation. 4) Number of false burglar alarms. 5) Number of false burglar alarms billed and fees collected. 6) Number of false robbery alarms. 7) Number of false robbery alarms billed and fees collected. 8) Number of reinstatement fees billed and fees collected. 9) False burglary and/or robbery alarms for permit owners. 10) False burglary and/or robbery alarms for non-permit owners. 2. PMAM shall also do the following: a) Generate suspension notices based upon Town ordinance. b) Generate notice to alarm users without permits. c) Maintain historical information on permit issuance, renewal, suspension and reinstatement on each property. d) Maintain current permit status information. e) Maintain incident count (true/false alarms) information on each permit. f) Perform searches on permit holders and business names. g) Print permits in batch or online. h) Archive inactive permits. i) Make adjustments/corrections on fees relating to accounting errors. j) Generate incidents manually for account. k) Issue notice to permit holders with excessive false alarms. 1) Issue notice to non-permit holders with false alarms. m) Archive historical data. n) Accept and establish temporary account numbers for non-permit holders who have incurred false alarm charges. o) Transfer temporary account number charges to a permanent account (permit) number. p) Determine false alarm charges based on the Town of Los Gatos's Alarm Ordinance fee schedule. q) Show all incidents and their associated charges during the current billing period. r) Provide itemized balance forward capabilities on billings. Town of Los Gatos 15 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Management EXHIBIT "B" PAYMENT FOR SERVICEs RENDERED 1. PMAM Corporation agrees to manage the False Alarm Program under this agreement. PMAM shall receive 35% of all revenue that it collects under this agreement and the remaining 65% will be sent to the Los Gatos/Monte Sereno Police Department, 110 E. Main Street, Los Gatos, CA 95031, once a month using a paper check format. The check shall be received by the Los Gatos/Monte Sereno Police Department before the 15th of each month. 2. The areas in which fees are collected include the following. 1. New Permit Fees 2. Permit Renewal Fees 3. Related fees as per the Town of Los Gatos's ordinance. This includes fines that are assessed when permit holders violate the Town's False Alarm Ordinance. Town of Los Gatos 16 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Manazement EXHIBIT "C" FACILITIES, EQUIPMENT, AND OTHER MATERIALS, AND OBLIGATIONS OF THE TOWN To facilitate the execution of this agreement, the Town of Los Gatos will provide the following information and authorization to PMAM Corporation. Town shall provide PMAM with a database of current permit holders and false alarm data ("Data") for the previous 18 months and PMAM will accurately convert all Data provided by the Town to populate the false alarm system. This will be a one-time activity that will be derived from the existing Land Database. 2. A letter from the Town of Los Gatos authorizing PMAM to open a Bank Account with Bank of America where all checks received from the residents are deposited. This account is dedicated only to the Town of Los Gatos and there will be no other activity on this account. 3. A letter from the Town of Los Gatos authorizing PMAM to open a dedicated P.O. Box where all correspondence regarding the Alarm Tracking and Billing will be received. 4. At the end of each month, two checks will be issued in the ratio of 65% to the Town of Los Gatos and 35% to the PMAM Corporation 5. This account is open to audit from the Town staff at any time. Town of Los Gatos 17 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc Professional Services Agreement for Alarm Management EXHIBIT "D" CONSULTANT PROPOSAL [ATTACH CONSULTANT PROPOSAL] Town of Los Gatos 18 Date Printed: September 21, 2009 Alarm Management Town of Los Gatos-PMAM Contract.doc RESOLUTION RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF LOS GATOS AUTHORIZING THE TOWN MANAGER TO NEGOTIATE AND EXECUTE AN AGREEMENT WITH PMAM CORPORATION FOR PROFESSIONAL ALARM MANAGEMENT CONSULTANT SERVICES WHEREAS, it is necessary for the Council to secure professional consultant services to provide professional alarm management consultant services for the Police Department; and WHEREAS, the Town Council has selected the firm of PMAM Corporation for professional alarm management consultant services; and NOW, THEREFORE, IT IS RESOLVED that the Town Council of the Town of Los Gatos hereby authorizes the Town Manager to negotiate and execute a Professional Services Agreement with PMAM Corporation to provide professional alarm management services in connection with police alarm services, outreach, tracking of false alarms and collection of fees. PASSED AND ADOPTED at a regular meeting of the Town Council held on the 19th day of October, 2009 by the following vote: COUNCIL MEMBERS: AYES: NAYS: ABSENT: ABSTAIN: SIGNED: MAYOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA ATTEST: CLERK OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA ATTACHMENT 3 ~pW N 0 !ps Gf+S~S COUNCIL AGENDA REPORT DATE: October 9, 2009 MEETING DATE: 10/19/09 ITEM NO: TO: MAYOR AND TOWN COUNCIL FROM: GREG LARSON, TOWN MANAGER SUBJECT: CONSIDER A REQUEST OF APPROVAL TO OPERATE A RETAIL WINE ESTABLISHMENT WITH FOOD, BEER, AND WINE SERVICE ON PROPERTY ZONED C-1. APN 529-07-047. PROPERTY LOCATION: 414- 416 N. SANTA CRUZ AVENUE. PROPERTY OWNER: JIM ZANARDI. APPLICANT: MICHAEL GUERRA / JOSEPH CANNISTRACI. FILE # U-09- 007. RECOMMENDATION: 1. Open and hold the public hearing and receive public testimony. 2. Close the public hearing. 3. Make the following motions: Accept the Planning Commission's recommendation and approve the Conditional Use Permit Application. If the Council decides to approve the proposed project, the following actions are recommended: ■ Make the required findings for approving the Conditional Use Permit (Attachment 1) and approve the application subject to the conditions included in Attachment 2 (motion required). Alternatively, the Council may take one of the following actions: ■ Continue the matter to a date certain with specific direction (motion required); or ■ Approve the application with additional and/or modified conditions of approval (motion required); or ■ Deny the Conditional Use Permit Application (motion required). PREPARED BY: Wendie R. Rooney, Director of Community Development Reviewed by: ' Assistant Town Manager A)LLI Town Attorney Clerk Administrator Finance Community Development N:\DEV\CNCLRPTS\2009\NSC414-416.doc Reformatted: 5/30/02 PAGE 2 MAYOR AND TOWN COUNCIL SUBJECT: 414-416 N. SANTA CRUZ AVENUE October 7, 2009 4. Refer to the Town Attorney for the preparation of the appropriate resolution if approved or denied (no motion required). BACKGROUND: The proposed project will occupy two tenant lease spaces, 414 and 416 N. Santa Cruz Avenue, in the Los Gatos Shopping Center (Exhibit 1 of Attachment 3). The subject spaces have been vacant for several years due to a substantial remodel at the shopping center. The spaces were previously occupied by a restaurant and a nail salon. The conditional use permit for the restaurant use expired due to inactivity for more than one year. DISCUSSION: A. Project Summary The applicant is requesting approval of the following: • Operation of a retail wine establishment with food, beer, and wine service. Please see Attachment 3 (the September 9, 2009 Planning Commission staff report) for additional information regarding the proposed project. B. Planning Commission On September 9, 2009, the Planning Commission considered the application (see Attachment 5). The Commission recommended approval (vote: 6-0, with Commissioner Micciche absent) of the application with the following changes to condition number three (added wording is underlined, deleted wording is struck out): APPROVED USE. The subject approval is for a retail wine establishment with food, beer, and wine and aloohoke service as generally described in the applicant's letter of justification (Exhibit 5 of U-09-007 Staff Report). Following t operations 4 tefmine if three ha-ve been n " l air'+" of Fo ioa n""s f r if staff determines bl m 4 h l l t d t that thefe afe no eoneems the pro e s. o a eo o fe a e ed to sei=~,e beeF in addit 4l t bli h t h ll b , ion to winewunder the same ten e a ow a s men s a es onsi t h ll b res it Th li f thi U P ble far- A costs a licable to the oan s a e p erm , e app o s se a gym ist+at', pp The Commission recommended approval of the application based on the applicant's documentation and written and verbal support. The Town has received nine written public comments and one verbal testimony in support of the project; the Town has not received any public comment or testimony against the proposal. The Commission recommended the modification to condition number three (3) because the service of beer does not seem to PAGE 3 MAYOR AND TOWN COUNCIL SUBJECT: 414-416 N. SANTA CRUZ AVENUE October 7, 2009 present any problems. Additionally, the applicant's existing business in a neighboring community has not had any complaints in its six years of operation. The Planning Commission suggested that Town Council should consider amending the Alcoholic Beverage Policy (ABP) at some future date to include a "wine bar" category. The existing ABP defines a restaurant and a bar. There are businesses that lie outside these definitions, such as the subject application, and a new category could remove ambiguity for similar proposals in the future. A revision could provide clear requirements and review procedures for wine bars or other chosen category. If Council determines there is merit in amending the ABP, staff should be directed to initiate the amendment. CONCLUSION: The Alcoholic Beverage Policy gives the hearing body discretion to approve alcoholic beverage service when the proposal will not negatively impact residential neighbors, alcohol related incidents will not occur, and when the application will provide a positive impact to the commercial area. The Planning Commission and staff believe this application fits such a case and recommend approval of the application. ENVIRONMENTAL ASSESSMENT: The project is Categorically Exempt according to Section 15301 Class 1 of CEQA as adopted by the Town, which exempts permitting an existing facility with no expansion. FISCAL IMPACT: None. Attaclunents: 1. Required Findings. 2. Recommended Conditions of Approval. 3. Report to the Planning Commission for the meeting of September 9, 2009. 4. Desk Item for the Planning Commission meeting of September 9, 2009. 5. Excerpt of the Verbatim Planning Commission meeting minutes for September 9, 2009. Distribution: cc: Michael E. Guerra and Joseph J. Cannistraci, 333 Santana Unit #307, San Jose, CA 95128 Jim Zanardi, P.O. Box 23027, San Jose, CA 95153 WR:JS:cgt N:\DEV\CNCLRPTS\2009\NS C414-416.doe REQUIRED FINDINGS FOR: 414-416 N. Santa Cruz Avenue Conditional Use Permit U-09-007 Requesting approval to operate a retail wine establishment with food, beer, and wine service on property zoned C-1. APN 529-07-047. PROPERTY OWNER: Jim Zanardi APPLICANT: Michael Guerra/Joseph Cannistraci FINDINGS Required finding for CEQA: ■ The project is Categorically Exempt pursuant to Section 15301 of the State Environmental Guidelines as adopted by the Town. Required findings for a Conditional Use Permit: ■ As required by Section 29.20.190 of the Town Code for granting a Conditional Use Permit: The deciding body, on the basis of the evidence submitted at the hearing, may grant a conditional use permit when specifically authorized by the provisions of the Town Code if it finds that: (1) The proposed uses of the property are essential or desirable to the public convenience or welfare in that the use will provide retail and basic food and beverage service to the community as well as bring visitors, shoppers, and residents to a less frequented area of North Santa Cruz Avenue. In addition, the economic viability of the Town's neighborhood commercial centers can be contingent upon the number of vacancies. Currently the subject site has nine vacancies. The addition of this use will therefore increase the center's vitality; and (2) The proposed uses will not impair the integrity and character of the zone in that the use will not impair the integrity of the zone since the use will be in a commercial zone; and (3) The proposed uses would not be detrimental to public health, safety or general welfare in that the use will not be detrimental to public health safety or general welfare because the use will not conduct business during late night hours and will be subject to provisions of the Alcoholic Beverage Policy; and (4) The proposed uses of the property are in harmony with the various elements or objectives of the General Plan and the purposes of the Town Code in that the proposed use meets the objectives of the General Plan and Town Code as discussed within the staff report. Attachment 1 414-416 N. Santa Cruz Avenue/U-09-007 October 19, 2009 Page 2 of 2 Required finding for the Redevelopment Plan for the Central Los Gatos Redevelopment Project Area: ■ That the proposed project is consistent with the Redevelopment Plan for the Central Los Gatos Redevelopment Project Area (Section IV.B). N;\DEV\FINDINGS\2009\NSC414 416.doc RECOMMENDED CONDITIONS OF APPROVAL - October I9, 2009 414-416 N. Santa Cruz Avenue Conditional Use Permit U-09-007 Requesting approval to operate a retail wine establishment with food, beer, and wine service on property zoned C-1. APN 529-07-047. PROPERTY OWNER: Jim Zanardi APPLICANT: Michael Guerra/Joseph Cannistraci TO THE SATISFACTION OF THE DIRECTOR OF COMMUNITY DEVELOPMENT: Planning Division I. 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 and letter of justification approved and noted as received by the Town on August 7, 2009 and July 23, 2009, respectively. Any changes or modifications to the approved plans shall be approved by the Community Development Director, the Development Review Committee, the Planning Commission, or Town Council, depending on the scope of the changes. 2. EXPIRATION. The approval will expire two years from the approval date pursuant to Section 29.20.320 of the Town Code, unless the approval has been vested. 3. APPROVED USE. The subject approval is for a retail wine establishment with food, beer, and wine service as generally described in the applicant's letter of justification (Exhibit 5 of U-09-007 Staff Report). 4. HOURS OF OPERATION. Maximum hours of operation shall be Monday to Wednesday 10:00 am to 9:00 pin; Thursday 10:00 aim to 10:00 pm; Friday and Saturday 10:00 am to 11:00 pm; Sunday 12:00 pm to 8:00 pm. 5. HOURS OF ALCOHOLIC BEVERAGE SERVICE. The service of alcoholic beverages shall not be permitted after 8:00 pm Monday through Wednesday, after 9:00 pin Thursday, after 10:00 pm Friday and Saturday, and after 7:00 pm on Sunday. 6. NUMBER OF SEATS. The maximum number of seats is sixteen (16), inclusive of the tasting bar and private event room. Note: number of individuals on-site at any given time is limited during specials events (see EVENTS condition). 7. EVENTS. Tasting events and/or classes shall be limited to two (2) per month. During tasting events and/or classes, the maximum number of attendees shall be limited to 25. The maximum number of individuals on site at any given time shall be 30, inclusive of employees, instructors, or presenters (based on ten (10) allotted parking spaces). Note: The maximum number of individuals is not in addition to the maximum seating of sixteen. 8. ENTERTAINMENT. Live entertainment and amplified music in prohibited. 9. SIGN PERMIT. A Sign Permit from the Community Development Department is required for any new sign or any change of face of an existing sign. 10. BUSINESS LICENSE. A business license is required prior to commencement of use. Attachment 2 11. CERTIFICATE OF USE AND OCCUPANCY. A Certificate of Use and Occupancy is required prior to commencement of use. 12. ENVIRONMENTAL HEALTH APPROVAL. The applicant shall submit plans to the County of Santa Clara Department of Enviromnental Health for review prior to commencement of use. The applicant shall provide a copy of the approval from the County of Santa Clara Department of Environmental Health with the Certificate of Use and Occupancy application. 13. TWO YEAR REVIEW. Town staff shall review the Conditional Use Permit within two years from approval to determine if there are any problems associated with the Permit and report their findings to the Planning Commission. The Planning Commission may direct that a public hearing be held to review the permit as specified in Section 29.20.3 10 of the Town Code. 14. ALCOHOLIC BEVERAGE POLICY. The applicant shall be subject to comply with any new requirements in the Town's Alcoholic Beverage Policy within two (2) years from the commencement of operation. 15. TOWN INDEMNITY. Applicants are notified that Town Code Section 1.10.115 requires that any applicant who receives a permit or entitlement from the Town shall defend, indemnify, and hold harmless the Town and its officials in any action brought by a third party to overturn, set aside, or void the permit or entitlement. This requirement is a condition of approval of all such permits and entitlements whether or not expressly set forth in the approval, and may be secured to the satisfaction of the Town Attorney. TO THE SATISFACTION OF THE CHIEF OF POLICE: 16. UNIFORMED SECURITY: Uniformed privately provided security guards may be required in or around the premises by the Chief of Police if alcohol related problems recur that are not resolved by the licensed owner. 17. CONSULTATION AND TRAINING: At the discretion of the Chief of Police, periodic meetings will be conducted with representatives from the Police Department for on-going employee training on alcoholic beverage service to the general public. 18. TRAINING MANUAL: The restaurant operator shall use an employee training manual that addresses alcoholic beverage service consistent with the standards of the California Restaurant Association. 19. DESIGNATED DRIVER PROGRAM: The restaurant operator shall actively promote a designated driver program such as complimentary non-alcoholic beverages for designated drivers. 20. POSTING OF TAXICAB TELEPHONE NUMBERS: Taxicab telephone numbers shall be posted in a visible location. NADEV\C0NDITNS\2009\NSC414 416.doc ~owN TOWN OF LOS GATOS ITEM NO: 4 PLANNING COMMISSION STAFF REPORT cos G.& Meeting Date: September 9, 2009 PREPARED BY: Jennifer L. Savage, Assistant Planner jlsava e a llos atg osca.gov APPLICATION NO.: Conditional Use Permit Application U-09-007 LOCATION: 414-416 N. Santa Cruz Avenue (east side of N. Santa Cruz Avenue, approximately 250 feet north of Los Gatos-Saratoga Road) APPLICANT: Michael E. Guerra and Joseph J. Cannistraci PROPERTY OWNER: Jim Zanardi CONTACT PERSON: Michael E. Guerra and Joseph J. Cannistraci APPLICATION SUMMARY: Requesting approval to operate a retail wine establishment with food, beer, and wine service on property zoned C-1. APN 529- 07-047. DEEMED COMPLETE: August 14, 2009 FINAL DATE TO TAKE ACTION: March 14, 2010 RECOMMENDATION: Forward Conditional Use Permit U-09-007 to the Town Council with a Recommendation of Approval, Subject to the Conditions Contained in this Report PROJECT DATA: General Plan Designation: Neighborhood Commercial Zoning Designation: C-1 -Neighborhood Commercial Applicable Plans & Standards: Central Los Gatos Redevelopment Plan Parcel Size: 12,544 square feet Surrounding Area: * Residential uses are directly east of, and adjacent to, the parking lot. Attachment 3 Planning Commission Staff Report - Page 2 414-416 N. Santa Cruz Avenue/U-09-007 September 9, 2009 CEQA: The project is Categorically Exempt according to Section 15301 of the State Environmental Guidelines as adopted by the Town because the project consists of permitting an existing facility with no expansion. FINDINGS: ■ As required by Section 15301 of the State Environmental Guidelines as adopted by the Town that this project is Categorically Exempt. ■ As required by Section 29.20.190 of the Town Code for granting a Conditional Use Permit. ■ As required by Section IV.B of the Redevelopment Plan for the Central Los Gatos Redevelopment Project that it meets the use set forth in the Town's General Plan. CONSIDERATIONS: None. ACTION: Forward Conditional Use Permit U-09-007 to the Town Council with a Recommendation of Approval, Subject to the Conditions Contained in this Report EXHIBITS: 1. Location Map (one page) 2. Findings and Considerations (two pages) 3. Recommended Conditions of Approval (three pages) 4. Written Description (one page), received July 23, 2009 5. Letter of Justification (five pages), received July 23, 2009 6. Sample Menu (one page), received August 7, 2009 7. Wine Education Curriculum (five pages), received August 7, 2009 8. Town's Alcoholic Beverage Policy (six pages) 9. Development Plans (three pages), received August 7, 2009 10 . Outreach Packet (nine pages), received August 28, 2009 11 . Public Comment (five pages), received August 31, 2009 and September 2, 2009 BACKGROUND: The proposed project will occupy two tenant lease spaces, 414 and 416 N. Santa Cruz Avenue, in the Los Gatos Shopping Center. The subject spaces have been vacant for several years due to a Planning Commission Staff Report - Page 3 414-416 N. Santa Cruz Avenue/U-09-007 September 9, 2009 substantial remodel at the shopping center. The spaces were previously occupied by a restaurant and a nail salon. The conditional use permit for the restaurant use expired due to inactivity for more than one year. The amended Alcoholic Beverage Policy (ABP) was adopted by the Town Council in September 2001 (Exhibit 8). The purpose of the ABP is to provide parameters for alcoholic beverage service and direction through a General Policy and a Specific Policy. The ABP is discussed in the Analysis Section below. PROJECT DESCRIPTION: A. Conditional Use Permit The applicant is requesting approval to operate a retail wine establishment with food and alcoholic beverage service. The applicant provided a written description and letter of justification describing the proposal (Exhibits 4 & 5). The service of food. and alcoholic beverages requires a Conditional Use Permit. The Planning Commission shall make a recommendation to the Town Council, who will be the final deciding body pursuant to the Alcoholic Beverage Policy (ABP). B. Location and Surrounding Neighborhood The project site is located at 414 and 416 N. Santa Cruz Avenue, on the east side of N. Santa Cruz Avenue and approximately 250 feet north of Los Gatos-Saratoga Road. The property is surrounded by commercial uses to the north, west, and south. To the east is a Town parking lot. Single family residential uses are located beyond the Town parking lot. C. Zoning Compliance Retail use is a permitted use in the C-1 Zone District. The zoning designation allows food and beverage service subject to the approval of a Conditional Use Permit. ANALYSIS: A. Business Proposal The letter of justification explains the proposal as "a centuries' old business model that combines elements of wine and good appreciation in a traditional and civil atmosphere" (Exhibit 5). The proposed business will sell wine by the bottle, wine accessories, and specialty food items. In addition, they will offer food and beverage service, including the service of wine and beer. The applicant provided a sample menu, floor plan, and interior Planning Commission Staff Report - Page 4 414-416 N. Santa Cruz Avenue/U-09-007 September 9, 2009 elevation illustrating the location and arrangement of the food preparation area (Exhibits 6 and 9, respectively). The wine tasting and food service area is approximately 252 square feet of floor area or 10% of the entire lease space. The applicant is proposing up to two events per month. Events include wine education (Exhibit 7), hosted tastings, corporate meetings, and private tastings. The maximum number of attendees per event will be 25. The applicant explains that the food and beverage service will enhance the objective of well-rounded wine education and the experience of wine culture. The applicant is proposing a maximum of 16 seats. Operating hours will be Monday through Wednesday from 10:00 am to 9:00 pm, Thursday 10:00 am to 10:00 pm, Friday and Saturday from 10:00 am to 11:00 pm, and Sunday from 12:00 pm to 8:00 pm (Exhibit 5). Alcoholic beverage service will cease one hour prior to closure. The Alcoholic Beverage Policy requires specific findings for alcohol service after 10:00 pm. The subject application does not propose alcohol service after 10:00 pm and, therefore, the findings are not required. The proposal does not appear to fit into the Town's current definitions of restaurant or bar because retail is a large component of the business and the use includes wine education classes. Town Code Section 29.10.020 provides the following definitions for a bar and a restaurant: `Bar means a drinking place where alcoholic beverages and snacks are served; possibly with entertainment such as music, television screens, video games or pool tables.' `Restaurant means a retail food service establishment in which food or beverage is prepared, served and sold to customers for on-site or take-out consumption.' B. Alcoholic Beverage Policy (ABP) Purpose The requirements contained in the ABP are intended to protect nearby residential neighborhoods, while maintaining `the viability of our commercial centers.' The policy provides assurance that hours of operation will be regulated for a variety of reasons, including proximity to residential neighborhoods and concentration of alcoholic beverage serving establishments within one area. Planning Commission Staff Report - Page 5 414-416 N. Santa Cruz Avenue/U-09-007 September 9, 2009 The site is located in an established shopping center that fronts on N. Santa Cruz Avenue. To the rear of the building is a Town parking lot. On the opposite side of the parking lot is a residential neighborhood. The applicants are sensitive to the proximity of residential uses. The alcoholic beverage service will not occur after 10:00 pm. Additionally, the applicants have experience operating a business near residential uses. They have an existing business located in a neighboring community in a mixed use development under residential condos. The applicants have stated that they have not had a single complaint or incident in the six years that the business has been in operation. General Policy The ABP's General Policy contains eight requirements. Although requirement No. 1 does not apply to the subject application, the requirement is discussed. Requirements 5 and 7 are applicable to the subject application. Requirements 2, 3, 4, 6, and 8 do not apply to the subject application because there will be no entertainment, no alcoholic beverage service after 10:00 pm, and there will not be any outdoor seating. Requirement No. 1 states `the Town shall continue to strongly discourage new applications for stand alone bars or restaurants with separate bars.' The proposal does not fall into the definition of a bar in that retail sales are a large component of the business and they will offer wine education classes. As noted previously, only 10% of the two lease spaces are dedicated to wine and food service. Requirement No. 5 states an establishment serving alcoholic beverages is subject to five provisions related to alcohol service (Exhibit 8). The Police Department has discretion over two of the provisions in Requirement 5. The Police Department has reviewed the proposal and concur with the staff findings and recommendations in the report. The subject application meets requirement No. 5 (Exhibit 3). Requirement No. 7 defines a meal as `a combination of food items selected from menu.' The applicants provided a sample food service menu and offers food pairing education as well (Exhibits 6 & 7). Specific Policy The Specific Policy has two requirements that address alcoholic beverage service at restaurants. The first states "alcoholic beverages may only be served with meals." The business will provide food service from a menu. The second requirement states that "meal service shall be available until closing." The business will offer food and beverage service that will cease an hour before closing - Monday through Wednesday at 8:00 pm, Thursday at 9:00 pm, Friday and Saturday at 10:00 pm, and Sunday at 7:00 pm. While food is not Planning Commission Staff Report - Page 6 414-416 N. Santa Cruz Avenue/U-09-007 September 9, 2009 proposed to be served during the final hour of operations, neither will alcoholic beverages. The intent of the Policy is to ensure that food will be served in conjunction with alcoholic beverages. In this case, neither food nor alcoholic beverages will be served during the final hour of operations; however, patrons will be allowed to finish their food and beverages and retail sales will be permitted. Staff believes that the proposal is consistent with the intent of the policy. Lastly, as noted in the applicant's letter of justification (Exhibit 5), in addition to wine service, the applicant is also proposing to serve beer. The applicant's Alcohol Beverage Control License is an On-Premise Beer and Wine license. Given the Town's historical concern for establishments that serve alcohol, staff is suggesting that for the first two years of operation, the use be limited to serving wine only. After two years, staff will conduct an administrative review of the operations to determine if there have been any undesired incidences, police calls for service or complaints. Provided there are no reported issues, the applicant will be allowed to serve beer in addition to wine and non-alcoholic beverages. Staff has added a condition for the administrative staff review that will occur two (2) years from the date the business opens to the public. C. Parking The shopping center consists of four parcels and has 124 parking spaces. The proposed use requires ten parking spaces. The parking requirement is based on the most intensive portion of the proposed use - the special events (for description of special events see business proposal discussion above). One parking space is required for every three attendees. The maximum number of individuals on site at any given time shall be 30. This allows a 25 person maximum for attendees and a five person maximum for employees, instructors, and/or presenters. The shopping center contains adequate parking for the existing and proposed uses (see parking table below). Planning Commission Staff Report - Page 7 414-416 N. Santa Cruz Avenue/U-09-007 September 9, 2009 404 - 442 N. Santa Cruz Avenue Parking Table Seats Requi red Par kin Suite Business Name Type of Use SF Res't Other Retail School Res't Other Total 404 vacant retail 400 1.3 1.3 406 vacant retail 2900 9.7 9.7 408 vacant retail 1870 6.2 6.2. 