15527 Union Avetp N p� MEETING DATE: 11/04/14
ITEM NO. 9
cps sat COUNCIL AGENDA REPORT
DATE: October 30, 2014
TO: MAYOR AND TOWN COUNCIL
FROM: GREG LARSON, TOWN MANAGER
SUBJECT: CONDITIONAL USE PERMIT APPLICATION U -14 -013. PROPERTY
LOCATION: 15527 UNION AVENUE. PROPERTY OWNER: DS DOWNING
LP A DELAWARE LIMITED PARTNERSHIP. APPLICANT /APPELLANT:
RUDY WRABEL.
CONSIDER AN APPEAL OF A PLANNING COMMISSION DECISION
APPROVING A REQUEST TO OPERATE A HIGH TURNOVER, SIT -DOWN
RESTURANT (JERSEY MIKE'S SUBS) AND IMPLEMENTING ALL
CONDITIONS, INCLUDING THE PAYMENT OF TRAFFIC IMPACT FEES ON
PROPERTY ZONED C -1. APN 523 -41 -036.
RECOMMENDATION:
After opening and closing the public hearing, it is recommended that the Town Council adopt a
Resolution (Attachment 10) to deny the appeal and uphold the decision of the Planning Commission
to approve the subject application implementing all conditions including the payment of Traffic
Impact Mitigation Fees.
ALTERNATIVES:
Alternatively, the Council may:
Determine that the Planning Commission's decision should be reversed or modified, and find
one or more of the following in accordance with Town Code Section 29.20.300:
a. There was error or abuse of discretion on the part of the Planning Commission; or
b. The new information that was submitted to the Council during the appeal process was not
readily and reasonably available for submission to the Commission; or
c. An issue or policy over which the Commission did not have discretion to modify or
address, but which is vested in the Council for modification or decision; and
1
PREPARED BY: LAUREL R. PREVETTI
Assistant Town Manager/ 00mimounit t Director
Reviewed by: N/A Assistant Town Manager wn Attorney S2-- Finance
N:\DEV\TC REPORTS\2014 \15527UnionAve- CUP- appeal.dw Reformatted: 5 /30/02 Revised: 10 /30/14 9:00 AM
PAGE 2
MAYOR AND TOWN COUNCIL
SUBJECT: 15527 UNION AVENUE/U -14 -013
October 28, 2014
2. Adopt a Resolution (Attachment 11) to grant the appeal and approve the project with a
modification to the amount of Traffic Impact Mitigation Fees due to the Town; or
3. Continue the application to a date certain with specific direction.
BACKGROUND:
The subject property is located on the southwest corner of Union Avenue and Los Gatos - Almaden
Road. The proposed project would occupy a vacant space in an existing commercial shopping area
called the Downing Center. The vacant space is a newly created 1,553 square feet unit in roughly
one -third of the space previously occupied by the restaurant "Live Oak Kitchen" and roughly one-
third of the former liquor store, "The Bottle Shop." The subject space is one of 18 existing
commercial spaces located on the property. A nineteenth space (Chase) is located on a separate
parcel on the corner.
This is the only application under consideration for the proposed property: Conditional Use Permit
(CUP) for approval to operate a high turnover, sit -down restaurant on property zoned C -1.
On September 10, 2014, this item was originally scheduled to be heard by the Planning Commission.
The Planning Commission continued the item to the October 8, 2014 Planning Commission meeting
at the request of the applicant.
On October 8, 2014, the Planning Commission considered the item as a consent item. The
Commission approved the CUP with conditions. The Commission's decision was appealed by the
applicant on October 9, 2014 "due the undue burden surrounding the Traffic Impact Mitigation Fee,
its timing, implementation, magnitude and the handling of the Conditional Use Permit application by
the Town" (quote from the Appeal).
This report was coordinated between Community Development Department and Parks and Public
Works Department.
DISCUSSION:
A. Project Summary
The applicant is requesting to operate a high turnover, sit -down restaurant in a 1,553 square feet
space. The restaurant would be called Jersey Mike's Subs, serving handmade cold and hot
sandwiches. The applicant is proposing to operate from 10:00 a.m. to 9:00 p.m. daily. The
applicant is proposing a maximum number of 24 seats. The site has adequate parking to
accommodate the proposed use. The proposed restaurant would not serve alcohol.
