Mayor Frederik M. Fowler
Vice Mayor Julia Miller
Councilmember Manuel Valerio
Councilmember Pat Vorreiter
Councilmember Jack Walker
Councilmember Tim Risch
Councilmember John Howe

List of Claims and Bills Approved for Payment by the City Manager (No. 103)

Staff Recommendation: Approve the list of bills.

City of Sunnyvale Investment Report 2^nd Quarter 2002

RESOLUTIONS
NO. 160-02
NO. 161-02
RTC 02-302

Award of Request for Proposals No. F0203-49 for Traffic Signal Coordination on Mathilda, Maude and Fair Oaks Avenues

Elaine Wesely, Finance Manager, presented the staff report. The award is for two contracts: one to TransCore for the Mathilda/Maude Avenue Project and a second to BiTrans Systems, Inc. for the Fair Oaks Avenue Project.

Councilmember Risch asked for the rationalization of not awarding to the low bidder for the Mathilda Avenue project and expressed concern over compatibility of two different systems.

Marvin Rose, Director of Public Works, explained that Mathilda Avenue is the highest traveled arterial in Santa Clara County and required a more complicated system. Fair Oaks, being much less traveled, requires a less complex system. He stated that both companies have a good history of the availability of parts and that the systems are not interconnected and therefore, compatibility is not an issue.

Mayor Fowler opened the Public Hearing and, there being no public comments, closed the Public Hearing at 8:02 p.m.

Councilmember Vorreiter moved, and Councilmember Risch seconded, to award a contract to TransCore for the Mathilda and Maude Avenues Project in an amount not to exceed $370,000; and award a contract to BiTrans System, Inc., for the Fair Oaks Avenue Project in an amount not to exceed $129,000. The motion carried unanimously.

Award of Request for Proposals No. F0205-70 for Document Imaging Services

Staff Recommendation: Award a three-year contract in an amount not to exceed $149,925 to Bid America, Inc., for document imaging services for the Community Development Department.

Award of Contract for Design and Construction Support Services for Improvements to Ortega and Lakewood Parks (No. F0207-03)

Staff Recommendation: Award a contract, in an amount not to exceed $96,000 ($81,000 in consultant fees and $15,000 in additional services, if authorized), to the Tanaka Design Group for design and construction support services for improvements to Ortega and Lakewood Parks.

Award of Contract for the Publication of Legal Advertising (No. F0207-02)

Staff Recommendation: Award a three-year contract not to exceed $225,000 to the San Jose Mercury News for legal advertising.

Award of Contract for Employee Recruitment Services (No. F0207-04)

Staff Recommendation: Award a one-year contract in an amount not to exceed $132,000 to the City of Palo Alto for personnel recruitment and selection services.

Authorization to Increase Expenditures under an Existing Contract for the Reconstruction of Curbs, Gutters, Sidewalks and Driveways (No. F0207-05)

Staff Recommendation: Authorize additional expenditures in an amount not to exceed $278,171 under an existing contract with L & B Engineering, Inc., for the reconstruction of curbs, gutters, sidewalks and driveways, making a total contract not-to-exceed the amount of $842,151.

Award of Juvenile Accountability Incentive Block Grant (JAIBG) Funding to the County of Santa Clara

Staff Recommendation: Approve the Resolution declining direct acceptance of funding and authorizing appropriation to the County of Santa Clara.

RESOLUTION NO. 162-02: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SUNNYVALE DECLINING TO DIRECTLY ACCEPT JUVENILE ACCOUNTABILITY INCENTIVE BLOCK GRANT FUNDS

Adoption of Ordinance No. 2700-02: Rezone of Nine Properties on the North Side of Tasman Drive Between Morse Avenue and Persian Drive from M-S/R3, ITR/PD (Industrial and Service /Medium Density Residential, Industrial-to-Residential/Planned Development) District to R-4/Planned Development (High Density Residential/Planned Development) District

Staff Recommendation: Adopt the Ordinance.

