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Past Due Projects Get More Time, Council Rejects Proposed Daycare

Two Santa Clara developments received extensions despite being behind schedule.

The Santa Clara City Council voted unanimously Tuesday night to extend contracts on a 306,000 square foot office development on Lawson Lane and the “agrihood” housing project on Winchester Boulevard. The “agrihood” project was scheduled to break ground at the start of 2017, but public input caused the developer, Core Companies, to redesign the project.

Ruth Shikada, Assistant City Manager, said Core and the city have been working with the state to avoid having the property revert to state control. The exclusive negotiating rights Core had are set to expire in June.


Working with the Project for Public Spaces, Vince Cantore, Senior Development Manager at Core, said his company moved where the agricultural aspect would be located, having it now face Winchester Boulevard. He asked that the Council not “overburden” the process.

“We are not here to talk about site design,” Cantore said. “Now is the time to move this project forward … The project is teed up for success.”

Members of the public, including representatives from Silicon Valley at Home and Silicon Valley Leadership Group, supported the development.

The Council agreed that the project was a boon, but Council Member Patricia Mahan said the City needs the project done “yesterday,” a sentiment other Council Members echoed.

Council Member Pat Kolstad said the development, which will house 165 senior and below-market-rate apartments, fills the need for “affordable” housing he wanted for the area back when talks of developing the site began. Council Member Dominic Caserta wanted more open space, and the “agrihood” project fulfills that need too, Kolstad said.

“This is so much a better project than either of us could have imagined,” Kolstad said. “But, 18 years is a long time to get a project built … The faster we can get this built, the better it will be for a lot of families.”

While Kolstad said he would like to “fast-track” the project to “get shovels in the ground,” Mayor Lisa Gillmor said she didn’t want to hurry the effort or nullify community input in doing so.

The Council unanimously approved extending the exclusive negotiating rights. Core is set to break ground on the site in Spring 2019.

Also approved by the Council was an extension for a Sobrato development located at 2200 Lawson Lane.

The two-phase office development is only halfway finished after being approved in 2008 and being granted a five-year extension in 2013. Now, the Council granted Sobrato another two-year extension to June 2020.

The 16-acre property is divided into two campuses. The east campus is complete and housing office workers. The west campus remains vacant.

Andrew Crabtree, Director of Community Development, said the company agreed to pay $153,450 additional traffic impact fees, pay new water impact fees, increase its transportation demand management (TDM) from 5 percent to 10 percent and install 6 percent of its parking spaces with electric vehicle charging stations.

The Planning Commission made more requests of the developer, asking for more money in traffic impact fees and for a $500,000 contribution—requests to which the developer refused to agree.

Following Crabtree’s recommendation, the Council voted unanimously to extend Sobrato’s contract.


Daycare Dispute

Contention over whether a daycare on Serena Way would cause traffic congestion and parking issues dominated much of Tuesday’s meeting.

The property in question, 281 Serena Way, straddles a commercial zone—next to a car dealership—and a single-family neighborhood.

The daycare would host up to 28 children ages two to six, requiring a rezoning and a special use permit to add a 900-square-foot park. The Planning Commission denied the rezoning and special use permit, but Crabtree recommended the Council overturn that decision, saying the conversion of the property is in keeping with the general plan’s preference for adding more daycare services to the City.

One neighbor of the proposed project, Jerry Brown, called it “ludicrous.” And he wasn’t alone. Five other neighbors spoke in opposition to the daycare’s location, saying it will lower property values, create parking issues and increase traffic congestion.

“This project will change the dynamics of our neighborhood,” said Kate Slama, a resident of Serena Way.

But not everyone opposed the project.

Yu Su, another resident of Serena Way, said the daycare could actually make the area more attractive to families, increasing property values. He said residents raised the same concerns when a Walmart moved in down the street several years ago, and property values increased following the Walmart’s arrival.

While most of the Council said Santa Clara needs more daycare, its members all had concerns about its size. Mayor Gillmor said it was a good use of the property, but it was just “too big.”

“This is probably not the best location,” said Council Member Mahan. “It is a business that belongs in a commercial area.”

Gillmor said if the applicant brings back a “more realistic” plan, the Council is open to considering it.

The Council upheld the Planning Commission’s decision to deny the project 6-1. Council Member Teresa O’Neill was the lone “no” vote.


Pension Benefit Dispute

Also at Tuesday’s Council meeting, former Acting City Manager Rajeev Batra requested the Council to add an item concerning supplemental pension benefits that the Council approved in August 2017, but which the City has so far failed to pay. Batra retired in March but continued to serve until October 2017.

As part of Batra’s agreement when he served as Acting City Manager, the City agreed to pay into an IRS 401(a) account the pension difference between his CalPERS pension—CalPERS caps the amount of salary that can earn pension benefits at $265,000—and what his pension would be were there no such limits. Batra’s salary at retirement was $296,000. The amount in question is about $13,000 per year. Batra’s CalPERS pension is $272,784 per year.

This agreement was conditional on a CPA opinion on whether this was legal under IRS code, which Batra said, in a letter, he provided. City Attorney Brian Doyle subsequently asked Batra to get a legal opinion on the question, according to Batra, who got the legal opinion and sent it to the City in December 2017.

The question next appeared as a “potential litigation” item on a closed session agenda in December, which Batra told the Council Tuesday night, was inappropriate. “There is no such litigation and I am representing myself.” His request was to come back at a future meeting “to show how my decision was made based on your [the Council’s] action.”

The City has waived its attorney-client privilege in this matter and Santa Clara Assistant City Attorney Alexander Abbe said that all the relevant documents would be in the public record. The issue will be on the April 24 Council agenda.

After the Bell, CA salary scandal, CalPERS set a cap on the amount of salary that can earn pension benefits. Public agencies get around that by setting up IRS 401(a) accounts, which are tax exempt, for highly paid employees.

For example, Santa Clara City Manager Deanna Santana gets an additional five percent of salary—about 19,400 based on her current $388,000 salary—paid into a 401(a) account. Santa Clara, however, isn’t paying into Santana’s CalPERS account.

The City Council meets again 7 p.m. Tuesday, April 24 in the Council Chambers at City Hall, 1500 Warburton Ave. in Santa Clara.


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