July 16, 2002

In December 2000, the City Council requested this study to examine the potential of rezoning industrial sites north of US-101, south of SR 237 and west of Lawrence Expressway to residential and commercial zones. This study was prompted by concerns about the current housing shortage and the lack of adequate neighborhood-serving commercial centers in the north part of the City.

There are three industrial areas within the study boundaries: Ross Drive/Hamlin Court, Weddell Drive/Weddell Court and ITR Sites 7 and 8. Based on the established criteria, staff eliminated both the Ross Drive/Hamlin Court properties and the Weddell properties from consideration. These properties were environmentally unsuitable for residential development due to freeway noise exposure. Reduced visibility and circuitous access made them less viable for commercial development.

The last group of industrial properties is located mainly in Sites 7 and 8 of the Futures Study (See Attachment 5 pg. 1, Study Area Maps). One 2.16-acre parcel is a City-owned property in the M-S (Industrial and Service) Zoning District. The remaining 81 acres of study area is zoned M-S/R-3/ITR/PD to promote conversion from existing industrial uses to medium-density residential development (see Background section for a complete discussion of the Industrial-to-Residential Study).

To verify the feasibility of a retail center in this area, the City hired the Sedway Group to perform a detailed analysis of the southwest corner of Fair Oaks Avenue and Tasman Drive. This study looked at the extent of the commercial space needed and appropriate site sizes to locate a neighborhood grocery and drug store. The subject site is made up of five parcels totaling 12.84 acres that currently contain a variety of manufacturing and related industrial uses. The study found that the 12.84 acre site could support up to 140,000 sq. ft. of retail, which would be adequate for a grocery and drug store tenant. However, the center would not likely develop prior to significant residential development in the adjoining area, as existing demand is not strong enough to support a center.

At the Joint Study Session on October 9, 2001, staff proposed two scenarios for this remaining study area. Both of these scenarios is designed to further promote redevelopment to residential and commercial uses. As a result of the public hearings with the Planning Commission two additional scenarios were added.

Based on the direction of the City Council and Planning Commission at the Joint Study Session in October 2001, staff hired a traffic consultant to prepare a Transportation Impact Analysis on the scenarios identified. The traffic analysis found that Scenario A would create enough traffic to lower the Level of Service (LOS) at Tasman Drive/Lawrence Expressway to LOS E, below City standards. Mitigation for this impact would require additional turn lanes to be installed this intersections to mitigate the traffic impact to acceptable levels.

Scenario B would create enough traffic to lower the Level of Service (LOS) at Tasman Drive/Lawrence Expressway and Tasman Drive/Fair Oaks Avenue intersections to LOS E, below City standards. Mitigation would require additional turn lanes to be installed at each of these intersections to mitigate the traffic impact to acceptable levels.

Scenario A – Remove the ITR designation from properties north of Tasman Drive and increase density allowed to 36 du/acre (R-4 density). Zone approximately 12.84 acres at the southwest corner of Fair Oaks Avenue and Tasman Drive to mixed use allowing up to 66 dwelling units and 140,000 sq. ft. of retail at that location. There would be no change in total units allowed for the study area and total new commercial square footage is 140,000. (Attachment D Scenario Breakdown)

Scenario B – In addition to Scenario A, increase the density allowed in the remaining ITR area south of Tasman Drive, but maintain the ITR designation for these properties. Net new units are 588, and net new commercial is 140,000 sq. ft.

Planning Commission Recommendation - Remove the ITR designation from properties north of Tasman Drive and increase density allowed to 36 du/acre (R-4 density). Retain the Medium Density Residential zoning south Tasman Drive and direct staff to study alternate locations for commercial development. There would be a net change of up to 243 total units allowed for the study area. As no specific zoning or general plan amendment for commercial development is recommended, this potential change is not included in the impact analysis.

Modified Planning Commission Recommendation (Staff Recommendation) – Accept the Planning Commission recommendation on zoning. Amend the General Plan to allow a range of residential densities from Medium to High and up to 140,000 s.f. of neighborhood serving commercial. Net new units and commercial could be up to the amount of Scenario B (588 dwelling units and 140,000 s.f. of commercial). Based on the preliminary applications for less than the maximum R-3 density development (21 units per acre proposed), it is unlikely that the maximum would be reached.