Additional details on the project are included in the September 10, 2014 Report to the Planning
Commission (Attachment 1).
PAGE 3
MAYOR AND TOWN COUNCIL
SUBJECT: 15527 UNION AVENUE/U -14 -013
October 28, 2014
B. Planning Commission Action
On September 10, 2014, this item was originally scheduled to be heard by the Planning
Commission. The Planning Commission continued the item to the October 8, 2014 Planning
Commission meeting at the request of the applicant. On October 8, 2014, the Planning
Commission considered the subject application as a consent item. The Commission approved
the CUP with conditions. Attachments 6 and 7 are verbatim transcripts of the Commission
meetings. On October 9, 2014, the decision was appealed as discussed below.
C. Appeal
Rudy Wrabel, applicant, appealed the decision of the Planning Commission on October 9, 2014
(see Attachment 4) on the basis that "we are facing an undue burden surrounding the Traffic
Impact Mitigation Fee, its timing, implementation, magnitude and the handling of the
Conditional Use Permit application by the Town." On October 24, 2014 the appellant/applicant
provided a letter providing further justifications for the appeal (see Attachment 5).
D. Traffic Impact Fee
The appeal maintains that the Town's Traffic Impact Mitigation Fee places an undue burden
upon the applicant. The concept of undue burden was established by the Supreme Court in a
landmark case known as Nollan v. California. In essence, the undue burden test requires that the
jurisdiction be able to demonstrate a nexus between the fee and the project. The Town has
demonstrated this nexus through the establishment of the Traffic Impact Mitigation Fee
(hereafter Fee) as approved by Council. This included a methodology report conducted by a
Town consultant that relates planned Town traffic projects with expected growth to determine
the Fee. This process was described at the March 24, 2014 Town Council meeting.
On March 24, 2014, the Town Council considered staff s recommendation to increase the Traffic
Impact Mitigation Fee. The Town Council after considering several options and public
testimony, approved the increased fee and eliminated the discounting that had previously been
provided to certain commercial projects. The Fee changes were subsequently confirmed at the
May 19, 2014 Town Council meeting and took effect 60 days later.
Because the Town's previous Traffic Impact Fee was so low, developers tended to pay the Fee
without objection. Since July, developers are asking more questions and the Fee is getting more
scrutiny. Since the increase took effect, staff has worked to align internal processes so that they
provide the most accurate and timely information possible to applicants. In this process, early
Fee information can be provided to applicants, with the final Fee amount set at the time of
submittal for a building permit. This is due to the likelihood of changes in the project that may
occur up to that point.
On August 19, 2014, the Town Council amended the Town's Traffic Impact Policy to update the
framework for evaluating and mitigating traffic impacts associated with new development,
including the process for establishing and assessing the Traffic Impact Mitigation Fee.
PAGE 4
MAYOR AND TOWN COUNCIL
SUBJECT: 15527 UNION AVENUE/U -14 -013
October 28, 2014
Following the Council's adoption of the new Traffic Impact Mitigation Fee structure where all
trips pay the same per trip fee, the Policy was updated to strengthen the nexus between the new
Fee and the calculation and assessment of traffic impacts. Among other items, the Policy update
included consideration for pass -by trip credits and credits for existing trips based on existing or
prior uses within the past five years.
Town Code 15.70.030(c)(5) states, "Unusual circumstances may result in this policy placing an
undue burden on a developer or landowner. In such cases, the Town reserves the right to enter
into an agreement to deviate from the policy as may be approved by the Town Council." If the
Council finds that the applicant would face an undue burden under Town Code 15.70.030(c)(5),
the Council would need to express the specific reasons for the record.