410 vacant retail 5007 16.7 16.7 414/416 The Boot Enoteca restaurant 2400 16 10.0 10.0 418 Bianco retail 1200 4.0 4.0 420 vacant retail 3000 10.0 10.0 430 vacant retail 3100 10.3 10.3 434 Studio Kicks school 4200 14.0 14.0 438 vacant retail 5400 18.0 18.0 440 Aldo's Deli restaurant 1600 22 5.5 5.5 442 Starbuck's restaurant 1600 32 8.0 8.0 Total Required Parkin 114 Total Provided Parkin 124 D. Traffic The retail aspect of the business does not create traffic impacts. The proposed use will have 16 seats, which is less than the 21 seats allowed in the discontinued restaurant. Therefore, the proposed use has no traffic impact. As noted, there may be special events, including wine education classes and private tastings. Per the applicant's proposal, only two events per month will occur with a maximum of 25 attendees. These limited events will not adversely affect the traffic conditions. E. General Plan The proposed use meets the following goals and policies of the General Plan: • Policy L.P.1.12 - When the deciding body's decision on a zoning approval is based on assumptions derived from the applicant's promises and/or description of the proposal, those assumptions should become conditions of the approval. The project is conditioned to limit the number of events, the number of seats, and the hours of operation as proposed by the applicant (Exhibit 3). • Goal L.G.5.1 - To provide residents with adequate commercial and industrial services. The proposed use provides a service to the Town residents. • Goal L.G.5.2 - To maintain a balanced, economically stable community within environmental goals. The proposed use fills an otherwise vacant commercial space and should encourage additional foot traffic to a vacant commercial area. Planning Commission Staff Report - Page 8 414-416 N. Santa Cruz Avenue/U-09-007 September 9, 2009 Policy L.G.5.1 - Maintain a variety of commercial uses (a strong downtown commercial area combined with Los Gatos Boulevard and strong neighborhood commercial centers) to meet the shopping needs of residents and to preserve the small- town atmosphere. The use contributes to the variety of uses available at the subject commercial center. Policy L.P.5.6 - Encourage development that maintains and expands resident-oriented services and/or creates employment opportunities for local residents consistent with overall land use policies of the Town. The proposed use provides a service to the Town's residents. F. Environmental Review The project is Categorically Exempt according to Section 15301 Class 1 of CEQA as adopted by the Town, which exempts permitting an existing facility with no expansion. G. Redevelopment Plan for the Central Los Gatos Redevelopment Project Area The Redevelopment Plan contains a Redevelopment Land Use Map that designates proposed land uses to be permitted in the Central Los Gatos Redevelopment Project Area. The subject property is designated commercial and, per the Redevelopment Plan, shall be used for the general commercial uses set forth and described in the Town's General Plan. The proposed use falls under general commercial uses. H. Conditional Use Permit Findings In order to grant approval of a Conditional Use Permit, the hearing body must make the following findings: (1) The proposed uses of the property are essential or desirable to the public convenience or welfare; and (2) The proposed uses will not impair the integrity and character of the zone; and (3) The proposed uses would not be detrimental to public health, safety or general welfare; and (4) The proposed uses of the property are in harmony with the various elements or objectives of the General Plan and the purposes of the Town Code. In regards to finding one, the use will provide retail and basic food and beverage service to the community as well as bring visitors, shoppers, and residents to a less frequented area of North Santa Cruz Avenue. In addition, the economic viability of the Town's neighborhood commercial centers can be contingent upon the number of vacancies. Currently the subject site has nine vacancies. The addition of this use will therefore increase the center's vitality. Planning Commission Staff Report - Page 9 414-416 N. Santa Cruz Avenue/U-09-007 September 9, 2009 In regards to the second finding, the use will not impair the integrity of the zone since the use will be in a commercial zone. In regards to finding three, the use will not be detrimental to public health safety or general welfare because the use will not conduct business during late night hours and will be subject to provisions of the Alcoholic Beverage Policy. In regards to the final finding, the proposed use meets the objectives of the General Plan and Town Code as discussed within this report. PUBLIC COMMENTS: The applicants conducted outreach to the local neighborhood and local business. The applicants prepared and circulated 60 outreach packets (Exhibit 10). At this time, the Town has received four public comments in support of the proposal (Exhibit 11). SUMMARY AND RECOMMENDATION: A. Summary: Staff recommends conditions of approval consistent with the applicant's proposed use regarding the number seats, number of events, and operating hours. The project site contains sufficient parking to accommodate the existing and proposed uses. The use will not operate during late night hours consistent with the requirements set forth in the ABP. The discretionary privilege of alcohol service may be acceptable pursuant to the application proposal and associated conditions. B. Recommendation: The Alcoholic Beverage Policy gives the hearing body discretion to approve alcoholic beverage service when the proposal will not negatively impact residential neighbors, alcohol related incidents will not occur, and when the application will provide a positive impact to the commercial area. Based on the evidence submitted by the applicants, staff believes this application fits such a case. If the Planning Commission finds merit with the proposal, it should: 1. Find that the proposed project is categorically exempt, pursuant to Section 15301 of the California Environmental Quality Act as adopted by the Town (Exhibit 2); and 2. Make the required findings as required by Section 29.20.190 of the Town Code for granting approval of a Conditional Use Permit (Exhibit 2); and 3. Make the required finding as required by Section IV.B of the Redevelopment Plan for the Central Los Gatos Redevelopment Project that it meets the use set forth in the Town's General Plan (Exhibit 2); and Planning Commission Staff Report - Page 10 414-416 N. Santa Cruz Avenue/U-09-007 September 9, 2009 4. Recommend approval Conditional Use Permit application U-09-005 with the conditions contained in Exhibit 3. If the Commission has concerns with the application, it can: 1. Recommend approval of the application to Council with additional and/or modified conditions of approval, or 2. Recommend denial of the application. Approved by: Wendie R. Rooney Director of Community Development WRR:JS:cgt cc: Michael Guerra and Joseph Cannistraci, 333 Santana Row Unit #307, San Jose, CA 95128 Jim Zanardi, P.O. Box 23027, San Jose, CA 95153 N:\DEV\REPORTS\2009\NSC414 416.doc 414 & 416 N. Santa Cruz Avenue a h EXHIBIT I REQUIRED FINDINGS FOR: 414-416 N. Santa Cruz Avenue Conditional Use Permit U-09-007 Requesting approval to operate a retail wine establishment with food, beer, and wine service on property zoned C-1. APN 529-07-047. PROPERTY OWNER: Jim Zanardi APPLICANT: Michael Guerra/Joseph FINDINGS Required finding for CEQA: ■ The project is Categorically Exempt pursuant to Section 15301 of the State Environmental Guidelines as adopted by the Town. Required findings for a Conditional Use Permit: ■ As required by Section 29.20.190 of the Town Code for granting a Conditional Use Permit: The deciding body, on the basis of the evidence submitted at the hearing, may grant a conditional use permit when specifically authorized by the provisions of the Town Code if it finds that: (1) The proposed uses of the property are essential or desirable to the public convenience or welfare in that the use will provide retail and basic food and beverage service to the community as well as bring visitors, shoppers, and residents to a less frequented area of North Santa Cruz Avenue. In addition, the economic viability of the Town's neighborhood commercial centers can be contingent upon the number of vacancies. Currently the subject site has nine vacancies. The addition of this use will therefore increase the center's vitality; and (2) The proposed uses will not impair the integrity and character of the zone in that the use will not impair the integrity of the zone since the use will be in a commercial zone; and (3) The proposed uses would not be detrimental to public health, safety or general welfare in that the use will not be detrimental to public health safety or general welfare because the use will not conduct business during late night hours and will be subject to provisions of the Alcoholic Beverage Policy; and (4) The proposed uses of the property are in harmony with the various elements or objectives of the General Plan and the purposes of the Town Code in that the proposed use meets the objectives of the General Plan and Town Code as discussed within the staff report. EXHIBIT 2 414-416 N. Santa Cruz Avenue/U-09-007 September 9, 2009 Page 2 of 2 Required finding for the Redevelopment Plan for the Central Los Gatos Redevelopment Project Area: ® That the proposed project is consistent with the Redevelopment Plan for the Central Los Gatos Redevelopment Project Area (Section IV.B). N:\DEV\FINDINGS\2009\NSC414 416.doc RECOMMENDED CONDITIONS OF APPROVAL - September 9, 2009 414-416 N. Santa Cruz Avenue Conditional Use Permit U-09-007 Requesting approval to operate a retail wine establishment with food, beer, and wine service on property zoned C-1. APN 529-07-047. PROPERTY OWNER: Jim Zanardi APPLICANT: Michael Guerra/Joseph TO THE SATISFACTION OF THE DIRECTOR OF COMMUNITY DEVELOPMENT: Planning Division 1. 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 and letter of justification approved and noted as received by the Town on August 7, 2009 and July 23, 2009, respectively. Any changes or modifications to the approved plans shall be approved by the Community Development Director, the Development Review Committee, the Planning Commission, or Town Council, depending on the scope of the changes. 2. EXPIRATION. The approval will expire two years from the approval date pursuant to Section 29.20.320 of the Town Code, unless the approval has been vested. 3. APPROVED USE. The subject approval is for a retail wine establishment with food, wine and non-alcoholic beverage service as generally described in the applicant's letter of justification (Exhibit 5 of U-09-007 Staff Report). Following two (2) years of operation, Town Staff will conduct an administrative review of the operations to determine if there have been any complaints or Police calls for service related to alcohol problems. If staff determines that there are no concerns, the establishment shall be allowed to serve beer in addition to wine under the same terms of this Use Permit. The applicant shall be responsible for all costs applicable to the administrative review. 4. HOURS OF OPERATION. Maximum hours of operation shall be Monday to Wednesday 10:00 am to 9:00 pm; Thursday 10:00 am to 10:00 pm; Friday and Saturday 10:00 am to 11:00 pm; Sunday 12:00 pm to 8:00 pm. 5. HOURS OF ALCOHOLIC BEVERAGE SERVICE. The service of alcoholic beverages shall not be permitted after 8:00 pm Monday through Wednesday, after 9:00 pm Thursday, after 10:00 pm Friday and Saturday, and after 7:00 pm on Sunday. 6. NUMBER OF SEATS. The maximum number of seats is sixteen (16), inclusive of the tasting bar and private event room. Note: number of individuals on-site at any given time is limited during specials events (see EVENTS condition). 7. EVENTS. Tasting events and/or classes shall be limited to two (2) per month. During tasting events and/or classes, the maximum number of attendees shall be limited to 25. The maximum number of individuals on site at any given time shall be 30, inclusive of employees, instructors, or presenters (based on ten (10) allotted parking spaces). Note: The maximum number of individuals is not in addition to the maximum seating of sixteen. EXHIBIT 3 8. ENTERTAINMENT: Live entertainment and amplified music in prohibited. 9. SIGN PERMIT. A Sign Permit from the Community Development Department is required for any new sign or any change of face of an existing sign. 10. BUSINESS LICENSE. A business license is required prior to commencement of use. 11. CERTIFICATE OF USE AND OCCUPANCY. A Certificate of Use and Occupancy is required prior to commencement of use. 12. ENVIRONMENTAL HEALTH APPROVAL. The applicant shall submit plans to the County of Santa Clara Department of Environmental Health for review prior to commencement of use. The applicant shall provide a copy of the approval from the County of Santa Clara Department of Environmental Health with the Certificate of Use and Occupancy application. 13. TWO YEAR REVIEW. Town staff shall review the Conditional Use Permit within two years from approval to determine if there are any problems associated with the Permit and report their findings to the Planning Commission. The Planning Commission may direct that a public hearing be held to review the permit as specified in Section 29.20.3 10 of the Town Code. 14. ALCOHOLIC BEVERAGE POLICY. The applicant shall be subject to comply with any new requirements in the Town's Alcoholic Beverage Policy within two (2) years from the commencement of operation. 15. TOWN INDEMNITY. Applicants are notified that Town Code Section 1.10.115 requires that any applicant who receives a permit or entitlement from the Town shall defend, indemnify, and hold harmless the Town and its officials in any action brought by a third party to overturn, set aside, or void the permit or entitlement. This requirement is a condition of approval of all such permits and entitlements whether or not expressly set forth in the approval, and may be secured to the satisfaction of the Town Attorney. TO THE SATISFACTION OF THE CHIEF OF POLICE: 16. UNIFORMED SECURITY: Uniformed privately provided security guards may be required in or around the premises by the Chief of Police if alcohol related problems recur that are not resolved by the licensed owner. 17. CONSULTATION AND TRAINING: At the discretion of the Chief of Police, periodic meetings will be conducted with representatives from the Police Department for on-going employee training on alcoholic beverage service to the general public. 18. TRAINING MANUAL: The restaurant operator shall use an employee training manual that addresses alcoholic beverage service consistent with the standards of the California Restaurant Association. 19. DESIGNATED DRIVER PROGRAM: The restaurant operator shall actively promote a designated driver program such as complimentary non-alcoholic beverages for designated drivers. 20. POSTING OF TAXICAB TELEPHONE NUMBERS: Taxicab telephone numbers shall be posted in a visible location. N:\DEV~CONDITNS\2009WSC414 416.doe i7 t, h~ , L, 5 DESCRIPTION OF PROPOSED PROJECT JUL E, 2009 For THE BOOT ENOTECA AND WINE MERCHANT OF L-OS GATnS ; _ ;;~,O 1 ulvIJive Both wine novices and enthusiasts enjoy convivial experiences involving wine and the surrounding wine culture. People in general are becoming more interested in experiencing better, authentic, more eclectic wines and foods. Due to the increased popularity of wine and food related television programming and associated books, the interested consumer also has an eye toward education, wine & food pairing, healthy and responsible consumption in a casual, friendly setting. It is our intention to provide both products and services that will directly tap into these expanding areas of demand and create a unique, innovative and authentic business based on these principles. We intend to provide a broad range of wines by the bottle, ranging from inexpensive, easy-to- drink wines to limited production, premium quality collectibles. We will feature a large percentage of Italian wines and a focus on local wineries from Santa Clara and Santa Cruz counties, yet we will have wines from all the major wine growing regions of the world. Beer and other non-alcoholic beverages, such as bottled water, soda, juices, and the like will also be available. In addition, we will sell a variety of wine-related accessories, such as corkscrews, decanters, stemware, wine gift bags, coasters, games, cleaning products, and similar items. We also plan to sell a selection of premium quality, artisanal specialty food items such as chocolates, cookies, crackers, cheeses, cured meats, as well as other packaged items. We also intend to provide a selection of wine "by the glass" as well as beer and other non- alcoholic beverages, such as bottled water, soda, juices, and the like. We also plan to provide "small plate" food items such as cheeses, cured meats, condiments and other charcuterie as well as other prepared foods like cookies, cake, chocolates. The food offerings shall be simple, easy to execute, and will not require any commercial equipment to prepare. In addition to our regular food and beverage service, we intend to provide, on a regular basis, hosted wine tastings with wine makers and/or winery representatives that will discuss their wines, the winery, the winemaking process, etc. We also plan to conduct hosted tastings for both corporate and private customers in a small, intimate setting in a separate room, off the retail floor. We will also conduct a wide range of wine classes that will appeal to wine novices as well as knowledgeable wine enthusiasts. Our establishment will create an entire culture and convivial atmosphere based on the appreciation and responsible consumption of wine and accompanying food pairings. EXHIBIT 4 LETTER OF JUSTIFICATION For Jul- 1' '1.009 THE BOOT ENOTECA AND WINE MERCHANT DESCRIPTION OF BUSINESS The Boot Enoteca is a centuries old business model that combines elements of wine and food appreciation in a traditional and civil atmosphere. We will provide a selection of fine wines, available both by the glass (on-premise) and for retail purchase (off-premise) in combination with a selection of wine-related small plates to be enjoyed on-site. In keeping with our goal of creating a culture of passionate, informed and responsible wine and food enjoyment, we will provide a separate room, off the main retail space, to be used for private, intimate events such as hosted tastings, corporate meetings, private tastings, and wine education classes. We intend to conduct hosted wine tastings and wine education classes on a regular basis in order to increase our customer's knowledge and appreciation of fine wines and specialty foods. We also intend to capitalize on popular and powerful media, specifically our website, to expand our presence beyond local boundaries and increase our customer base by offering on-line wine courses, video- based wine commentaries and interviews, blogs and other content. Vision and Values: Both wine novices and enthusiasts enjoy convivial experiences involving wine and the surrounding wine culture. People in general are becoming more interested in experiencing better, authentic, more eclectic wines and foods. Due to the increased popularity of wine and food related television programming and associated books, the interested consumer also has an eye toward broadening his/her experience, expanding his/her knowledge, becoming educated about wine & food pairing, and fostering healthy and responsible consumption in a casual, friendly setting. The Boot will provide both products and services that will directly tap into these expanding areas of demand and create a unique, innovative and authentic business based on these principles in order to help support our retail operation. HOURS OF OPERATION: Monday -Wednesday: 10:00 AM to 9:00 PM Thursday: 10:00 AM to 10:00 PM Friday and Saturday: 10:00 AM to 11:00 PM Sunday: 12:00 PM to 8:00 PM Please note: Food and Beverage service will terminate ONE HOUR prior to close. NUMBER OF EMPLOYEES: We plan to employ 4 full-time employees (including ourselves) and 2 to 5 part-time employees, as the demands of the business necessitate. PRODUCTS AND SERVICES: OFF PREMISE PRODUCTS: We intend to provide a broad range of wines by the bottle, ranging from inexpensive, easy-to-drink wines to limited production, premium quality EXHIBIT 5 collectibles. We will feature a large percentage of Italian wines as well as a focus on. local wineries from Santa Clara and Santa Cruz counties, yet we will have wines from all the major wine growing regions of the world. Beer and other non-alcoholic beverages, such as bottled water, soda, juices, and the like will also be available. In addition, we will sell a variety of wine- related accessories, such as corkscrews, decanters, stemware, wine gift bags, coasters, games, cleaning products, and similar items. We also plan to sell a selection of premium quality, artisanal specialty food items such as chocolates, cookies, crackers, cheeses, cured meats, as well as other packaged items. ON PREMISE PRODUCTS: We intend to provide a modest selection of wine "by the glass" as well as beer and other non-alcoholic beverages, such as bottled water, soda, and juices. We also plan to provide focused selection of "small plate" food items such as cheeses, cured meats, condiments and other charcuterie as well as other prepared foods like cookies, cake, chocolates. The food offerings shall be simple, easy to execute, and will not require any commercial equipment to prepare. SERVICES: In addition to our standard food and beverage service, we intend to provide, on a regular basis, hosted wine tastings with wine makers and/or winery representatives that will discuss their wines, the winery, the winemaking process, etc. We also plan to conduct hosted tastings for both corporate and private customers in a small, intimate setting in a separate room, off the retail floor. We will also conduct a wide range of wine classes that will appeal to wine novices as well as knowledgeable wine enthusiasts. Our establishment will create an entire culture and convivial atmosphere based on the appreciation of wine and accompanying food pairings which we believe will benefit our retail operation. Maximum number of seats: 16 Maximum number of Tasting Events/Classes per month: 2 Maximum number of attendees per Event/Class (Private): 6 Maximum number of attendees per Event/Class (Public): 25 NOTE: Tastings and classes are typically held after 6:00 PM if on a weekday OR on Saturday afternoons. BENEFITS TO THE COMMUNITY: • Currently, there is no existing business that offers a wide range of eclectic wines (and specialty foods) in town, so residents have to drive to neighboring areas to purchase wines and to interact with passionate, friendly, and knowledgeable staff. We will fulfill this unmet need for Los Gatos residents, thereby increasing their satisfaction with the amenities found in town and alleviate any frustrations they may have about having to drive elsewhere in order to procure the products and services they desire. o Our business will provide the type of products and services that will also attract upscale patrons, both private and corporate, into the town from outlying areas, bringing more collateral business and sales revenue into town which will benefit other local businesses and the town. We plan to do a high volume of sales for the modest physical footprint of our business which will provide always-needed sales tax revenue to the town. • By providing a unique and popular destination in the Los Gatos Shopping Center, we will draw people into an area beyond the downtown core, thereby expanding activity and business into a less-frequented, less "popular" section of town. • Promotion of Local Wineries: We intend to dedicate a portion of our inventory to wines from local wineries (from Santa Clara and Santa Cruz counties) as well as host tasting events featuring local wine makers and/or winery representatives in order to help increase their exposure and expand their customer base. FACTS THAT JUSTIFY APPLICATION: • Our business will comply with the Noise Element in the General Plan. • Our business will comply with the town's Alcohol Beverage Policy in that we will not serve any wine/beer past 10 PM (see note under Hours of Operation). • We operate a similar business in Santana Row which is a very impacted, densely- populated residential/retail center where we have residents that live directly above our establishment. In nearly 6 years of operation, o. We have not had a SINGLE complaint filed by any residents regarding noise, disruptive customer behavior or ANY other reason. o We have never had a SINGLE incident of drunken or disorderly conduct by any of our patrons. o We have never had a SINGLE incident in which we or any SR resident has contacted SR security or local law enforcement because of problematic behavior of our patrons. • Our business would help achieve the objective of providing a "diverse shopping experience" as outlined in the General Plan because we would provide a unique, interactive and mutli-level wine-related experience that is not currently available in the town limits. • Our business would help achieve the objective of "preserving the small town character" of the town as outlined in the General Plan because we would be a small, privately owned and operated business. One of the principals has long-standing roots in the local community. • Our business would help achieve the objective of supporting "an active business community that provides a wide variety of goods and services and a broad range of employment opportunities, minimizing the need to travel to other communities" in order to obtain sought-after products and services as outlined in the General Plan. • The proposed uses of the property are desirable to the public conveniences; the proposed uses will not impair the integrity and character of the zoning district; the proposed uses would not be, detrimental to public health, safety, _or general welfare the proposed uses of the property are in harmony with the various elements or objectives of the General Plan (as outlined above) and the purposes of the Town Ordinance. BIOGRAPHIES OF BUSINESS PRINIPALS: Joseph Cannistraci Joe's initial work background was in the trades as a Journeyman Plasterer. Before joining the trade union, he was an Apprentice Machinist at the Defrancisi