In December 2000, the City Council requested this study to examine the potential of rezoning industrial sites north of US-101, south of SR 237 and west of Lawrence Expressway to residential and commercial zones. This study was prompted by concerns about the current housing shortage and the lack of adequate neighborhood-serving commercial centers in the north part of the City.

Within the study area boundaries are two ITR (Industrial-to-Residential) sites totaling 81 acres. The ITR combining district was created in 1993 to specifically identify commercial and industrial areas that would be appropriate for transition to residential uses. The ITR designation on these sites allows for the continuation or expansion of existing industrial and commercial uses as well as the construction of new medium-density residential housing. Appropriate General Plan, Zoning and environmental review was conducted to simplify the process for potential development. Environmental impacts associated with the construction of residential units were addressed with an EIR in the original study.

However, since these ITR sites were designated in 1993, none have converted to a residential use. There are several explanations for this, including existing building quality, the high demand for industrial square footage and the lack of nearby neighborhood services.

In 1997, Sunnyvale conducted a retail market study for the entire north of Sunnyvale (North of Central Expressway). This study analyzed neighborhood-serving commercial centers in the area to determine if the existing supply met demand. The results indicated that the northern part of the City is under-served and recommended additional steps to facilitate neighborhood retail. A preliminary site at the corner of Tasman and Fair Oaks was identified as one of several sites having the potential for additional commercial uses.

Policy C2.1 Provide land use categories for and maintenance of a variety of residential densities to offer existing and future residents of all income levels, age groups and special needs sufficient opportunities and choices for locating in the community.

Action Statement C2.1.4 Support the transition of Industrial to Residential (ITR) areas as opportunities to increase housing variety and stock.

Action Statement C2.4.1 Locate higher density housing with easy access to transportation corridors, rail transit stations, bus transit corridor stops, commercial services, and jobs.

Policy N1.6 Safeguard industry’s ability to operate effectively, by limiting the establishment of incompatible uses in industrial areas.

Housing and Community Revitalization Sub-element

Goal A – Foster the expansion of housing supply to provide greater opportunities for current and future residents within limits imposed by environmental, social, fiscal and land use constraints.

Action Statement A.1.d Study increasing the density of residential areas near transit stops and along major transportation corridors in conjunction with regional transportation plans.

Action Statement B.3.c Study feasibility of Rezoning ITR Sites 7 and 8 to residential zones.

On May 8, 2002, a new Housing and Community Revitalization Sub-element was certified by the State of California’s Housing and Community Development Department. This Sub-element lists the types of goals and programs that the City intends to pursue or maintain in order to provide an adequate supply of housing. The City’s fair-share housing numbers are incorporated into this sub-element. Based on job and population projections, it is estimated that the City will need to provide 511 additional housing units per year until the year 2005. This requires almost 3,500 housing units in the seven-year period from January 1999 to December of 2005. The Housing and Community Development Department of the State of California requires all Cities to show how they will meet their fair share of housing in the Sub-element period. Staff estimated that almost 1,500 housing units would need to be built in all the ITR areas throughout the City in the next 4.5 years to meet this goal.

The study consists of four main sections: research, public outreach, analysis and recommendation. In the early part of 2001, staff conducted research on the types of uses in the study area, property characteristics and ownership patterns. A retail market study was commissioned to analyze the potential for development of neighborhood-serving retail. Staff also conducted a series of public meetings to inform property and business owners of the process and its possible impacts. Based on this information, staff presented several alternatives for consideration by the Planning Commission and City Council at a joint study session on October 9, 2001 (see Scenarios listed on pg. 8).

Following the Study Session, staff hired a traffic consultant to prepare a Transportation Impact Analysis on the alternatives identified. Staff continued research on different land use alternatives for each property. The recommendations in this report are based on the information gathered through consultant studies and staff research as well as community input.