E. CUP Application Process and Fee Estimates
The Conditional Use Permit (CUP) for Jersey Mike's Subs was processed similar to other CUPs
in the Town of Los Gatos. Staff typically meets with a prospective applicant prior to the filing of
an application to explain the process, application submittal requirements, and possible issues that
may need to be resolved during the CUP process. The applicant then submits the application. A
couple of weeks after filing, the applicant attends a Staff Technical Review Committee (STR)
and receives comments from the Building, Engineering, Fire, and Planning divisions. At STR,
the applicant is given draft conditions including any impact fees and is asked to provide
additional information to complete the application and facilitate the completion of the staff's
review. Subsequently, the applicant provides the requested additional information to the Town,
and then the application is deemed complete. Once complete, staff works with the applicant to
schedule a Planning Commission public hearing date.
On May 9, 2014, Planning staff met with the prospective applicant for Jersey Mike's Subs at the
Planning counter. The potential applicant was informed of the CUP process and provided the
application requirements. As with all Conditional Use Permits, Planning staff asks the
prospective applicant to provide project location, the proposed use, and the previous use. The
applicant informed staff that the proposed tenant space was previously occupied by Live Oak
Kitchen, resulting in a restaurant to restaurant use in the same space which would not trigger the
Traffic Impact Mitigation Fee. Staff informed the applicant that there was an active CUP for the
tenant space located next door in a portion of the former Live Oak Kitchen restaurant. The
proposed neighboring business, Mooyah Burger (15529 Union Avenue), would be a high
turnover, sit -down restaurant. (This CUP was approved at Planning Commission on May 28,
2014 and did not pay Traffic Impact Mitigation Fees because the prior use was also a high
turnover, sit -down restaurant.)
On May 20, 2014, the applicant for Jersey Mike's Subs submitted the CUP application materials
with an incomplete traffic questionnaire.
On June 7, 2014, Planning and Engineering staff requested more information including a larger
site plan and details of the application including the number of seats and square footage.
PAGES
MAYOR AND TOWN COUNCIL
SUBJECT: 15527 UNION AVENUE /U -14 -013
October 28, 2014
Engineering staff explained that the information was needed to determine if Jersey Mike's would
be the same type of restaurant as Live Oak Kitchen and if any traffic fees would be required.
On June 11, 2014, staff met with the applicant at the (STR) to discuss the completeness of the
application. A traffic questionnaire was submitted to the Town for the use of calculating traffic
impact fees. Staff learned that the proposed use would occupy not only a portion of the former
Live Oak Kitchen restaurant but also a portion of the former liquor store tenant space. Staff
requested an updated traffic questionnaire and a site plan reflecting this new information. Staff
also explained and discussed the required Traffic Impact Mitigation Fees that would be part of
the conditions and that Fees are calculated at the time of building permit application.
From the STR meeting on June 1 I to July 21, 2014, Engineering and Planning staff worked with
the applicant to obtain the required information to complete the application and the analysis. On
July 7, 2014, Planning and Engineering staff received an updated but still incomplete traffic
questionnaire. Engineering staff discussed traffic fees with the applicant based on the incomplete
information provided. On July 21, 2014, Planning staff received an updated and completed floor
plan layout providing the proposed tenant space overlay with the former tenant spaces. This
layout included specific square footage from a portion of the former "Live Oak Kitchen" and a
portion of the former "Bottle Shop." All required application material had been provided and the
CUP application was now complete. On the same day, Engineering staff provided an estimate of
the Traffic Impact Mitigation Fee based on the provided information of $179,340 to the applicant
and Planning staff.
The day before the Council considered the update to the Traffic Impact Policy (August 18, 2014),
Engineering staff provided the applicant and Planning staff an updated Fee estimate of $78,568
using the pass -by trip calculation identified in the Policy update.
On September 10, 2014 the Conditional Use Permit was originally scheduled to be heard by the
Planning Commission. The Planning Commission continued the item to the October 8, 2014
Planning Commission meeting at the request of the applicant. On October 8, 2014 the Planning
Commission considered the item as a consent item. The Commission approved the CUP with
conditions including the Fee amount of $78,568. The application was subsequently appealed as
discussed in this report.
On October 15, 2014, Engineering staff found that Jersey Mike's Subs was classified as a custom
fast food establishment for purposes of trip generation and recalculated the trip generation using
a traffic classification of high turnover, sit -down restaurant. Based on the revised analysis,
Engineering staff provided the applicant and Planning staff an updated fee estimate of $39,284.
