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2017-009 - Approve request to modify an existing CUP for the Toll House at 140 S Santa Cruz Ave to allow entertainment before 10pmRESOLUTION 2017 -009 RESOLUTION OF THE TOWN COUNCIL OF THE TOWN OF LOS GATOS APPROVING A REQUEST TO MODIFY AN EXISTING CONDITIONAL USE PERMIT TO ALLOW ENTERTAINMENT BEFORE 10:00 P.M. ON PROPERTY ZONED C -2:PD APN: 510 -45 -064 AND 065 CONDITIONAL USE PERMIT APPLICATION: U -16 -055 PROPERTY LOCATION: 140 S. SANTA CRUZ AVENUE PROPERTY OWNER: MICHAEL MOHR - COO METWEST PROPERTIES, LLC APPLICANT: LG HOTEL LLC D.B.A. TOLL HOUSE WHEREAS, the applicant requests approval for a modification to an existing Conditional Use Permit (CUP) to allow entertainment before 10:00 p.m. on property zoned C -2:PD; and WHEREAS, on September 14, 2016, November 9, 2016, and January 11, 2017, the Planning Commission considered CUP application U -16 -055 to modify an existing CUP on property zoned C -2:PD. The Planning Commission recommended approval of the request with modified Conditions of Approval, finding that the proposed use of the property is essential or desirable to the public convenience in that it will allow entertainment before 10:00 p.m. for patrons; the proposed use will not impair the integrity and character of the zone in that the proposed use is a commercial use and is located in a commercial zone; the proposed use will not be detrimental to public health, safety, or general welfare in that the proposed modification will comply with the Town's Entertainment Policy; and 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 and as discussed within the September 14, 2016 Planning Commission Staff Report; and 1of5 Resolution 2017 -009 March 7. 2017 WHEREAS, this matter was regularly noticed in conformance with State and Town law and came before the Town Council for public hearing on February 21, 2017; and WHEREAS, the Town Council received testimony and documentary evidence from the applicant and all interested persons who wished to testify or submit documents. The Town 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 for its meeting on February 21, 2017, along with any and all subsequent reports and materials prepared concerning this application; and WHEREAS, the Town Council approved the application subject to modified conditions and continued the item to March 7, 2017 in order to review the Draft Resolution, the Conditions of Approval attached hereto as Exhibit A, and the Operating Agreement attached hereto as Exhibit B. WHEREAS, Council finds as follows: A. The project is categorically exempt from environmental review pursuant to Section 15301 of the State Environmental Guidelines as adopted by the Town. B. Pursuant to Town Code section 29.20.190: 1. The proposed use is desirable to the public convenience and welfare in that it will allow entertainment before 10:00 p.m. for patrons; and 2. The proposed use will not impair the integrity of the zone, in that the proposed modification will comply with the Town's Entertainment Policy and Noise Ordinance; and 2of5 Resolution 2017 -009 March 7, 2017 2058. 3. The proposed use as conditioned by the provisions of the CUP and Operating Agreement attached hereto as Exhibits A and B will not be detrimental to public health, safety, or general welfare, as the conditions will mitigate potential impacts; and 4. The proposed use is in harmony with the General Plan and Town Code. C. The CUP, as modified, is in conformance with Planned Development Ordinance D. That the proposed use is consistent with the Redevelopment Plan for the Central Los Gatos Redevelopment Project Area (Section IV.B) in that the subject property is designated commercial and the proposed use falls under general commercial uses. NOW, THEREFORE, BE IT RESOLVED: 1. The requested modification to the existing CUP to allow entertainment before 10:00 p.m. is approved. 2. The Conditions of Approval attached hereto as Exhibit A are hereby adopted. 3. The Town Manager is authorized to sign the Operating Agreement attached hereto as Exhibit B which must be executed prior to any entertainment occurring on the property as allowed under the modified CUP. The Town Manager is further authorized to approve any modifications to the Operating Agreement consistent with Town Codes and policies. 