Machine Corporation, a renowned manufacturer of commercial pasta machines from 1990 to 1991. Prior to developing his passion for wine, Joe expanded his entrepreneurial pursuits and was a key founding owner of Coastal Sol Foods, an energy bar company, which he shepherded from conception to product launch. He did product research and development, worked closely with a consultant to create a business plan, recruited outside co-investors, and was responsible for all aspects of product development, including formulations and branding. Joe began his career in the wine industry by working at a South Bay wine retailer, which was one of the largest in the US. Joe immediately demonstrated a special knack for developing both customer and business relationships, as well as an aptitude for absorbing and utilizing a vast amount of wine knowledge. Within his first year, he was promoted to Assistant Manager and made the Italian Wine Buyer. Since 2002, Joe Cannistraci has been working as a founding partner at Vintage Wine Merchants, the premiere wine retailer/wine bar in the San Francisco Bay Area. As a partner, he has managed all operational aspects of the business, as well as purchasing, hiring collateral staff, acting as the key person in the front end of the business, as well as building his key customer contacts All four of Joe's grandparents were Sicilian immigrants, and he is the youngest of four children. His family of origin gave him a taste and appreciation for good food and wine, as well as many family recipes for traditional Italian food. He is currently married to Louise, his wife of nine years, and resides in San Jose. Besides wine and fine food, Joe has a passion for surfing. Work History and Associations: Vintage Wine Merchants Founding Partner Wine Club Assistant Manager and Italian Wine Buyer Coastal Sol Foods Defrancisi Machine Corporation Bricklayers and Allied Craftsmen, Local 13 in Newark, New Jersey Michael Guerra Prior to working in the wine business, Mike's work background was as a family and child therapist for 5 years in Solano County as a Mental Health Clinician in the Children's Day Treatment Program in Vallejo, CA. Prior to accepting this position, he was awarded and completed a one-year Post-Master's Clinical Fellowship at the Yale University Child Study Center in New Haven, CT. In 1999, Mike took a position with a South Bay wine retailer in order to more formally explore his passion for wine, and it changed his world. He was only there a brief time before he accepted a position at another wine retailer in the San Francisco Bay Area, where he was able to put his knowledge and passion of Italy and Italian wines to use and become the Assistant Italian Wine Buyer. He left the wine industry briefly for a two year sojourn as a Human Resource Specialist for an internet security company before joining Vintage Wine Merchants. The founders of Vintage Wine Merchants, a premiere wine retailer/wine bar in the San Francisco Bay Area, recruited Mike during the build-out stage of their business in 2002. Mike. quickly established himself as a key contributor at Vintage by taking on wine buying responsibilities, developing and implementing the food program, developing and implementing the Wine Education program and acting as the Event Coordinator and Customer Liaison for private parties and corporate functions. As a result of his commitment and contributions to the growth and success of the business, he became one of the four partners to eventually run the business. Because of the excellent reputation he developed during his tenure at Vintage, Mike has been featured in the San Jose Business Journal, San Jose Magazine and interviewed on "In Wine Country" and for 2 different features on KRON-TV. Mike is the third generation of Italian immigrants from Calabria, Italy, and is the youngest of two children. He spent his junior year in college studying abroad in Rome, Italy, which, he says, was a pivotal year and one of the experiences that eventually led him to pursue his current career and passion. He still has a passion for international travel and foreign languages. Work History and Education: Vintage Wine Merchants 2002-present Human Resource Specialist for an internet security company, 2000-2002 K&L Wine Merchants, 1999-2000 Mental Health Clinician - Solano County Children's Day Treatment Program, 1994-1999 Post-Master's Clinical Fellowship - Yale University Child Study Center, 1992-1993 Master's degree in Social Welfare - University of California at Berkeley, 1991 B.S. Psychology - Santa Clara University, 1986 High School Diploma - Bellarmine College Prep., 1982 n This is a sample Menu AUG 7 2000 -f'!-ANN OF LOS GA, Antipasti ANNiNG DjV~,,_,, , n Antipasti- Salumi Finocchiona, 6opesatta, Coppa, La Tur cheese with Coponata and Acme Bread Small 1- 2 people $15 Large 3-4 people $22 Cold Mediterranean Seafood Salad, Octopus, Scungilli, Prawns, Calamari Celen Lemon, Extra Virgin Olive Oil and Capers $13 Little Gein Lettuces with Asparagus, Peas & Pecorino $16 Bruschetta Bruschetta Classico Crostini topped with diced organic Roma tomatoes marinated in Extra Virgin Olive Oil with Basil, Sicilian Sea Salt, Crushed Pepper and a Shaved Slice of Reggiano $8 From the Mozzarella Bar Mozzarella tasting: Burrata, Fior di Latte & Bufala Mozzarella $24 Bufala Mozzarella with Prosciutto $16 Burrata with Extra Virgin Olive Oil and Ground Pepper $16 Panini Siciliano Grilled Eggplant, Roasted Red Peppers, Ricotta Salata, Baby Greens on Acme Focaccia. $9 , Entree Melanzane ally Parinigiana Breaded Eggplant Layered with Tomatoes, Basil, Mozzarella & Parmigiano, $14 Pollo ally Diavola Boneless Skinless Grilled Chicken Breast Poached in Wine, Tomatoes, Capers Lemon and Garlic $18 Pizza Pizza Margherita Mozzarella and tomato sauce $18 EXHIBIT 6 E IF I~1 Greetings Friends, Customers and Fellow Wine Enthusiasts! AUG 7 2009 Well, we've just finished our inaugural session of our "Decanting" series wine classesc)FThiey c/-,,,_,. were very well received and very successful-which is good, because we are very--&eii 6d DIV; about our "new and improved" offerings. Okay, we can't take all the credit. After all, we did receive some great suggestions from some of the "Decanting alumni" and have tried to incorporate them into our new curriculum. To those of you alumni to whom this applies, we say, "Thank you...and we'd like to offer you a laurel ...and hardy handshake as a show of our appreciation..." Drum roll please ...as we are ready to unveil our new class offerings. As an introductory note, let us just say that, following the example of the great visionary and awesome filmmaker, George Lucas, we decided to launch our project with the "second installment" of a three-part series. No offense George (and fellow Star Wars fans), but we hope that our other installments are a bit more satisfying than their movie counterparts... That being said, here are the new Vintage Wine Merchant class offerings: "Uncorking" Series This might be referred to as "Introductory" Level classes in normal nomenclature, but you know us, we like to do things a little differently and, hopefully, more creatively...These classes will focus on introductory subject matter and skill development. They are great for beginners and for those of you who want to take a "refresher" class to hone your skills. Examples of future "Uncorking" classes would be: Beginning Wine Appreciation, Component Tasting, and Food & Wine Pairing 101. "Decanting" Series These would otherwise be known as "Intermediate" Level classes, which focus on introductory and/or general overviews of selected topics, such as an overview of wines from a particular country or an overview of certain categories of wine. Though beginners are always welcome, having some knowledge of basic wine terminology and styles will allow attendees to receive maximum enjoyment from these more "advanced" topics. Some of the upcoming classes that are tentatively scheduled in this series are: Decanting Sparkling Wines, Decanting Dessert Wines, and Decanting Austria. "Savoring" Series These classes provide even more focused, in-depth coverage of specific topics. More than just a cursory overview, in these classes we'll take the time to really explore each topic to the fullest extent. These weekly classes may take from 1 to 4 sessions, depending on the breadth of the material covered, and are just the ticket for those of you who really want to become "experts" on certain topics. Some examples of upcoming classes that are tentatively scheduled in this series are: Savoring Italy (a three session class): Northern Italy, Central Italy, and Southern Italy. EXHIBIT 7 "Follow That Grape" Series This is an independent series of classes that will focus on incarnations of individual grape varietals (i.e., Cabernet Sauvignon, Pinot Noir, Chardonnay, etc.) from various viticultural regions around the globe. Attendees will examine the similarities and differences in the terroir, winemaking practices, philosophies, and styles of the various wines. For example, we'll take a look at "typical" Cabernets from Napa, France, Australia, Chile, Italy, and see how they compare with each other. These classes are a great way to really get familiar with your favorite grapes, in all their many shapes and sizes. WARNING: F.T.G. classes may foster heated debates among attendees (including the instructor). Attendees are advised to wear comfortable, old clothing, as opinions, quips, wine, and quite possibly, food are expected (and encouraged) to be flung at some point during the evening. VINTAGE DECANTATIONS Decantation (de-can-TA-tion), n. The act of pouring (a liquid) from one vessel into another in order to separate from sediment and allow for maximum exposure and optimal expression. We're taking a little poetic license and using this concept to refer to the fact that we'll be doing more than just popping corks in our new classes. In keeping with our philosophy that wine appreciation should be FUN, our classes are designed to be interactive and informal, as well as informative. We'll leave all the myths and pomposity behind and retain the more pleasurable aspects of sharing knowledge, stories, and impressions with each other about the wines and regions we'll be exploring-"to allow for maximum exposure and optimal expression!" Our initial Decanting Series provides a general overview of the various topics (more intensive, in-depth courses will be offered in the future). Though we encourage you to attend any of the classes that interest you, those totally new to wine might gain a fuller appreciation of the Decanting classes if they "wet their lips" with the Basics class first. Each class is $40.00/person. Classes will be held in the store or (depending on the size) at a nearby location at Santana Row. We'll provide the stemware and educational materials. All attendees must be at least 21 years of age. To ensure maximum enjoyment of the wines, we ask that attendees refrain from wearing strong perfume or cologne. Capacity is limited, so sign up quickly. Sign up for any 4 classes in advance and get the 5th class free!!! CLASS SCHEDULE Basic Wine Appreciation - What is This Thing Called Wine? This class is a wine snob's worst nightmare and a wine novice's dream come true! In this class, we'll discuss the basics of wine appreciation: grape' varieties and major growing regions, wine making basics, the "How- To's" of tasting wine, proper wine storage, food and wine pairing, and ordering a wine in a restaurant. After this class, you'll never feel intimidated (about wine) again! Decanting Australia - Like A Bridge Over Coonawarra or Home, Home on the Grange The Land of Oz has just surpassed France as the second leading wine-exporting country to the US! Just marketing you say? Well, they DO have that (How many of you have had the Tait "Ball Buster" Shiraz??). They also have made a reputation for palate and pocketbook-pleasing wines. However, they are making world-class wines in all price ranges. We'll taste some great values and expensive collectibles as we learn about the main grape varieties, growing regions and producers (large and small) of the Land Down Under. Woop, Woop! Decanting California - Sipping by the Dock of the Bay California is the "new kid on the block" in terms of fine wine production when compared to most other countries-but we've come a long way in a short time, no? Fearlessness and innovation have made this state a titan of the wine world. France has Cabernet, Merlot, Chardonnay and Viognier-so do we! Italy has Sangiovese and Pinot Grigio-us too! Spain has Tempranillo and Garnacha-same here! Germany as Riesling-no problem! We also have a little grape called Zinfandel... anyone? Didn't think so! California has it all-the Good, the Bad and, yes, the Ugly. We'll "tell all" as we learn about the wines, the regions, and the producers that have made this state so great. Decanting Spain - Sweet Home Albarino Spain has more land under vine than any other country in the world-and is the third largest producer and exporter of wine (only behind France and Italy)! Until recently, quality Spanish wines were hard to come by here in the States-but there has been a wine revolution going on in Espana! The current generation of Spanish wine producers has been focusing on quality wine production-and the results are astounding! Spain is making exciting wines at ALL price levels-just pick up any current wine periodical and check out the scores. Become more acquainted with the likes of Crianza, Cava (sparkling wine), Albarino, Priorato, Rioja, and Ribero del Duero among other things as we explore the Land of La Mancha! Decanting France Show Me the Way to Go Rhone No other country in the world produces more world-class, highly-prized (and expensive) wines than France. You've heard the names bandied about: Bordeaux, Burgundy, Champagne ...Costieres de Nimes ...That's right, though France set the standard for the rest of the world with magical elixirs that have now become household names, there are many other glorious wines and regions to sample and enjoy-and we will! We'll explore the major grape varieties and growing regions of France as well as some lesser-known values that will tease your palate and please your wallet. Decanting Italy - Whenever I Call You Firenze Ah, Bella Italia ...or as the Greeks called it "Oenotria," Land of Vines. Wine has been produced in Italy for thousands of years and there are reported to be over 400 grape varieties growing in Italy-and we'll taste them alll Well, not quite...but we'll travel from the foot of the Alps (Piemonte), land of Barbera, Dolcetto, Baroto, down through Tuscany, where Sangiovese is King, on to Sicily, where Nero D'Avola reigns supreme, sampling and discussing the important grape varietals, producers and growing areas as we go. Experience La Dolce Vita in your own home town! Decanting Germany - Like A Rhine-stone Cowboy Often overlooked by the casual wine enthusiast, Deutschland is where Riesling, some say the noblest of white grape varietals, reaches its ultimate expression. Come and learn about such wines and terms as Spatlese and Trockenberenauslese or Nahe and Mosel. We'll discuss how to decode German wine labels and cover the various growing regions and producers and why these wines provide a near-religious experience when paired with Asian or Indian foods. Auf Wiedersehen! "A little learning is a dangerous thing; drink deep, or taste not the Pierian spring: there shallow draughts intoxicate the brain, and drinking largely sobers us again." Alexander Pope (1688-1744) - An Essay on Criticism - COME AND DRINK LARGELY! VINTAGE WINE MERCHANTS VINTAGE WINE MERCHANTS FALL CLASS SCHEDULE Call 408-260-1115 to reserve a space or visit us at www.vintagewinemerchants.com for more details Thursday, October 141h: INTRO TO CHEESE - A SLICE OF HEAVEN (BACK BY POPULAR DEMAND!) Are you a closet Caseophile or do you share your love of cheese with the rest of the world? Maybe you're just a casual cheese consumer... Perhaps you've come to one of our Friday Night Wine and Cheese pairings and tried something new and interesting... or just maybe you think Velveeta is the cat's meow (as our own Harry Fong often rants). In any case, you may want to learn more about cultured milk (a.k.a. cheese). In this introductory class, we'll explore the vast world of cheese: how it's made, the main types of milk used, the many kinds of cheese and the major regions in which it's produced. Don't just say "Cheese "...eat it! Capacity: 20 Students Cost: $20.00/person + tax Thursday October 28th (White) and November 4th (Red): DECANTING: BURGUNDY Okay, so we could spend a lifetime exploring the vast nuances, varied character, and multitude of vineyards and vignerons that make up the complicated, delectable fabric that is Burgundy (maybe a future candidate for an "Indulging In" series? but let's crawl before we run, shall we? In this introductory class, we'll conduct a general overview of the region, breaking down the classes into "White" and "Red." See, that isn't so scary, is it? Come and learn about the region that many believe gives birth to the highest expressions of the Pinot Noir and Chardonnay grapes. If nothing else, you'll learn a valuable secret: Good Burgundy doesn't necessarily HAVE to be expensive ...sshh, don't tell anyone we told you! More secrets are yet to be revealed... Capacity: 15 Students Cost: $30.00/person + tax ($55.00/person for both sessions) Thursday, November 11th: UNCORKING: HOLIDAY WINES Happy Festivus, everyone! The holidays are upon us and visions of sugar plums (and other sundry comfort foods) dance in our heads-bringing to mind the annual question of "Which wine do I serve with this cornucopia of textures and tastes?! From Thanksgiving turkey with all the fixin's to Holiday dinners and cocktail parties ...the season is chock full of occasions to explore the vagaries of food and wine pairings-and the options are boundless! We'll sample everything from the sublime to the ridiculous before moving on to "The Airing of Grievances..." Capacity: 20 Students Cost: $20.00/person + tax Thursday, November 18th: UNCORKING: SPARKLING WINES Dom Perignon may have said it best when, upon first imbibing some of the bubbly elixir, he exclaimed to his fellow monks, "Come quickly, I'm drinking stars!" Sparkling wine is one of the true treats of the wine world-exuberant, titillating, uplifting, sensuous, and delicious-far too wonderful to save for special occasions only! Nothing rejuvenates the spirit like a bottle of bubbly, so why not "pop'" open a bottle to add a little sparkle to a Tuesday night or to add a little panache to a Sunday brunch? Most all of the major wine-producing regions produce sparkling wines-and some are very inexpensive! We'll taste an array from Italy, Spain, Australia, California and, of __p__ course France[ Ca acity 20 Studehts C6st; 25.00/ person 4wtax Thursday, December 2nd: UNCORKING: DESSERT WINES Do the words "Late Harvest" send a shiver down your spine? Does the term "residual sugar" make your heart go pitty-pat? When dining out, do you check out the dessert menu BEFORE you look at the dinner menu? If you answered "Yes" to any of these questions, then this class is for you! We will indulge our sweet tooths with some of the world's finest "stickies" from French Sauternes to German Eiswein to Spanish Sherry to some domestic Last Harvest wines ...learn about the grapes, the regions and the techniques used to make what some slightly lascivious folks refer to as "belly button" wines ...yum! Capacity: 20 Students Cost: $25.00/person + tax RESOLUTION 2001 106 RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF LOS GATOS AMENDING THE TOWN'S ALCOHOLIC BEVERAGE POLICY WHEREAS, the sale of alcoholic beverages, if not regulated, can jeopardize public safety, result in an increase of calls for police services and compromise the quality of life for Town residents,; and WHEREAS, The Town Council wants to balance the regulation of alcoholic beverage service and protection of residential neighborhoods with the goal of maintaining a vibrant and successful Downtown and commercial areas throughout Los Gatos; and WHEREAS, the Town Council held a study session on July 2, 2001 to discuss issues relating to service of alcoholic beverages; and WHEREAS, the Town Council has indicated a desire to review all applications for new alcohol service or change in existing service, and a need to amend the existing Alcohol Policy, THEREFORE BE IT RESOLVED: the Town Council of the TOWN OF LOS GATOS does hereby adopt the amended. Alcoholic Beverage Policy attached hereto as Exhibit A. EXHIBIT 8 PASSED AND ADOPTED at a regular meeting of the Town Council held on the 171 day of September, 2001, by the following vote: COUNCIL, MEMBERS: AYES: Randy Attaway, Steven Blanton, Sandy Decker, Steve Glickman, Mayor Joe Pirzynski. NAYS: None ABSENT: - None ABSTAIN`. None / SIGNED: YOR HE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA ATTEST: CLERK OF T.BE TOWN OF LOS GATOS LOS GAT10$ CALIFORNIA 2 -1 s I t POLICY REGULATING THE CONSUMPTION AND SERVICE OF ALCOHOLIC BEVERAGES . 1. Purpose The consumption or service of alcoholic beverages, if not regulated, can jeopardize public safety, result in an increase of calls for police services and compromise the quality of life for Town residents. This policy provides parameters for alcoholic beverage service, particularly addressing late night service when alcohol related incidents are most likely to. occur and when the disturbances to Town residents is least tolerable. The service of alcoholic beverages, with or without meals, past 10 PM is a discretionary privilege to be determined on. a case by case basis. The following provisions are intended to balance the protection of residential neighborhoods in close proximity to commercial districts and still maintain the viability of our commercial centers in which restaurants have aft essential role. Hours of operation may be regulated based on an establishment's proximity to residential neighborhoods or schools, the concentration of establishments in an area serving. alcoholic beverages or for other reasons that may arise at the public hearing. The deciding body may approve a conditional use permit to serve alcoholic beverages based on the merits of the application and subject to the following requirements: R. General policy 1. The Town shall continue to strongly discourage new applications for stand ,alone bars or restaurants with separate bars. 2. The Town shall continue to discourage applications for entertainment establishments serving alcoholic beverages. 3 . Entertainment in association with an eating or drinking establishment maybe allowed if standards and a permit process are adopted. . ' 4. Alcoholic beverage service for new conditional use permit applications or applications for modification of a conditional use permit shall not be allowed: A_ After 11 PM Sunday through Thursday, except for holidays and evenings before holidays. B. After 1 AM Friday, Saturday,'holidays or evenings before holidays. An existing establishment with a conditional use permit in good standing allowed to serve alcoholic beverages past the hours stated above may continue to operate under their existing hours of operation. Exhibit A Town of Los Gatos Alcoholic Beverage Policy Page Z of 4 Any establishment serving alcoholic beverages shall be subject to the following: A. Uniformed privately provided security guards may be required in or around the premises by-the Chief of Police if alcohol related problems recur that are ,not resolved by the licensed owner. B. At the discretion of the Chief of Police, periodic meetings will be conducted with representatives from the Police Department for on-going employee training on alcoholic beverage service to the general public. C. All establishments shall use an employee training manual that addresses alcoholic beverage service consistent with the standards of the Californian restaurant Association. D. All licensed operators shall have and shall actively promote a designated driver program such as complimentary non-alcoholic beverages for designated drivers.. E. Taxicab telephone numbers shall be posted in a visible location. 6. The deciding body shall make the following findings prior to approving an application for conditional use permit to serve alcoholic beverages past l OPM: A. Late night service will not adversely 'impact adjacent residential neighborhoods. B. The applicant does not have a history of complaints and non-compliance with local ordinances or the Alcoholic Beverage Policy. C. The applicant has demonstrated a clear benefit to the community. 7. A meal is defined as a combination of food items selected from a menu (breakfast, lunch or dinner); Appetizers such as popcorn, nachos, pretzels, potato skins, relish trays, etc. (hot or cold) are not ineals. 8. Alcoholic beverage service in approved outdoor seating areas may be permitted if adequate separation from public areas is provided as° determined by the Town Manager. The separation shall clearly suggest that alcohol is not allowed outside the restaurant seating area. Town of Los Gatos Alcoholic Beverage Policy Wage. 3 of 4 III. Specific Policy Restaurants: Alcoholic beverages may only be served with meals. Restaurants With Separate Bars: Alcoholic beverage service is permitted in the dining area only in conjunction with meal service: Meal service shall be available until closing or 11 PM Sunday through Thursday and until 12 midnight Friday, Saturday, holidays and evenings before holidays, whichever is earlier,, if late night bar service is available. Specific hours of operation for each establishment are determined upon issuance of a conditional use permit. IV. Review Process Proposals for new bars or restaurants with bars and all requests for new alcohol service or a change to existing service shall be reviewed by the planning Commission. The Commission will make a recommendation to the Town Council and the Council shall have final review authority. 2. Changes in ownership for businesses involving service of alcoholic beverages. shall be reviewed by the Community Development Department. The following process will be followed: a. The Director of Community Development shall contact the new business owner to make them aware of the conditions of approval attached to the Use Permit for the location. b. One year following issuance of a business license, surrounding/impacted property owners shall be notified and any comments regarding the operation of the business shall be solicited. C. If the Director of Community Development becomes aware of any alcohol related impacts on the surrounding neighborhood, the Director shall review the operation of the business to determine whether there is a violation of the use permit. Town of Los Gatos Alcoholic Beverage Policy Page. 4 of 4 d. If there are violations of the use permit that have not been voluntarily corrected by the business owner the matter will be forwarded to the. Planning Conumigsion for public hearing pursuant to Section. 29.20.3 10 of the Zoning Ordinance, e. Pursuant to Section 29.20,315 of the Zoning Ordinance the Planning Commission may revoke or modify the conditional use permit if it finds that sufficient grounds exist. IV, Enforcement All conditional use permits issued to establishments for alcoholic beverage service on site shall be subject to Section 29.30:310(b) of the Town Code authorizing the Town Manager to take enforcement action if it is determined that the sale of alcohol has become a nuisance to the Town's public health, safety or welfare. Enforcement of section 29.20.310(b) of the Town Code will be based on, but, not limited to, the following factors:, I. The number and types of calls for service at or near the establishment vvhick that are a direct result of patrons actions; 11. The number of complaints received from residents ad other citizens concerning the operation of an establishment; U, The number of arrests for alcohol, drug, disturbing the peace, fighting and public nuisance violations associated with an establishment; IV. The number and kinds of complaints received from the State Alcoholic Beverage Control office and the County Health Department; V, Violation of conditions of approval related to alcoholic beverage service. The Alcoholic. Beverage Policy is not to be construed to bea right of development. The Town retains the right of review and approval (or denial) of each project based on its merits. N.\DEV 8UY.ANNblCa=iMcohdPoL-A001atcohdPoliaywpd QI L--l' WZ X7 AUG 7 2009 w z W 4 N be u a z N h a4 a z p r,~ O I .OS GATT` DjVISi..,,, a _z z oC C 4 Vl 0 a N 0 v 4, 0 z 3 O EXHIBIT 9 \ N O M L. andicap access u O fC E L Q M 4a C a a~ M a C C LU O O 3 Ell- O U C R W V ;F+ E P V O L. O a C O LL d O p C V M 7 f8 d1 p1 = 4) 4w T O 3 F. 