To analyze the suitability of transitioning the industrial sites to residential or commercial development, staff used the following criteria.

• Accessibility and visibility of the site for viable retail development
• Size of individual properties
• Proximity to transit (including light rail, bus lines and freeways)
• Noise impacts of surrounding freeways on potential residential uses
• Location of hazardous materials and their effect on potential development
• Balance of the City’s economy including value of existing industrial properties for small businesses and start-ups. The City’s Economic Development Program has identified certain types of businesses that should be retained in order to provide an appropriate balance between types of economies and business size.
• Age of existing buildings indicating the likelihood of redevelopment in the immediate future.

There are three industrial areas within the study boundaries:

• Properties on Ross Drive and Hamlin Court - located west of Mathilda Avenue in the triangle between Route 237 and US-101.
• Properties along Weddell Drive and Weddell Court - frontage roads along US-101.
• ITR Sites and a City-owned property near Fair Oaks - Sites 7 and 8 of the Futures Study, and a 2.16-acre parcel near the intersection of Fair Oaks and Route 237.

Based on the established criteria, staff reported to Council the elimination of two groups of properties from consideration for changing to a residential or commercial zoning designation.

Ross Drive/Hamlin Court – These properties have limited visibility on Mathilda Avenue, and are bordered by two major freeways, which create a loud noise corridor unsuitable for residential development. Several of the buildings in this group have been constructed in the last 10 years, making it less likely that they would redevelop into a new land use in the near future.

Weddell Drive and Weddell Court – These properties have limited access, as the main connection of Weddell to Fair Oaks is less visible. Weddell is a frontage road that contains many multi-tenant and small tenant spaces, making them valuable for the overall economic health of the City and the businesses. The proximity to US-101 could make them inappropriate for residential development due to noise considerations.

At the Joint Study Session on October 9, 2001, the Council and Commission concurred with staff recommendation that the above groups of properties should be eliminated from residential or commercial consideration.

The last group of industrial properties is located mainly in Sites 7 and 8 of the Futures Study (See Attachment 5 pg. 1, Study Area Maps). In addition, there is a 2.16-acre site owned by the City that is located in an M-S Zoning District. The remaining properties are zoned M-S/R-3/ITR/PD and are designated for conversion from industrial uses to medium-density residential development (see Background section for a complete discussion of the Industrial-to-Residential Study).

Land Uses – The area consists mainly of industrial, research and development and manufacturing uses. There are two churches located in the study area along Tasman and Persian Drives. A 169-unit townhouse development (Traditions) and a 186-unit apartment complex (Kensington Place) are located adjacent to these sites.

Property sizes – The property sizes range from approximately 0.70 acres to 6.90 acres.

Ownership Characteristics – Most properties are owned by the business that occupies the land or an individual property owner. There are no multiple parcels owned by single individual or company.

Building Age and Intensity – Most buildings were built in the 1970s, making them approximately 30 years old (see Attachment C). Over half of the properties are built at higher than 35% FAR, which is more than allowed currently in the M-S Zoning District.

Nearby Transit – the site is directly adjacent to the Fair Oaks light rail station and is within 1,000 ft. of both SR 237 and US-101. Two bus lines (the 26 and 54) run along Fair Oaks Avenue next to the study area.

In response to the original retail market study conducted in 1997, the City hired the Sedway Group to perform a detailed analysis of the southwest corner of Fair Oaks Avenue and Tasman Drive. This study looked at the extent of the commercial space needed and appropriate site sizes to locate a neighborhood grocery and drug store. The subject site is made up of five parcels totaling 12.84 acres that currently contain a variety of manufacturing and related industrial uses.

The study found that that site could support up to 140,000 sq. ft. of retail, which would be adequate for a grocery and drug store tenant. The likelihood of this site developing into a retail center is dependent on two factors: the competition from nearby grocery stores and the amount of residential that develops in the surrounding area. The conclusion states that designation of a neighborhood shopping center is warranted if the surrounding area were to develop with medium to high-density residential uses. However, the center would not likely develop prior to significant residential development in the adjoining area, as existing demand is not strong enough to support a center.

