Cupertino Matters
- Council Recess in August
- Vallco (now The Rise) Update
- RECAP – City Council, Mon., July 22, 2024, Mon., 6:30 Special Meeting
- RECAP – City Council, Tues., July 16, 2024, 6:45 p.m., Regular; 5:00 p.m. Special Meeting
I hope readers have the opportunity to take vacation, as well as to visit with family and friends this summer. City council recesses for the month of August, so Cupertino Matters will publish irregularly with election news (city council filings close Aug. 9) and other topics until council resumes regular meetings on Wednesday, September 4. (Recall that regular meetings are shifted to Wednesdays when they follow a Monday holiday. The September 4 meeting follows Labor Day on September 2.)
In the meantime, numerous events remain to be enjoyed for the rest of the summer: Shakespeare in the Park on weekends, summer concerts on Thursdays, Movies in the Park, and the Baer Blacksmith Shop at McClellan Ranch, as well as other free and fee based recreation programs. Readers can review the full Fall Schedule for Parks and Recreation here. Note the separate 50+ Scene newsletter has been merged into the quarterly Parks & Recreation brochure due to budget constraints. A separate calendar for each month is available online and in print at the Senior Center.
Returning to city council news, the council took up its much-anticipated resolution of fee disputes impeding progress at Vallco. As expected, the city council followed through on its unanimous closed session vote to settle litigation risks over the city’s claimed fees for the Vallco SB 35 project (now known as The Rise). On a 4-1 vote, council implemented that settlement by approving fee waivers for legally untenable fees claimed against the Below Market Rate (BMR) housing included in the project. The agreement relieves both the city and the developer of legal risk. It also creates certainty in the timing and quantity of fee payments at a time when the state is making it harder to assess fees. Finally, the agreement also gives the city greater flexibility in how fees would be spent to offset impacts, such as on traffic and parks. All told, the agreement would bring $43 million dollars to the city. This was reasonable given that the project includes 890 affordable homes–by far more than any project in the history of the city and one of the largest such provisions of affordable housing in a single project in all of California–as well as more than seven acres of public parkland. The San Jose Spotlight and the Mercury News both covered the matter.
Despite unanimous approval in closed session, Councilmember Liang Chao voted against approving the waivers to implement the city’s legal commitment following a rant against the developer and state housing laws, dredging up her historical opposition to the project. Chao does not acknowledge her vote in 2019 to repeal the Vallco Specific Plan, thus forcing the developer to move ahead with its SB35 plan, removing city council approval oversight and the loss of over $120 million in community benefits.
Concerns have been expressed regarding the 1.95 million sq. ft. of office space in the project. According to a report by Kidder Mathews, Cupertino is in the very unusual situation of having a 2.3% office vacancy rate, the lowest in the West Valley, much lower than the 30-35% vacancy rates in SF, SJ, and Oakland, and among the lowest in the Bay Area. This means there is no space for new companies to diversify the city economy. The office component at The Rise will provide that additional space. According an earlier press release, “Within the most amenitized office environment in Silicon Valley, The Rise introduces 1,973,000 square feet of office/lab space, with expanded floor plates to allow spacious office layouts (as well as laboratory configurations, in recognition of the massive expansion of the Bay Area’s life sciences market)”. Note this type of space is lacking in the South Bay.
This lack of office space also impacts the need of the city to secure office space to relocate staff from city hall. There is little to no availability of 20,000 to 25,000 sq. ft of contiguous office in Cupertino, especially as compared to surrounding cities.
Cupertino is not the only city grappling with impact fees. The same court case, Sheetz v. County of El Dorado, potentially affects impact fees assessed in other cities. A Mercury News article highlights a Sunnyvale case in which impact fees were a 10% surcharge on top of building costs, creating a deterrent to more housing at a time when construction costs and financing are increasingly expensive. Builders say city impact fees hinder new housing. A recent Supreme Court ruling may give developers more power to fight them: Impact fees can add thousands of dollars onto a new home. Developers say they’re keeping projects from penciling out
“In 2023, the 29-year-old product manager submitted plans to Sunnyvale to raze the modest 1,000-square-foot bungalow he bought a year earlier and replace it with a three-story, five-unit multifamily building.
“He paid a few thousand dollars for an architect to draw up plans, then a few thousand more to the city for application fees. His parents called him insane for spending so much, but Yu had the money, and he wanted to build housing.
“He didn’t have the funds for what Sunnyvale demanded next: To get the permit for the $3 million project, he would need to pay $300,000 in impact fees, one-time charges imposed by local governments to fund improvements to infrastructure like roads, parks and schools.”
In Cupertino, the reduction of impact fees for Accessory Dwelling Units (ADU’s) led to a significant increase in building affordable housing units. Indeed, for a number of years, ADUs have constituted the lion’s share of all new housing production in Cupertino.
In other news, the San Jose Spotlight highlighted city council’s adoption of the Vision Zero Plan plan to end traffic deaths for both pedestrians and bicyclists.
RECAP – CITY COUNCIL – Mon., July 22, 2024, 6:30 p.m., Special meeting
YouTube: 58 min.
