Ordinance No. 13-2114 Repealing Ordinance No. 1702 and approving a new agreement with Apple Inc.ORDINANCE NO. 13 -2114
ORDINANCE OF THE CITY COUNCIL OF THE CITY OF CUPERTINO
REPEALING ORDINANCE NO. 1.702 AND APPROVING A NEW
DEVELOPMENT AGREEMENT BY AND BETWEEN THE CITY OF
CUPERTINO AND APPLE INC. FOR THE DEVELOPMENT OF A NEW
CORPORATE CAMPUS
WHEREAS, Apple Inc. ( "Apple ") has a legal and equitable interest in certain real
property consisting of approximately 176 acres located within the City and generally bordered
by East Homestead Road on the north, adjacent properties to the east of North Tantau Avenue
on the east, Interstate 280 and The Hamptons apartment community on the south, and North
Wolfe Road on the west, as more particularly described in Exhibits DA -1a and DA -lb of the
Development Agreement ( "Property "); and
WHEREAS, Government Code Sections 65864 through 68569.5 provide the statutory
authority for development agreements between municipalities and parties with a fee or
equitable interest in real property; and
WHEREAS, Cupertino Municipal Code ( "CMC") § 19.144.010 et seq., establishes
additional procedures for review and approval of proposed development agreements by the
City of Cupertino ( "City "); and
WHEREAS, a portion of the Property is currently subject to that certain development
agreement between Apple's predecessor -in- interest, Hewlett- Packard Company, and the City
dated November 6, 1995, approved by City Council Ordinance No. 1702, as amended ( "HP
Agreement "); and
WHEREAS, the Project (defined below) proposed by Apple to be developed on the
Property is inconsistent with the development project contemplated by the HP Agreement; and
WHEREAS on or about August 9, 2011, Apple applied for a General Plan amendment
and rezoning of a portion of the Property to accommodate the demolition of approximately 2.66
million square feet of existing office, research and development buildings, parking areas and
ancillary facilities located on the Property; vacation of a portion of Pruneridge Avenue and
vacation of various public easements; and construction of a new approximately 3.42 million
square foot office, research and development campus with associated parking facilities and
ancillary uses including a 50,000 square foot central plant, a 120,000 square foot (1,000 seat)
corporate auditorium, a 100,000 square foot fitness center and other minor ancillary buildings
for security and landscaping; and improvements to adjacent thoroughfares, including street -
widening, landscaped medians; detached sidewalks, buffered bike lanes, widened freeway off -
ramps and trail improvements (collectively, the ''Project "); and
WHEREAS, the Project will be constructed in two or more phases. The first phase will
include the construction of a 2.82 million square foot ring- shaped main building with a 2,385
space underground parking facility, a 100,000 square foot fitness center with a 25 space parking
Ordinance No. 13 -2114 DA- 2011 -01 November 19, 2013
Page 2
lot, a 120,000 square foot (1,000 seat) auditorium, a 5,870 space main parking structure with
attached central plant, a 765 -space auditorium, employee and visitor parking structure with a
25,000 square foot valet parking reception area, 7,000 square foot visitor security reception
structures, 10,000 square feet of landscaping and maintenance buildings, 10,000 square feet of
outdoor food stations,, and ancillary on -site and off -site public and private improvements. The
second phase(s) of construction will include the development of 600,000 square feet of office
and research and development buildings with 1,740 parking stalls and two satellite plants for
energy generation and ancillary on -site and off -site public and private improvements. All
figures are approximate; and
WHEREAS, on August 19, 2011, the City issued Notice of Preparation for an
Environmental Impact Report for the Project. A scoping session was held on September 8, 2011
to provide the public the opportunity to comment on the topics to be studied in the Draft
Environmental Impact Report ( "Draft EIR "). Public comments were collected through the
scoping period's conclusion on October 5, 2011; and
WHEREAS, from August 19, 2011 to June 6, 2013 2013, the City's environmental
consultant, LSA, prepared a Draft EIR pursuant to the requirements of the California
Environmental Quality Act (Public Resources Code Section 21000 et seq.) ( "CEQA ") and the
Guidelines for Implementation of the California Environmental Quality Act (Title 14, Sections
15000 et seq. of the California Code of Regulations) ( "CEQA Guidelines "); and
WHEREAS, the Draft EIR was released for a 46 -day public review /comment period
beginning on June 6, 2013 and ending July 22, 2013. The Notice of Completion of the Draft EIR
was sent to the State Clearinghouse in the Governor's Office of Planning and Research on June
6, 2013 under State Clearinghouse No. 2011082055. The Notice of Availability was filed with the
Santa Clara County Clerk - Recorder on the same day and was also: (1) sent to other potentially
affected agencies as required by CEQA; (2) sent to adjacent property owners as required by
CEQA; and (3) posted at the Project site and at City Hall; and
WHEREAS, on June 26, 2013, the City held a duly noticed public meeting to allow the
public an additional opportunity to provide input on the Draft EIR and received public
testimony; and
WHEREAS, following the close of the public review and comment period on the Draft
EIR, written responses to comments concerning the adequacy of the Draft EIR received during
the public review and comment period have been prepared and compiled in a Response to
Comments Document (which includes revisions to the Draft EIR); and
WHEREAS, the Final -Environmental Impact Report ( "Final EIR "), consisting of the
Draft EIR (published in June 2013), the Response to Comments Document (published in
September 2013), and all documents incorporated therein was issued on September 23, 2013.