'a IM M ® V a CL O V e_ V 0 L a M C O li M y y0„ O O 0 L 3 LL O Cr ~ rp O a .C M 41 Handicap Emergency Exit Handicap Bathroom Bathroom n MN co rt wn O 1 24" freezer N (D 52" 2 door standing fridge I o x rn c m 0 o _ _ v► Z M s m T 3 M d rt Three comp sink in n M Garbage Slim Jim m : U) ; v CL rl to O0 (n O to -0 N M ~ 0 O C O N c CL a~ to O 0 0' o a m aCD : m O N O M1 AU G 7 2009 r,,n~ CIF I -OS GAT"i September 2009 Dear Sir or Madam: Our names are Mike Guerra and Joe Cannistraci. We have an application going before the Los Gatos Town Planning Commission on Wednesday, September 9(b to open a wine retail store and tasting room (based on the time-honored concept of "Enoteca" in Italy) in the Los Gatos Shopping Center at 416 N. Santa Cruz Avenue. Please accept this packet of materials as our way of introducing ourselves to you and letting you know about our plans to open a business near you. In brief, we are seasoned and serious wine industry professionals who intend to create an upscale, yet casual environment of passionate, informed and responsible wine and food enjoyment. We will offer eclectic selection of fine wines, wine-related accessories, and specialty foods available for retail purchase, as well as a modest selection of wines for tasting and a menu of substantial, yet simple food choices to be enjoyed on premise. In keeping with our core belief of ever increasing our customers' knowledge and appreciation of fine wines, we also plan to conduct hosted tastings and wine education classes on premise and feature videos of interviews of wine industry professionals (such as winemakers, Master Sommeliers, wine importers, etc.) and other wine-related commentary on our website. In order to provide you with as much information about who we are and our proposed venture as possible, we have enclosed a detailed description of our concept, short biographies of ourselves, a DVD of an interview we conducted with an Italian winemaker, a copy of a wine class curriculum we conducted at a prior location, and a sample menu of food offerings we intend to provide. We hope to become an active, responsible and beneficial addition to the Los Gatos community. In order to help us achieve this, we invite you to contact us to share any questions, concerns or comments you may have about our proposed venture, as your input and support are very important to us. You can reach us at: joe@joecannistraci.com. We look forward to hearing from you. Thank you for your consideration, A0. / Michael Guerra and Joseph Canni~traci, Prin ~ als AUG 2 8 2003 EXHIBIT 10 ENOTECA AND WINE MERCHANT DESCRIPTION OF BUSINESS: Our Enoteca is based on a centuries old business model that combines elements of wine and food appreciation in a traditional and civil atmosphere. We will provide a fairly significant selection of fine wines for retail purchase (off-premise) as well as a modest selection of wine offered by-the-glass for tasting (on-premise) and for pairing with our menu of wine-related food offerings. We intend to conduct hosted wine tastings and wine education classes in order to increase our customer's knowledge and appreciation of fine wines and specialty foods. We also intend to capitalize on popular and powerful media, specifically our website, to expand our presence beyond local boundaries and increase our customer base by offering on-line wine courses, video-based wine commentaries and interviews, a blog and other content. Both wine novices and enthusiasts enjoy convivial experiences involving wine and the surrounding wine culture. People in general are becoming more interested in experiencing better, authentic, more eclectic wines and foods. Due to the increased popularity of wine and food related television programming and associated books, the interested consumer also has an eye toward broadening his/her experience, expanding his/her knowledge, becoming educated about wine & food pairing, and fostering healthy and responsible consumption in a casual, friendly setting. Our Enoteca will provide both products and services that will fulfill these expanding areas of demand and create a unique, innovative and authentic business based on these principles in order to help support our retail operation. HOURS OF OPERATION: Monday - Wednesday: 10:00 AM to 9:00 PM Thursday: 10:00 AM to 10:00 PM Friday and Saturday: 10:00 AM to 11:00 PM Sunday: 12:00 PM to 8:00 PM Please note: Food and Beverage service will terminate ONE HOUR prior to close. BENEFITS TO THE COMMUNITY: • Currently, there is no existing business that offers a wide range of eclectic wines (and specialty foods) in town, so residents have to drive to neighboring areas to purchase wines and to interact with passionate, friendly, and knowledgeable staff. We will fulfill this unmet need for Los Gatos residents, thereby increasing their satisfaction with the amenities found in town and alleviate any frustrations they may have about having to drive elsewhere in order to procure the products and services they desire. • Our business will provide the type of products and services that will also attract upscale patrons, both private and corporate, into the town from outlying areas, bringing more collateral business and sales revenue into town which will benefit other local businesses and the town. • We plan to do a high volume of sales for the modest physical footprint of our business which will provide always-needed sales tax revenue to the town. By providing a unique and popular destination in the Los Gatos Shopping Center, we will draw people into an area beyond the downtown core, thereby expanding activity and business into a less-frequented, underutilized section of town. Promotion of Local Wineries: We intend to dedicate a portion of our inventory to wines from local wineries (from Santa Clara and Santa Cruz counties) as well as host tasting events featuring local wine makers and/or winery representatives in order to help increase their exposure and expand their customer base. We intend to be active in the Chamber of Commerce and participate in as many community- sponsored events as possible. FACTS THAT SUPPORT OUR APPLICATION: • Our business will comply with the Noise Element in the General Plan. • Our business will comply with the town's Alcohol Beverage Policy in that we will not serve any wine/beer past 10 PM (see note under Hours of Operation). • All employees will receive third-party training on proper service of alcoholic beverages. • We operate a similar business in Santana Row which is a very impacted, densely-populated residential/retail center where we have residents that live directly above our establishment. In nearly 6 years of operation, o We have not had a SINGLE complaint filed by any residents regarding noise, disruptive customer behavior or ANY other reason. o We have never had a SINGLE incident of drunken or disorderly conduct by any of our patrons. o We have never had a SINGLE incident in which we or any SR resident has contacted SR security or local law enforcement because of problematic behavior of our patrons. • Our business would help achieve the objective of providing a "diverse shopping experience" as outlined in the General Plan because we would provide a unique, interactive and mutli- level wine-related experience that is not currently available in the town limits. • Our business would help achieve the objective of "preserving the small town character" of the town as outlined in the General Plan because we would be a small, privately owned and operated business. One of the principals has long-standing roots in the local community. • Our business would help achieve the objective of supporting "an active business community that provides a wide variety of goods and services and a broad range of employment opportunities, minimizing the need to travel to other communities" in order to obtain sought-after products and services as outlined in the General Plan. • The proposed uses of the property are desirable to the public conveniences; the proposed uses will not impair the integrity and character of the zoning district; the proposed uses would not be detrimental to public health, safety, or general welfare; the proposed uses of the property are in harmony with the various elements or objectives of the General Plan (as outlined above) and the purposes of the Town Ordinance. SPECIFIC ISSUES RELATED TO SERVING ALCOHOLIC BEVERAGES: ° The stated purpose of the Alcohol Beverage Policy is to avoid the potential to "jeopardize the public safety" which may "result in an increase of calls for police services." o As stated above, in 6 years of operating a similar concept in Santana Row, we have not had a SINGLE incident involving disruptive behavior, public drunkenness OR any incidents requiring security or local law enforcement intervention. • The Alcohol Beverage Policy "provides parameters for alcoholic beverage service, particularly addressing late night service when alcohol-related incidents are most likely to occur and when the disturbances to Town residents is least tolerable." o The latest our food and beverage service will terminate on any given night will be 10:00 PM (which will only be on Friday and Saturday nights). Most nights it will terminate at 8:00 PM • Our proposed use would not be classified as a "Bar." o The typical definition of a "Bar" is an establishment whose primary service/function is the service of alcoholic beverages, mainly hard liquor and mixed drinks, to be consumed ON-PREMISE, usually until late in the evening (closing at 2:00 AM). • Our primary function is the retail sale of wines and wine-related items, other products and services are meant as collateral support to this function. • We will not serve or sell any hard liquor or mixed drinks. • We will not be open past 11:00 PM ■ Any on-premise wine tasting selections will be accompanied by a menu of food selections. (See Sample Menu) • "Stand-alone Bars" typically do not offer educational classes or hosted tastings (with winemakers or winery representatives) - we will, as part of our goal to increase our customers' knowledge and appreciation of wine. • Our proposed use would be classified as a "Restaurant." o We will offer a menu of food offerings that will be substantial, pet simple and easy to execute. (See Sample Menu) • A meal is defined as "a combination of food items selected from a menu." o Our beverage service will be offered in conjunction with meal service. o Our meal service and tasting area are in the same location - there is no separation between the meal service and wine tasting area. o Our hours of operation are in conjunction with typical restaurant hours (versus late night "bar" hours). VISION AND VALUES: Our fundamental belief is that wine is meant to be consumed with food. Selling wine in an environment where the consumer has the opportunity to pair it with food facilitates a greater understanding of this concept. It also helps us to educate our customers and promote an increased interest in wine appreciation in terms of: winemaking techniques, the various wine regions around the world, the multitude of grape varietals and their unique characteristics, proper techniques of wine assessment, fundamentals of food and wine pairing and the like. It is our goal to encourage our customers to engage their intellect whenever they enjoy wine. We want them to become interested in "the Story" behind each wine they try, such that whenever they taste or drink wine, they ask themselves: Who made this wine? Where did it come from? What grapes are in it? What scents and flavors to I detect? Why does it smell/taste the way it does? How is different or similar to other wines I've tasted? What foods would it pair well with? Wine is a unique beverage that engages all the senses and appeals to one's intellect, emotions, and spirit. We intend to share our passion for and knowledge of fine wine and food with every customer that walks through our door. BIOGRAPHIES OF BUSINESS PRINCIPALS: Joseph Cannistraci Joe's initial work background was in the trades as a journeyman Plasterer. Before joining the trade union, he was an Apprentice Machinist at the Defrancisi Machine Corporation, a renowned manufacturer of commercial pasta machines from 1990 to 1991. Prior to developing his passion for wine, Joe expanded his entrepreneurial pursuits and was a key founding owner of Coastal Sol Foods, an energy bar company, which he shepherded from conception to product launch. He did product research and development, worked closely with a consultant to create a business plan, recruited outside co-investors, and was responsible for all aspects of product development, including formulations and branding. Joe began his career in the wine industry by working at a South Bay wine retailer, which was one of the largest in the US. Joe immediately demonstrated a special knack for developing both customer and business relationships, as well as an aptitude for absorbing and utilizing a vast amount of wine knowledge. Within his first year, he was promoted to Assistant Manager and made the Italian Wine Buyer. Since 2002, Joe Cannistraci has been working as a founding partner at Vintage Wine Merchants, the premiere wine retailer/wine bar in the San Francisco Bay Area. As a partner, he has managed all operational aspects of the business, as well as purchasing, hiring collateral staff, acting as the key person in the front end of the business, as well as building his key customer contacts All four of Joe's grandparents were Sicilian immigrants, and he is the youngest of four children. His family of origin gave him a taste and appreciation for good food and wine, as well as many family recipes for traditional Italian food. He is currently married to Louise, his wife of nine years, and resides in San Jose. Besides wine and fine food, Joe has a passion for surfing. Work History and Associations: Vintage Wine Merchants Founding Partner Wine Club Assistant Manager and Italian Wine Buyer Coastal Sol Foods Defrancisi Machine Corporation Bricklayers and Allied Craftsmen, Local 13 in Newark, New Jersey Michael Guerra Prior to working in the wine business, Mike's work background was as a family and child therapist for 5 years in Solano County as a Mental Health Clinician in the Children's Day Treatment Program in Vallejo, CA. Prior to accepting this position, he was awarded and completed a one-year Post- Master's Clinical Fellowship at the Yale University Child Study Center in New Haven, CT. In 1999, Mike took a position with a South Bay wine retailer in order to more formally explore his passion for wine, and it changed his world. He was only there a brief time before he accepted a position at another wine retailer in the San Francisco Bay Area, where he was able to put his knowledge and passion of Italy and Italian wines to use and become the Assistant Italian Wine Buyer. He left the wine industry briefly for a two year sojourn as a Human Resource Specialist for an internet security company before joining Vintage Wine Merchants. The founders of Vintage Wine .Merchants, a premiere wine retailer/wine bar in the San Francisco Bay Area, recruited Mike during the build-out stage of their business in 2002. Mike quickly established himself as a key contributor at Vintage by taking on wine buying responsibilities, developing and implementing the food program, developing and implementing the Wine Education program and acting as the Event Coordinator and Customer Liaison for private parties and corporate functions. As a result of his commitment and contributions to the growth and success of the business, he became one of the four partners to eventually run the business. Because of the excellent reputation he developed during his tenure at Vintage, Mike has been featured in the San Jose Business Journal, San Jose Magazine and interviewed on "In Wine Country" and for 2 different features on KRON-TV. Mike is the third generation of Italian immigrants from Calabria, Italy, and is the youngest of two children. He spent his junior year in college studying abroad in Rome, Italy, which, he says, was a pivotal year and one of the experiences that eventually led him to pursue his current career and passion. He still has a passion for international travel and foreign languages. Work History and Education: Vintage Wine Merchants 2002-present Human Resource Specialist for an internet security company, 2000-2002 K&L Wine Merchants, 1999-2000 Mental Health Clinician - Solano County Children's Day Treatment Program, 1994-1999 Post-Master's Clinical Fellowship -Yale University Child Study Center, 1992-1993 Master's degree in Social Welfare - University of California at Berkeley, 1991 B.S. Psychology - Santa Clara University, 1986 High School Diploma - Bellarmine College Prep., 1982 Class Categories "Uncorking" Series This might be referred to as "Introductory" Level classes in normal nomenclature, but you know us, we like to do things a little differently and, hopefully, more creatively... These classes will focus on introductory subject matter and skill development. They are great for beginners and for those of you who want to take a "refresher" class to hone your skills. Examples of future "Uncorking" classes would be: Beginning Wine Appreciation, Component Tasting, and Food £t Wine Pairing 101. "Decanting" Series These would otherwise be known as "Intermediate" Level classes, which focus on introductory and/or general overviews of selected topics, such as an overview of wines from a particular country or an overview of certain categories of wine. Though beginners are always welcome, having some knowledge of basic wine terminology and styles will allow attendees to receive maximum enjoyment from these more "advanced" topics. Some of the upcoming classes that are tentatively scheduled in this series are: Decanting Sparkling Wines, Decanting Dessert Wines, and Decanting Austria. "Savoring" Series These classes provide even more focused, in-depth coverage of specific topics. More than just a cursory overview, in these classes we'll "indulge ourselves" and take the time to realty explore each topic to the fullest extent. These weekly classes may take from 1 to 4 sessions, depending on the breadth of the material covered, and are just the ticket for those of you who really want to become "experts" on certain topics. Some examples of upcoming classes that are tentatively scheduled in this series are: Savoring Italy (a three session class): Northern Italy, Central Italy, and Southern Italy. "Follow That Grape" Series This is an independent series of classes that will focus on incarnations of individual grape varietals (i.e., Cabernet Sauvignon, Pinot Noir, Chardonnay, etc.) from various viticultural regions around the globe. Attendees will examine the similarities and differences in the terroir, winemaking practices, philosophies, and styles of the various wines. For example, we'll take a look at "typical" Cabernets from Napa, France, Australia, Chile, Italy, and see how they compare with each other. These classes are a great way to really get familiar with your favorite grapes, in all their many shapes and sizes. DECANTATIONS Decantation (de-can-TA-tion), n. The act of pouring (a liquid) from one vessel into another in order to separate from sediment and allow for maximum exposure and optimal expression. We're taking a little poetic license and using this concept to refer to the fact that we'll be doing more than just popping corks in our new classes. In keeping with our philosophy that wine appreciation should be FUN, our classes are designed to be interactive and informal, as well as informative. We'll leave all the myths and pomposity behind and retain the more pleasurable aspects of sharing knowledge, stories, and impressions with each other about the wines and regions we'll be exploring-"to allow for maximum exposure and optimal exp ressi on l" Our initial Decanting Series provides a general overview of the various topics (more intensive, in-depth courses will be offered in the future). Though we encourage you to attend any of the classes that interest you, those totally new to wine might gain a fuller appreciation of the Decanting classes if they "wet their lips" with the Basics class first. We'll provide the stemware and educational materials. All attendees must be at least 21 years of age. To ensure maximum enjoyment of the wines, we ask that attendees refrain from wearing strong perfume or cologne. Capacity is limited, so sign up quickly. CLASS SCHEDULE Basic Wine Appreciation - What is This Thing Called Wine? This class is a wine snob's worst nightmare and a wine novice's dream come true! In this class, we'll discuss the basics of wine appreciation: grape varieties and major growing regions, wine making basics, the "How- To's" of tasting wine, proper wine storage, food and wine pairing, and ordering a wine in a restaurant. After this class, you'll never feel intimidated (about wine) again! Decanting Australia - Like A Bridge Over Coonawarra or Home, Home on the Grange The Land of Oz has just surpassed France as the second leading wine-exporting country to the US1 Just marketing you say? Well, they DO have that (How many of you have had the Tait "Ball Buster" Shiraz??). They also have made a reputation for palate and pocketbook-pleasing wines. However, they are making world-class wines in all price ranges. We'll taste some great values and expensive collectibles as we learn about the main grape varieties, growing regions and producers (large and small) of the Land Down Under. Woop, Woop! Decanting California - Sipping by the Dock of the Bay California is the "new kid on the block" in terms of fine wine production when compared to most other countries-but we've come a long way in a short time, no? Fearlessness and innovation have made this state a titan of the wine world. France has Cabernet, Merlot, Chardonnay and Viognier-so do wel Italy has Sangiovese and Pinot Grigio-us tool Spain has Tempranillo and Gamacha-same here! Germany has Riesling-no problem! We also have a little grape called Zinfandel... anyone? Didn't think sol California has it alt-the Good, the Bad and, yes, the Ugly. We'll "tell all" as we learn about the wines, the regions, and the producers that have made this state so great. Decanting Spain - Sweet Home Albarino Spain has more land under vine than any other country in the world-and is the third largest producer and exporter of wine (only behind France and Italy)! Until recently, quality Spanish wines were hard to come by here in the States-but there has been a wine revolution going on in Espanal The current generation of Spanish wine producers has been focusing on quality wine production-and the results are astounding! Spain is making exciting wines at ALL price levels-just pick up any current wine periodical and check out the scores. Become more acquainted with the likes of Crianza, Cava (sparkling wine), Albarino, Priorato, Rioja, and Ribero del Duero among other things as we explore the Land of La Manchal Decanting France - Show Me the Way to Go Rhone No other country in the world produces more world-class, highly-prized (and expensive) wines than France. You've heard the names bandied about: Bordeaux, Burgundy, Champagne ...Costieres de Nimes ...That's right, though France set the standard for the rest of the world with magical elixirs that have now become household names, there are many other glorious wines and regions to sample and enjoy-and we will! We'll explore the major grape varieties and growing regions of France as well as some lesser-known values that will tease your palate and please your wallet. Decanting Italy - Whenever I Call You Firenze Ah, Bella Italia ...or as the Greeks called it "Oenotria," Land of Vines. Wine has been produced in Italy for thousands of years and there are reported to be over 400 grape varieties growing in Italy-and we'll taste them all! Well, not quite ...but we'll travel from the foot of the Alps (Piemonte), land of Barbera, Dolcetto, Barolo, down through Tuscany, where Sangiovese is King, on to Sicily, where Nero D'Avola reigns supreme, sampling and discussing the important grape varietals, producers and growing areas as we go. Experience La Dolce Vita in your own home townI Decanting Germany - Like A Rhine-stone Cowboy Often overlooked by the casual wine enthusiast, Deutschland is where Riesling, some say the noblest of white grape varietals, reaches its ultimate expression. Come and learn about such wines and terms as Spatlese and Trockenberenauslese or Nahe and Mosel. We'll discuss how to decode German wine labels and cover the various growing regions and producers and why these wines provide a near-religious experience when paired with Asian or Indian foods. Auf Wiedersehenl Page 1 of 2 Jennifer Savage - Support for Enoteca Wine Bar From: "Kathy Sulgit (ksulgit)" <ksulgit@cisco.com> To: <planning@losgatosca.gov> Date: 8/30/2009 8:28 PM Subject: Support for Enoteca Wine Bar Attachments: logo.gif; green.gif AUG 3 2009 Dear Los Gatos Planning Commission I am a fourteen year resident of Los Gatos. ..~~Vi~.., I am writing a Letter of Support on behalf of Michael Guerra and Joe Cannistraci in support of their application to open a wine retail store and tasting room in the Los Gatos Shopping Center at 416 N. Santa Cruz Avenue. Michael and Joe plan to open a business that will provide the type of products and services that will attract upscale patrons, both private and corporate, into the town from outlying areas, bringing more collateral business and sales revenue into town which will benefit other local businesses and the town. I have visited their wine shop in Santana Row on numerous occasions, and would much prefer to spend my money locally! They run a wonderful operation. There is no comparable business on this side of town. By providing a unique and popular destination in the Los Gatos Shopping Center, they will draw people into an area beyond the downtown core, thereby expanding activity and business into a less-frequented section of town and possibly make downtown less impacted. also support their commitment to promote local wineries. This unique facet of our community is sorely untapped and underutilized. Michael and Joe can help us to promote these local specialty businesses and help make Los Gatos more of a "destination" region for locals and non-residents/tourists who are interested in fine wines, pe of fine dining, and fine living. Theirs is exactly the type of business that our town needs to grow and develop in a way that is consistent with our vision and goals of being a diverse, culturally rich, and unique place to visit, live and work. Michael and Joe have a proven track record for operating a successful, well-respected and well-run business. I am confident that Michael and Joe will create another successful business and will become active, responsible and beneficial additions to the Los Gatos community. Thank you for your consideration, Kathy Sulgit 111111111 is Kathleen Suigit Director, Corporate Events Marketing / CMO ksulgit.a&cisco _com Phone: (408)528-5431 Fax: (408) 608-0474 Cisco Systems, Inc. 170 West Tasman Drive, San Jose, CA 95134-1706 USA Cisco homepage EXHIBIT 11 file://C :\Users\j savage\AppData\Local\Temp\XP grpwise\4A9B 8 6E4TOWN_DOTO WNP 8/31/2009 Page 2 of 2 A Think before you print. This e-mail may contain confidential and privileged material for the sole use of the intended recipient. Any review, use, distribution or disclosure by others is strictly prohibited. If you are not the intended recipient (or authorized to receive for the recipient), please contact the sender by reply e-mail and delete all copies of this message. Cisco Systems Limited (Company Number: 02558939), is registered to England and Wales with its registered office at 1 Callaghan Square, Cardiff, South Glamorgan CR 0 513T file://C:\Users\j savage\AppData\Local\Temp\XPgrpwise\4A9B 86E4TOWN_DOTOWNP... 