At the Joint Study Session, staff proposed several alternatives for consideration to promote redevelopment of the properties to housing units and creation of a retail center.

One option is to remove the ITR designation from some or all of the properties. Removing the ITR designation eliminates the ability for property owners to add on or rebuild industrial uses. Without the M-S/ITR zoning designation, all existing industrial or commercial uses would become non-conforming. Non-conforming status for industrial or commercial properties means that no additions in floor area are allowed and that if the building is damaged or destroyed such that the cost of repairing the damage is greater than 50% of the value of the building, the property may not be rebuilt with the non-conforming use.

The second option is to increase the permitted density from 24 du/acre to 36 du/acre. This is intended to increase the value of the property as a residential site and capitalize on the proximity of the site to light rail, freeways and the employment center of Moffett Park. This density increase may be applied in conjunction with the ITR designation.

Staff proposed two scenarios for traffic analysis purposes (see Attachment D, Breakdown of Scenarios).

Scenario A – Remove the ITR designation from properties north of Tasman Drive and increase density allowed to 36 du/acre (R-4 density). Zone 12.84 acres at the southwest corner of Fair Oaks Avenue and Tasman Drive to mixed use, allowing up to 66 dwelling units and 140,000 sq. ft. of retail on that site. The total net new units allowed in the entire study area would be 0. Net new commercial allowed is 140,000. (Attachment E, Scenario Information)

Scenario B – In addition to Scenario A, increase the density allowed in the remaining ITR area south of Tasman Drive, but maintain the ITR designation for these properties. Net new units are 588, and net new commercial is 140,000 sq. ft.

A Transportation Impact Analysis (TIA) was conducted for the proposed zoning changes according to the requirements of the Santa Clara County Congestion Management Program (CMP). A TIA is required for any proposed land use entitlement that will result in the generation of 100 of more peak hour trips.

The analysis was conducted for a long range (2020) development build-out. For the purpose of traffic analysis, staff examined the traffic impacts associated with three possible land use scenarios, including the two listed above. The third scenario included a sensitivity analysis to determine the breaking points for various traffic mitigation improvements associated with varying levels of development.

Scenario A and B traffic conditions were represented by adding the additional traffic generated by the scenario to the base year 2020 traffic volumes. Base Year 2020 traffic volumes were derived from the City of Sunnyvale travel demand forecast model and the General Plan. Traffic conditions under each scenario were evaluated relative to the base year 2020 conditions in order to determine potential impact. The traffic impact study included an analysis of 13 signalized intersection and six freeway segments (see Attachment E, Study Intersections).

Level of service (LOS) at these locations was analyzed based on City and Santa Clara County Congestion Management Program (CMP) standards. City intersections were analyzed based on City LOS standards. Regionally Significant intersections and state freeways were analyzed based on CMP standards. Intersection and roadway designation is based on the Land Use and Transportation Element, Roadway Classification Map.

The following is a breakdown of the total net new trips caused by each scenario.

The results of the traffic impact study show that the neither Scenario A or Scenario B would result in impacts on the freeway segments, or merging segments analyzed. This is according to county CMP level of service standards for freeways.

However, the results of intersection level of service analysis show that Scenario A and Scenario B would both result in a significant impact to the Lawrence Expressway & Tasman Drive intersection. Scenario B would have additional significant impacts at the Fair Oaks Avenue & Tasman Drive intersection.

The evaluation of the scenarios for bicycle and pedestrian facilities showed that existing facilities in the study area would need improvement. Sidewalks would need to be constructed on both sides on Tasman Drive, west of Fair Oaks Avenue. Bicycle facilities such as racks and lockers should be included in site design. The existing transit facilities will be sufficient to accommodate the proposed zoning changes.

The following mitigation measures have been recommended in order to mitigate the project impacts described above.

• Lawrence Expressway and Tasman Drive - Scenarios A and B both result in impacts at this intersection. The current planned long range improvement to provide a grade separation at Lawrence and Tasman does not include separate right turn lanes for either the eastbound or the westbound directions. Adding an eastbound and westbound right-turn lane to the planned interchange would mitigate the CMP level of service impact.
  