The revised fee is due to the change in use of the liquor store portion of the building only. There
is no change in use for the portion that was formerly Live Oak Kitchen. The Traffic Impact
Mitigation Fee is payable at the time the Building Permit is issued.
In summary, the handling of this application is consistent with the Town's practices of working
with an applicant to explain the process, likely conditions of approval, requirements for a
PAGE 6
MAYOR AND TOWN COUNCIL
SUBJECT: 15527 UNION AVENUE /U -14 -013
October 28, 2014
complete application, and the schedule for taking an application to hearing once the application
is complete.
ENVIRONMENTAL ASSESSMENT:
The project is Categorically Exempt pursuant to the adopted Guidelines for the Implementation of
the California Environmental Quality Act (CEQA), Section 15301 for a proposed use in an existing
facility with no increase in floor area.
CONCLUSION:
It is recommended that the Town Council deny the appeal and uphold the decision of the Planning
Commission to approve the subject application with conditions including payment of the Traffic
Impact Mitigation Fee, and adopt the resolution affirming this action (see Attachment 10).
Alternatively, the Council can approve the appeal and approve the project with conditions including
a modified Traffic Impact Fee with specific documentation for a finding of undue burden
(Attachment 11).
FISCAL IMPACT:
Under the Council approved Traffic Impact Fee and Policy, the applicant would be required to
pay a total Traffic Impact Mitigation Fee of $39,284.00 prior to issuance of a building permit.
Attachments:
1. September 10, 2014 Staff Report to the Planning Commission (including Exhibits 1 -5)
2. September 10, 2014 Addendum to the Planning Commission
3. October 8, 2014 Staff Report to the Planning Commission
4. Appeal of Planning Commission Decision, received October 9, 2014 (one page)
5. Letter from the applicant/appellant, received October 24, 2014 (two pages)
6. September 10, 2014 Planning Commission meeting verbatim minutes (3 transcribed pages)
7. October 8, 2014 Planning Commission meeting verbatim minutes (1 transcribed page)
8. Required Findings and Considerations (one page)
9. Recommended Conditions of Approval (two pages)
10. Draft Resolution for denial of the appeal and approval of the project with conditions including
the payment of the Traffic Impact Mitigation Fee (three pages)
11. Draft Resolution to grant the appeal and approval of the project with conditions including a
modified payment of the Traffic Impact Mitigation Fee (three pages)
Distribution
cc: Rudy Wrabel, 818 Fremont Street #4, Menlo Park, CA 94025
DS Downing LP, A Delaware Limited Partnership, 200 E. Baker St., Costa Mesa, CA 92626
LRP:EW:cgt
TOWN OF LOS GATOS
PLANNING COMMISSION STAFF REPORT
cos si,. Meeting Date: September 10, 2014
PREPARED BY: Erin Walters, Associate Planner
ewalters a,losgatosca.gov
APPLICATION NO: Conditional Use Permit Application U -14 -013
ITEM NO: 1
LOCATION: 15527 Union Avenue (southwest corner of Union Avenue and
Los Gatos Almaden Road)
APPLICANT/
CONTACT PERSON: Rudy Wrabel
PROPERTY OWNER: DS Downing LP, A Delaware Limited Partnership
APPLICATION SUMMARY: Requesting approval to operate a high turnover, sit -down
restaurant (Jersey Mike's Subs) on property zoned C -1. APN
523 -41 -036.
DEEMED COMPLETE: July 21, 2014
FINAL DATE TO TAKE ACTION: January 21, 2015
RECOMMENDATION: Approve, subject to conditions.