4. The decision constitutes a final administrative decision pursuant to California Code of Civil Procedure Section 1094.6 as adopted by Section 1.10.085 of the Town Code of the Town of Los Gatos. Any application for judicial relief from this decision must be sought within the time limits and pursuant to the procedures established by California Code of Civil Procedure 3of5 Resolution 2017 -009 March 7, 2017 section 1094.6, or such shorter time as required by State and Federal Law. PASSED AND ADOPTED at a regular meeting of the Town Council of the Town of Los Gatos, California, held on the 7th day of March, 2017, by the following vote: COUNCIL MEMBERS AYES: Marcia Jensen, Rob Rennie, Barbara Spector, Mayor Marico Sayoc NAYS: Steve Leonardis ABSENT: None. ABSTAIN: None. SIGNED: ,1 Y1A-w MAYOR OF E TOWN F LOS GATOS LOS GATOS, RNIA DATE: 3- 10— 1-7 ATTEST: CLERK ADMINISTRATOR OF THE TOWN OF LOS GATOS LOS GATOS, CALIFORNIA DATE: `1 4of5 Resolution 2017 -009 March 7, 2017 TOWN COUNCIL -February 21, 2017 MODIFIED CONDITIONS OF APPROVAL: 140 S. Santa Cruz Avenue Conditional Use Permit Application U -16 -005 Requesting a modification to an existing Conditional Use Permit to allow entertainment before 10:00 p.m. on property zoned C -2:PD. APNs 510 -45 -064 and - 065. PROPERTY OWNER: Michael Mohr - Coo MetWest Properties, LLC APPLICANT: LG Hotel LLC D.B.A. Toll House TO THE SATISFACTION OF THE COMMUNITY DEVELOPMENT DIRECTOR: Planning Division 1. ALCOHOLIC BEVERAGES: So long as this establishment serves alcoholic beverages it 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. This establishment shall use an employee training manual that addresses alcoholic beverage service consistent with the standards of the California Restaurant Association. d. The licensed operator 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. 2. TOTAL SEATING: Total seating shall not exceed 130. 3. OUTDOOR SEATING: Outdoor seating shall not exceed 36. 4. ALCOHOLIC BEVERAGES: Alcoholic beverages may be served. 5. OUTDOOR SEATING USE: The outdoor seating shall not be used for banquet, reception or conference purposes. 6. OUTDOOR MEAL SERVICE HOURS: Meal service outdoors shall be limited from 7:00 a.m. to 10:00 P.M. 7. ENTERTAINMENT: Entertainment before 10:00 p.m. in conformance with the Town Policy Regulating Late Night Entertainment is allowed by the operator, pursuant to the approved Operating Agreement. EXHIBIT A 5of5 Resolution 2017 -009 March 7, 2017 TOLL HOUSE OPERATING AGREEMENT TO ALLOW ENTERTAINMENT AT 140 S. SANTA CRUZ AVENUE This OPERATING AGREEMENT ( "Agreement ") is dated for identification this 7 1 day of March 2017, the terms of which are agreed to by Michael Mohr, Coo and Metwest Properties LLC and LG Hotel LLC dba Toll House (hereinafter collectively referred to as "Toll House ") and approved by The Town of Los Gatos (hereinafter "Town ") and made in conjunction with Conditional Use Permit U -16 -005, issued by the Town to Toll House. RECITALS WHEREAS, Toll House is a hotel and restaurant establishment located at 140 S. Santa Cruz Avenue in Los Gatos (APN 510 -45 -064 AND 065), property zoned C -2:PD; and WHEREAS, the existing Conditional Use Permit (CUP) allows the restaurant to offer outdoor dining until 10:00 p.m. on the patio, overlooking the hotel's central outdoor courtyard, but prohibits any music, entertainment or amplified sound in the courtyard; and WHEREAS, on March 7, 2017, the Los Gatos Town Council approved Conditional Use Permit U -16 -005 for a modification to the existing Toll House CUP to allow for entertainment in the courtyard before 10:00 p.m., subject to certain conditions of approval; and WHEREAS, Conditional Use Permit U -16 -005, Condition No. 7 requires Toll House to enter into an Operating Agreement, which would further define and impose operational limitations, responses, and remedies for the Town to employ as necessary to insure that the entertainment at the Toll House does not negatively impact the health, safety, and welfare of the Town; and WHEREAS, Toll House recognizes that Toll House has no vested right for the allowance of entertainment at the Toll House and that this Operating Agreement, coupled with the CUP U -16 -005, memorializes the terms and conditions under which Toll House is allowed to have entertainment in the courtyard before 10:00 p.m. NOW THEREFORE, in consideration of the mutual covenants and conditions set forth herein, the Parties agree as follows: 1. The foregoing Recitals are incorporated into this Operating Agreement. 