8/31/2009 September 1, 2009 Dear Los Gatos Planning Commission: My name is Carrie Castro, I have been a resident in Los Gatos for five years. I have an eclectic background but to summarize it simply, I have been in some kind of sales for more than twenty years. I've managed sales teams in the Waste industry in the Bay Area and have enjoyed at different times in my career selling art, furniture, clothing and even wine. I have had the great pleasure of working one night a week for several years with Mike Guerra and Joe Cannistraci at the Vintage Wine Merchants. I have a passion for food and wine and wanted to learn more about wine, I was given an opportunity to expand my knowledge with hands on experience. Actually, I could never have imagined the amazing people I'd meet, the eclectic variety of wines I'd taste and the friends I've gained while in company with these two. Enough about me, I am writing to you, to show my support for Mike and Joe in their application before the Town of Los Gatos Planning Commission and the Town Council to open a wine retail store and tasting room in the Los Gatos Shopping Center at 416 N. Santa Cruz Ave. I'd like to tell you a little about how it is to work with Mike and Joe and give you a bit of the inside scoop. First off, these two men have been at the heart of the success at the Vintage, they share a gift with people and wine, rare even in this state rich with grapes. Professional and ethical, always friendly without intimidating people who are in search of the perfect wine for their special event or just for dinner that night. Joe is one of the best story tellers I've ever met, but the stories lead you to a new wine or give you incite on a wine maker or the history behind the winery he's a researcher and will find an answer to any wine question one might have, most of them he knows already. Mike is a brilliant writer/educator so expect to get an incredible lesson on a variety of wines from local wineries as well as an assortment of places he and Joe may have traveled to in Italy or France. One of the best testaments to their potential here in town is the people that return, the "regulars," locals and professionals that fly in to the area and wish to buy from someone who knows what they like, its fairly amazing and I'm sure I don't know the half of it. Living here in town, it would be great to be able to meet friends down town for a glass of wine and a cheese plate, to meet a winemaker at a scheduled event or to take one of Mike's wine classes. I belong to several organizations through my company and would love to have an establishment like Mike and Joe are proposing to hold business events. The location suggested is perfect, plenty of parking and I hardly get to that side of highway nine and always say I should. Mike and Joe are hard working, creative, businessmen with a history of running successful operations. I can't think of a better addition to the Town of Los Gatos than a wine retail shop with wine tasting and small plates. We'd be lucky to have them, they live the motto, "Good food, good wine and good friends!" I hope you'll take into consideration what I've written and please don't hesitate to call me with any questions you may have. Sincerely, c U Carrie Castro Cell (650) 454-5821 E V 1 11 D J SEP a 2 2009 TOWN OF LOS GA T OS PLANNING DIVISION THE AR 'T SO'U! OF -COO/ KttdG ' 28 August, 2009 r z, "'A 6 t 1 ~ r ~ To T.tie Los"-Gatos Manning comf ns' ion" 'I am wntingao you`to express my enthusiasm and eager anticipation of the proposed Enot&! . and -Wane-'Bdf th t Joseph •G" 1straei and 1Vlichael Guerra :plan to bpen'liere in f' `ftlie to twn of Los Ga on Y 1. t /}r ~ / 'z , ~ , ('r ; I„have"been a loyal cus bmer at their formei Wine:Bar 1'ocated in Santana Row for over six ears I can honestl tell ou that ;ou ill not find two rrioie knovyledgea e a years'. Y. Y Y w ((;.911., ; enthuiastic'and p`assionate~people m the vine busiziess They are both wine enthusiasts' :that en oY g shariii g their'knowledge and stories to an;fl yone,who walks iii their N. es'tabl'ishment 1 !r I am a long time retailer in the Town of Loss Gatos, being part of the Qpening~ age returning as t l "e manager of ,:manment team ;here at Sur La Table in 1999, and recga the'Los Gatos'location I :truly feel tle, Wine Bar Will be aperfect addition to the town of " ``Los Gatos `Which has evolved into the. mecca for people who enjoy and that have a true passion for great food; fine wines and all the finer'things in life! - - - y' il,, 1. '1 r ~ {.r Milva Gobbi Sur La Table Store'Mana er. Los-Gatos & San'tanaRow ' 408:3`95.,6946 Z. DONALD A. PERRUCCI August 31, 2009 Planning Commission Town of Los Gatos 110 E. Main Street Los Gatos, CA 95030 Having known and done business with Joe Cannistraci and Michael Guerra for many years, I have become familiar with their plans to open a quality wine shop in Los Gatos. Both have superior wine knowledge, and their plans to pair wine with specialty foods should create a venue that will be most desirable for Los Gatos residents. I am excited about the possibility of being able to make my wine purchases locally, rather than drivin o San Jose. I encourage the Town to approve their application so that Joe and can jo' the fine list of Town merchants as soon as possible. Yoh rsVery trgly, onNd A. Perrucci DAP/cb - 2009 C'T' 1_Os G'Al 96 N. THIRD ST., SUITE 275, SAN JOSE, CA 95112-5572 • TEL. (408) 275-0550 FAX (408) 298-0702 Bowe 0 TOWN OF LOS GATOS PLANNING COMMISSION STAFF REPORT ~~s GASO`' Meeting Date: September 9, 2009 PREPARED BY: Jennifer L. Savage, Assistant Planner jlsavage@los atg osca.gov APPLICATION NO.: Conditional Use Permit Application U-09-007 ITEM NO: 4 DESK ITEM LOCATION: 414-416 N. Santa Cruz Avenue (east side of N. Santa Cruz Avenue, approximately 250 feet north of Los Gatos-Saratoga Road) APPLICANT: Michael E. Guerra and Joseph J. Cannistraci PROPERTY OWNER: Jim Zanardi APPLICATION SUMMARY: Requesting approval to operate a retail wine establishment with food, beer, and wine service on property zoned C-1. APN 529- 07-047. EXHIBITS: 1-11. Previously received with September 9, 2009 Staff Report. 12. Public Comments (seven pages), received September 8-9, 2009. REMARKS : The Town received five letters in support of the application after the staff report was circulated. The comments are attached as Exhibit 12. P ep red Approved toney J fifer L. Sava Wendie RAssistant Planner irector of Community Development WRR:JS:cgt N:\DEV\REPORTS\2009\NSC414 416 desk.doc Attachment 4 September 3, 2009 Planning Commission Town of Los Gatos 110 E. Main Street Los Gatos, CA 95030 Dear Planning Commission: We are excited to hear of the application from THE BOOT and encourage support of this new business in town. Knowing the applicants, Mike and Joe, and their prior experience, we are confident they will bring a unique and upscale business offering - especially to an area that needs revitalization. Their idea of an upscale retail wine shop with tasting area is very pertinent at this time of a growing wine industry, especially in this region where we are becoming known for wines and vineyards. Their plan to be active in the community and to participate in some of the destination marketing activities will be a benefit to them as well as the other local merchants. Their targeted market is upscale and affluent and since they are not getting into hard liquor or a typical "bar scene," I believe they will be an asset to the community in their presentation, customer draw and community involvement. Thank you for your consideration. Yours truly, Patti A. Rice Owner/Spa Director %OOa par i F. EXHIBIT 12 Pagel of 2 Jennifer Savage - Fwd: Re: Enoreca and Wine merchant by Joe Cannistraci and Mike Guerra at 414and 416 north Santa Cruz Ave. From: Wendie Rooney To: Patsy Garcia Date: 9/8/2009 12:32 PM Subject: Fwd: Re: Enoreca and Wine merchant by Joe Cannistraci and Mike Guerra at 414and 416 north Santa Cruz Ave. CC: Cindie Taylor, Jennifer Savage Thanks Patsy: We will include this in the Planning Commission's public record. Thanks, Wendie Wendie Rooney Director of Community Development Town of Los Gatos 110 E. Main Street Los Gatos, CA 95031 (408) 399-5768 WRooney@LosGatosCA.gov > > > Patsy Garcia 9/8/2009 12:16 PM > > > Hi Wendie: For your attention - PC agenda item George Montanari <gmontana@apr.com> 9/3/2009 12:58 PM Mike, If I can ask you a favor, please forward this to the appropriate people at planning I would appreciate it. I don't think the City Council is involved at this level. I am in strong support of Enoreca and Wine merchant by Joe Cannistraci and Mike Guerra at 414 and 416 north Santa Cruz Ave. Mr. Cannistraci was invoked with vintage wine merchants in Santa Row. He was excellent operator with many loyal customers. This type of retail business would be a welcome addition to Los Gatos. This business will serve us citizens of Los Gatos, as well as help bring back the lost customers that Los Gatos has lost in recent years. They will appeal to both and create energy in a part of town which is lacking. The Los Gatos planning department has scheduled a meeting on September 9th at 7:00 PM in which we unfortunately cannot attend. We want to make sure that the planning department knows the we strongly encourage their swift approval If you have any questions, Please fee 1 free to call or email us anytime George and Jill Montanan 160 Longmeadow Dr Los Gatos 95032 408-358-5455 file://C:\Users\j savage\AppData\Local\Temp\XPgrpwise\4AA64ECDTOWN_DOTOWNP... 9/8/2009 Page 2 of 2 George Montanari Alain Pinel Realtors George@)apr.com Top producer since 1980 408-357-8808 Direct Line www,gmontanari.com Click on this link for my website (mis listings, school scores, mortgages etc...) D.R.E # 00780027 file://C:\Users\jsavage\AppData\Local\Temp\XPgrpwise\4AA64ECDTOWN DOTOWNP... 9/8/2009 Septembr 6, 2009 Los Gatos Town Council 110 E. Main Street Los Gatos, CA 95030 To whom it may concern This letter is in support of the proposal from The Boot Enoteca and Wine Merchant. I believe they will be an excellent addition to the Los Gatos community. It's important that citizens have many choices to shop and The Boot will be a great for Los Gatos residents. Their plan to support the local vintners by providing wine tastings and educational classes will make for a great addition to the Los Gatos cultural scene. It should also be a great draw for tourists visiting the Santa Cruz Mountain Wine Region. Our family has known one of the proprietors, Michael Guerra for over 30 years. We believe they will be a credit to the local business community. Sincerely, Angir 229 Massol Avenue Los Gatos, CA 95030-7240 p.1 September 8, 2009 To: Los Gatos planning Commission From: Jannette Scott 420 Alberto Way #18 Los Gatos, CA 95032 1 have had the fortune of living in Los Gatos since the summer of 1995 and more blessed to become a homeowner in the year 2000. I absolutely love this town! I do the majority of my business here in Los Gatos: Peet's, Andale, Steamers, Wine Cellar, Icing on the Cake, Bunches, Pet People, Campo di Bocce, Whole Foods, Los Gatos Dog and Cat Hospital, Banana Republic, Wijllow Street, just to mention a few I visit regularly. I have always wished we had a domestic wine shop/tasting bar in town so when I want to meet a friend or colleague for a just a glass of wine in a quiet atmosphere. Or even a place to host a small networking event, or a small team building project, in a relaxed, yet classy environment. I am writing a Letter of Support on behalf of Nfichael Guerra and Joe Cannnstraa in regards to their application going before the Town Planning Commission and Town Council to open a wine retail store and tasting room in the Los Gatos Shopping Center at 416 N. Santa Cruz Avenue, Michael and Joe are seasoned and serious wine industry professionals who intend to create an upscale, yet casual environment of passionate, informed and responsible wine and food enjoyment. Currently, there is no so existing business that offers a wide range of eclectic wines (and specialty foods) residents/employees have to drive to neighboring areas to purchase wines and to interact with passionate, friendly, and knowledgeable staff. Their concept will fulfill this need, Their business will also provide the type of products and services that will also attract upscale patrons, both private and corporate, into the town from outlying areas, bringing more collateral business and sales revenue into town which will benefit other local businesses and the town. Furthermore, by providing a unique and popular destination in the Los Gatos Shopping Center, they will draw people into an area beyond the downtown core, thereby expanding activity and business into a less-frequented section of town and possibly make downtown less impacted. I also support their commitment to promote local wineries. This unique facet of our community is sorely untapped and underutilized Michael and Joe can help us to promote these local specialty businesses and help make Los Gatos more of a "destination" region for locals and non-residents/tourists who are interested in floe wines, of fine dining, and rime living. Theirs is exactly the type of business that our town needs to grow and develop in a way that is consistent with our vision and goals of being a diverse, culturally rich, and unique place to visit, live and work. Michael and Joe have a proven track record for operating a successful, well-respected and well-run business, I am confident that Michael and Joe will create another successful business and will become active, responsible and beneficial additions to the Los Gatos community. Thank you for your consideration, September 9, 2009 Dear Los Gatos Planning Commission, My name is Brian Crane; I am married to Heather Crane. I have lived at 131 Ann Arbor Drive in Los Gatos for over 7 years. I am a founder of Intero Real Estate Services and I personally started the office of Intero Real Estate Services in Los Gatos. I am a part owner of the building at 518 N Santa Cruz in Los Gatos. I have 3 children ages 18, 16 and 14. I am a board member of the Los Gatos-Monte Sereno Police Foundation. I am writing this letter to support the project (retail wine store and tasting room) that Michael Guerra and Joe Cannistraci have proposed to the Town Planning Commission at 416 N Santa Cruz Avenue. Michael and Joe are veteran business owners and wine industry professionals who 'intend to create an upscale, casual environment designed so that wine enthusiasts in Town and outside of town can go to enjoy a few hours together. My wife and I have often thought that it would be nice to have a specialty wine shop (with knowledgeable employees) that we could go to without leaving town. In the past we have gone outside of Los Gatos to purchase wine for various functions we have hosted or attended. This shop will be a destination for upscale gatherings prior to other events here in town, or prior to dinner here in town. For this reason I believe this shop will enhance the downtown Los Gatos dinning experience. I think they will add to the great experience that is "Los Gatos". Michael and Joe have a proven track record. I have been to their shop at Santana Row many times, not only to buy specialty wine, but to meet friends and enjoy the environment and experience they have created there. Michael and Joe have contributed to the communities they serve. I have attended several "charity" events that they "donated" to various community groups. This is a project that fits with Los Gatos residents and visitors. I encourage the commission to support this project. Sincerely,, Brian Crane c ` 20GJ 131 Ann Arbor Drive supoort for Michael Guerra.doc Page 2 of 2 Los Gatos, CA 95032 Intero Real Estate Services 518 N Santa Cruz Avenue Los Gatos, CA 95030 http://mail.google.com/mail/?ui=2&ik=4e9b 1 eeb37&vie,A--att&th=1239fcee89b59d54&atti... 9/9/2009 N b) r A a) C O • H o N N N }-I a rl b O H Id a S4 1) E la N ro w rtS o o o 14 41 x u qq u, (d u , ro , q a) • 0 3 v w d a) w 1 }4 3 w 0 o a) a) v C 3 11 C w C a) •.i d1 N a) O N O w (n a) H -.i •rl v (d (d Ca 1 o E C -f1 0 ,q (d 3 v a) C 3 Iq 4-) 0, H In ?a Id O •-i 0 (d ri -ri JJ a) 'O o) E 1 rd •rl o w u (d ro •rl lJ u r ro a) o N (d (n N o (n -r1 C 3 V a A o -1 w o V 4 •11 U -1 iJ 0 •rl w 10 U) O 0 41 U (1) (d ,C A C U 1J a) a) C rJ w ~ N o q W o ° o x U zd ro (n r (d a v m t a to b a a) O C a) (d •,A a $ ( N H L1 w d C A w J-) C o ro a) (n b) b) 4J •r1 JJ ri > •rl +J O (d N a) C (n C u) •ri io R ri O H U o a) ~I •rl •r1 a) •rl rl N a) 1J 41 O o (n O f-, v rl L1 R a) 'o a) O V 3 > (d w H (n .i k + N A V •4 w o U w a) a) A a) N k H a) rt - )a w O rl O d (d (d C J H (n p o ,J u o w D C) U C 25 •r1 aJ N E N R (n t+ U) •.i N a O a) (1) H )-I id a N a u > a) H Sa a > 0 4-1 > o a) u! w } 1 (a ro V) V N 1i a a 3 0 0 1) JJ JJ a .,1 1 a) a) H r+ fd a r! C Sa (d o 11 0 v C U) C C (d N u o N JJ a) 11 rd ;I H S-1 •rl JJ O •rl •rl b) )-I 4-1 C O fd a A 04 C o (s (d 3 •rl (n U (d ~ (d a) U) 1-a }-I w 11 O x (d (n r f0 1j 0 (1) k .ra 0 a u cn a) {-I o a) m u d A a a ro v V u W a) FI a ~4 .4 r-I rd (n 11 •rl •r1 u n > u z (d M E A a O w w A 0 to u s U } -1 v R rl A v n v a) ro ~4 (d •rl {-I 1) o (d ro a) b) U) a rd H n (d a) 1J 1 (n a q N (n C J O W A ' N O u) a rd m O of y •ri A w H (d o x v u a a~ h s4 (n v r0 10 u) a 1 H H (n C o 3 3 E a (1) rd C o }1 a) H S-1 -rl a) (d U R O w •ri O •rl O O r0 z v mo 0 w U FD N H 0 0 ro E ( d u N ( R rd a) F 4 o a) N (d O SA C -rl N N ,4 U k .-1 O M a) }4 F.' O O O ~ 1J a) a) m (d a d1 1 N (0 0i JJ U m U w 4 a 1 N d U to o a) a) (1) N U w E. b) (n a) ~ N ~ R A 4J u) i-] (d O U c -I N • l - rl C •i (d W .11 -1 •r ~ -H a) -1 C ul 4.) ~ d w a, G ro r 4-3 1 4 o m o N N (0 !n a) 0 C.r m (d 0 a) o o a) •rl C ;:j •rl rl w fd al m •rl k u (cf •rl U) C7 z 11 H a 3 •r1 A 3 (a A a-1 r1 m ri N M d~ vl lf) t ` ro a 1 H H H N rl H M W ri i!1 rl H H r rl W ri 01 rl o N N N N N M N N N N N 0 o v C~ M \ N O U H fd !n JJ H w 010 H z w a I P4 <r H me 0 E-i ~ 0 H N H ~i rl C U (n O 0 O C 00 r0 Ul L14 N ~ O O Ln r -I U to X (1) 0) ()()0(1) P M it 1 W o W t n R a E D C f~ In W P~ (d O N a) U O qq U -r~ r0 x o i W a P, U C C C (d U A k li a) P4 a) w i C ro 0 U o 0 o A 0.11 q R u N U O U (d u i a,' C7 . U H (n a) v O O -rl N O f-I au nn E E t7 z Q W w U 0 (x a v o C m \ N ZO U H (d W 4J En r H (d 'All U 41 S4 C9 O zz H '-DT a -i w 0 w °a JJ H .i N M ~ U1 ~ t` W o1 O H N M d~ ul ~ t` W rP O H N M W lfl rl N .i N N N N .-1 .i N N N N N N Attachment 5 o H 3 4J 0 U) 0 v 4 a) u a) to ? •u q) a) 3 U 1) ro 10 A o m v ,C > C a) w u o 1 u ro v u ro C v m A m a) O H a) N O ?1 U) > 0 •n O w w (0 U) E U ro C u! a) a) A N a) O a) -H al a) a) ro a C q-4 4) 0) O) k N > > v o C > o u) N ro 0 C •H ~ ~ v u, 3 v ~ m ro ~J )i •li a v v m 0) 3 11 4-) H > u, O o v) C a) > a) + (D O 4 U) A 11 0 i) 01 N Yi S4 0 a) 3 •HI 11 N a) w v O C S v m ) R n C a) ro C o 'R U b b a 41 H U) w o a) ) (dd N > • H Sli m 41 41 N -H o JJ u a) H u C }i u v U) w H rl (n O .C A S~ (d a) U) 3 41 v O a) . H A rd C N H U ro H a) U > O C N N C. r C U O -H O H O .u a) a) O x a) 4 •Hi H a) >1 0 41 (d 41 ~4 41 04 0 a) 0 .,1 u 1 3 > ro a) 01 a) v (n v • i o 0 o u • ° w ro v N ro m ro ro ro u (0 w a) a) a) O 11 a) ~1 . H U O U, J 11 11 S4 a) j: J U) a ~ A ~ N U .U A, a) > Ul O a U +J (d r4 U 91 1) ro U •,1 11 a) (D H U o . H u, '0 •H ro 11 o t, 0 •H1 3 U) H m w J, H S4 w a) y) ,-1 C 11 0 11 a) m w -Hi •H1 P ro a •H o (O w ro U, Si •H C N H H .U k 0) a) U a) a) ¢1 C m u o C o o C a) a) U) o C A 'o C C ro w a) •H o (1) R .C •H 0 )i 7 w H 'd •H C o v U w a u U U O O 0 (d h b N H •Hi •H ;C (D o U) u •H u u ¢i H 1, C U) O o 11 u V A U) H H a) U U) I" S I a) 0 O S4 11, HI ro ro ~ 4 0 s, P' 11 O a) 3 a o ro r4 ~ ~t rtf 41 C H N a) }-1 ~ (d }l w 10 O ?1 0 (0 4 0 ~ u a) O U w C 'o U w 10 U, w U (0 rO E w a) O -1 J-) u a) ro ro H O r o 0 0 )i C H 4J k C u C (d w (d o C a o U) a ro H o n N o Si a) •Hi o w v u u m a a (d u, •'1 C 9 N ro Vl U, r ~i 'U C O m a' U •H 11 N O HU 'a) Yk •HI N (0 a a) •HI •H C O F1 •HI ro ?i Ti N G' 11 al u) HO v N -H S) w N (d u V N o C ~3 (D o .C 0 w 0) d u t i • 1 A m W -,A H r A ! ) d ( Q1 1 > s4i (a 3 . C a a) E u (n w (d o 0 11 U) B O a) u o 4-1 0 a a) v a) U) O a -H1 U •H Zd ,s~ R a) U vl a) o C )-1 3 O H a) u a) E m a rn •H ro H •H H •H v a s1 C H k A U >1 ro w C u n o a) al a U •HI •HI H •HI U •HI k N •HI U HI rd •HI H k a) 'CJ a) O -W k a) 4-3 W w U O a C.' H H > a) C a 11 -0 5 U J-) N (d N U -H 0) 0 W a a 44 0 H 44 4 u 0 'C a ) i u U) P, A ( n w l d 0 O E b o o W J u v v N W C 0 0 !0) .91 -1 0 44 Q) U 11 O rl >1 ji a) u C )i ro O v A ~ m •HCi a! ~ U a) C H P •H a 1 iAi v -H a) 0 (d a~ 1 E -H Id 4) H U) S°i ~ 3 A E ~ U 0 N •HI b) H •HI P0, C U v rn ~ O C o w m ~ N T ~ O U H (d U) i) an U) °u 4111 1 S4 H z H P, H m d 0 U) E O H <v Hi N M W ,/1 ~ t` W Ol o Hi N M d~ Ifl ~O t` OD al O H N M d~ Ifl H Hi N H H N ri HI Hi N N N N N N N 'd 0 )1 ro 10 w o US', o U) Q) 0 Q) A 0 o q u C O i) lb O C •n i) a) w C rtf H C .I.U u, O R ro a) rd o ro H ro a) C v l m U u O •HI H U) -HI (d UI (1) U) v w Q) •H •Hi 1-1 41 7 a) U) Ji td U) U v ,4' O N Ow •,1 (d H •H o (d u 1-1 ro H Cl v o o u o (d r U) 7 O C u -H (1) U U •HI a ~ a U a H •H •H H U ,U a a) > N a) 11 u) o 0 0 R U w u •,1 a) U) }4 A 'U a N ro S•1 H O HO O Q) G,' C H U P: -H rd a) v (a ro v A H U C Ho o •H1 0 •H1 A m C 11 4 a) U1 ~ H ~ O -A P, a) w 11 H O a) 'O E > O H O a) •HI N V (1) U •'1 Ul •ri N P4 'a) •HI q N 4) ro > ?4 3 rn w (d u) v H u i) V a of u •3 •41i fd Ul ~i w 01 a) ((d U - 1 0 0 (d ~ u, N r (D U) 1 ro1 'd ? ro1 'u 1 > Al 'U C >t U H O H (D (1) 'U) (d 11 (1) •HI a) q q O N b O E a .C a u ro a O > H F H a > ro 'u O ro a) (ad a>i a) (d •li (1 U)i C A a ,s~ a) ,G a) a) }i o a) U, a) A (1) m 0, ¢d R O ro b) w .u A 7 U) • A r i) a) U) (d q ro b H m ~ 0 0 r -H C o H A C H )i d a) G', o a) C) o -0 0 i) 10 E H a) a 3 0 11 (d o a) ~ o A m 4 A r N 1) (d H q U i) U j' > •H 11 ~ O H a) R U) }l G 0 H1 a) (n S+ a) o w u 1) V •11 u -11 u •H 0 (0 a) o O a ro •H1 N A u A •Hi C rd 3 'O H )-I U) a > 3 a }-I N 'O > H H 0) u Ci rd b) a 'd C }i O •H 0 w ro ;j 11 a) >1 Kt H O •,1 •HI i) (d C o a) O 0 3 0) N O H •Hi $ u O a (V H O X U U U 11 )-1 y, a H. O w O •HI a) •L', P, L', 1) a ( > ro O •H C .w H O H N a S1 (d (d U) 'd O C,' O. R) o (d ,Hi O O }l U id CJ ro 0 dk a) Q) 11 i) 1d R O }i i Pi H 11 •H (d i U) 0 0 rd 11 C co v w 11 w to v (0 a) 11 C -H ro ro b u C U H O H C a) o C 11 :C En c v S1 3 7 rn a) (d o (d H ro (d 0) S1 a) N ft o )-I a) O U •HI U) •H) 0) a) a) }i (d al O O) O )i O H a) N •HI '(1) u (D 1) 0 (D a ,4 U) w U O •H1 'U H I" H U) 1) (d o b 0 •Hi 11 ,a" a ro a) O ro ro m (d i.1 ;j 11 (d (d •HI -H f1 C p U) i) (d 11 > H u) >i 3k 11 7 w )-I •H H H U, (1) O ro 0 a) N (1) O S-I k u >1 )-I Si o ;j u u a H F! H U, HU a) m • . ;j (1) 0) -H H O - (1) (644(1) a) C o >,00000)4 0 a C H a N U o a O A O H (d o (d ro C 1-40 a) o O a N 4uC', C '0 u) U) • -O w0 HO C O U ro O H (D 6 a (d ~ro N a) C Hi HI 'd 'U) k •HI 11 (1) Ul U) ro f. id 10 RS' a) 1:1 H a) E w ?1 , m U) a) k O E )-I U H 1) 1) 0 C ro C (d U a) w o H a) o o U w (d (d o a) 0 0 ro ri U E U010 >1 )40 ",j H o a C N " W a) o C 3 C (d w H } 1 FC o a) o U, u U) Q) V! 41 U) a> a m A a, u 'u 41 au a) (0 p w (Ok 1) rJ N G) o (O A O R •H u Ot O ld Hi a) o U a) r N C ro 0 o v Si 0 11 > > (1) v f" 6 )i O N r o HU 9 0 04) }1 O H a) (d a) • ro v 3 aa) N 3 U) A 'CU V o ~ N P, 'u H -1 N Pi ~ 0 N N M d~ Ul lD t` W o1 O .-i N M d~ N ~ 1~ W T o H-I N M W Ul N H H rl Hi H Hi N N Hi N N N N N N m o C o a) N m m ;J O V H (0 U) v ~ ro 0 4 0 H n c H 0 d O ri) 0a 11 H M m n• m O U U m qq d H ~ ~ rd w m (d n• b N n. A a) O w U) ri U aJ O U U ro bl o •d (d ?a r w u u u o zf ro , r 3 v .u v U o a) o v -i m 3 S4 (d o A O C v (0 U S4 o a) U m a) s 0 p E U Si O R U ro }i P, k U > , G A H 'J U En PQ b7 O U) O a) O N U) o N w O ro U r w -i v u ro ro v m u ro (d .C v ri o U a) a U q o u G m + ro m o G r a) v o C o C v A v ~4 o U J-) o a) ri •r1 H •,1 o U > (d o -1 o ri a -,1 a H U m >1 A ro (o a) +i v v A 41 ro u ro U a ro v ro U 3 3 k m CA v ri U ri U ul X U X O rl N O (U N •rl v X o U m m m C + qq U H q q U U ro ri q rd u) X f i o ( d a i m v m R q q m a) R 4J m U v N q, Si a X v U u v ? E W C H m i O ro m U :j v A v Si v ro (d U (d A U 01 Si U U ri U a h u u v u rd H a) -rl U a U w •H v N y m v N i) •ri O a ro m m o w u cn a q ro w 41 H m •r1 N H N R" (d v (d v m 'j fd m w o C1 rl O 0 Si U > 4 N v a U R W U m w W o O bi U w (d E w C 3 u ;li 0 U 10 ro C9 •rI •rt 0 >1 4i v o o m G ro E m fl m 0 O w x a u N C m o rt , C o C 3 ~ N s (d o a o u v w o U o w x U o U m a/ R 0 ro 0 m 0 H 41 a P'1 -,A 44 44 4-) 0 4 . fA U m - w C7 F~ 3 n3 (d v a) u o zd o m 4 u q z3 m m c4 •H v ~ m P: v N ~ ro a U U U) u o C a) -I w w FC v W to d > m rd v (d u u H 0 o o z m o m m z 1~11 (a U X Q O m v O 41 C q v a) U r-I a) C b1 H U v Pi d H 3 a d m N a } i u m U }i o O ?i In m W rl to U O W }i A f] a v ~ ~ U ro u ~ to v 7J w U U) U) U W U v m S-, `C R O a a) m P: H 0 0.l H H a O E (O u H v H O A v H ro U v V m b) (d U 3 u ro ~o r, •,1 O !i O o a) A 'W O U ri ro W a) N C N u w E w O N V u xi h 3 U (d o ,si h N (d (d y m O b C G U U U i ' a S-1 v v U H a) v o 4 r G •H o O v ~J A o W q U ro r-i ri •H .u ro O rd u U m (d •u m ro m (d v (d ,q m v S4 a ri a v ri u ro ri > m d m 41 v ~ 4J a (d o m fu m o >1 ri •rl ; -H O ri •r♦ ii r ro ro ro x v r', U A H H U m a -H o U 14 o -H (d a i S U O ro a U U) V J~ N v U u ri U a r-C v $ u ' v S4 s a > ro o U v a o q v N v 3 H a '3 0 a ° v v o a) N m ~ N O u H (d Ul U m H 0 4 u" zz ~n 10 a IV m~ 0 0 °a U H w N N M d' (/1 ~ 1~ m O1 O N N M V~ u) b r W 01 O ri N M d~ ul rl ri rl ri rl rl rl rl H H N N N N N N v a) (D b) ,C {4 ,O a) N ;j U ro A N > .u -rl O 41 A •.i > v v ri •ri G' X v U v 'O U k U U m O ro > b) v ri U (d !i '0 o ~11' C •1-1 o m q ri U !a r-1 •'i (o A •ri •rI u as H G I) ro m z 1~ ro 0, 7 0) )i U 3 m •ri a m q O U U H O v O ri a) 0) m v u •o > w 3 a ro O ro 3 > i) m a A A m N C w > (d o 0 0 > w a r u v U U a 41 41 •,A q ro 0 bi H o (d ri •.i R ro f,, ro ry' v U -0 •rl A U w G ro 11 N a) •ri ri a a) ro v rd m m o v C C C ul C U O U ro (1) m r4 r -4 : > m u ~i 74 v •rt o ro o a .H -rl zd C X A v 1-, •rl R rd U 0 q -H u -H U v m v 4 ro (a 0 J-1 v 0 O a) O > f > U m m E v ro m 10 w •,1 v -,1 > ro V b) r, o > v u Q) 0 4J ~4 10 (b 0 0) U) X ro a > o ro ro w U H 14 U) v a ro W v i p d a U U a) H a O > (d U U H m m 0 ro i o m O) •ri H v O a E al (d (d ri U A Si ri v v S.' S: ro W N b1 ri •,1 U H U {4 ro C m 'A v •rt A A E 0 a) > N v 3 •ri O v v -r1 m S R U J) u a) C i o C N R a > a y u (d ro w ro G H q E o o u o u 1- G R o m G ro > H ri FC 4-1 ~ a u ri o ~j U o (d •rI r0 C v m > u ri v -r1 o a o o -ri m H a V 0 •ri !i •~i N U m v A (tl m N -H -1-1 rtf C O N N (d 1H io.) U U L"i m i.' ri •rl ?i v v •rl qq •ri 'U a' O H U U U w a (d C o zt v U > 3 > !u H H r1 ro C O 0 v O ri v •rl •rl (d O U ?i O N v •ri ro H a) a) N k 0 ;J b) m E Si o .1- G 3 a Si ro v C U U b m -o o 0 qo. a) U r - u El o a. E., a b) A l U )i H u 4) u u } a H p •ri ri m ro > a U a f! N' q N a N b P, v 'cl H 3 > N m o m b v v 0 H a) H a v m i r a u A) ro )-1 zs o ri r, u O ro ro o q ,C o S4 o O 4 -H ro m 0 o ri i u C C A v o m E o U a A v u C ro m E N O r~'i ,3 O E N UI m U U C O R ml SA O fi N U 01 U O tr Si U U •rl v v N v 41 O U b) (d a v q m ZS m w C v m a) v C qUq H -W N m C • i > v 3 o Si C qOq of (d r-i a) -H N U (d U v N •mi o rd o N (d U N C 41 rt o (d v a v y (d U •rl m fi U U A G q v m O G r m Si q rC 10 ro rJ ro (d m C (d ro •rI •rt m H r v O ro N v ro O S4 W P, O ro ro b) a) ri U w .u .u ro •r+ A U A U) N 0 (d 14 U # G ro a) p s m (1) C mil v roi In b) 1mi o O m -1 i C rid v U U m rtS al v v U 01 a) ro v R 1i •rl •,A O •,A a) u v U u U Si r0 C ro C. C s4 a (o u w 4 -i 'O o u ro a •ri -rl •ri Si •ri -ri a) a J_1 0t ri C v > •r) (d a) U) (a a) m m > o 0 ~ rd N a) v } I m 1) a N U v 0 a v q (d v o H A A v v o q u v 14 A o (d A R m U) C C (d 3 a (d 41 J.) m )4 r A ro N v o N N m ~ N 01 ~ O U H (d W 4J ro O H 1-10 riI a a '~P H 0 O m O U H 1n rl N M d~ u) ~ h CO O\ O rl N M d~ u) l0 r W m o rl N m d~ ,fl r1 rl rl .-t .-I N rl N N rl N N N N N N i w 4 43 l w H W 4 N f C 0 .,A 'A Fi En (d .U O ) 1 H H O O O U H V •ri r a) o N 41 a (1) rt o N ro o w N v v 3 0 H U (1) -H N 44 m 4J Ol N q 3 rl U .14 r{ N O N U N O 41 3 A 3 G v ro O a o C o H U O (l~ a 11 rd ) 0 id ~ 0 " ° l rt k O q v o u , rd of (D 44 -,1 0 3 A • • i a N N V R O W N ° N W ,J O H U >1 U ro 41 (d `O a) 01 •ri ro H O w ~ O b 0 3 H U fli (1) r4 ~j 0 4 J N a Z o (A q ((~77 O ro u fd P H O P A a O q (1) 0 o (l) n 0 C7 U ro A ° u v a a 0 3 a o H H a 4J a) a) H A l H µ ~ (1 4j a) H 0 ::j H a) U u n F W O v 3 z ro A (d 4J (D N U) > 3 W i u C k r-i al S i N 7 o A r r o u w A >i R, U) h ri N M ~ (n io r ro m o ri ,-i ri N ri M ri w N N N H w H > >i 41 A y r(j a) (0 U a q -1 0 4-3 C ro 41 +A o rou 0 ro q S4i O 3 a) X 4 W w m a) En Q) •,A I,, r--ii ri ri N S v ~ aa)i 3 A (d 0 m O u 0 H yy ro ro N EWW H y o H A 3 H o q 41 r-4 W A $ .rl H in -14 U ,A w -i U) 41 rx u 4) 0 ro 3 0 aa7 o W m ro H N W Z W •.i 41 a) -,I 0 r, U) Q) U 04 X O ,fHrt~S ~ O O ~ H 0 H H ,J ri -i PY H -H U a w a) 1d A V H A A ro o m o uu o -W 41 41 H a) H ro (d W 0 N O )O O0) H N a X W .u y~1 ro ~ o u A N A A o rl •ri N n io r m m ri N M w in i .i ri .i rl N N N N N N CD CD C C3 a zv o ro Hfd O w U 41 Hz° rl a i wv rl O N a H co H ro w a u o G 3 Ed a) o 0 N ° 3 w (1) H U J~ u N •rN-1 ''O N v v Aj C a) H (d Ci A H U) .,Y 41 (o 4j ~ n. U 0 A 'Fdj 9 a O a) rCS 5 a)H-I 41 a ro 5 w -W N O 6 o N a) S4 1d G-! ,L', ro w u m 41 N w H ~ 11 O (1) 41 11 U) o C a) ,J ay) C u rl o (d w H o b a u o ji b o o ~ (d 3 H U u C W N C A 0 o ji IS i ro f (d w w rry~ A C C rl X 0 U 3 H ro .