PROJECT DATA: General Plan Designation: Neighborhood Commercial
Zoning Designation: C -1 — Neighborhood Commercial
Applicable Plans & Standards: General Plan
Parcel Size: 5.8 acres
Surrounding Area:
Alt'ITACIWNT 1
Existing Land Use
General Plan
Zoning
North
Commercial and
Neighborhood Commercial
C -1, O, and
Residential
and City of San Jose
City of San
Jose
East
Commercial and
Neighborhood Commercial,
C -1, O, and
Residential
Office Professional, and City
City of San
of San Jose
Jose
South
Residential
Medium Density Residential
RD and
and Neighborhood
C -1
Commercial
West
Residential
Medium Density Residential
RD and
RM -5:12
Alt'ITACIWNT 1
Planning Commission Staff Report - Page 2
15527 Union Avenue/U -14 -013
September 10, 2014
CEQA: The project is Categorically Exempt pursuant to the adopted
Guidelines for the Implementation of the California
Environmental Quality Act (CEQA), Section 15301: A proposed
use in an existing facility with no increase in floor area.
FINDINGS: ■ As required by the adopted Guidelines for the
Implementation of the California Environmental Quality Act
(CEQA), this project is Categorically Exempt Section 15301:
A proposed use in an existing facility with no increase in
floor area.
■ As required by Section 29.20.190 of the Town Code for
granting a Conditional Use Permit.
CONSIDERATIONS: None.
ACTION: The decision of the Planning Commission is final unless
appealed within ten days.
EXHIBITS: 1. Location Map
2. Findings and Considerations (one page)
3. Recommended Conditions of Approval (two pages)
4. Letter of Justification and written description (two pages),
received May 20, 2014
5. Development Plans (three pages), received July 11, 2014 and
July 21, 2014
BACKGROUND:
The proposed project would occupy a vacant space in an existing commercial shopping center.
The subject space is one of 18 existing commercial spaces located on the property. A nineteenth
space (Chase) is located on a separate parcel on the corner.
New owners recently acquired the shopping center and have made minor modifications to the
site including adding 29 new parking spaces. The new parking spaces have been installed; the
parking analysis for the subject application uses the existing parking spaces currently on the site.
PROJECT DESCRIPTION:
A. Conditional Use Permit
The applicant is requesting approval to operate a high turnover sit -down restaurant in
roughly one -third of the space previously occupied by Live Oak Kitchen and roughly one-
i__
Planning Commission Staff Report - Page 3
15527 Union Avenue/U -14 -013
September 10, 2014
third of the former liquor store, "The Bottle Shop." The restaurant would be a Bay Area
based franchise called Jersey Mike's Subs. The maximum hours of operation would be
10:00 a.m. to 9:00 p.m. daily. The applicant provided a letter of justification and written
description (Exhibit 4), and development plans (Exhibit 5) describing the proposal.
When reviewing a Conditional Use Permit (CUP), the deciding body should consider the
information in the applicant's business plan; however, the key consideration should be the
explicit proposed use since the business plan can change from owner to owner. The
explicit use may be, and is often, defined in the recommended conditions of approval as a
"use" condition. The CUP runs with the land, and the deciding body should review
applications based on the explicit use as opposed to the applicant or the applicant's
business plan.
B. Location and Surrounding Neighborhood
The project site is located on the southwest corner of Union Avenue and Los Gatos -
Almaden Road (Exhibit 1). The subject commercial space is located in the northwest
corner of the property. Commercial uses border the property to the north; residential and
commercial uses border the property to the west and east; and residential uses border the
property to the south.
C. Zoning Compliance
The zoning designation allows restaurants subject to the approval of a Conditional Use
Permit.
ANALYSIS:
A. Project Summary
The applicant is requesting to operate a high turnover sit -down restaurant in a newly
created 1,553 square feet (sq. ft.) space, in roughly one -third of the space previously
occupied by Live Oak Kitchen and roughly one -third of the former liquor store, "The
Bottle Shop." The restaurant would be called Jersey Mike's Subs, serving handmade cold
and hot subs. The applicant is proposing to operate from 10:00 a.m. to 9:00 p.m. daily.
The applicant is proposing a maximum number of 24 seats.
B. Deliveries
The applicant is requesting delieveries to be received Monday through Friday between 8:00
a.m. and 10:00 a.m. There will be no overnight delieveries.