• Fair Oaks Avenue and Tasman Drive - According to the City of Sunnyvale level of service policy, Scenario B would result in a level of service impact at this intersection. LOS would decline from a D to an E in the AM peak hour. The City's LOS policy is "D" or better, except that for intersections of regional importance it is LOS E or better. Adding an eastbound right-turn lane would mitigate the City of Sunnyvale level of service impact. However, this would require widening the Tasman Drive/Fair Oaks Avenue intersection and possibly the purchase of private right of way. The traffic impact study estimates that this mitigation could cost approximately $250,000 (not including right of way costs).

Staff feels that although widening of the intersection of Fair Oaks Avenue and Tasman Drive may be an appropriate mitigation from a traffic engineering viewpoint of efficient vehicular transportation, it may not be the most appropriate solution from a multi-modal and regional transportation viewpoint. The VTA has adopted policy to support concentrated development in transit cores, corridors and station areas. Part of this policy advocates for a diverse mix of uses and the design of streets and intersections for pedestrians. Widening an intersection as mitigation for concentrated residential and mixed use development in the vicinity of a transit core would be contrary to this policy.

The City is currently undergoing a comprehensive plan to examine and identify transportation and infrastructure improvements needed to accommodate planned changes in land use. This comprehensive program will be evaluating transportation corridors and making larger city-wide decisions on transit corridor designations, appropriate levels of service and road standards. One option the Commission and Council could choose is to defer making any land use decisions until the TSP is completed in 2003. Based on the information in the TSP, certain mitigation may not be required in order to increase residential densities in this area.

If this land use decision is not deferred, than road-widening mitigation must be adopted in order to approve any land use changes which exceed the levels identified in Scenario A.

The City owns two pieces of property that could be affected by proposed changes. The first piece is a 5.33-acre site located at 1010-1024 Morse Avenue, just north of the Hetch-Hetchy Park. Five buildings contain approximately 82,000 s.f. of multi-tenant industrial space are located on this parcel. The City has designated that site as a potential future park to better serve existing and future residential development in the area. There are no immediate plans to make this conversion, and staff does not recommend any special designation for that property at this time.

The second property is a 2.16-acre parcel at the interchange of Fair Oaks Avenue and Route 237. The parcel is split in half by the off-ramp from 237 South and the continuation of Persian Drive from the west side of Fair Oaks to the east (see Attachment F, Aerial Photograph). Fair Oaks Way borders the property to the west and the 237 overpass of Fair Oaks Avenue borders the east. The property is used as a construction staging area for parking of construction vehicles. An adjoining 0.71-acre parcel owned by the Santa Clara County Transit District contains a large transformer that is used for the light rail.

The site has several challenges to development:

• Access - while there is an off-ramp from 237 to Fair Oaks, there is no corresponding on-ramp. Main roads that lead to the property are the frontage roads of Persian Drive and Fair Oaks Way.
• Visibility – the site is difficult to see from the major arterial of Fair Oaks due to grade differentials in the Fair Oaks overpass.
• Size – as the site is partially taken up with the off-ramp and Persian drive connector, the remaining halves are less than one acre each, limiting development potential.

The Traditions Homeowners Association, representing the adjacent townhouse project, has requested that the site be designated as park space for use by nearby residents. The Parks and Recreation Department have denied that request due to safety concerns with high-speed traffic on the off-ramp and Fair Oaks Way (see Attachment H, Letter from Public Works). Public Works has proposed landscaping both lots and installing fencing in order to improve the appearance of the site. Due to budget constraints, this item has not yet been listed as a priority high enough to receive funds for the project.

An appropriate use for this site would be low-intensity destination uses (a use not requiring high visibility). Certain uses such as day-care, mini-storage, or a garden centers could be considered under the current zoning.

Since the time of this study, several property owners have contacted staff expressing interest in redeveloping their industrial properties to medium-density residential uses. These properties are located at the southwest corner of Tasman and Fair Oaks Avenue in the area identified for possible transition to commercial use. Both property owners expressed strong interest in redeveloping their properties to residential, not commercial uses.