(d A, ro v u o C ° q°q 'o (1) ~ I o ° o ro C ° 41 a s u v •ri w p (d rt •H x rl U) u U u O y v a) ID 11 r ri o rd w o U C U ro U C U 5 U w o o H > o u o o qq N DC w w a) a ? • i ro x rd a) fd OW O 5 H U H al A H i, N a C X AJ a) N U 'n fd H 1d •,1 O, H •rl N a) O N •H N b) AJ N ,i, O a) rl a N U O O) •,i H •H V V ro H C H ,iy 3 •H U A O •ri N u N A- d N a) a) O a) O 0 H a O a ti O H N -rNi H ~ N U H a) H N •Id G N U ro •r~i O rd N p ' J S-) H ro r0 H w (d H 43 A ~ U i, )-1 a) a) u C a) r4 N 0 rd 1) a) H 4-1 41 fd H ro m O z H q a ro ,r, O N O r-i ro a N ~1 o A u o N o H F w H z ro ro p H C ri W v a) N cn A al C .C -rl 3 -n •ri rd O R4 H A a N W H .C O U N 41 41 W _p C H v C- 3 v N w o a x m a) a) w 4-1 a o ~a u w a 3 v o 11 3 u w o U a w b F U a w Ei >1 o rd C§ a N (7 H ri W v ro u FC .C W N U li C FC N N o w o r h' fk A A Ln a) !Z •rl H O ro 2i. •fl a) to U) (d 0 o ry' C 7. H N H o •ri 0 -ri (1) 0 71 0 1, U) O O rd z O w a) U) O a) -rl ro m N i, A Q O v ro H Q Ei O W 0C Q ro 5 C C H N •ri ,-1 - H A-1 P' - H ~j O) •,1 (4 - N (d O O -H W k r o N .u ,-1 C w _o o C cn ri o 3 W o .('ro N u w •A C N N a) w o N o y, C w (d r 3 w ro w rl W H ~j N U H .k f4 -H H ,L' ro w H Px O a) :J a) ~j ro H O G w O o N H O (DPI ri a) ~j,-1 O -H o a) a u H -H U .C ro N O, 4 o a) 0 3 d H u 0 E •rl U H U A n y, 3 fd H o N r0 o •rl r0 11 H ri b) C H rU a) 41 •rl a1 w co ;j -H H O (d fd N C 0 H o a) C .C A a) (d ro A (1) N ? 0 0 v a o a) N rn ~ N O U En V U) ~i H (d N O ~ H H z cn ri a. a <n o~ C7 # cn Oa U H r ri N M W (n (O r fD O~ O ri N M T (n r fp 01 O .i N M d~ rfl ri rl ri ri .i H ri ri rl H N N N N N N ro H N 44 0 -H o ~ ro r0 4-1 '1 A q w 5 r0 10 ~-A 0 C) (n 10 -,1 0 0 U 41 0 (1) a) W ° ~ ([I -1 x ° N 10 w v H P Q .Q o 9 3 m • N O u Ol O bl 4-) Id U CO.' N N N w ~r H .,A N a X H U) 41 10 q) 10 4-3 k Q) H N rd w 0 Ol U H 10 a) .,A O O U O ff., O 0 H N 41 V R O W 11 .U iH W N r H ro t~ 4-1 o w N 'O ro U ~4 U) 4 ~a W o ' O 41 o 41 U, a U r-; O rn rC fWZ a w t il u rd U) rC LWG V U) l -i w o w Iq 41 ~ O CD O Q o ~ O Q o 1 m u u) U) N w X a w O m H ro 3 rd a U) H a bl q rl U] N w ro H N ro H H PR HH^ O1 O ,i •lii w 4 H •,A m U ~ 4 5~' 'd N Y-, u H J -i N w O w H O N H 0 O k u A ~ U ~ u u ~ H ~ n, ~ a O " w U C v o E G w ro O u A a Li O 44 -H r4 a) 0 4-) ~4 4J k -H O f." .r+ H w O ~A O >1 l) J~ O N yi 44 w (d a . v~ am A 0 4J w y ~ H w j N N o U O A O S4 11 w o u ~ H O ca 0 H N X A l~ u td iJ N +J W O 0 0) 44 u w N X r N 44 41 U b1 q X •,i r P, -4 b N N H w IyO JA-1 JA-1 ro H N 0 H 3 4 z 3 w ro v O ~ N ~ S"i x •~1 4-3 41 v q w ww u Q o j A A a O 41 O ~ (a 4j (1) 0. to ~A ~ H O P V o ~l ~ii ro w w w 0 H 1 .i rd N O (d ! X q ro C 41 ro 0 N 5 a ~ 3 u w 4 a w C) N N m m ~fi O U H (d U) U N G H d m IQ o~ H z i w~ N 0 cn O H 0 rl N M c:+ N ~ r W O~ rl N M d~ (fl N l~ W N H N M d~ Ul ci H N rl N N rl H rl N N N N N N N H b d N 4J (1) ~-l rd H H k S4 ,4• 'O1 O H O .11 (1) V En v Li 0~ 44 -,1 4J o N v H N p A u N 44 ~i a 3 w w •,i 0 a) 41 OU N ro~ 4j -4 43 4J (o u ul 41 a o v v w ,H w 3 ro J o S%I U H -li ro H O N H Q m i wa m C a ro N 0 ro N (d N w N H A (1) 0 U 41 H H 'O N (d w w -ri w 41 }4 w ro ro N -i 4J v 41 i A U H w a A Si ro U w 41 " H ro ro w H" 0 w r-i w ro ro O H a X 0 H O ~ ~ aa a H b ro H H U ro o 0.y E O (Hd ro N N Eo o V f~i W H En N N 44 ?4 H .,a N H Id (dH U O o o 6 J S o H N 4 H a w U) S%I N O H 3 w N S-1 " O O w U a i w b' iiU44 jFi' w O 44 41 ry `w N ro X S w H O a w u 'X j~4 -1 aN) U OO ~ r, r4 U oroi h ~ a w A C v ~ ~ .U o .3 N Fw,' U Q 0 }i i- Q) P, N L U ro (d 0 1-1 >>1 W N (0 5 1 411 (6 ° (d do H 2 O O S ro (1) ~4 4J q) U) 0 q) G ro A a 41 0) r .1i ro >1 r ro U) U v o 41 R H 3 0 }4 H 41 •H •Hi N N N (d 0) v 0 3 w u . m 0a) 10 0 y 0 U r-i ro O O a u ro C A, U }-i H •11 O 41 •14 O U ro W a; a N N H (Oil 43 W Or) O ro .u U t3 _a w F. C A 3j a P' O A 4j .11 a) w w H H R i~GY' c' o fro wa w CHH 5 Jw w W 1 41 41 NP., N ¢i O A U H H O w ~ o f-1 N A (D ro ro m o w 41 1j) 1 0) ~J x H w H a -i 4-J 4a° m o u 3 m 3 ? w o q 0 (v m ~ N m H zu O ro U) 4-J m H (d O E V U ?4 Nz° a~ ci O ~H O O O ~ H m •-1 N M ~T ul ~ t` W O~ ~-I N M dI Ifl ~ W al rl N M <M (ll N N rl H ri ri .-1 `i N H N N N N N N 4 > w > 3 v ro 4J 4 u ° Ni v a) ,4 v 3 ~ v yt o C o 01 Al o w 0 o a) ro J-) 4 0 4 (d (d a1 v o ,i-,a) _4 044 > v W w ro -i u 3 + 4 4 U U) ~ v r a (d a) Al v U) v ;I a) 4 Al H (d r rd U) o > d (1) U) i i O r U U •ri O n• N r• u 3 .r 4 3'd ro Al u a, m ) 3 Al (d E1 Al a )-I Al Al 4 4a $ ;j U) o H v a) X •ri ro O v 7 a) b) 0 w Al A Al 3 4 3 r Al Al A b r w rd fd U) a) 4) U) 41 H .r a Al ro v N O U) r .r O (n a) a r > A n U i (d H f~ 3 o u ro v 4 v m o ro C v A C A ro Al r A (d •H v 'd ro N n• o w f.' 11 o 41 H H U) o N O ro H (d C r O 3 r m ,r u) "d Al m > r Al a) A u O 4-1 b) 0 r U 4 X A ••i X Al (d )-1 H r 'U U1 ro U) 0 4 v U 0 a v Al Al r r (d o 4 v 0 o •1i rd A o 3 a ro ro v A ri v v 4 o H H 41 A ~J N o u 3 > rt U rn 4 4 o v ,AR -rt U C bt N (d n• •rt a a) C o) X N F r N A JJ b) v C H v ,1 4 O C •,1 rl r U w 0 r U) o) o W ri r r H Al 3 -H ri C ri N v ,r o o ,r •rt v r .H r>i ni -H (d o 0 0 v U •I-I a) Al O ro ,(1 -H 41 O N a) (D r 4 4 0) a) -rl JJ >1 J-) Al x Al '0 0 E 4 N w 4 4 U) 4 •H o x C (d r •,i -,1 • 4 ? rl (d v U) (d m w m v r 3 r ro d ro H A (d a) 4 v w o v N s ° , m o 4-3 fo ro v 7 a a r ~a U) 3 v x v > J! JJ 0 , l r v a U a E Al v 1 Al 4 a) r 0 ° -r H 1i (d 3 v •,i (n v 3 4 ro a (d o w 4 3 (d A Al H a v Al v 4 v v 3 +1 ,q p v u •,i a) 3 3 .r v Al ro v d C9 d v o i A o a O o Z 6 u J r o o C i1 > U 0 r .11, Q a 0 Al U) a H (d (d n• d ro a (d 4 (d ro u- H H a A w x r +1 4 w v H a) (d O a) 0 U) ;j 0 v A) U v! Al (d rtS v v 4 '0 C (D A •i'. w w i 1 4 C ro •r1 a) ,r 3 a Al d 0 o U) Al f4 AJ H 3 u) a) v a ~ H v V O r U O 4 U H td " O rl r 3 v V N a r r v 5 ri ,r o b [ u i 4 X u a 3 v u v v n v o H u Al r Al 4 0 0 0 041 U) ro U) •ri 4 Al u o > U o ro d -H v A r w q (d (d O Al 4 H rd w r r ,La' v (D > ro Al U) r in w o U A o O Al A 4 o v v r r o v 0 4 -ri ro .C 7 a) r .C (d a) a) Al br) H ~ X w a) ;:j v 4 N .4 O -H V 1-1 3 o A (d v 3 u 3 a .H of •ri (D r U) ro A H Al o r H ° v m v i r A A i A 3 Al 4 r 4 u H ri 4 Al 0 r a) ro v Aj H rd u o N 0 o r v v o r r 3 0 - H o A r -H o r 0 0 0 4 o) 3 0 -1 JJ u Al U 3 rd 3 3 A •n >t N ° 1) C) v N ~ N rn C 7 u o H u H q H fd u) u 41 H Z H a P, ~ ri U) 0 0 E o Al H N ri H N M d~ v, ,o h OJ al O H N M d~ u) ~O h 00 O\ O H N M d ~ H H H H H H H H H H N N N N N N 0 v ro ro ro ro A N ro 3 (d A m v N p H m O O v A r C .C N (a Al (d 4 a) o, A 3 N 3 v m (0 o •rI 3 r H 4 ,C 4 v ,r C 3 a Al > v r H Al Al (d C v v (d ul O Q) Al i 4 -H r v -rt b) Al r .u o A r v i u H v > 3 H r r 9 N r H o v U u v v 0 ri 3 u) v ro A a) qH m o 4 A C 3 r uS 4 U m a O4 4 u 3 -.1 m •H -rl v C U o Al v (d o ri -ri r •rl a) r v En ,r 3 Al O J-) ri H v v H w ro ro H U) 4 a) 4 O >i 4 bi X Al r (n (d 4 a O v m •C u o a) C C v O ro •rI 4 w O Al r ro N Al w u k v •rt ri to r m U o O o A U) •H v H 3 0 0 ~ •H A ~ s~ o (d •H 4 (v Cl ;u X Al (d r4 ,r U r v u, o m ro v U) v r, U 3 r O ro , 4 v U W td 4 O O U) O ri N H rd R, 0 w U ro>, 4 N •,1 4 w r rI •H ~ •H ri 3 ri •o w w 4 0 (D N .u b) 0 11 Al Al 4 S1 q i U o o a) A A v A C m (d (d (d N v 0 o (d w v u m 0 v 0 > Al C v rt u r .C Al > E U w ,r -rl N n. b) > Al O 4 •rl ro Al ~J Al •H 4 Al Al U (d r N 0 o Al v (n 3 a) r C w m u) a) 'A (0 v a ro - (n Al 4 b, (d A r U) > H ri -H r(3 A (d u r Id 4 4 ;C ri u) -H ai m C ;j N 21 41 q A-) A ~ h D fd Al C ,C C •,i U) v Li U ro r Al 4 v d ro '11, R v r u A 4 3 Al v m o r v A v m C u + 0 3 4M a) +1 ro w O x A O m m r v r Al ~ H N v w (d rd O r u) 4 (d C U (d '74 C Q) H A b) .r w ,C C N (d a) w rd d (d O O r o r Al o E d 3 A Al o v H v u .r 4 En o U o v b) 4 r A v Al v x u m .0 41 N •H 4 w 4 6) m ri ,1 r . Al vi ~l (d -i Al •C Al v .u o r u) N a ri o 3. 10 ;q w -H 3 r r o v v (d 0 v w -H H 7 o w A A rd a) N -i C r v A o Al r r r d A U) 3 (0 roN O A 4 aa;; -•i u, a U o o o m o rx m Al (d r +J (d w w u) En m > i v •H 3 H - A w ~ v m Al o A a ° r 7 3 w ri 4 H Al H .u Z ro v U •rl v H U A A O Al 0 v r Al Al w a t) O w •H v ri u 0 r 0 v (d u v 0 H w > 4 w r 4 f (d 4 4 F] 4 Al r a v N Al H U C cn id O v •~1 ra a) A) (d (d (d N •H r ri C u C •n v W Al 4 4 4 ri Al o (n a H A v o v ri •rl 4 o C H cn a Al 4 a (d U ro u) •ri J-) a) 4 v RS r (d ri U N •rl O v i N m N u N o 4 (d v o A A) $ a U Al m ,r o v id H • A r w •q U) ,C -1 U) v o .r O 4 u) (d U .u O Ul •rt a (d Al u H o •C 41 X U E C r (d m C 4 N 2 (d u (d 1~ Al .(0 0 v •rrf > N G (d Q) b -1 10 a) aa)i U 4 H H O w Al O A m (d > ri A a1 -A v w 3 a) ri v •rl ri O ACS O O r A rd Al (d rd •rl H w (d N Al A ro •H u ro A to r H v (d •ri C 3 v w U rl (d v C Al Al U) H H W H pp 4 Al N 3 Al O •ri a) ro A ri Ul 4 r 0 (1) Al U (d Si v ••i ro m m ro (d O ,r r v td v o .r O r C v v a r v r o A o (0 •r~ 1 4 ,C v 0 .R 3 Al In m 1 4 0 O Hi 3 ro 0) u rJ A 3 a u A ro v o C ro ~ N ZO U H (d H (~d O AU 4 H Z ri ai P4 <n H me 0 U °a Al H r1 H N M d~ u, l0 t` W 4l O H N M d~ Ul l0 r W O, O H N M d~ i() H H H H H H H H H H N N N N N N X O 3 C v o a) I 10 bi C bi d 1 10 o ~ H H C bl •ri a) -H 0 10 O (1) H O V a U 44 O m •H td )4 O C H ,q aJ k H a > C O C ai )i o (n R a) u m o o FC ro H o (d o H U C N u u m r4 m ~-i ro a) 0 > LJ 4J fd ro R) 3 o v C to 3 ro C o >1 v .q W N H •rl 3 •rl m m r o w o Ul O •rl •rl >1 a) -H F O H r I- O 1J .>•'i H U m J-) o X w o U C (cl >1 a) C C C C o H o rl ro C H (1) N .q ro 1J •rl !.J N 'd V 10 Fi .,A 43 10 v )i 3 H v a) >1 01 > ro &I fd 'd m Id ,q (L) a !i ro (a rd C a x o a u a) a b o H a) > H C o H r (d m a) + -H 3 m O o C o > w > C O •rl 3 U !4 rtS m a > ro a N bl G' C m O A-) 'd f.' 1J H U >r a) -rl ,G N t ;j U) o o q v u p o m x o o s r, m m > zJ C C d k 3 m > ro > X > a o C ro u C C H ro + r C o v a r r m C o o w .U a) > a) •H U a) m F1 a ro 4 td w H fd > 2 i C - C o F F H H O a) a O q A i N A m q 4.) 1 RS RI N O a H O ,q bl 4.1 H •o H U) a A u m Id A r4. 43 C F n• C a) 4a O •C H ro a) .U (0 O F4 H )4 -.i U JJ O b) ,C a) S-1 a) H Sa H U' •rl a) Id O m U' H +l (1) > ~ -H 1J X 1J X >1 a) a a x m > v m (d a Id a) a) m a0 W M Ci -,I 4j N a) 'a) 4 ?4 R5 4J O 'A II -H H W a O a) a) ~4 cn 0 ~ 4jd u m a ~ ro Q A m ~ ~ O A !y' O a) O )d •ri '~1 O a) - J-1 m iJ bl U H . 4J o a o m y m a y p O m o 4-4 x C o m u) u) O o f4 O H u H H H S-I 0 > C H ro En m q a > G fd U H m ro d 0 m U H 'H U m ,q 0 a) -H U C a H ,q k 0 a) U 5". U U RJ H A a) -rl iJ m m .S v a) u O U O •H H U a) C u )-I a) G' JJ 0 U a) >1 0 >1 +J 'o •ri O fd v m •rl r u ro Ll C H m C H •H H ro 0 3 O o •H a) A al ro to m a) }4 S U O 4-4 4 2 d )4 ro U [ > a) a) m •r1 N a N U) a) a) H k O m a w 4-I m v v q v C > > > C ~J v Id o ro ro a) N a~ •H ,C •H C +j ro C 0 o 4 o 4-) ) m H a 1) 3 v g .H m 44 fd U C aJ U u) e-1 N M. d N lp r m D 1 O H N rl N .-1 M ri d N i+l N N t` rl H c-1 N 'i N N N d' N N v C) a) N \ N m 0 u H Id M 4-J ro m U 44-1 H Z a ac m O Ch ~ m 04J H J u ~4 m o v X X ro C v A a) 'd n. A -w C 01 U H m •Hi N N S w o a) o 0 J, 1J x ~ A%) o ? Ui 44 yJ rl a) Ol O U ~:5 O a) O )-I a) H ro a iJ $ H ro O O m a) U ;1 Sa U > 0 F' a) a) O a) iJ a) H H 0 a) O .q R5 m 3 U >v J.J A 3 r•JCi A N C o -I bl a) (1) (d O O r a) '(11 iJ rd 41 X 'o +-1 ;J O ,s~ O w r m a) 41 G H v u S 14 3 U o ro ro ro ro O m a) 1J N O )-I bl J-1 H U H m O IJ J-, 0 w ,q X 0 o v G m 11 N •H w 3 F v o 4-I 3 v 10 H a) ?l o n. U J J v H, b ,q o a) C )-I iJ o o ro w " V -,i to ~l A O G ' O v O b) V N O U ' .C 0 N iJ m .i a) b) O a) 44 X H bl a) 11 l~ O Sl •14 fd o 4 C (n•q a) a) H m U m C S4 (1) S'C C u )-1 11 O1 rJ ri U m r14 N H H W m O 0-1 O X m a) a) H C v o O O m iJ ,C 4-1 C7 C m o C v x w ,C 0 R o bl u 'd m .H 41 1 H ro > iJ m 4 o fd C 20 iJ 1J iJ V H a) m a) iJ k •rl fd 44 >y m fd U a) m O rJ 11 H fJ 0 Fo H H J-1 H fd JJ a) iJ ,q -rl o (1) O 11 o a) iJ v O ro H -A O A N m m 1J , q ' g W N m >1 U O U W ,q ro a) W a o O a) a Si 3 C7 a) ;j 'o •Hp U) Z fd U E O rn m 'd FD 'd U a) rJ F7 O •H ro a) O m H FC m Rf G i C ] 0.1 w a m a a Pa y N H d E fy~' a) A H H N ro al W U G U W O ] " -ii a) u S N o z o N L) °o 04 m z m w 8 X 0 iJ a) 4o a) A o o a) ro 44 a) a) O 0 H bl O O fd 3 f. N ~I - Ol H U m Si m ,s.' H bl a f.• H W J, a) 44 C H a .C H W m •.i al X U) ~C U ,f; a •rl bl JJ ,C W O H O O O iJ O rC a) H x 00 C ~J H W :q x A m rt •H U H rl O iJ rl O a O 44 a) O U U .q 3 ?i U ;:j 47 10 O ?4 O o U O X U H H o H O ~d O $ R H 1-1 U a) U H •rl H H U m H U 4~ O •r1 O f-. 3 fd m H fd • 1 X H 10 bJ o :1 JJ m o o s 3 fd C 171 3 A ?i •H H ~d m a) H •rf 11 C: bl O O1 OQ N H IJJ U H U U bl W LH H .,I U) H H •d 11 H bl T) }-I m 41 ro O 41 O -H H (d H •rl Z) o O N iJ MU)4J (d U) ro f., o •H a) 44 •H a) O O O 1J fd a) a) 11 A 3 I(l O 3 C U 44 >1 -ri a m Si ro 'n N U v o q o a) c~ \ N m C o U H ro m v m H m U z to H d~ P4d H m ~ O C7 ~ O 41 H M H H N M d' an lD W a1 O H N M cN vt ~ r W O rl N M d~ ul H N ci H rl H rl H H N N N N N N o H N 7 w ri k o w ri •HI m v w x -'i A o .C v v O ri H N O 10 v 4-1 O N C (d 'd v ?4 v ri (d w H k1 H m o 1+ U C U C C v o li -1 3 3 u n• b) (a F' o r~ 0 C 0 4 v N a ro S, m •14 •HA I U ~4 w a) -H m ..-I m 3 O N A m O - i m v -li 5 v >1 v v C ri v v H bl N v U m -H H P, v 5 v v )i a) Hi A m N a O O ;:j O v (d v (d u F. A bl )i N H . W 0 0 3 W S' ro Hi ,q H v m •ri 4 q o fi •l N 'd 0 m v A v (d Y) H Si ro C v a) u v v bl C 1 v ro o o p v (d 3 a) m v C m Si ro 5 m 3 A H U Si ro v ro r4 U H ij A C 3 ro li a v 3 0 a) a, d C v a) a) ro 3 v v 'd o ~4 Id 3 s a) 3 C 3 s m r~ •,i w b) ro 0 C C bi v ~d 5 N !i m ro H x 3 •Hi a) v v v ro C U) C i ro 3 3 v c } R u X N O A k N .C A •H td v C A 0 (d (d 'U O O r v v C a) bl v 1-) v o o 'o qq C r4 a) }4 H -HI C a) o 0 ro ro v 3 o r-i x o C m a U k O $I m U S4 O 0 U O ;j O - 2S •HI b) td O O •HI H O bl ,C ?a H O 1j ?i O Hi al O ro C w w H H U o r, U) N N - i A . , C v o u •rl H a) v •rl v O w Al v 3 O 1a 0 J-) O 43 v A 44 R 0 3 0 o a a) (d ~l ~ o H v q a) H z v U w bb o b) o a w v m a) M v o N 'd w C7 ro ?i r p u) m C C C -li m Si )i y, U) r o v b) a) >y ro w )i o o ro )4 0 (d v a) N m m v w ~ a) • A u v A fi v o a a w h w v u C a) a a o ro v R o } i ` H (d r a a a E ri O v C a) A k a d ~:S m w rd o 11 v -r{ m Rl AJ 'Jr :.1 •,i w •H J~ v N w N z z ~ W u ~ z O i O z 41 m ~ O Q N o (d u N m X (d O Q 2 o N U rt A O A O w N N o I n !4 P -o •H 0 Q 10 H - 1 3 v ,q (d o H 1 i - H ?i w v 'd - m H H m N Si ~j O 4 F o m y, b) o U) o A -H 3 o v m O -H (D 71 a Z3 o m C (D •Hi p,' H ul H r-i H ro r1 •HI v 41 M H V) H F,~ m u ro C (d .U d C O 3 m H H (d E, (n H u 3 .U (d m •H O m I 1-i 44 O poi u >i 0 •rl N a) A ~C N F m 4! A M N O A F (d M 'd v H r x o W ro v x o b v 3 H )i o r-1 v .C (D o Fi o ri U U k O u U a) U v U Hi al v m U A 0 'Li u Hi H Ol •O )i ,C H 3 O C a) 'o Hi 0 a) W C rd a) 1) O W O w v H 0 p, v rd b) U )i v 4 G •H~ V Hi u O A C a) q v H v a) bi x m y, o rd a) m •ri k o 'o 5 C U a) A U A ) W x - H v o ri w (D ro )i V x m !a C b) x - •Hi ,C w rd C v A .C O C a) r (D -Hi ~A C ~A v rd v m o U C k o (v .11, v o o a) o .,4 4j 4-1 p C ro ro U o w U A i) 3 3 'd a u 3 ul O v -n rl 3 N o rd v o 0) N 4 m m C ~ei \ N O u H ro U) 41 HH M 'A °vg H a d~ 0 O C~7 # W E o v H HI N M T '/1 ~O h W Ol N N M d~ W N N ~ ul .-1 Hr HI rl Hi HI N N N Hi N N N N N N ~b ro ro •HI ~j ( O .C m )-1 1d H v N ,C U 4i O m m v H 3 m N m ,C 4-) C m 3 a) 0 A a) a) , v •rI v C v r, v H o x C A M A-) -1 u (d m 0 o O v •Hi a) m m v m •rf m v 3 m A C J-1 J-1 JO-) U ~ H U b ~ v N •1~i ~ N H W v O (d .1 m v O X roi C 3 ~ D. A d Si -,1 ~ v A a) v C (d a, 41 m M •vHi N •H~ A 0 o i 0 a) O G' o m W q ~4 m •C •HI U ri )i v p v Hi (d •ri H C 3 , ,C v 0 7 U I •ri o (d C R) 0 m o rO -i lN i v it •H R 3 u a) o C ,C A R -1 Q )w o m v b-, O •ri • i v v ro 0 H H -A v x H Q w C •Hi Q) }i ri w v O A U a) v rHi w o O •HI 'L) v •,4 Hi -HI m o r o 0 1i w y, H C R v (d ,C -H d o •Hi a) u ro v 3 (DO M w u H O .C v a) v 3 W o C A u ro N U v 41 o •Hi o v w v m v v H ti ro 3 C ,-)m A a) 0 o i) v v a) 4) ro v O U 5 4 N v v (d r. _U J.) C H R o !i v m C H 41 o ro N V o v m 5 C. v r.• o !i 0 H F', v v O r.' •rl ,ty" O HI ro N 'J •.i N •rl o r (d r'. v I'. 'o 3 m m r C o C7 3 •11 v v •Hi u Hi f~ R R ro m H O N O AJ bl S4 •rl U 'b v ro w r-i •HI J~ ,4 S-I U v •H1 v G' v G: 7t w H w w a C o C 'd }4 v (D m •ri ?4 v H o o q y~ v o v ro q a) C ,q w -li E Hi o m o v 41 (D li o N S4 m 3 3 'd 'd J, ro v v a) n rti ro 'd m v a) $ v W A v u o d m V O r 1 v HI 'o Or U O J-1 •n v -HI u) m v U ri ri v ~ n. 43 bl S4 O HI 'o •Hi 'o A 10 x m r,' rd 10 H m o v (d o v C v •ri r.' y m _C Id C. w N +rl 'C r (d k. 3 ,ri. m A •d. 'd v ro N !d C m w N O a c4 U m v o v v qq •HI C v v p m C7 v u a w a) C U v w C C o C m v si m d s v r w C', A x 0 v 'o v m v (d C D ai v (d 0 v Z a m ro q v m •Hi v Hi o C a1 ! v N p v R N w~] >1 v •H+ v AC 0 o C m a) a U 0 3 ,C ro U to m v o N 1-1 S4 .u N v v 3 v o 0 H U v v A N C Q O ri v d v (d P4 A v O O (d D C n b H (d ro 01 3 C C w J) W •HO W O uv w O 1) •HI ~N 'd v (4v v m C + ro U I •rl v W rd w sl 0 m 0 ro Si N C Hi ro 7 m 41 M 0 H H b) W H HI v N S v 'd 3 ~ m v S ~ O 'Si O C.' H 4J V ,C •rl v bl U J-1 O -ri ri m v v m bt ro }i -H~ r4 0 (d r co b) O ro a) C A !i v v -1 '0 ?4 d ,C v ~r O 9v HI •HI rj U u u m Sl, .C (d 4J ro 5 S'. ri ;j O 3 v A U H H, O H N -,-i 3 A 5 `U a) N v Hi 00 U v U S4 rd E C R v z) v si Hi v o '0 ti ti C q u N a) v (d 'o m v H v A 3 C v ro N 3 7 Si R ro H ro w u R N -rl p •v- m 0 o v 'd ro HOi 'd E O ,U (d U u ?i w O o v C 3 H C ro O Hi ii v a) m ro ro (d U v d a v ~ m 0 J-( o i) u v v ,i~ v o - i C v 0 A C 0 o i G 1-) o C C C o a) J-1 y n u H v v ( 3 a v o m 3 a o 3 v (d C C HI N M d~ N ~O h W m O N N M d~ vl ~ h W m O ri N M C~ N rl N HI ri N N N N Hi N N N N N N N v o a) o a) Q m \ N m C N U O ~ F~i! ro V A U 3 2 z Hi D4 d! Hi 0 d 0 C7 ~ 0 o~ H vl H a) G C G W v q ro O w w •H •rl C y, w O w O U) ro u 3 > o w 3 ~ 01 U) 4 bl o H N 0) C o X )4 H o ro w to JJ N ro A C ,1 o C o 4 o 41 H z7 3 1~ (3 C •14 o ,q w ro o o m U o O U) (d o w w m 3 N A u U X u J 4) ro J ro b o a v w w o H -i w w H N w C u N C a) u w U " A H o H a) U w w .C w A w w o to H u o H JJ O H JJ H bl H ro N N H ro 0 •0 U > O w to a w O a) w a) ro ro G O H A 41 X A C w o X m w C H r !J :C o w a o •11 w 0 w U) )J O > iJ 'H fd 0, H a H 11 C. H •,1 O w X f[ .H w (1)4j 00 q )O Q )U) U) O > w G' , 1J Ul a) o 0 a) U 4J w u) o A U H U J-) •,A U) rl 4J o -1 'O up A O iJ -0 a C q H ro ~ U) J4J 4 J~J •C fd fd w rJ UJ N O 3 v w H E JO) FO.' u 1roi m o 3 > H p + o u 0 o x O ,J 4-)H w U U) ro w C, 3 H H w fd o u C r1 X N w U) 0) H > A 0 1 O a) O NR g C U 4 C S -,i H v 0 a) tP to 0 , v o C (d Au H r to fd X H U C ~N u a~ ,i + A o w ? A (d A w w !J a) !J w a) o A .q ro 4-1 H H H w U w A -li a) > ,J a) >y 1J H JJ w w a) ro (d O p, A > H H (IS O H U) H U) H to g 4 u 3 o C u •ri w F,' 1) -H H bl w w C •,i v 10 41 (0 Q) (1) -11 to -H 0 rd •rl rl a) ftl H H w 0 (IJ Sa) C 3 0 +Al w H w o ro A H w C 0 -1 N v A JJ o w w 0 Z to U) (0 o N L) 4 o ,i-i - 7, x H 0 ~ v 'd d o C o zO 7 3 C lJ u u w C o o C U w O H H H N O O H ri H •,1 X rl H ro U) C X P4 w a) a '0 w td [ U) H bl w 0 (d H 0 m a) (d w u a H j., w aJ H a) w JJ JJ o u w bi x H rJ ro C w ;j u > fd ? 7 A H •H rO JJ 3 ul C m (q rd a v 0 0 3 o aJ a) 14 o i~ fd A 4 fd a H m u a) U v 3 H d q N o H A [ ,J a -i W > d 3 3 C 4-) C u ro a) H w w -li w w C w JJ JJ ,C 10 O Z) of O In $ q H o g N w ro ro rJ 7, O H C C '0 7 7, 2 w C F J) a) L H ro ro n H JJ [~77 w JJ -ri H 11 U) w (A 3 w a) 4-1 F.' H SC -rl O S fd rJ to 'U b) A H J-) -li (1) w •H 'O 'b C 0 '0 a) A f+ 10 H w a (d JJ w U) H ro O N L) m C 3 o C UJ o 00 H C w o ;j w N O O ro fd 3 O w ~j w a) (d JJ H O H -H In a 3 b (d H a AJ > > u ro o 3 U) > u U C H a) )-I a) bl ~ 1) p v U JJ S-I rl a) C w 0 JJ N H a) C, H H u •rl ?i Ul to ro ro X w x O w ro a 'i ro U H S~ flJ CJ u > o u C w 3 ro u > m b a 5 rl N M ~ N ~ r W O, o .y N ~ N d~ H H N H H N r-1 rl H ri N N N N N N E tJ C JJ C w }4 O C.' rd H ?i bl 'I H a) N ro ~O (1) N a ro 'C H ~J 3 (1) J-) w w H a r, g ro O N Ul •rl 00010 ,4' H ro H O •He U o U a) o 10 (13 _0 41 C w Ul o v M RU w C aa)i ~ H m w w m U H -rl F. w w a) U) H W U x 'n 4-1 H H C H H (1) U O H A 0 0 > N (d ro •-I w to •rl a U H JJ a `Lj U 'o w ~ C ro a) w O H u w C v w o V a) u) ~4 •,q A r, 3 )-I C ro ro Ul w a) U (nit o H •ri ro v 'O , H v v U) a) o H M H m o o A A za 4 0 (Dro O V ,L,' W a) 40 (d a) ~4 a u ro ro 1) x C o w _0 m o AJ A w w w H Ul H w C o 0 3 •H 'H H m H -H 3 lJ .C 3 'w U) o -li ro ,N o JJ o H w w 3 w C JJ N u w H ~ U 'b 0) )J (13 Ul u 4-J ~ U) ay) (0 y, o w S q • ~ i (0 w H C 0 m C w w r, to C R 'o C C ro C 3 3 •,i C A •H •li o H •,A C o w H u ro H C 3 w u r 4J ~i w U) 0 0 i 4 o ~ ro w o w > 1 o w U) U)4-) )J Z U, R , ~ H 3 F N qq m to w •.i 0) U) O w w N U N M R H X td a > u 0 )J U) )J rd o w Hi w U a V) n ro w H (d Fi H ro L w u C w w > o •,1 w > C W C o w (W~ w H 1) A - 0 0 w b) ro JJ 'O X w w H a aJ 'O C W H w 1, C 0 w td C JJ >r H 0 ,C (n •H A w O o O H > ro w y w 4J O O ;j 'U H JJ O u N 11 JJ u W 4 ro 0 w 'd O '0 aJ H '.U) O O H ZS ~j to (d w }j 4J 4J H w -,1 q ro fi' V 1) ~j b $ A W § C W 0 w w H A -U H C or 04, $ o. a) !cf w a ro O O b) u O •rl to a ~a a w H o 0 'O H 0 o u H 8 a H a w w u o ro o AJ fd >1-14 •H U) N A H oOrry+ H W W o w H bl ,J ro 0 ~ X b bi Fw-, A H X N H N IOW w --H > rd (d JJ n O ro C H AJ w H o H Z, w O 7-, O H '0 w ro a) 0 H non AJ A H v w ,1- O H 11 w U) K., 'H O - H - U) (d JJ H 41 H 1) v o v w •ri 11 u) 'O R O w o 4-1 ~ lJ A (n aJ rd o U) rA w q •n w 10 ro w 0 C a H H w w • j -H (d O H H 10 w R w 4 O H 0 w J-) H H H O AJ R 0 O O 41 a) 0 ~j 0 O N .C H 0 .id !J H 'C a) 10 w O ai m o m a V4 a o J-) u P 4M m w 4J O w H U U) > U u U (UJ-) ',7 R H (d u w ,C H a P. C b) (n -1 o N 'o C I AJ x w > JJ O 0 0 o C H 3 X w td to r U) m 0 O w q q w td U) R w ro u ai w l } w H a > a J > w b x w (d ro U ( [ H w '0 H a O RS w X w H 11 f., UI •rl •ri rl R 'O w H 1.) O H x r w JJ •.i JJ U) H Q) ~J C w 0 4 w u w N H o ~:l 11 -H o o K o 0 0 o O H w O )J H R '0 U A w H U aJ ,J JJ A 10 O 0 4) 'o w H N N M dto b t` W O, N N M d~O r (b O, N N M d,f) N •-1 r-1 •-i ri .-1 H N ri N N N N N N w C) N N m ~ N m ~ zu O ro U) 0 H H u H H Z a i P4 '0 H m~ 0 0 °a rJ H fp H H w o o w N m ~ N m ~ ZO U H ro m m H o~ H H Z H D4 H O t7 ~ 0 O H .4 rd 1) 1 2H ro rd 4 O (d 0 v u O 0 a-1 v a) rtf V H C H U a) H .1 a $ O 4 (d H 'O O H m (1. 4-4 .X C 41 w O O 4k m •H -i al iN U) •41 3 0 X J~ $ 11 S-1 H rd •ri n• UNl (Ij o fi 4-) w ro # o v 3 D 4 a) rd a r4 E O v a) N a) al 10 a) 4 H a 41 0 W U) X v b C -ri Si 4 ?4 0 •ri ro v •r, ••1 U C a) o p A o N u U r1 A (A r•1 •,I m m A 3 v v ro JJ A 4J ro m 4J v V N .4 a) a) ro U v v 1-1 to rd C m 'd H i) •ri ri O) 4 .4 0 .4 •ri 4 w w a .J H v o U) *k ri v w v 4 •ri U A N •ri o ;j U) C ; A (1) •,1 4-1 i o i a) A l a) o (1) o rl 0 0 1) p rd ro O a w q v to m 0 4 4 3 !i 4 r O 3 Z ro O •ri U) O 3 X v rd o p v .u v o 441 •ri a .4 f. rd O ro -0 •.1 N U) H v -H 4J m a) .a) v r-I UI •n 11 E v (d m rl a A U ro •11 ~k 4-) v ro (d u N rd O A 41 d C 'd .4 X H A O ,h v O r H v (d N A N O C C 0 •ri )j O (n d, 4 o a) a) .4 S i) N U O O rd ri O 4-1 rd H 1i 11 •ri Cl O •.i D 5 U 0 u •ri a) P: U1 W H .u y, A W •rl A (D ri a) U) 41 U C N a s O M 1 U 4- ri 'd A-) 0 -1 X ri (a O ro a ro u U u d v • 1 W (d (d ro 4 > 3 U) ro v v a) 4 f-1 v m id U) C •ri W ro U) N H •4 rd 4j •n A U) O 41 rd v H .4 H O ff., H X H m O C o -ri o U a) (d r •a v O E O U •H O O O 4t: O ' W r4(1) o A }A C 440 3 W W -IM W E U i H a w •ri (1) 4J u 41 C7 C7 v C7 U C O 1) U I w v H v 4j 4) (d L) l o w o WA o o u a w v U) o }-1 w •5 U -i a w z m z w m a A si 0 Om HO 3 W a o w o o rd o rd w RS C •ri a •n v! 0.4 O W' O H P4 O P: C W v O O -1 6 H J_1 O H II W O z 3 ro si v (d C ?4 0 N O NN 0 v u o 0 0 a) a C H D 0 a )1 C A o 0 3 o S4 o Q H N J~ (d 4 O O a) O - H W H R: H v fl H rd E X (Cl U •ri v •ri N }i U) N O U) m m m U) O U) v •ri (d .4 .u is a •11 0 v V (f) w U) W H U) v W U) H F4 H J-) v u C A U) 11 0 •ri rn', H H H H ~k H WH ?~H"' ~Wf 0 ~ O U A O r OC) U U) CN3 Ou u 0 W 0 W 0 0 m 3 U 0 o .14-) ul 1 0 U A w , •11 a O a) 3 3 -H # •r1 o o rd A v C E ,4 rd o U) 41 •H r q .C (d 41 H r) C a 3 U) a) 1-1 •ri (d U si -11 ro v o v J~ i is w -ri w m }4 ,d rd v u v 4 '0 u a) 11 11 U 4 a) X 31 0 o O o (d C ro o .1, a C C C 0 N UO~DUUP4H"VUH 0 rd 4J N N M Ji/1 ~O 1~ ~ al N N J~ W H N M ~X N N ci N H N N N N N N N N N N N v o N N rn m ;I ZO U H ro l °u~ z° ID `i a 1 W IT H cn <n 0 C~7 0 11 H N v v (1) W (Ti N a) •r i 3 -H a i N a) 0 'n H A x ' 0) H W H U b O td U 11 u O b . Si r4 ~A H rd Il (D 0 (1) rc$ a C ~J ~Y i - 41 )4 C C f r 0 a rt U) v •l{ v o ro y, a v .w (a o 0 ( d 4 1 1 U •ri .C (L) A 3 v U A O A •rI -ri A-) U) li 3 A J~ 11 Ul X 11 U) $ w C v 1) N S4 O H - fd Si U) O In 'G v O o •r1 i) ?1 ro ?i a) ~1 0 W 01 J, m (d -ri •14 ro ? ro v 4 ro A a C 0 C 4:1 U) a) H H 5 m o A v 3 v v - i a) ro a a) 51, H 4j A •r1 5 r-1 (A Ai 3 N C rt o S4 0 rd 41 11 a) -r1 0 C •rl O 0 -ri k' )i U U) •,1 3 C -1 w (d C .4 v SI ri r (n •r1 (1) O U) a) 11 ro a) O .di v 11 ro O 1"J •rl H •r1 C U) x 44 n• v b •ri a 4 v U f ro D U a (d O A 0 C C -1 ro C W v N i S4 U) a f + > o m •ri 11 C O C rd w 11 v ry' a) 0) Si o rb -ri ri U) (d o ro C ro N W U) C v C v a) w 0 (d i) ,4 4 )-I U (n u O U) rd rl ,4 '4 a) O F.' ri A J, 41 a) O 11 A u C 4 rd o L' •ri v rd i) U) H s •ri V) 11 C a) o .u L) Id o 41 (d v 3 (D H o .1, 41 0 3 •rf 3 U v 4-) U) U) •r1 4 H d 0) o o u 4-j _H 4 N 3 d 0 10 v i E A" H O (d u v Si ro v ro ro ro v 0 ? u -1 u }4 C o N a) 4 .