ORDINANCE NO. 2700-02: AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SUNNYVALE AMENDING THE PRECISE ZONING PLAN, ZONING DISTRICTS MAP, TO REZONE NINE PROPERTIES LOCATED ON THE NORTH SIDE OF TASMAN DRIVE BETWEEN MORSE AVENUE AND PERSIAN DRIVE, APN NOS. 11029002, 11029005-008, 11029011, 11029027, 11029028-29 FROM M-S/R3, ITR/PD (INDUSTRIAL AND SERVICE/ MEDIUM DENSITY RESIDENTIAL, INDUSTRIAL-TO- RESIDENTIAL/PLANNED DEVELOPMENT) DISTRICT TO R-4/PD (HIGH DENSITY RESIDENTIAL/PLANNED DEVELOPMENT) DISTRICT

Adoption of Ordinance No. 2701-02: Downtown Parking Maintenance District Debt Service Ad Valorem Assessment for Fiscal Year 2002/2003

Staff Recommendation: Adopt the Ordinance.

ORDINANCE NO. 2701-02: AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF SUNNYVALE FIXING AND LEVYING AD VALOREM ASSESSMENTS FOR FISCAL YEAR 2002-2003 ON ALL LAND AND IMPROVEMENTS WITHIN THE DOWNTOWN PARKING MAINTENANCE DISTRICT

Acceptance of Improvements – Water Pollution Control Plant Administration Building Improvements

Staff Recommendation: Accept, by Resolution, the project as complete and satisfactory.

RESOLUTION NO. 163-02: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SUNNYVALE ACCEPTING AS COMPLETED WORK FOR WATER POLLUTION CONTROL PLANT ADMINISTRATION BUILDING IMPROVEMENTS (PR-98/10-99), AUTHORIZING FINAL PAYMENT AND DIRECTING CITY CLERK TO FILE NOTICE OF COMPLETION

Acceptance of Improvements – Reconstruction of Curbs, Gutters, Sidewalks and Driveways

Staff Recommendation: Accept, by Resolution, the project as complete and satisfactory.

RESOLUTION NO. 164-02: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SUNNYVALE ACCEPTING AS COMPLETED WORK FOR RECONSTRUCTION OF CURBS, GUTTERS, SIDEWALKS AND DRIVEWAYS (ST-00/04-01), AUTHORIZING FINAL PAYMENT AND DIRECTING CITY CLERK TO FILE NOTICE OF COMPLETION

Public Hearing to Cause Charges for Non-Payment of Utility Services and Non-Payment for the Cost of Abatement of Nuisances to be Placed on the FY 2002/2003 Tax Roll

Tim Kirby, Finance Manager, reported that this would place assessments on the tax roll for two properties for delinquent fees owed to the City of Sunnyvale. Both properties have at least three outstanding bills that are at least 60 days delinquent. Attempts to collect the outstanding debts have been unsuccessful.

In response to Vice Mayor Miller's query, Mr. Kirby reported that both customers are continuing violators.

Mayor Fowler opened the Public Hearing at 8:07 and, there being no public comments, closed the Public Hearing.

Vice Mayor Miller moved, and Councilmember Howe seconded, to adopt the resolution and proceed with the assessment process through the County of Santa Clara. The motion carried unanimously.

RESOLUTION NO. 165-02: A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SUNNYVALE CONFIRMING LIENS ON REAL PROPERTIES FOR NONPAYMENT OF UTILITY CHARGES AND ABATEMENT OF NUISANCES COSTS

RTC 02-292

Diana O'Dell, Associate Planner, presented the staff report. She identified the three goals of the policy: to provide clear expectations to city residents, applicants, Council, Planning Commission and staff regarding what is or is not compatible development; to emphasize important issues such as privacy and neighbor-to-neighbor respect; and to provide photos and illustrations of the majority of policies to assist property owners in understanding architectural concepts and techniques. The new policy includes more detailed numeric standards and more detailed directions regarding categories such as entry height and second story size.

Councilmember Risch expressed concern regarding the compatibility of differing roof pitches.

Trudi Ryan, Planning Officer, responded stating that the intention is to create a balance of individuality and compatibility in neighborhoods.

Councilmember Vorreiter speculated that compatibility allows for flexibility in design while remaining in compliance with the guidelines.

Councilmember Walker suggested including recessing the back wall of a second story as well as the sidewalls under section 3.4 (C) of the guidelines. He affirmed that the impacts on new homes would be reduced with the new guidelines.

Vice Mayor Miller expressed similar concerns that flat roofs may not be compatible with pitched roofs. She also questioned the enforceability of the guidelines.

Ms. Ryan clarified that this is possible based on the materials that are used, as well as other factors, but that in some circumstances a flat roof may not be compatible. The guidelines are techniques and will be enforced in that an application can be approved or denied based on the guidelines.

Robert Paternoster, Community Development Director explained the difference between the Design Guidelines and Zoning Standards.