2. Toll House is allowed to have entertainment before 10:00 p.m. on Friday, Saturday, and Sunday in conformance with the Town Policy Regulating Late Night Entertainment and pursuant to the terms and conditions of this Operating Agreement. Toll House entertainment allowed by this Operating Agreement shall not be the primary use at any time and is only allowed as an ancillary use 1of5 Toll House Operating Agreement to Allow Entertainment at 140 S. Santa Cruz Avenue EXHIBIT B and at no time shall the Toll House offer any stand -alone entertainment. For the purposes of this Operating Agreement, entertainment includes, live music both instrumental (no percussion) or vocal, amplified music or sound that is associated with weddings, banquets, corporate or family gatherings and restaurant associated activities. 3. Toll House shall have on site during any entertainment event a Manager who will serve as a point of contact between Toll House and the surrounding neighborhood and members of the public. The Manager's contact information will be accessible to members of the public, by telephone and on the Toll House website. Toll House shall keep a log with the date and time of any noise complaints by the surrounding neighborhood and any actions taken pursuant to a complaint. This log will be made available to Town Staff upon request. 4. Toll House shall install two permanent noise monitoring devices of an agreed - upon type at the locations set forth in the attached Noise Assessment, dated October 4, 2016, completed by Charles M. Salter Associates Inc. for the purpose of monitoring noise levels during entertainment events at the Toll House. This equipment will be set to monitor decibel levels of sound during Toll House entertainment events and shall be maintained and calibrated to industry standards. This equipment shall be capable of recording, storing, and retrieving data by date and time of the decibel levels of sound. If at any time during an entertainment event, decibel levels exceed the levels set forth in Paragraph 5, a noise file will be electronically sent to the on duty Manager's electronic device to allow for immediate adjustment of amplification equipment to reduce sound levels to no more than the allowed maximum provided in Paragraph 5. In addition, the on duty Manager shall immediately forward monitoring results documenting levels above the limits set forth in Paragraph 5 to the Town Manager of Los Gatos by email. Toll House shall also provide a copy of all the monitoring results to the Town within 4 business days of any entertainment event. 5. Toll House agrees that the decibel levels recorded by the two permanent noise monitoring devices shall not exceed the amounts set forth in the attached Noise Assessment, dated October 4, 2016, completed by Charles M. Salter Associates Inc. as follows: A. Entertainment events occurring from 1:00 p.m. to 10:00 p.m. on weekdays shall operate at a maximum level of 74 dBA at the C1 location and 82 dBA at the C2 location in order to meet the required Town Noise Zone Limits. 2of5 Toll House Operating Agreement to Allow Entertainment at 140 S. Santa Cruz Avenue B. Entertainment events occurring from 1:00 p.m. to 10:00 p.m. on weekends and holidays shall operate at a maximum level of 69 dBA at the C1 location and 77 dBA at the C2 location in order to meet the required Town Noise Zone Limits. 6. In the event Toll House exceeds the maximum level of dBA set forth in Paragraph 5 during an entertainment event that results in a noise complaint within 15 minutes of the exceedance, the Toll House shall receive a written warning. The second separate and subsequent entertainment event that results in a noise complaint within 15 minutes of the exceedance shall result in a fine of $500.00 for that entertainment event. The third and separate and subsequent entertainment events that result in a noise complaint within 15 minutes of the exceedance shall result in a fine of $1,000.00 for that entertainment event and Toll House agrees to cease any further entertainment events immediately until such time as a public hearing is scheduled to determine whether the Town Council should revoke, suspend or modify CUP Condition No. 7 and this Operating Agreement. The costs associated with this public hearing shall be borne by the Toll House. Toll House agrees that in