-1 v v 5 i u 4 ro (d v v v ri f~ sr o C a ~ ro ro i 3 + A ~A a r W C u z a o a A 41 •H •H N O rd (d -ri W •ri U) O O) C H 11 (a a) a) )4 v U rd v v U) to X 0 U) z ro v 5 U 4 O v 3 •rl i W a) A W C 0 a W ro O S1 a rl v W 41 o O u •ri O 3 U 0 A w w •ri x ri a w rD rd ro ,4 (n d r 41 U) a w •3 w 0 a) Ln w V (d (d a) m c4 A 10 z U 3 N v a) C 0 O a-1 41 S4 -r1 W 41 0 ro Z z N 0' A .4' rl o x U) (d 4 o z 4 FA 0 4 41 0 A JJ C A-1 41 N 'J, U 4 41 w O o O J-) 1) (d ~ U) v 0 IJ m x o ro a G 3 v o m x a s i a ) Q) 0 4) C C ~j a rJ i n C U) a) O O ,4 a a) b) O 0 •rl r4 H S-1 U) a D: X N 4 4 4 • f." C )1 U H w H W a) U) ro H -ri E O RJ v i) U O O ? C S_1 (d v ~ H S4 fy' -i aJ C -rl -rl Si a) O H N 3 rU O }i a n v a) O v rd H a) C (d O $ U U v rd (n S -1 U N Ul A U C (d O (a H v ) ru L) 41 O ro •11 U1 O O '0 • (d O U U •ri $ i) U ~ A 0 -H V H 4 N U U U) C (d 4 AJ v •rl v v v N U '1 U U) a) o 4 ~ !1 C :4 ri C A 3 •ri v •H X O1 0.) U a) u ~ w u v N v V 0 A ( ' d rn rd q C 3 o o U) a) rc$ 0 a a 4i S" SO1 C 0 rJ $ U! O •,1 !1 S-1 4 ro A A U O p, a', u N W H N M W N l0 L~ W o 1 o H N H N N M N d~ r1 ~ ri ~ ri h H OD ri a, N o N ri N N N M N d~ N ul N v C) G o v m ~ N ov H ro U) 0 (d £ OU1A 00 H ri a a~ ri o ~ U) 6 O ~ H ci q r } U O a) Q RS L 44 O 3 H td C O i 1 O S " .0 'd i7 F." c. H U) V u) d •-1 • O q m q q iJ o o y ' ' u o 3 o ro ro 0 4J A q 'o n o v 5 w o v 3 N. q U n. H Q) ro ? z) 0 0 a 0 0 10 H V o H u) C O a O n. O pa a) u! H H 0 7 CL •H ~J w G X rd U H O lJ AJ o C o ~d U) u) C u) q 44 o V ,C u N u q 3 u H O 4-1 u) 0) n. ro q a) H u C 7 u H 4a Ti iJ ri C ro u U! q rn ro 0 U N u m 'd r1 $ C q a) w ro C O 41 41 b a) ro b) C ~ -H u CL iJ U) 'n +J •rl •r-I u (v H u G' o qy FC E+ N q H a) H U v u) +J 41 m w N 10 A o u H H H A ro C H N aJ H N H q En ,G F 4 u u ~(7] fY. L 0 ul u) 3 iJ •,A H 44 ?i ro o M 0 Id ri O 3 O N rl ro H q H H q N 5, O (n m O O a) '4 d U a) N O u) rd U H W H U) •41 ~ 41 N FC O x ~ 3 H ~1 U H N rt U) z WW Id In to 44 N n. 4-3 H bl 0.01 P4 ia-l W G 1 r] ia-l FC H P~ (D A q v o- tJ U A W W U) (D rl 5 (D b) •fi H N ill iJ G •rl W C7 R,' ~ 1-1 W O 6 ro w a) W - W W 2 a) W o H rl m W s-, H b7 F4' W G z O H (n J O 3 O q o z O H cn 0 - o H 4 w 7 . O H U) U q H W O lJ q ~ H q O q o o ~ - , O H c lJ q F' H a) q G •rf b) H , W a W o - o r q o x U) H r) rl P'. cn H 0.'i i td cn H5 ? q A b, 0 U iJ f1. m x co H ~ G A (d A q k, zHz W v, O A C (d E N n W 0 i o H ] W 0 u H 0 0 Q x U 7 ro U U q C U H o W O a r-C q U G U .11 JJ 3 q q u `U H )d rJ U H H r A o (o -H -li H a a) a) u 5 ~j ~ o 1 iJ u) ;J O N •ri q )-I q .,1 n. 4JJ U C rA N ;J V aJ U) 4a H q 3 V G q q q •,1 m 0 q H N .H A H H 27 -.4 V H C r1 lJ o q cd (o q a) C m 0 U a) FD O u H •,1 H W Q) u) O U ri U a) >1 1-) 'r v O u O q o J-: o q N ~ N m o U H td En 41 H ro U) o41 H H Z H a d~ O vi C7 3k En E O iJ H -i N rl N M d~ ul ~n h ro al O ~ N M d~ vl to h W T O H N M d~ vl H .i H H ri H N H H N N N N N N N ~pW N OF tos os COUNCIL AGENDA REPORT DATE: AUGUST 13, 2009 MEETING DATE: 10/19/09 ITEM NO: r TO: MAYOR AND TOWN COUNCIL FROM: GREG LARSON TOWN MANAGER G SUBJECT: TOW CONTRACT SERVICES A. INTRODUCE AN ORDINANCE AMENDING TOWN CODE SECTION 28.30.030 AND 28.30.035 TO ELIMINATE POLICE ROTATION TOWS B. APPROVE A RESOLUTION AUTHORIZING THE TOWN MANAGER TO NEGOTIATE AND EXECUTE A CONTRACT WITH SOUTH BAY TOWING TO PROVIDE TOWING SERVICES FOR POLICE INITIATED TOWS RECOMMENDATION: 1. Take public comment 2. Direct Cleric to read title of proposed ordinance (Attachment 1) (No Motion Required) 3. Motion and vote to waive reading of text (Motion Required) 4. Motion to introduce ordinance (Attachment 1) (Motion Required) 5. Direct Cleric Administrator to publish notice (No Motion Required) 6. Adopt the resolution of the Town of Los Gatos authorizing the Town Manager to execute a contract with South Bay Towing to provide towing services for police initiated tows (Attachment 2) (Motion Required) BACKGROUND: Town Code section 28.30.030 establishes a rotation system for police initiated tows of vehicles and directs that the police chief maintain a list of tow operators to call to move and store motor vehicles in accident, arrest, disabled vehicle and similar cases. Staff propose to contract with a single tow company for police initiated tows and no longer utilize a rotation tow system. The Town Code must be amended to eliminate the requirement that a rotation system be utilized. DISCI J0,STON- The current tow rotation list is comprised of five local tow companies. A request for a tow initiated by the police department either for its own purposes or on behalf of a motorist who otherwise has no preference for a specific tow company is given to one of the five companies on a rotation basis. PREPARED BY: SCOTT R. SEAMAN, CHIEF OF POLICE V66 ,1~~ q ~c~... C:\DOCUME-I\ISHRIE-I.LOS\LOCALS-I\Temp\XPgrpwise\Tow Franchise Resolution Council Memo.doc LIA Assistant Town Manager Town Attorney Reviewed by: Clerk Administrator Finance ommunity Development PAGE 2 MAYOR AND TOWN COUNCIL SUBJECT: TOW CONTRACT SERVICES OCTOBER 19, 2009 The Town Code requires that each company meet established standards for response time, facilities and licensing, among other requirements. No fee is collected by the Town from a tow company responding to a police initiated tow request. While this system has worked well for the department and the public, staff has considered a different model for tow services wherein the Town would contract with a single tow company to handle police initiated tows for an established fee to the Town. This model is similar to that utilized in San Jose and other cities in California. In San Jose, individual tow companies are contracted to provide service within an established zone. The City of San Jose charges $50 per car towed for this contract. Benefits of this model include consistency of service within the contract area, close access to the tow yard for the owners of towed vehicles and revenue to the jurisdiction. Staff surveyed all California police departments and determined that a number of police departments utilize either this or a similar model. The department uses towing services for police initiated tows approximately 350 times per year. The towing of cars initiated by a police department can be managed through several means. Rotational tow systems distribute towing business to a range of established towing companies, most commonly without any revenue to the municipality. Municipalities have the ability to establish a towing function within their service provision model and perform their own towing for police initiated tows with the ability to collect all fees and charges associated with the towing, storage and release of the vehicle. A third option is to contract for this service with an established business. While the creation of a towing function is within the authority and ability of municipalities, staff believes that it makes sense to instead contract for this service with an established business. The five tow companies in the current rotation system are: Bob's Towing, Dick's Towing, Lima Towing, South Bay Towing and Courtesy Tow Service. South Bay Towing and Courtesy Tow Service are owned by the same person and for the purposes of this issue are considered by staff as one company. South Bay Towing/Courtesy Tow Service is the only tow company that is based in Los Gatos at 615 University Avenue. The other companies are located in Campbell. In early 2009, the Town and the police department were approached by the owner of South Bay Towing/Courtesy Tow Service and asked to consider creating a single vendor agreement. Under such an agreement, the contractor would have exclusive right to police initiated tows for a specified period of time; five years is currently being considered. This agreement gives the contractor a degree of revenue certainty which would allow them to make capital investments in facilities and equipment to maintain and improve services. As proposed, South Bay Towing would be the actual contractor and the Town would receive revenue of $50 for every vehicle which is towed under the agreement. Town purchasing guidelines direct the Town Manager or designee, acting as Purchasing Agent, to `give preference to merchants whose place of business is located within the Town limits, quality and price being equal' (Town Code Section 2.50.115). Such preference applied in the case of a tow contract would provide direct benefit to residents and visitors whose car has been towed by having them travel only to a location in Los Gatos to pick up their car, as opposed to tow locations located outside the Town. The Town Code currently specifies that the police department will establish and utilize a rotation system for police initiated tows. The attached ordinance amends the Town Code rescinding the rotation system. PAGE 3 MAYOR AND TOWN COUNCIL SUBJECT: TOW CONTRACT SERVICES OCTOBER 19, 2009 If the ordinance is introduced by council, the ordinance will return to council at the next meeting. The Town Manager would then be authorized to execute an agreement with South Bay Towing to provide towing services for police initiated tows for a five year period. CONCLUSION: Staff recommends adoption of the resolution rescinding rotation tows. If adopted, staff would negotiate, and the Town Manager would execute, an agreement with South Bay Towing to provide contract towing services for police initiated tows. ENVIRONMENTAL ASSESSMENT: Is not a project defined under CEQA, and no further action is required. FISCAL IMPACT: A franchise agreement would be expected to increase revenues to the Town in the amount of $17,000 per year. This is based upon an estimated 350 police initiated tows each generating a $50 fee. The FY 09/10 budget contains anticipated revenues from a tow franchise agreement within the police department budget in this amount. Attachments: 1) Ordinance 2) Resolution Distribution: Bob Coen South Bay Towing Courtesy Towing 615 University Ave. Los Gatos, CA Ata Nayebzedeh Bob's Towing 70 Cristich Ln, Campbell, CA Steve Sgarlato Dick's Towing 888 Camden Ave. Campbell, CA Paul and Lupe Lima Lima Towing 180 E. Sunnyoaks Ave. Campbell, CA ORDINANCE ORDINANCE OF THE TOWN OF LOS GATOS AMENDING DIVISION 1 OF ARTICLE III OF CHAPTER 28 OF THE LOS GATOS TOWN CODE REGARDING POLICE-INITIATED TOW SERVICES WHEREAS, Los Gatos Town Code section 28.30.030 requires the Chief of Police to maintain a list of tow operators to call to move and store motor vehicles in accident, arrest, disabled vehicle and similar cases; and WHEREAS, Los Gatos Town Code section 28.30.035 authorizes the Chief of Police to impose more stringent operating standards for tow operators included on the rotation list required pursuant to section 28.30.030; and WHEREAS, the Town may at its option provide its own tow services for police-initiated tows or contract with private contractors to provide such services; and WHEREAS, the Town Council desires to authorize the Town Manager to enter into one or more contracts to provide police-initiated tow services and to repeal the rotation list required by Town Code sections 28.30.030 and 28.30.035. THE TOWN COUNCIL OF THE TOWN OF LOS GATOS ORDAINS AS FOLLOWS: SECTION I. Division 1 of Article III of Chapter 28 of the Los Gatos Town Code is amended by repealing sections 28.30.030 and 28.30.035 in their entirety and reserving said section numbers. SECTION II In the event that any part of this ordinance is held to be invalid, the invalid part or parts shall be severed from the remaining portions which shall remain in full force and effect. SECTION III This Ordinance takes effect 30 days after the date it is adopted. This Ordinance was introduced at a regular meeting of the Town Council of the Town of Los Gatos on 2009, and adopted by the following vote as and Ordinance of the Town of Los Gatos at a regular meeting of the Town Council on , 2009. COUNCIL MEMBERS: AYES: NAYS: ABSENT: ABSTAIN: ATTEST: CLERK OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA SIGNED: MAYOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA NAMGR\AdrainWorkFiles\2009 Council Reports\No Tow Rotation Ordinance 10-19-09.doc ATTACHMENT 1 RESOLUTION RESOLUTION OF THE TOWN OF LOS GATOS AUTHORIZING THE TOWN MANAGER TO NEGOTIATE AND EXECUTE A CONTRACT WITH SOUTH BAY TOWING TO PROVIDE TOWING SERVICES FOR POLICE INITIATED TOWS WHEREAS, it is necessary for the Town Council to secure an agreement with a towing company to provide towing services; and WHEREAS, the Town has selected,South Bay Towing to provide towing services. RESOLVED, by the Town Council of the Town of Los Gatos, County of Santa Clara, State of California, that the Town Manager is authorized to negotiate and execute an agreement with South Bay Towing to provide towing services for Police initiated tows for a period of five years. PASSED AND ADOPTED at a regular meeting of the Town Council of the Town of Los Gatos, California, held on the day of , 2009 by the following vote: COUNCIL MEMBERS: AYES: NAYS: ABSENT: ABSTAIN: SIGNED: MAYOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA ATTEST: CLERK ADMINISTRATOR LOS GATOS, CALIFORNIA NAMGR\AdminWorkFi1es\2009 Council Report0outh Bay Towing Resolution 10-19-09.doc ATTACHMENT 2 to;N0,t MEETING DATE: 10/19/09 ITEM NO: f / ~U~,,,,,,,,I ~k I gas-cat~~ COUNCIL/AGENCY AGENDA REPORT DATE: OCTOBER 19, 2009 TO: MAYOR AND TOWN COUNCIL/ CHAIR AND MEMBERS OF THE REDEVELOPMENT AGENCY FROM: GREG LARSON, TOWN MANAGER/EXECUTIVE DIRECTOR SUBJECT: FISCAL YEAR 2009/10 FIRST QUARTER BUDGET PERFORMANCE AND STATUS REPORT FOR THE PERIOD JULY 1, 2009 - SEPTEMBER 30, 2009 A. ACCEPT 2009/10 FIRST QUARTER BUDGET PERFORMANCE STATUS REPORT B. AUTHORIZE BUDGET ADJUSTMENTS AS RECOMMENDED IN THE ATTACHED FIRST QUARTER BUDGET PERFORMANCE REPORT. RECOMMENDATION: 1. Accept Fiscal Year 2009/10 First Quarter Budget Performance and Status Report. 2. Authorize budget adjustments as recommended in the attached First Quarter Budget Performance report. PURPOSE: The purpose of this report has three primary goals. First, the report informs the Town Council on the status of the Town's Fiscal Year 2009/10 Adopted Budget and status of the local economy at the first quarter. Second, staff provides the Town Council an update on the preliminary General Fund financial results (unaudited) as of June 30, 2009. Third, the report includes an update on the state budget's impact to the Town and Redevelopment Agency, and staff's most recommended budget adjustments for FY 2009/10 as of the first quarter. BACKGROUND: The attached Budget Performance Report covers the first three months of the fiscal year beginning July 1, 2009 and ending September 30, 2009. The report presents analysis and recommendations related to key General Fund revenues by category and expenditures by fund. .f f / ar r PREPARED BY: STEP>FI N' CO AY Finance and Admi> Ysttrative Services Director N:T1NANCE\Qtr1y Financial Reports\FY 2010\Ist Qtr\10-19-09 1st Qtr Budget Report.doe Reviewed by: Assistant Town Manager/Deputy Director Town Attorney/General Counsel Clerk Administrator/Secretary Finance Community Development PAGE 2 MAYOR AND TOWN COUNCIL/CHAIR AND MEMBERS OF THE REDEVELOPMENT AGENCY SUBJECT: FISCAL YEAR 2009/10 FIRST QUARTER BUDGET PERFORMANCE AND STATUS REPORT FOR THE PERIOD JULY 1, 2009 - SEPTEMBER 30, 2009. OCTOBER 14,2009i : Staff provides to Town Council periodic updates on the status of the current year's adopted budget revenues and expenditures and the projected financial condition of Town funds, concentrating on the Town's General Fund. Though financial results are limited to the first three months, staff is able to provide an update based on early revenue trends for the current fiscal year, and to advise on potential fixture revenue and expenditure challenges which may materialize during the fiscal year. DISCUSSION: The attached first quarter budget report includes a recap (prior to final audit) of last year's General Fund fiscal results. The General Fund closed FY 2008/09 with a moderate amount of revenue over expenditures, primarily from budget savings, cost containment strategies and property tax revenues exceeding earlier estimates. These dollars (approximately $525K) at year end are available to aid in addressing revenue shortfalls this fiscal year, and/or to supplement the limited dollars set aside in the General Fund for capital improvements. State Budget Impacts: Upon passage of the State's FY 2009/10 budget, two major takes from the Town and the Redevelopment Agency were approved by state lawmakers. The State proposes to take in the form of a loan approximately $980,000 of the Town's local property tax. The enabling legislation provides a mechanism referred to as Prop 1A Securitization, wherein the Town can sell its property tax state loan and receive full payment in kind through the securitization proceeds of the amount borrowed. If the securitization is successful, no fiscal impact is expected to the Town. A separate item authorizing staff to proceed with the securitization is part of the October 191h 2009 Council Agenda. The State also proposes to take approximately $2.7 million ($2.2 million in 09/10 and $0.5 million in 10/11) from the Town's Redevelopment Agency. Similar to the take attempted by the State in FY 2008/09, which was found to be unconstitutional, the California Redevelopment Association believes this take will also be found unconstitutional and unenforceable. The CRA intends on filing a lawsuit this year and staff has assisted the CRA in that effort by providing information about the Agency's project area. Once the lawsuit has been filed, more news about the status of the lawsuit and the state "take" may be available during the spring FY 2010/11 budget development. In the meantime, staff will include the "take" in its mid-year budget adjustments, if necessary. There has also been concern that the Town's COP'S Grant monies ($200K) are also vulnerable due to state budget problems. Staff is monitoring this item very closely, and support for the program is being communicated strongly to the legislature by the various groups including the California Police Chiefs Association. There is also increased certainty with this revenue source due to a linkage with the vehicle license fees. No action or budget change is recommended at this time. Other small local government program funding (e.g.certain state mandate PAGE 3 MAYOR AND TOWN COUNCIL/CHAIR AND MEMBERS OF THE REDEVELOPMENT AGENCY SUBJECT: FISCAL YEAR 2009/10 FIRST QUARTER BUDGET PERFORMANCE AND STATUS REPORT FOR THE PERIOD JULY 1, 2009 - SEPTEMBER 30, 2009. OCTOBER 14, 2009 reimbursements) has also been reduced or eliminated; those revenue changes will be quantified. at the mid-year budget review. CONCLUSION: Despite a severe recession, the state budget crisis, and a troubled real estate market, the Town continues to manage effectively through the current fiscal challenges. Shortfalls were dealt with, priority services maintained, and General Fund contingency reserves are preserved. Key goals are to minimize the impact on Town services, maintain the community's quality of life, and remain a competitive employer while sustaining the Town's fiscal health. FORMAT OF THE REPORT The attached Budget Performance Report includes a financial overview comprised of. a brief discussion of the Town's financial condition; the FY 2009/10 financial outlook; a summary of the performance of the Town's primary General Fund revenue sources and necessary budget adjustments. ENVIRONMENTAL ASSESSMENT: This budget report is not a project defined under CEQA, and no further action is required. FISCAL IMPACT: The attached First Quarter Budget Performance Report: includes a section providing a detailed list of recommended expenditure and revenue budget adjustments recommended for the first quarter of FY 2009/10. Upon approval of the recommended budget adjustments by Town Council, the adopted appropriations for the fiscal year will be adjusted accordingly. Attaclunent: Budget Perfonnance Report for the Three Months Ended September 30, 2009 TOWN OF LOS GATOS BUDGET PERFORMANCE REPORT FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2009 October 19, 2009 FINANCIAL OVERVIEW - EXECUTIVE SUMMARY Status of FY 2009/10 Adopted Budget: First Quarter revenue trends are mixed. Staff was pleased that the Town's property tax receipts for the year ending June 30, 2009 achieved an approximate 6°l growth rate from the prior year in a very tough real estate environment. Despite the worst national recession in seven years, and the loss in recent years of five automobile dealerships that were in the top ten sales tax providers, sales tax receipts for the first quarter are trending slightly ahead of collections for the prior year. The chief reasons for this are the continued success of Netflix and a state "true-up" payment relating to an underpayment of sales tax based on state estimates the prior fiscal year. Despite this favorable trend, the Town's sales tax revenue of $8.7 million may need to be lowered by approximately $300 to $500K at the mid-year budget review due to the loss of one car dealership six months earlier than planned in the financial estimates and the general effect of the recession across all sectors of the local economy. Department expenditure totals for the first quarter FY 2009/10 are also trending favorably, with departmental spending at the end of the first quarter averaging 21% o expended, or 4% below the 25% benchmark level used for 3 months of 12 months operations. With only three months of data available, it is difficult to predict revenues and expenditures for the whole year. The uncertainty of the economic effects of potential rises in energy costs or a more dramatic downturn in the local real estate market may impact consumer behavior. In light of this uncertainty and being fully aware that the local economy's recovery remains vulnerable, staff continues to be cautiously optimistic while monitoring fiscal developments very closely. Consequently, further adjustments may be necessary during the fiscal year. Any mid-year course corrections or budget adjustments necessary to balance operating revenue and expenditures will be brought to Town Council's attention at the earliest opportunity. Prior Fiscal Year Closing Results: The FY 2008/09 closing financial results continue to affirm the positive effects of the Town's budgetary actions taken in response to the continuing flat revenue growth or downturns in key operating revenues the Town experienced since FY 2001/02. In developing the FY 2008/09 "status quo" budget, Town Council approved a combination of budgetary initiatives that held the line on service level delivery coupled with revenue adjustments in the Town's "Charges for Services" category. The bulk of these fees are to recover costs related to private development activity aligning fees charged for services with the current cost incurred by the Town. This strategy coupled with the effect of Town-wide expenditure reduction strategies continued from prior years and other revenue gains like continued strong performance by Netflix sales tax generated a favorable General Fund closing balance of approximately $525K of available revenues over expenditures at fiscal year end June 30, 2009. The Town's General Fund reserves closed the year (unaudited) at a total of approximately $22.7 million (including the Town's Reserve for Economic Uncertainty intact at $3,678,000), compared to $17.1 million balance upon the close of the prior year, an increase of approximately $5.6M in total General Fund reserves. This large increase comes primarily from the receipt of the sale of Town land in Vasona park for $6 million, all of which was in a designated reserve at June 30, 2009. The following factors led to the $525K from FY 2008/09 savings to be available for the Town's Revenue Stabilization Reserve and Reserve for Future and Special Projects: • Property tax revenue final collections exceeded mid-year estimates by approximately $600K due primarily to stronger than expected real estate assessed values and property turnover. • Sales tax estimates exceeded FY 2008/09 mid-year estimates by approximately $300K due primarily to stronger performance by Netflix than staff's estimates. • Investment earnings exceeded mid-year estimates by approximately $416,000 largely due to increases in the overall interest yield market. • These revenue gains were offset by plan check and building permit fees which were approximately $550K below estimates made at inid-year FY2008/09. Revenues collected last year for work to be performed in this fiscal year were recorded as unearned revenue, earmarked as such in the General Fund, and accordingly were not included in the determination of revenues available for reserve designation at fiscal year end. • General fund expenditures were approximately $1.8 million FY 2008/09 below adjusted budget levels, due primarily to salary and benefit savings ($1.1 million) obtained from hiring freezes, reorganizations and other successful cost containment strategies. In each fiscal year it is likely that the Town's cost of services will be impacted by potential or pre-bargained labor and benefit cost increases and other operating expenditure increases. It is reasonable to anticipate these costs to trend upward in the future for no other reason than inflationary pressures. This reality will continue to require strong performance in the Town's economically-sensitive revenues. to offset the cost increases likely to occur. The Town's efforts over the past five years, including expenditure reductions, alignment of user fees to cost of service delivery, operational reviews and service level adjustments, along with ongoing efficiency efforts, have allowed the Town's revenue base to keep pace with the cost of providing services and provide funding for much needed capital improvements such as road resurfacing, sidewalk repairs, retaining walls, and trail and park facility refurbishments. General Fund Reserve Status - June 30, 2009 General Fund reserves are classified into two categories - Restricted and Designated. Restricted reserves are those which are restricted in use by accounting standards or legal agreements and are not considered as available for use for another purpose. Designated reserves are established by Council policy for an intended purpose. Currently Restricted Reserves in the General Fund are approximately $2.1 million as presented below. Restricted General Fund Reserves: Amount (Millions) Reserved for RDA Loan $ 1.5 Reserved for LT Notes Receivable 0 6 Total Restricted 'General Fund Reserves $ 2.1 As stated earlier the total General Fund Reserves closed at a balance of approximately $22.7 million at June 30, 2009. In addition to the approximate $2.1 million of General Fund Reserves set aside for restricted purposes, the Town has approximately $20.6 million in designated reserves established in accordance with Town financial policies and operating and capital budget requirements. Designated Reserves: `Amount (Millions) Vasona Land Sale $ 6.1 Designated for Revenue Stabilization 4.6 Designated for Economic Uncertainty 3.7 Designated for Capital & Special Projects 3.7. Market Fluctuations 0.8 Designated for Open Space 0.6 Retiree Medical Acturial 0.4 Sustainability Reserve 0.2 Designated for Mgrs Contingency & Prod. 0.2 YE Savings Budget Adjustments 0.2 Designated for Authorized Carryforwards 0.1 Total iJesgnated Reserves $ 20.6 The Reserve for Capital and Special projects, whose source is derived from half of the annual available General Fund budget savings, serves as the primary source for replenishment to the Town's Capital Improvement Fund (GFAR) in addition to the budgeted transfer from the General Fund ($850,000 in FY 09/10). As such, it represents the source fora large number of unfunded needs identified during the annual capital improvement plan process. This reserve also functions as a potential funding source for new capital projects or augmentations to authorized projects funded through the Town's Five Year Capital Improvement Program (CIP). The Town continues to be challenged in identifying an ongoing source of funds to meet the annual $1.5 million recommended for the street repair and maintenance program and other priority infrastructure improvements such as sidewalk repair and replacement. The Revenue Stabilization Reserve was established to serve as a transitional or "bridge" ftinding source that could be used to mitigate or smooth out cyclical ups and downs in locally generated revenues due to temporary downturns in the local economy or "one-time" revenue losses where recovery of the revenue base is deemed likely to be restored in the near future. 3 tr1 its public communications, staff refers to the $20.1 million in Designated General Fund reserves as the Town's "reserves" since these are established by Council policy for their intended purpose. The availability of approximately $20.1 million in Designated General Fund reserves provides the Town with resources to manage through future fiscal challenges and opportunities, mindful of the many competing priorities for resource allocation, ranging from restoration of core services to the community to a large amount of unfunded capital improvements. GENERAL FUND - KEY REVENUE ANALYSIS FY 2,009/10 The following provides the status of significant General Fund revenue sources as of the first quarter ending September 30, 2009. Staff monitors each revenue source closely and at this time recommends certain revenue adjustments based on revenue actuals or state budget actions. Adjustments necessary (if any) will be brought forward to Town Council for approval at mid-year (approximately February 2010), when more revenue data is available. BUDGET PERFORMANCE REPORT FY 2009/10 ♦ Sales Tax Revenue Description The State Board of Equalization, with the implementation of the "triple flip," now allocates .75 cents of the 8.25 cents of local sales tax collected by merchants on retail sales and taxable services transacted within the Town of Los Gatos. This .25 cents of local sales tax is being replaced by the state with an equal amount of property tax. Revenues are remitted to the Town on a monthly basis. This revenue is placed in the General Fund for unrestricted uses. Analysis According to a recent update from Muni Services, the Town's sales tax analysis consultant, a majority of jurisdictions across California experienced significant declines in sales tax revenues, averaging 8.2% statewide in early 2009. The Town's decline is approximately 6.4% for the same time period, which is slightly better than the statewide average The UCLA Anderson Forecast for the California economy concludes that the worst recession in seven decades likely ended in third calendar quarter of 2009, but it expects the negative impact of the downturn will last well into the next decade. With the closure of five auto dealerships in recent years that were "top ten sales tax" generators, the fact that sales tax collections are down only moderately from the prior year's pace is encouraging. The continued success of Netflix has prevented a more dramatic decline in sales tax, but staff believes that at mid-year, it may have to adjust sales tax for 2009/10 downwards by approximately $300K to $500K in 2009/10, based upon Muni Services "most likely" projection and some other factors whose outcome is unknown at this time. As always, diversification of the revenue base continues to be a goal for this revenue category. The Town continues to seek more balance in business sectors that generate sales tax. Quarterly and Annual Revenues 5-Year History $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 ® l st Quarter j Actual Revenues i ❑ Fiscal Year Total; Actual Revenues' i ® Fiscal Year Budgeted Revenues FY 05/06 FY 06/07 FY 07/08 FY 08/09 lst Quarter Actual Revenues $ 1,392,150 $ 1,407,997 $ 1,568,505 $ 1,508,479 Fiscal Year Total Actual Revenues $ 8,655,565 $ 9,253,891 $ 9,345,432 $ 8,487,000 Fiscal Year Budgeted Revenues FY 1004105forward will reflect the Sales Tax In Lieu paid by Santa Clara County FY 09/10 $ 1,672,973 $ 8,677,460 Ist Quarter Percent of Total 16.08% 15.22% 16.79% 17.77% 19.28% Recommended Budget Revision No Change * Includes a trite-up front FY 08109 5 FY 05/06 FY 06/07 FY 07/08 FY 08/09 FY 09/10 BUDGET PERFORMANCE REPORT FY 2009/10 Property Tax Revenue 1 Description Property Tax is one of the Town's largest revenue sources, accounting for 21.8% of the Town's budgeted General Fund revenue for FY 2008/09. Property Tax distributions are largely received in the third and fourth quarters of the fiscal year, meaning revenue receipts are not reflected proportionately by quarter in the chart below. Property Tax is levied at 1 % of a property's assessed value, of which the Town currently receives approximately 9.5 cents on each dollar paid to the County Assessor's Office. The assessed value of real property appraised by the County Assessor is the 1975-76 assessment role value, adjusted by a two percent inflation factor thereafter. However, when property changes hands or new construction occurs, property is reassessed at its current market value. Real property values critically impact revenues. With the passage of Proposition 13, voters in California limited the tax rate that can be imposed by the Town on property. With the limitation on rates, the higher the aggregate property value, the higher the revenue generated. Analysis Property taxes performed better than expected in FY 2008/09 (approximately 6% increase from the prior year) which was budgeted for flat revenue growth. 