The sole item on the agenda was Approval of lien assessment and collection of fees on private parcels resulting from abatement of public nuisance (weeds and/or brush) for the annual Weed and Brush Abatement Programs. This is a routine county process that requires a public hearing. Property owners cited for violation of weed/brush ordinances have an opportunity to contest assessed fees. Four of the 101 property owners on the list appeared in person. The inspection fee is $96 and reflects work already performed by the county to administer the program. The fees are paid through property tax bills. Council approved 3-0-2 with Wei and Fruen absent.
RECAP – CITY COUNCIL – Tues., July 16, 2024, 6:45 p.m., Regular Meeting; 5:00 p.m., Public Hearing
YouTube: Special Meeting 30 min.; Regular Meeting 3 hr. 40 min.
Special Meeting – Public Hearing, 5:00 p.m.:
Item No. 1: Lease agreement with San Jose Water Company for the operation of the Cupertino Municipal Water System. This was a short meeting, since there was only one response to the request for proposals (RFP)–San Jose Water Company, the current operator. After a brief discussion regarding use of the monies (the “concession payment”), the lease was approved unanimously.
Regular Meeting, 6:45 p.m.
Oral Communications was lively, with over 20 residents expressing opposition to a 23-home apartment building on Scofield Drive proposed under the “builder’s remedy” of the Housing Accountability Act in March of this year. This is one of a handful of projects submitted prior to the city having an approved Housing Element–a direct result of the prior city council and Planning Commission’s failure to produce a legally sufficient Housing Element by the end of 2022. Update: A Council Informational Memo entitled Re: Scofield Drive SB330 Preliminary Application pursuant to Builder’s Remedy (“BR”) Provision of the Housing Accountability Act (“HAA”) has been issued. The report details various recent housing project applications that rely on SB 330’s process reforms. Of those, 4 utilize the “builder’s remedy” of the Housing Accountability Act, which allows applicants to bypass General Plan and zoning code standards for qualifying below market rate and mixed income housing projects. Under SB 330, an applicant has 6 months to submit a formal application after submitting an initial application. Thus far, only one formal application under the “builder’s remedy” has been submitted for a property at the corner of North Blaney and Stevens Creek, but it remains on hold pending resolution of issues between the property owner and its tenants.
Councilmembers Liang Chao and Kitty Moore pulled Consent Calendar items No. 1 and No. 7 which were considered after the Action Calendar summarized below.
The sole action item was Item No. 10: Waiver of Below Market Rate Housing Mitigation Fees (“BMR Fees”) and Zoning/Planning Municipal Code Fees (“Planning Fees”) imposed on Vallco/Rise SB 35 project (10101-10330 North Wolfe Road). Over a dozen speakers spoke in favor of this settlement. The voices of the public included young adults, often missing in the council chamber, as well as Reed Moulds, The Rise Project Director, looking forward to providing a vibrant new community in Cupertino.
In order to implement the settlement unanimously approved in closed session, the council had to formally waive the relevant impact fees in an open session. The staff report was clear on the justification:
“As explained in the findings set forth in the proposed Resolution (Attachment C), the provision of 890 affordable housing units fully mitigates the impact of the project’s market-rate housing and nonresidential components on demand for affordable housing, thereby justifying the waiver of the BMR Fee under Sheetz v. County of El Dorado.”
With the exception of Councilmember Chao’s rant referenced above, the council was generally supportive of the agreement expressing a strong desire to move ahead to developing this over 50 acre eyesore. Council approved 4-1 with Chao voting nay.
Item No. 1: Receive the FY 2022-23 Annual Comprehensive Financial Report (ACFR) (Continued from July 9, 2024). Prior to the meeting, Councilmember Chao submitted numerous questions which were answered in the Supplemental Report for this item. Despite the answers, she pulled the item anyway, wasting dais time for a minor administrative report that was approved unanimously after little discussion.
Item No. 7: Second reading of Municipal Code Amendments and Zoning Map Amendments to ensure conformance with the Housing Element and related CEQA exemption, the final step to approval of a compliant Housing Element. This item was pulled by Councilmember Kitty Moore, who voted against approval of these amendments during the first reading. Failure to approve this second reading would have left the city without a certified Housing Element and vulnerable to more projects under the “builder’s remedy” as described above in reference to Scofield Drive. No additional information was presented in nearly an hour of discussion, which primarily consisted of objections by Councilmembers Moore and Chao. Council ultimately approved 4-1 with Moore voting nay.
CUPERTINO COURIER: July 26, 2024
The front page photo and article on page 5 is entitled ‘From the Fields to the Future’ Santa Clara County Fair celebrates its 80th anniversary season. Community briefs on page 5 are (1) Clean energy winners and (2) Support for the homeless, regarding Rotating Safe Car Park program.Page 8 is a previously published Mercury News article entitled Artificial turf fields to remain at high schools in the Fremont Union High School District. There are two legal notices of Second Readings of the General Plan amendments and rezoning to comply with the recently approved Housing Element.
CUPERTINO COURIER: July 19, 2024
The front page photo and additional photo on page 5 is entitled Groundbreaking project: Construction commences on all-inclusive playground at Jollyman Park. A previously published Mercury News article on page 5 is entitled Farmers market seeks new location, and an article on page 8 is entitled Pact to waive fees moves big housing project forward. The sole Community brief on page 5 is County fair turns 50. The sole legal notice is the First Reading of the ordinance regarding parking on streets adjacent to Lawson Middle School.
Warm regards,
Jean Bedord
Cupertino Matters
Publisher and Editor