addition to decibel levels set forth in Paragraph 5 above, the decibel levels at any point outside the property plane shall comply with the requirements set forth in the Town Noise Ordinance and Town Noise Maps. At no time shall any entertainment originating from any part of the business create a public nuisance as defined under Town Code and State Law. S. Toll House shall include the terms of this Operating Agreement and the requirements of the Town's Noise Ordinance into any contract for entertainment. In addition, any contract for entertainment shall require that all entertainment instruments and equipment shall only be setup on the north end of the courtyard with the sound system facing south (i.e., inwards towards the hotel). 9. Toll House agrees that it must cease operation of the noise source immediately if there is an exceedance in the maximum level of dBA set forth in Paragraph 5 during an entertainment event until such time that additional measures are implemented to eliminate the noise exceedance. Such additional measures include but are not limited to, speaker reduction, speaker placement, noise dampening, or any other solution to remedy the exceedance. In addition, the Town Manager may amend the conditions of this Operating Agreement if changes are needed to address any issues which the current conditions do not fully address. 3of5 Toll House Operating Agreement to Allow Entertainment at 140 S. Santa Cruz Avenue 10. In addition to Paragraph 9, this Operating Agreement and Condition of Approval No. 7 may be revoked, suspended or modified by the Town Council, at any time, whenever, after a noticed hearing, the Town Council finds that three violations of this Operating Agreement have occurred that cannot be remedied through implementation of additional measures and conditions to eliminate additional violations. 11. In addition to paragraph 9 and 10, this Operating Agreement and CUP Condition No. 7 shall be reviewed by the Town Council at a noticed public hearing on November 7, 2017, to ensure on -going compliance with this Operating Agreement and to ensure that the Toll House is in compliance with Town Code and State Law. At this hearing, the Town Council may revoke, suspend or modify CUP Condition No. 7 of this Operating Agreement in order to address any issues related to entertainment at the Toll House. The costs associated with this public hearing shall be borne by the Toll House. 12. Toll House understands and agrees that this Operating Agreement and CUP Condition No. 7 does not now, nor will it in the future, establish any vested rights for the allowance of entertainment and does not run with the land. Toll House agrees that this Agreement shall be disclosed to any prospective purchaser, assignee, or subtenant of Toll House and any purchaser, assignee, or subtenant of Toll House must re- execute this Agreement before the allowance of any entertainment. 13. Toll House agrees to defend, indemnify, and hold harmless the Town or any of its boards, commissions, agents, officers, and employees from any claim, action or proceeding against the Town, its boards, commissions, agents, officers, or employees to attack, set aside, void, or annul, the approval of the project. The Town shall promptly notify the applicant of any such claim, action or proceeding. The Town shall have the option of coordinating the defense. Nothing contained in this condition shall prohibit the Town from participating in a defense of any claim, action, or proceeding if the Town bears its own attorney's fees and costs, and the Town defends the action in good faith. 14. To the extent of any conflict between the Town Policy Regulating Late Night Entertainment and this Operating Agreement, real or alleged, this Operating Agreement shall control. 4of5 Toll House Operating Agreement to Allow Entertainment at 140 S. Santa Cruz Avenue IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first herein above set forth. TOWN OF LOS GATOS Laurel Prevetti Town Manager O AND METWEST PROPERTIES LLC By: Jason C. Bogan, CHA Hotel Manager, Authorized Agent of Coo and Midwest Properties APPROVED AS TO FORM: obert Schultz Town Attorney ATTEST: Shelley Neis S Clerk Administrator 5 of HOTEL LLC DBA TOLL HOUSE By: Jason C. Bogan CHA Hotel Manager, Authorized Agent of LG Hotel LLC dba Toll House Toll House Operating Agreement to Allow Entertainment at 140 S. Santa Cruz Avenue