2009/10 property tax was budgeted at a minimal growth, but is below the amount received the prior year, so it may need to be adjusted positively at mid-year. The Santa Clara County Assessor's 2010/11 roll for July 1, 2010 lien date indicates a 2.09 % growth in total assessed value for the Town. Los Gatos is in the top four of the cities, in the county still anticipating positive assessed valuation growth for FY 2009/10. Quarterly and Annual Revenues 5-Year History $10,000,000 $8,000;000 $6,000,000 $4;000,000 $2,000,000 Il st Quarter Actual Revenues i i 0 Fiscal Year Total Actual Revenues ® Fiscal Year Budgeted Revenues FY 05/06 FY 06/07 FY 07/08 FY 08/09 1st Quarter Actual Revenues $ 105,271 $ 75,831 $ 138,916 $ 91,597 Fiscal Year Total Actual Revenues $ 7,755,200 $ 8,584,612 $ 9,178,869 $ 9,724,070 Fiscal Year Budgeted Revenues FY 2004/05 forward will reflect an increase in Property Tax due to "Perotattent" Realignment of VLF Ist Quarter Percent of Total FY 09/10 $ 65,628 $ 9,248,120 1.36% 0.88% 1.51% 0.94% 0.71% Recommended Budget Revision No Change FY 05/06 FY 06/07 FY 07/08 FY 08/09 FY 09/10 BUDGET PERFORMANCE REPORT FY 2009/10 ♦ Transient Occupancy Twc Description The Town of Los Gatos levies a 10 per cent Transient Occupancy Tax on all hotel/hotel rooms within Town limits as a method to help fiend Town services provided to transitory lodgers. Analysis The Transient Occupancy Tax revenues received in the first quarter of FY 2009/10 reflect a decrease in collections compared to the prior year. This year the State of California is projecting flat growth in domestic and international visitation compared to the prior year. The California Travel & Tourism Commission reports for the period ending June 30, 2009 that domestic travel spending statewide was approximately $79.2 billion, compared to its forecast of approximately $79.3 billion. Due to the lower than expected first quarter collections, staff may advise a change in estimate for 2009/10 at the Town's mid-year budget review. Quarterly and Annual Revenues 5-Year History $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 111 st Quarter Actual i Revenues O Fiscal Year Total Actual Revenues i ® Fiscal Year Total Budgeted Revenues FY 05/06 FY 06/07 FY 07/08 FY 08/09 FY 09/10 1st Quarter Actual Revenues $ 107,529 $ 116,118 $ 90,367 $ 134,569 $ 99,179 Fiscal Year Total Actual Revenues $ 1,028,664 $ 1,108 257 $ 1,245,078 $ 966,638 Fiscal Year Total Budgeted Revenues $ 1,080,000 Ist Quarter Revenue Percent of Total 10.45% 10.48% 7.26% 13.92% 9.18% Recommended Budget Revision No Change 7 FY 05/06 FY 06/07 FY 07/08 FY 08/09 FY 09/10 BUDGET PERFORMANCE REPORT FY 2009/10 9 Interest Income Revenue 1 Description The Town earns Interest Income revenue by investing cash not immediately required for daily operations in a number of money market instruments. These investments are made within parameters as stated in the Investment Policy approved by the Town Council. The Town's goal is to achieve a competitive rate of return while protecting the safety of those funds. Interest Income revenue for the Town is primarily dependent upon two factors: the cash balance in,the Town's investment portfolio, and the yield on those funds. Analysis The Town's Interest Income earning has been impacted this fiscal year years by use of Town funds to make significant investments in Town infrastructure, most notably the purchase of land downtown, among other infrastructure investments made in carrying out the Town's approved capital improvements plan. Current year interest revenues are tracking below budget estimates due to historical low yields available in the market. Actual LAIF yields have declined significantly to an average yield of 0.75% in September 2009 (a new record low), from 4.801% as recently as December 2007. Despite very low yields available in the market, with the receipt of property tax in the second quarter, more average dollar balances will be available for investment. Staff recommends no adjustment to budgeted revenues at this time. Quarterly and Annual Revenues 5-Year History $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 r ® I st Quarter Actual Revenues O Fiscal Year Revenues ® Fiscal Year Total Budgeted Revenues FY 05/06 FY 06/07 FY 07/08 FY 08/09 FY 09/10 1st Quarter Actual Revenues $ 272,325 $ 489,730 $ 562,339 $ 461,985 $ 210,301 Fiscal Year Revenues $ 1,439,685 $ 1,977,233 $ 2,221,338 $ 1,627,727 Fiscal Year Total Budgeted Revenues $ 1,430,000 1 st Quarter Revenue Percent of Total 18.9% 24.8% 25.3% 28.4% 14.7% Recommended Budget Revision No Change * Estimated 8 FY 05/06 FY 06/07 FY 07/08 FY 08/09 FY 09/10 BUDGET PERFORMANCE REPORT FY 2009/10 ♦ Business License Tar Revenue Descri Lon The Town of Los Gatos requires businesses to obtain a business license if a business is located within Town limits, or if an agent of a business conducts operations within Town limits. The Business License Tax is based on the type of business activity. Activities such as retail sales, wholesale, and manufacturing are based on estimated gross receipts, on a sliding scale, and comprise approximately 40% of the Business License Tax revenue, Other Business License Tax revenues are based on flat fees as set forth in the Town Code, and make up the remaining 60% of revenue. Annual business license renewals are due and payable in advance on January 2nd of each year. New business license applications for flat-fee based businesses are pro-rated by quarter, from the date of application to the end of the year. Analysis The Business License Tax revenue received in the first quarter is primarily comprised of new Business License fees. The majority of revenues come from renewals, which are received in the second and third quarters. The actual first quarter collections are trending positively in comparison to prior years due to some significant collections on amounts past due from various businesses either that were unlicensed and or had become delinquent in payments. Because of this success, staff intends on conducting additional audit efforts again this fiscal year. Quarterly and Annual Revenues 5-Year History 1,200,000 1,000,000 800,000 600,000 400,000 200,000 I st Quarter Actual Revenues Fiscal Year Total Actual Revenues Fiscal Year Total Budgeted Revenues Ist Quarter Revenue Percent of Total IN 1st Quarter Actual Revenues ❑ Fiscal Year Total Actual Revenues ® Fiscal Year Total Budgeted Revenues FY 05/06 FY 06/07 FY 07/03 FY 08/09 FY 09/10 42,402 63,057 55,900 65,330 99,179 1,019,386 S 1,176,422 8 1,138,057 $ 1,139,107 $ 1,030,000 4.16% 5.36% 4.91% 5.78% 9.13% Recommended Budget Revision No Change 9 FY 05/06 FY 06/07 FY 07/08 FY 08/09 FY 09/10 BUDGET PERFORMANCE REPORT FY 2009/10 , Description Franchise Fee achieving 11.75%0 of budget versus 11.87% of budget collected at the first quarter in FY 2008/09. With the transition in the spring of 2007 to the new garbage contract, the franchise fees were established at 16%. The prior contract provided for a 10%o franchise fee and approximately $300,000 in annual surcharge fees for solid waste program expenses. The new contract increases the franchise fees but eliminated the solid waste surcharge fees. Franchise Fees are collected by the Town for the privilege of operating a utility service within Town limits, and as a fee in lieu of business license tax. Franchise Fees are currently received from Comcast for cable television services, PG&E for gas and electric service, and West Valley Collection and Recycling for solid waste collection services. Analysis First quarter results are pacing slightly behind the percentage collected the prior year, $2,000,000 $1,500,000 $1,000,000 $500,000 I st Quarter Actual Revenues Fiscal Year Total Actual Revenues Fiscal Year Total Budgeted Revenues FY2007108 Total Actual Revenues 1 st Quarter Revenue Percent of Total Staff recommends no change to this revenue source. Quarterly and Annual Revenues 5=Year History FY 05/06 $ 22,702 $ 1,030,189 •eflect increased revere 2.20% FY 06/07 $ 28,661 $ .1,162,037 rre based on inc 2.47% FY 07/08 $ 215,985 $ 1,659,829 Pease of Garba 13.01% ® 1st Quarter Actual Revenues i O Fiscal Year Total Actual Revenues 11 Fiscal Year Total Budgeted Revenues FY 08/09 $ 196,630 $ 1,656,100 ;e Franchise A 11.87% FY 09/10 $ 198,499 $ 1,689,260 ;reenrent 11.75% Recommended Budget Revision No Change 10 FY 05/06 FY 06/07 FY 07/08 FY 08/09 FY 09/10 Budget adjustments are reconunended for the following revenues and expenditures at the fist quarter as described below: RECOMMENDED BUDGET ADJUSTMENTS General hund Revenues JAG Grant (including Interest) Other Fund Revenues GFAR Pollard Crosswalk Project from El Camino Hospital Blosssom Hill/University Undergrounding Project- transfer to GFAR Grant Funds Transportation Development Sidewalks Grant Funded - from ARRA Cei►cral I and Expenditures Art in the Council Chambers Receptions JAG Grant + Interest Other Funds Expenditures GFAR Pollard Crosswalk Project Blosssom Hill/University Undergrounding Project Utility Undergroundung Fund Utility Undergrounding Fund - transfer to GFAR Grant Funded Rebuild Together Silicon Valley - reallocate fi-om CDBG Mitchell Avenue Sidewalks from Transportation Development Act Prospect Avenue Resurfacing Storm Drain #1 Hernandez Ave Stoini Drain Pipe Replacement Equipment Replacement Fund Urban Runoff Equipment $ 14,100 15,620 23,260 28,000 102,000 $ 500 14,100 15,620 23,260 23,260 5,000 28,000 102,000 11,000 15,275 JAG (Justice Assistance Grant.) - $14,100 This grant is available through the American Recovery and Reinvestment Act of 2009. The Town intends to use these funds for the purchase of software and computer equipment used in the Police Deparment's property and evidence functions. Community Services Department: Arts in the Council Clambers Reception - $500 Art in the Council Chambers is a series of rotating exhibits in the Council Chambers of work by local artists, curated by the Arts and Culture Commission. Traditionally, the opening of each new exhibit is celebrated with an opening night reception. There are not currently any funds budgeted for refreshments to be provided at these receptions, so the artist, or in some cases an Arts and Culture Coninission member, have paid for reception food. It is recommended that $500 per fiscal year, for five fiscal years, be directed to the Arts in the Council Chambers opening night receptions (a total of $2,500 over five years). 11 Community Development Block Grant - $S, 000 In FY 2006/07, $5,000 of the Town's federal Community Development Block Grant (CDBG) funds was allocated to Rebuilding Together Silicon Valley, a local nonprofit agency. Rebuilding Together did not use these funds in 2006/07, but they remained available to be drawn down from the CDBG program. The Town has signed a contract extension with Rebuilding Together to allow them to use these funds in the current fiscal year, but a budget adjustment is also required in order to allow the funds to be drawn down from the federal CDBG program and passed through to Rebuilding Together. The fiends are targeted for the "House of Hope" project, a joint effort of West Valley Community Services, Calvary Church, and Rebuilding Together. This project has converted a facility owned by the church into a place to provide food pantry and case management services to low-income families from the Los Gatos area. Rebuilding Together's work included plumbing, flooring, painting, and installation of an ADA-compliant restroom. An Open House for the remodeled facility was held September 17. Hernandez Avenue Storm Drainpipe replacement: - $11, 000 The Town was notified of a collapsed storm drain pipe on upper part of Hernandez Avenue in early October 2009. After inspection, it was noticed that an old corrugated metal pipe across the road which has been rusted over the years has collapsed and created a sink hole on the road. To keep the roadway safe, the collapsed section of road was barricaded and covered with steel plates until pipe could be replaced. Staff has solicited bids from several contractors for this storm drain pipe replacement and the lowest bid for the project is about $11,000. This stone drain pipe is located within Town Storm Drain basin #1. Sufficient fund balance is available to fund this proj ect. Mitchell Avenue Sidewalks: - $28,000 The Town of Los Gatos has received a Transportation Development Act (TDA) grant from State of California for construction of sidewalks and related improvements on Mitchell Avenue from Fisher Avenue to George Street. This section of roadway is in direct route to Fisher Middle School and does not have a safe and functional way for pedestrians to walk due to lack of sidewalks. This project will construct concrete curb, gutter, and sidewalk and related improvements on Mitchell Avenue to provide safe way for pedestrians to walk to and from school. Blossom Hill University Intersection Utility Undergrounding- $23,260 The Town has received Federal Stimulus Grant Funding for the construction of improvements to the intersection of University Avenue and Blossom Hill Road. This project will replace the old and outdated traffic signal at University Avenue/Blossom Hill Road with 'a new, more functional traffic signal system. Additionally, there will be dedicated left turn lanes constructed to improve the operation of this intersection. Sidewalks will be built along University Avenue adjacent to Oak Meadow Park in order to fill in missing sections of existing sidewalks and provide safe access for pedestrians. There will also be pavement repairs and storm drainage improvements as part of this project. In conjunction with this project, sections of overhead electric lutes on University Avenue at this intersection will be relocated into underground system to not only enhance the aesthetic aspects of the site, but also accommodate the location of new traffic signal posts. The relocation and undergrounding of the overhead electric lines will be performed by PG&E. The cost of this undergrounding, $23,260 will be paid by the Town from the Town utility undergrounding fiends. 12 Tier 2 Stimulus Project: Prospect Avenue Resurfacing: - $102,000 The Town of Los Gatos has received a federal grant as part of The American Recovery and Reinvestment Act (ARRA) of 2009. The Town was informed by Caltrans that there is an additional grant related to the American Recovery and Reinvestment Act which the Town has received and it can be used for resurfacing projects. Since this Tier 2 grant is relatively small, it is recommended to be used to resurface Prospect Avenue area to complete the resurfacing that was done to College Avenue in the same neighborhood earlier this year as apart of another State grant El Camino Hospital Crosswalk - $15,620 The location of El Camino Los Gatos Hospital on Pollard Road and alignment of the roadway do not provide an ideal crosswalk placement for pedestrians who want to access the hospital from other side of the road. The Town has received a number of inquires in the past about construction of a formal and safe crosswalk for pedestrians in this vicinity. The Town has worked with the new El Camino Los Gatos Hospital and VTA on selecting a new crosswalk location at intersection of Pollard Road and Teakwood Avenue which will provide much improved access to the hospital for pedestrians. The construction of this project will be fully reimbursed by the El Camino Los Gatos Hospital Equipment Replacement Fund - $15,275 Parks and Public Works Department has advised staff that an important vehicle used for debris removal requires extensive maintenance and, repair prior to the rainy season. Sufficient funds are available in the Town's Equipment Replacement fund. FINANCIAL SUMMARIES, PROJECTIONS AND RECOMMENDATIONS General Fund The following page presents the Schedule of FY 09110 General Fund Operating Revenues vs. Operating Expenditures for the first quarter and comparison information from the prior year. In the last column, the Finance Department projects final balances for the fiscal year based upon the early trends observed through the first quarter. 13 Town of Los Gatos Schedule of General Fund Operating Revenues vs. Operating Expenditures For the period ended September 30, 2009 Unaudited FY08/09 FY08/09 FY08/09 FY08/09 FY09/10 FY09/t0 FY09/l0 FY09/10 FY09A0 Final Adjusted Is( Qtr % Adopted Adjusted 1st Qtr % Finance Balance Budget Actuals YTD Budget Budget Actuals YTD Projection Revenues General Property Tax S 7,417,030 $ 6,924,370 3 91,597 1% $ 6,922,920 $ 6,922,920 S 65,628 1% $ 6,922,920 Prop Tax Car Tax Back611 2,307,040 2,206,250 - $ ,2,325,200 $ 2,325,200 - 0% S 2,325,200 Sales &Use Tax 8,487,000 3,198,300 1,503,479 18% $ 3,677,460 $ 8,677,460 1,672,973 19% S 3,677,460 Franchise Fees 1,698,061 1,656,100 196;630 12% $ 1,689,260 $ 1,689,260 198,499 l2% S 1,689,260 Transient Occ Tax 966,638 1,100,000 134,570 12% $ 1,080,000 $ 1,080,000 99,179 9% S 1,080,000 Business License Tax 1,139,107 1,100,000 65,831 6% $ 1,122,000 $ 1,122,000 75;003 7% $ 1,122,000 Licenses & Permits 1,323,2D5 2,185,150 683,599 31% S 2,204,610 $ 2,204,610 508,134 23% $ 2,204,610 Motor Vehicle In Lieu 101,265 168,100 35,581 21% $ 144,280 $ 144,230 17,239 12% S 144,280 Intergovernmental 533,316 679,930 66,379 10% S 651,310 $ 651,310 79,804 12% $ 665,885 Charges for Services 2,054,601 1,982,678 321,762 16% $ 2,353,015 S 2,353,015 516,898 22% $ 2,353,015 Fines & Forfeitures 618,771 500,000 48,220 10% S 496,040 $ 496,040 119,837 24% S 496,040 Interest 1,777,726 1,690,800 461,985 27% $ 1,580,000 $ 1,580,000 43;643 3% $ 1,580,000 GASB investment to market per audit 329,479 - - S - $ - $ Miscellaneous/Other 8,807,329 8,336,783 575,711 7% $ 2,324,395 S 2,824,395 556,383 20% $ 2,824,395 Fund Transfers 437,925 184,370 435 0% S 475,920 $ 475,920 844 $ 475,920 Total Revenues 38,498,493 37,412,881 4,190,773 11% 32,546,910 32,546,910 3,954,214 12% 32,560,985 Use of Other Funding Sources: ' Use of Reserves 2,437,000 1,350,000 1,350,000 1,350,000 1,350,000 Fund Balance Reallocations (1,411,609) Vasona Reserve (6,078,967) Carryfenvard Allocations - 20,918 160,528 160,523 160,523 PERS Liability Account - 300,000 300,000 300,000 300,000 Use of intemal Service Reserves 194,000 194,000 194,000 194,000 Total Other Funding Sources (5,053,576) - 1,864,918 2,004,528 2,004,525 2,004,528 Total Revenues plus Reserves S 33.444;917 $ 37,412,331 $ 4,190.773 $ 34,411,823 S 34.551.438 S 5,958,742 S 34.565,513 Expenditures (Includes Of but no encumb rances) - Mayor & Council 164,336 133,300 34,774 19% 159,321 159,321 35,766 22% 159,321 Attorney 229,978 247,900 49,628 20% 214,912 214,912 41,925 20% 214,912 Administrative Services 2,443,581 2,628,170 562,048 21% 2,361,440 2,361,441 513,466 22% 2,361,441 Comm Development 3,297.602 3,954,460 674,120 17% 3,843,824 3,360,963 702,107 18% 3,860,963 Police 13,055,759 13,037,030 2,992,530 23% 12,926,566 12,926,566 2,911,497 23% 12,940,666 Parks & Public Works 5,791,776 6,314,768 1,203,324 19% 5,617,569 5,617,569 1,091,175 19% 5,617,569 Community ' Services 1,145,186 1,386,350 227,795 16% 1,283,151 1,290,608 222,774 17% 1,291,103 Library 2,018,590 2,122,880 499,374 24% 2,067,116 2,120,910 493,646 23% 2,120,910 Total Dept Expenses _L28,146.858 $ 29,875,358 S 6 .243,643 2t% S 28,473,899 $ 28,552,289 S 6.012,356 21% S 23,566,889 Non-Dept Expenditures and other uses General Government Total Non-Dept Expenses Total Operating Expenditures Net Operating Revenues Before Capital' & Budgeted Beg Fund Balance Authorized Use of Reserves Capital Projects/Special Projects Total Budgeted Use of Reserves Net Surplus or (Use) of Reserves 4,772,235 4,371,200 165,700 3% 4,086;970 4,148,190 337,694 8% 4,148,190 $ 4,772,235 $ 4,S71,200 S 165,700 3% S 4,086.970 S 4.143,190 S 337,694 8% S 4,148,190 S 32,91) 093 $ 34.746,558 $ 6.409,343 18% $ 32,560,869 $ 32,700,479 S 6,350,049 19% S 32,715,079 $ 525;824 S 2,666,323 S (1.213,565) S 1,350,959 $ 1.350,959 S (391,307) 1,350,000 1,350,000 1,350,000 1,350,000 1,350,000 1,350,000 1,350.000 1.350,000 525.824 500,95') 500,959 11,741,307) 500,434 Guide to Presentation: Each of the following groups of financial summaries present data by governmental fund type - the types are Special Revenue Funds, Capital Projects Funds, Internal Service Fends, and Redevelopment Agency Funds. In each of the following projections a similar format is presented. The find information starts with beginning fiend balances and adds current year revenues and subtracts current year expenditures resulting in endingfind balance. Budget amounts are also provided for revenues and expenditures, useful for comparing actual amounts received or spent to date versus budget for FY 2009110. 14 Special Revenue Fund - Special Revenue Funds, which account for the proceeds derived from specific revenue sources that are legally restricted or assigned. to special purposes including the Community Development Block Grant Fund, Non Point Source Fund, Landscaping and Lighting District Funds, and the Operating Grants Fund. Special Revenue Funds Budget to Actuals Comparisons CDBG Non Point Grants Source LIDS Beginning Fund Balance (Pre-audit) 475,999 20,181 96,980 Budgeted Revenues 149,319 135,000 35,860 Actual Revenues - 1st Qtr 2,565 135,000 69 Budgeted Expenditures 374,438 147,335 43,290 Total Actual Expenditures - 1st Qtr 3,347 23,456 640 1st Quarter Ending Fund Balance 475,217 131,725 96,409 Capital Projects Funds - Capital Projects Funds are utilized to account for resources used for acquisition and construction of capital facilities by the Town. Funds included in this category are the GFAR Fund (General Fund Appropriated Reserve), Traffic Mitigation Fees Fund, Grant Funded CIP's Fund, Storm Drains Fund, Utility Undergrounding Fund, and the Gas Tax Fund. Capital-Project Funds are tracking in accordance with the FY 2009/10 adopted budget. If operating revenues will support it, the FY 2009/10 budget includes a General Fund's current year transfer of designated Future Year's Capital & Special Projects reserves in the amount of $850,000 in support of the first year of the Town's adopted Five-Year Capital Improvement Plan. Capital Project Funds Budget to Actuals Comparisons Beginning Fund Balance Budgeted Revenues Actual Revenues - 1st Qtr Budgeted Expenditures Total Actual Expenditures - Lst Qtr GFAR Traffic Grant Fund Storm Utility Gas Fund Mitigation C1P's . Drains Undergd Tax 9,528,699 4,117,527 (161,410) 681,867 2,462,596 683,180 15,328,564 65,000 2,563,646 105,850 52,080 595;670 79,899 - - 21,248 2,971 - 23,930,205 65,000 2,364,275 55,000 350,000 941,601 1,301,351 6,375 21,699 - 23,260 153,135 1st Quarter Ending Fund Balance 8,307,248 4,111,153 (183,108) 703,115 2,442,306 530,045 Internal Service Funds - Internal Service Funds are used to finance and account for special activities and services performed by a designated Town department for other departments on a cost reimbursement basis. Included in this fund type are the Equipment Replacement Fund, 15 Worker's Compensation Fund, General Liability Self Insurance Fund, Stores Fund, Management Information Systems Fund, Vehicle Maintenance Fund, and the Building Maintenance Fund. Internal Service Funds are tracking in accordance with the adopted FY 2009/10 adopted budget. No revision to adopted revenues or expenditures is required at this time. Staff believes there is still some potential for further operating transfers in filture years, if needed, from these funds as excess balances exist in amounts needed for funding in a number of these funds. Internal Service Funds Budget to Actuals Comparisons Equipment Workers Self Office . bfmgt Info Vehicle Building Replacemt Comp Insurance Stores Systems i4laint. Mahtt. Beginning Fund Balance 3,078,191 2,583,280 2,091,699 263,444 2,175,717 268,331 716,700 Budgeted Revenues 339,280 692,510 528,990 124,500 1,038,420 618,400 1,085,200 Actual Revenues - 1st Qtr 83,640 5 26,326 105,038 154,650 271,463 Budgeted Expenditures 472,698 648,781 606,812 146,000 1,151,488 610,324 1,171,245 Total Actual Expenditures - 1st Qtr 70,783 191,771 407,775 36,760 240,593 90,468 177,852 1st Quarter Ending Fund Balance 3,091,048 2,391,514 1,683,923 253,011 2,040,162 332,513 810,311 Trust and Agency Funds - Town Trust and Agency Funds have fund balances as of June 30, 2009 of $206,258 for Parking District #88 and $328,526 in the Library Trust Funds. No budget revisions are contemplated at this time for these funds, Redevelopment Agency - The Agency's FY 09/10 and FY 2009-14 Capital Improvement Plan adopted budgets are incorporated into the Redevelopment Agency's' financial statements and year-to-date actuals as presented below. The. Capital Projects Fund balances include approximately $144,938 dollars of remaining unexpended funds at September 30, 2009 from the Agency's $10.7 million dollar 2002 COP issue. Approximately $65,000 of the remaining proceeds are encumbered to be spent on the S. Santa Cruz/Wood Road Gateway project, and $78,080 for Almond Grove Concrete Rehabilitation Pilot project. Redevelopment Agency Funds Budget to Actuals Comparisons Beginning Fund Balance Budgeted Revenues Actual Revenues - 1st Qtr Budgeted Expenditures Total Actual Expenditures - 1st Qtr 1st Quarter Ending Fund Balance Capital Debt Lowliviod Total Projects Service Housing RDA Funds 2,065,624 7,988,113 8,631,125 18,684,862 635,000 6,744,490 1,771,430 9,150,920 575,000 96,096 8,721 679,817 1,424,724 6,295,300 383,354 8,103,378 428,468 1,169,348 1,366,266 2,964,082 2,212,156 6,914,861 7,273,580 16,400,597 Since 1992 redevelopment agencies across the state have been required to make Educational Revenue Augmentation Fund (ERAF) payments to the State. In accordance with the State budget agreement, the ERAF payment was increased $303,000 for FY 2004/05 & FY 2005/06. The State suspended this "take" for FY's 2006/07 & 2007/08, but the FY 2008/09 Budget Bill t6 reintroduced a new ERAF payment of approximately $456,910 which was eventually ruled to be unconstitutional. Once again, the State has proposed an additional ERAF take of approximately $2.2 million for FY 2009/10, disallowing the Agency to retain this amount of tax increments to be used for important future Agency projects. The California Redevelopment Association expects to file a second lawsuit on this "take" and that it will once again be found to be unconstitutional. Proposition IA approved in 2004 does not contain specific protections for redevelopment agencies. These were not included because there are existing legal opinions that conclude that redevelopment agency tax increment revenue is constitutionally protected from state revenue takes. It is important that the Town continue to monitor developments regarding Redevelopment Agencies to discourage the legislature from further State takes from Redevelopment Agency Tax Increment. Protecting Redevelopment Agency funds for all cities is also a strategic priority for the League of California cities. It is essential to preserve the Agency's tax increment revenue as any take from this source will reduce the annual revenue stream. If a larger revenue take is enacted, the lowered revenue stream will reduce the total amount of bonds the Agency can issue in the future.. CONCLUSION The financial results from the prior fiscal year coupled with the FY 2009/10 first quarter data point towards continued adherence to conservative fiscal planning and efforts to sustain and develop the Town's sources of economically-sensitive revenues. This is especially important in light of the loss of five top ten sales tax providers in the past three years. Though the update to the Five-Year Financial Plan presented in the spring 2009/10 budget process projected future revenue shortfall challenges, these challenges will be made less so if the Town's econoinically- sensitive revenues can sustain their momentum and the cost of core service delivery can be kept in check. 17