In response to Councilmember Walker, Ms. Ryan stated ambiguous language has been removed from new guidelines, are more defined, and more grounded in the community concerns. Periodic educational workshops will be held with staff, Planning Commission and design consultants.

Councilmember Risch clarified the standards for adding a second story in neighborhoods that are predominately one-story. He addressed the issue of the placement of windows to minimize the intrusion on the privacy of the adjacent homes.

Responding to Mayor Fowler, Ms. Ryan clarified that the City would have three documents: Citywide Design Guidelines, which will apply to commercial and multi-family; Industrial Guidelines; and the Single Family Design Techniques, which is a sub-set of the Citywide Design Guidelines.

David Simons, Planning Commission Chairman, presented the recommendation of the Planning Commission that included modifications to several sections of the guidelines.

Mayor Fowler opened the Public Hearing at 8:44 p.m.

Arthur Swartz, a member of the public, stated that he and his wife enjoy walking and the ambiance of the area. He urged the Council to maintain cohesive neighborhoods and not be influenced by the current fashion of home designs.

Lou Wirtz, a member of the public, expressed concerns with the guidelines adequately addressing privacy issues and enforceability of the guidelines. He thinks that neighborhood review committees should be allowed to review all new developments before approvals are granted.

Vice Mayor Miller would like the guidelines for single story rebuilds to come back to Council to address the privacy impacts on the adjacent neighbors relative to the grading and elevation of the property.

Peggy Pollen, Coldwell Banker, stated that the area realtors are not clear on regulations regarding remodeling existing homes and would like clarification to assist potential buyers.

Werner Gans, a member of the public, asserted that the staff has done an excellent job on developing the design guidelines.

Bill Callahan, a member of the public, thinks that the guidelines have been weakened and are not enforceable.

Joseph Dittbesner, a member of the public, stated that he would like to build a second story onto his home that may be larger than the guidelines allow. He stated that a transition neighborhood is difficult to define when the homes range in age from circa 1918 to present.

Vice Mayor Miller read a letter into the record from Wilma Anderson, 1617 Wright Avenue, stating that when this item had been heard by the Planning Commission she thinks that incorrect information had been posted on the City's website. She thinks that the new guidelines will be ineffective and need further clarification before implementing them. She also would like the final draft of the guidelines be made available to the public.

Tom Carrig, a member of the public, asked how the Municipal Code, Zoning Code and Design Guidelines interact.

Mayor Fowler closed the Public Hearing at 9:40 p.m.

Motion by Councilmember Walker, and seconded by Councilmember Vorreiter, to adopt the Single Family Design Techniques, as modified by the Planning Commission, as a subset of the City-Wide Design Guidelines and direct staff to modify the existing City-Wide Guidelines and remove all references specific to single family homes. To include rear set backs under 3.4 (C) and directed staff to come back with recommendations on dealing with privacy related to grade separations for both single and two-story homes.

Vice Mayor Miller offered a friendly amendment reiterating that staff to come back with recommendations on dealing with privacy related to grade separations for both single and two-story homes directing that the final draft of the report, with amendments and corrections is to be submitted to Council as an Information Item and posted on the City's website. The amendment was accepted.

Councilmember Vorreiter offered a friendly amendment that in section 3.5 (L) substitute the word "compatible" for "similar" in the text and the picture caption, and in 3.6 (C), make the pictorial instructions synonymous with the narrative, which includes the words "where possible". The amendment was accepted.

Councilmember Risch offered a friendly amendment to remove the 35% requirement in section 3.4 (A). The amendment was not accepted.

Councilmember Risch moved, and Councilmember Valerio seconded, to remove the 35% requirement in section 3.4 (A). The motion failed on a split vote with Mayor Fowler, Vice Mayor Miller and Councilmembers Walker and Howe dissenting.

The original motion carried unanimously.

Mayor Fowler recessed the meeting at 10:00 p.m. and then reconvened at 10:13 p.m.

RTC 02-307

John Hopkins, Assistant Director of Public Works, presented a detailed staff report. He detailed the elements of the Disposition and Development Agreement (DDA) and noted the exceptions allowed, under the City Charter, to the competitive bid process. He then reviewed the alternatives that have been offered for Council's consideration.

Councilmember Risch posed questions regarding the legal aspects of awarding the contract without the benefit of competitive bidding.