Notice of Availability of the Final EIR was sent to the Santa Clara County Clerk Recorder's
Office, posted at City Hall and the Project site, and sent to 10 local libraries and property
owners, business owners and residents within 1,000 feet of the Project site. A courtesy notice
regarding the availability of the Final EIR was also mailed to all postal customers in the City of
Cupertino and within 1000 feet of the Project site and published in the Mercury News; and
Ordinance No. 13 -2114 DA- 2011 -01 November 19, 2013
Page 3
WHEREAS, on September 26, 2013, City Staff presented the Final EIR to the
Environmental Review Committee ( "ERC") for review and recommendation. After considering
the Final EIR, all supporting documents, and Staff's presentation, the ERC recommended that
the City of Cupertino City Council approve the Project; and
WHEREAS, the City received comments following the close of the public review and
comment period on the Draft EIR and, although pursuant to Public Resources Code Section
21091(d)(1) and CEQA Guidelines Section 15088(a) written responses are not required,
responses have been provided with staff reports; and
WHEREAS, the Final EIR was presented for review to the Planning Commission and
City Council on October 1, 2013 at a Joint Planning Commission and. City Council Study
Session; and
WHEREAS, on October 2, 2013, the Planning Commission held a public hearing and
voted 4 -0 -1 (1- absent) to recommend that the City Council approve Findings Revision #1
(October 1, 2013) to adopt Mitigation Measure TRANS -23 (Alternate), as amended to delete the
penalty provisions, to allow three left turn lanes out of the project driveway on to N. Wolfe
Road, a Resolution Recommending Certification of an Environmental Impact Report (EIR),
adoption of Findings and a Statement of Overriding Considerations, adoption of Mitigation
Measures, and adoption of a Mitigation Monitoring and Reporting Program in substantially
similar form to the Resolution, as amended (Resolution no. 6727); Approve the General Plan
Amendment, GPA- 2011 -03, in substantially similar form to the Resolution presented
(Resolution no. 6728); Approve the Zoning Map Amendment, Z- 2011 -03, in substantially similar
form to the Resolution presented (Resolution no. 6729); .Approve the Vesting Tentative Map,
TM- 2011 -03, in substantially similar form to the Resolution presented (Resolution no. 6732)
Approve the Development Permit, DP- 2011 -04, Use Permit, U- 2011 -11, Architectural and Site
Approval, ASA- 2011 -14 and Tree Removal Perrrdt, TR- 2011 -39, in substantially similar form to
the Resolution presented (Resolution no. 6731); and Approve the Development Agreement, DA-
2011-01, in substantially similar form to the Resolution presented (Resolution no. 6730), adopt
the Findings and Statement of Overriding Considerations for the Project, and make conditions
of approval all of the mitigation measures for the Project that are within the responsibility and
jurisdiction of the City that are identified in Findings; and; and
WHEREAS, Supplemental Text Revisions, Apple Campus 2 Project Final Environmental
Impact Report, which is part of the Final EIR, identifies a third alternative mitigation measure
for Impact TRANS -23, a third alternative mitigation measure for Impact TRANS -27, and
discloses recent amendments to Chapter 6.5 of Division 13 of the Public Resources Code; and
WHEREAS, on October 15, 2013, the City Council held a duly noticed public hearing on
the Final EIR and the Development Agreement; as well as the following Project approvals:
Ordinance No. 13 -2114 DA- 2011 -01 November 19, 2013
Page 4
amendments to the General Plan to allow a change in the land use designation of a 1.1 acre area
from Parks and Open Space to Industrial /Residential, a change to figure 2 -G to reflect the
relocation of Glendenning Barn, changes to various figures to reflect the vacation of Pruneridge.