Planning Commission Staff Report - Page 4
15527 Union Avenue /U -14 -013
September 10, 2014
C. Traffic
The previous use of the newly created 1,553 sq. ft. space was 493 sq. ft. of a former high
turnover sit down restaurant (Live Oak Kitchen) with similar hours and 1,060 sq. ft. of a
specialty retail shop (The Bottle Shop). The proposed project would result in a net increase
of 92 average daily trips (ADT), no net new morning peak hour trips, and one net new
evening peak trip. Under the recently Council approved Traffic Impact Fee and Policy, the
applicant would be required to pay a total traffic mitigation fee of $78,568.00 prior to
issuance of a building permit.
D. Parking
At this time the commercial shopping center currently has 353 parking spaces (343 regular
spaces and 10 spaces for persons with disabilities). The proposed use requires eight
parking spaces. As shown on the table below, the proposed use and the existing uses
would comply with the parking requirements.
Planning Commission Staff Report - Page 5
15527 Union Avenue /U -14 -013
September 10, 2014
E. Conditional Use Permit Findings
In order to grant approval of a Conditional Use Permit, the deciding body must make the
following findings:
(1) The proposed use of the property is essential or desirable to the public convenience or
welfare; and
(2) The proposed use will not impair the integrity and character of the zone; and
(3) The proposed use would not be detrimental to public health, safety or general welfare;
and
(4) The proposed use of the property is 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 applicant explains in their letter of justification that the use
would provide high quality and freshly made meals within the proposed restaurant and that
a similar use does not currently exist in this part of Town. 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
and will be replacing a portion of a similar long standing use. In regards to finding three,
the use will not be detrimental to public health safety or general welfare because conditions
placed on the permit will mitigate potential impacts. hi regards to the final finding, the
proposed use meets the objectives of the General Plan and Town Code as discussed within
this report.
F. General Plan
The goals and policies of the 2020 General Plan applicable to this project include but are
not limited to:
Policy LU -2.1 — Minimize vehicle miles traveled for goods and services by allowing
and encouraging stores that provide these goods within walking distance of
neighborhoods in Los Gatos.
Policy LU -9.6 — 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.
Policy LU -9.2 — Maintain a variety of commercial uses, including a strong Downtown
commercial area combined with Los Gatos Boulevard and strong neighborhood
commercial centers to meet the shopping needs of residents and preserve the small -
town atmosphere.
Planning Commission Staff Report - Page 6
15527 Union Avenue/U -14 -013
September 10, 2014
G. Environmental Review
The project is Categorically Exempt pursuant to the adopted Guidelines for the
Implementation of the California Environmental Quality Act (CEQA), Section 15301 for a
proposed use in an existing facility with no increase in floor area.
PUBLIC COMMENTS:
At this time, the Town has not received any public comment.
SUMMARY AND RECOMMENDATION:
A. Summary
Staff recommends conditions of approval consistent with the applicant's proposed use,
specifically the seating and operating hours. The site has adequate parking to
accommodate the proposed uses. The proposed restaurant would not serve alcohol and
would close by 9:00 p.m. The proposed application is in conformance with Town Code
and the General Plan.
B. Recommendation
Staff recommends approval of the Conditional Use Permit subject to the recommended
conditions of approval. If the Planning Commission finds merit with the proposed project,
it should:
1. Find that the proposed project is Categorically Exempt, pursuant to Section 15301
of the adopted Guidelines for the Implementation of the California Environmental
Quality Act (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. Approve Conditional Use Permit application U -14 -013 with the conditions
contained in Exhibit 3.
If the Commission has concerns with the proposed use, it can:
1. Continue the matter to a date certain with specific directions; or
2. Approve the application with additional and /or modified conditions; or
3. Deny the application.
Planning Commission Staff Report - Page 7
15527 Union Avenue/U -14 -013
September 10, 2014
r
P pared by: Approved by:
rin Walters Laurel R. Prevetti
Associate Planner Assistant Town Manager /Community
Development Director
LRP:EW:cg
cc: Rudy Wrabel, 421 College Avenue, Palo Alto, CA 94306
DS Downing LP, A Delaware Limited Partnership, 200 E. Baker St., Costa Mesa, CA 92626
N: \DEV\PC REPORTS\2014 \15527 UnionCUP.docx
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