City Attorney Armento responded that the City Charter offers flexibility with regard to projects that are considered to be Municipal affairs on competitive bidding. Exceptions to competitive bidding practices are allowed and are justified in the report. Timing is not the sole reason for the exemption. There are other interrelated factors that have been considered to determine if the exemption is legitimate.

Councilmember Risch asked what the dollar spread could be on a competitive bid.

Director Rose responded that, based on previous projects, this project there would probably be from two to four bidders and the bids would be relatively close. Many factors, including cost, schedule and the integrity of the watertight system of project, promulgated the discussion of the advantages for considering a negotiated contract. Another advantage is that it would accelerate the construction schedule and ameliorate some warranty issues that might occur, over time, with two separate contractors. Staff would come back to Council with a negotiated contract with a not-to-exceed dollar amount for what they believe is a competitive bid. Staff will calculate a parallel internal bid of the project, which will remain confidential during negotiations with Devcon.

In response to Councilmember Howe's inquiry, Director Rose clarified the estimated time that would be cut from the project is three months. He estimated that a contract could be negotiated and brought back to Council in September 2002.

Mayor Fowler opened the Public Hearing at 10:45 p.m.

Joe Antuzzi, representing the Downtown Association, directed comments to the Council in support of the staff recommendation to negotiate a contract with Devcon Construction for the Downtown Plaza. Merchants are anxious to see the construction completed and are confident with the quality of the Devcon's work.

Andy Maloney, a member of the public, expressed concerns that exempting the project from the competitive bidding process jeopardizes the integrity of the bid process.

Suzi Blackman, President and CEO of the Sunnyvale Chamber of Commerce, supports the staff's recommendation to negotiate a contract with Devcon Construction.

Werner Gans, a member of the public, asked what the percentage of the entire contract is for the subcontractors. Director Rose responded that the cost would be unknown until the contract has been negotiated.

Daisy Anzoategui, Senior Project Manger for Devcon Construction, attested to the integrity of the waterproofing of the Downtown Plaza. She assured the Council that Devcon would pre-qualify bidders on subcontracts. She also stated that there would not be excessive change orders.

Mayor Fowler closed the Public Hearing at 11:15 p.m.

Councilmember Vorreiter moved, and Councilmember Walker seconded, to make the finding under Sunnyvale Municipal Code Section 2.09.070 (b)(5) that solicitation of bids is unavailing as affecting the final result and will not produce an advantage to the City since the public interest is best served by contracting directly with Devcon Construction Incorporated for the reasons previously identified as advantages, and directed staff to initiate negotiations with Devcon to develop a Guaranteed Maximum Construction Contract for review and action by the City Council at a future meeting. The motion carried with Mayor Fowler, Vice Mayor Miller and Councilmember Risch dissenting.

RTC 02-296

Investment and Cash Management Policy Update for FY 2002/2003

Therese Balbo, Finance Manager, presented the staff report. She explained that the purpose of the policy is to establish objectives and criteria for the investments of the City's idle funds and to provide guidelines for the cash management system. The policy also addresses the types of securities that are eligible for investment and the dollar limits.

In response to Vice Mayor Miller's question about the reserves, Mary Bradley, Director of Finance, responded that the reserve is made up of three components: the contingency reserve, the service level reserve and the resource allocation reserve, and totals about $80 million. Cash on hand is approximately $25 million.

Mayor Fowler opened the Public Hearing at 11:40 and, there being no public comment, closed the Public Hearing.

Motion by Councilmember Walker, seconded by Vice Mayor Miller, to adopt the investment policy as presented.

RTC 02-306

City Clerk Kitchens presented a brief staff report.

Councilmember Walker suggested moving the evaluation for the City Attorney as two Councilmembers will be out of town on the date that is currently scheduled.

Mayor Fowler requested that staff schedule the Budget Appropriations Study Session for either September 24 or October 8.

Councilmember Valerio suggested moving the City Attorney Evaluation to September 30 to accommodate the Council's schedule.

Mayor Fowler opened the Public Hearing at 11:48 and, there being no public comments, closed the Public Hearing.

Motion by Councilmember Walker, and seconded by Councilmember Vorreiter, to adopt the Study Issues Calendar with the change of moving the City Attorney's evaluation to September 30.

Mayor Fowler offered a friendly amendment to direct staff to identify either September 24 or October 8 for a Study Session regarding Budget Appropriation Controls. The amendment was accepted.

The motion carried unanimously.

Appeal of Planning Commission Hearing of July 8, 2002 and Administrative Hearing of July 10, 2002

No action was taken.