Based on the ABAG regional housing needs and the goals and policies of the Land Use and Transportation Sub-element as well as the Housing Sub-element, staff finds that development of housing is necessary for the health of the community. In addition, the retail market study has identified a potential demand for commercial development and possible locations along Fair Oaks Avenue to support the increased residential development.

The existing ITR sites in the study area are the best suited for additional residential and commercial development. These sites are currently designated for medium-density residential uses; and, their location adjacent to a light rail station, bus lines and major freeways make them ideal for higher-density housing and possible commercial designation.

However, staff has found that many of the possible methods for encouraging commercial development may have drawbacks that actually slow redevelopment. The retail market study states that there is difficulty in developing a viable commercial center prior to significant residential development in the area. In addition, all five properties in this area would need to be aggregated to support a substantially-sized grocery and drug store as stated in the report. These two factors could combine to slow redevelopment at an important corner. Two of the property owners in that area have expressed interest in redeveloping to medium to high-density residential uses, which would be discouraged by a commercial zoning. While it is acknowledged that commercial services are needed in the area, rezoning a large section of the area without enough existing demand to support development of a commercial center now may be detrimental to the short-term (5 to 10 year) redevelopment of the area.

To encourage further housing development, staff recommends removing the ITR designation and increasing the allowed density to 36 du/acre in certain sections of the study area. Removing the ITR combining district would be effective in discouraging industrial redevelopment and increasing the density allowed could increase the desirability of the land for residential development. Staff also recommends changing the general plan to allow a range of residential densities: from medium (24 du/acre) to high (36 du/acre).

Staff has analyzed possible uses for the City-owned site and has not been able to identify a use that is compatible and supportive of the adjacent residential yet is not adversely affected by the limited access and small site size. Possible uses identified do not necessarily require different zoning districts, so no zoning change is recommended. Staff recommends that as a separate study issue, a commercial broker assist the City in identifying businesses or uses which may be viable at the site.

This item was heard before the Planning Commission on June 10, 2002. Several community members and interested parties spoke regarding the item (see Attachment J, Planning Commission Minutes). Several speakers requested that the area south of Tasman be maintained at an R-3 density due to its suitability for developing medium-density ownership units. Concerns were expressed regarding the feasibility of developing high-density (R-4) ownership housing. One citizen expressed concern about making any changes to the residential zoning without designating a specific location for commercial uses. Other citizens spoke regarding traffic impacts and the uses associated with City-owned property.

Based on the testimony and staff recommendation, the Planning Commission concurred with staff that no specific commercial designation be made at this time. However, Planning Commission modified staff’s proposal to increase densities throughout the study area. The Commission recommended that the existing medium-density zoning be retained in the study area south of Tasman Drive while the area north of Tasman be rezoned to R-4/PD.

At the Planning Commission hearing, staff originally recommended that the area north of Tasman be rezoned to R-4/PD, and the area south of Tasman also be increased in density but retain the ITR designation that allows industrial buildings to remain conforming. No specific commercial designation was recommended at that time, due to concerns about sufficient existing demand for development of the center and the desire of certain property owners to redevelop with residential uses. Staff would work with commercial developers to find an appropriate site for a commercial center and encourage its development.

Revised Scenario based on Planning Commission Hearing – After reviewing the information given during the public hearing and the direction of the Planning Commission, staff has formulated a revised scenario to address issues regarding permitted densities and adequate commercial services. Staff recommends:

1. Adopt the Mitigated Negative Declaration.
2. Amend the General Plan in the study area to allow Medium to High Density Residential and up to 140,000 sq. ft. of neighborhood-serving commercial area. (this new general plan designation will allow for a range of densities as well as adequate retail in the study area),
3. Rezone the study area north of Tasman Drive to R-4/PD.
4. Work with retailers to encourage commercial development in this area (as the general plan will already permit neighborhood-serving retail, the staff will work with brokers and businesses to identify an appropriate site for commercial zoning and to encourage private commercial development in the area).
5. Direct staff to prepare a paper for a potential Council Study Issue to examine possible development of the 2.16-acre City-owned property.

These actions are intended to encourage further housing development by removing the ITR designation and increasing the allowed density to 36 du/acre (High Density Residential) for the area north of Tasman. The City will work with private developers and commercial brokers to facilitate development of neighborhood-serving commercial uses in the area. This action requires the same mitigation required with Scenario B.

A Mitigated Negative Declaration has been prepared for this project. The environmental review analyzed the effects of Scenario B, as recommended by staff, which included a net potential increase of 588 residential units and 140,000 sq. ft. of retail. The traffic analysis noted mitigation that is required to maintain City of Sunnyvale standards for intersection Levels of Service if this alternative is adopted. If Planning Commission’s recommendation is adopted, the same mitigation as Scenario A will need to be adopted. If staff’s revised recommendation is adopted, the mitigation will be similar to Scenario B, but additional traffic analysis may be necessary for the individual commercial centers. See Attachment A Mitigation Monitoring Program for a complete discussion of impacts.

Generally, redevelopment of sites in the study area would result in normal fees and taxes. The actual change in land uses (as opposed to zoning changes) could result in different needs for city services, which would be reflected in the appropriate operating budgets. Many of the fee-based services (e.g. utilities, building permits and inspections) are full cost recovery. The type of fiscal impact depends on the action taken.

• Scenario A – would require a mitigation to upgrade the Lawrence/Tasman intersection, the cost of which would be dependent on the final design for an anticipated grade separation at this intersection.
• Scenario B - would require the mitigation associated with Scenario A as well as the mitigation required at Tasman/Fair Oaks intersection estimated at $250,000.
• Planning Commission’s recommendation would require the same mitigation as Scenario A
• Staff’s revised recommendation would require the same mitigation as Scenario B.

Staff conducted a series of public meetings on September 4 and October 3, 2001 to gather input on the issue. To advertise the meetings, notices were sent to all property and business owners within the affected areas. Approximately 15 people attended each meeting. In addition, staff received several letters from interested property owners and residents stating concern with high density residential development (see Attachment I).

A majority of the business owners that attended had concerns with the difficulty of finding and keeping affordable spaces for small businesses. They expressed concern that redevelopment in the area would displace existing businesses. Several property owners had concerns with what changes in zoning would mean for the maintenance of existing buildings. Two property owners at the southwest corner of Tasman and Fair Oaks stated concerns with a commercial designation and desire to redevelop their properties to medium to high-density residential uses. A summary of comments is available in Attachment G.

At the Planning Commission hearing, several speakers were in favor of retaining the R-3 Zoning (Medium Density of 24 du/acre) in the area. One citizen had concerns about not designating a commercial site concurrently with an increase in residential density (see Draft Planning Commission Minutes, Attachment J). Based on this testimony and information from staff, the Planning Commission concurred with staff recommendation with one modification to retain the existing zoning in the area south of Tasman, and not increase the density to 36 du/acre. Since the Planning Commission hearing, preliminary review applications for R-3 density housing have been submitted for two sites (6.64 acres) south of Tasman.

In order to approve the amendments to the Zoning Code, the City must make the findings that the new regulations are in conformance with the General Plan and the amendments are in the public interest.

1. Adopt the Mitigated Negative Declaration.
2. Amend the General Plan in the study area to allow Medium and High Density Residential and up to 140,000 sq. ft. of neighborhood-serving commercial area (see attached Resolution)
3. Rezone the study area north of Tasman Drive to R-4/PD.
4. Work with retailers to encourage commercial development in this area.
5. Direct staff to prepare a paper for a potential Council Study Issue to examine possible development of the 2.16-acre City-owned property.

2. Adopt the Planning Commission actions (Alternative 1 with a modified General Plan Amendment and modified direction to staff on the commercial development).
3. Defer all action until the completion of the Transportation Strategic Program.
4. Do not adopt the Mitigated Negative Declaration and direct staff as to where more analysis is necessary.