Avenue, amendments to the text in Policy 2 -35, a change to the setback ratio for N. Tantau
Avenue, and other minor related amendments to figures and tables, Rezoning of said 1.1 acre
area from Parks and Recreation (PR) to Planned Industrial Park P(MP), Vesting Tentative Map,
Development Permit, Use Permit, Architectural and Site Approval for Phase 1 of the Project,
Tree Removal Permit, and street and easement vacations; and
WHEREAS, in compliance with the CEQA Guidelines, on October 15, 2013, the City
Council adopted Resolution No. 13 -082 to certify the Final EIR for the Project, adopt findings
and a Statement of Overriding Considerations, Mitigation Measures and a Mitigation
Monitoring and Reporting Program; and
WHEREAS, on October 15, 2013, the City Council adopted Resolution No. 13 -083
amending the General Plan to accommodate the Project; and
WHEREAS, on October 15, 2013, the City Council introduced an ordinance to rezone 1.1
acres of the Property from Parks and Recreation (PR) to Planned Industrial Park (P(MP))
(Assessor's Parcel Numbers 316 -06 -050 and 316 -06- 051,); and
WHEREAS, on October 15, 2013, the City Council adopted Resolution Nos. 13 -085 and
13 -084, approving, respectively, a Vesting Tentative Map and a Development Permit, Use
Permit, Architectural and Site Approval for Phase 1, and Tree Removal Permit for the Project;
and
WHEREAS, on October 15, 2013, the City Council adopted Resolution No. 13 -086 and
13 -087 vacating that certain approximately 4.64 acre portion of Pruneridge Avenue identified in
Exhibit DA -1g to the Development Agreement and approving a sale of the Pruneridge Avenue
vacation area to Apple, subject to satisfaction of certain conditions, including relocation of all
public utilities, for a purchase price of $23,814,257.00, under the terms described in Article 6 of
the Development. Agreement attached hereto as Exhibit DA -1 ( "Development Agreement "); and
WHEREAS, approval of the Development Agreement will provide Apple with
assurances that its development of the Property in connection with the Project can proceed
without disruption caused by a change in City planning and development policies and
requirements, which assurance will thereby reduce the actual or perceived risk of planning,
financing and proceeding with construction and use of the development and promote the
achievement of the private and public objectives of the development; and
WHEREAS, City desires to enter the Development Agreement in order to: (1) increase
the number of well -paid high - quality jobs in the City for employees who either live in the
community and /or support local businesses; (2) improve the City's quality of life and the built
environment by redeveloping outmoded office buildings with a coherent state -of -the art
corporate campus; (3) support the development of a local corporation that has grown into one
of the world's outstanding high tech firms, thereby stimulating local businesses and the local
economy and supporting the City's fiscal health and ability to provide needed services; (4)
secure a source of substantial tax revenues for the City by encouraging a major corporation to
Ordinance No. 13 -2114 DA- 2011 -01 November 19, 2013
Page 5
continue its existing operations in the City; and (5) attract visitors who will generate both
additional revenues for local businesses and increased tax revenues for the City, as well as
further the City's visibility worldwide; and
WHEREAS, the terms of the Development Agreement include the following community
benefits funded by Apple:
• An affordable housing contribution equal to twice the otherwise applicable City
affordable housing in -lieu fee for the North Vallco Area.
• Contribution of $8,270,994 for the establishment and maintenance of a 1.1 acre park
at a location within the City to be determined, or transfer by Apple of a 1.1 acre
park site acceptable to the City, together with an improvement, maintenance and
capital replacement fund.
• Installation of a fiber optic conduit along Wolfe Road between the 280 Freeway and
Homestead Road for City use.
• Traffic signal preemption device improvements in an amount up to $320,000.
• Contribution of $250,000 toward the cost of a study for a pedestrian/bicycle trail or
path, including potentially a full Class I separated trail, along the drainage channel
running parallel to southbound I -280 between North De Anza Boulevard and
Calabazas Creek, and then south along the western bank of Calabazas Creek to
Vallco Parkway.
• Apple's commitment to require its general contractor to comply with a Tax
Localization Plan that would cause sales and use taxes generated from the purchase
of materials, fixtures and equipment for the Project to be allocated to the City.
• Amendment of an Agreement for Consultation Services that may generate
additional sales tax revenue for the City.
■ Contribution of $2,644,035 to City if Apple desires to relocate the historic
Glendenning barn off of the Property to other City -owned property.
NOW, THEREFORE, BE IT ORDAINED AS FOLLOWS:
That after careful consideration of the facts, exhibits, testimony and other evidence submitted in
this matter, the City Council based upon the findings described above, the public hearing
record and the Minutes of Planning Commission Meeting of October 2, 2013, and subject to the
conditions specified below:
Section 1. The recitals set forth above are true and correct, and are hereby
incorporated herein by this reference as if fully set forth in their entirety.
Section 2. City Council Ordinance No. 1702 is hereby repealed and the HP
Agreement is hereby canceled in its entirety pursuant to Government Code section 65868.
Section 3. The City Council, having considered the evidence received at the public
hearing duly noticed and held for said proposed Development Agreement, finds as follows:
A. The proposed Development Agreement is consistent with the objectives,
policies, general land uses and programs specified in the General Plan, as amended.
Ordinance No. 13 -2114 DA- 2011 -01 November 19, 2013
Page 6
B. The proposed Development Agreement is compatible with the uses
authorized in, and the regulations prescribed for, the land use district in which the Project is
located.
C. The proposed Development Agreement is in conformity with and will
promote public convenience, general welfare, and good land use practice.
D. The proposed Development Agreement will not be detrimental to the
health, safety, or general welfare.
E. The proposed Development Agreement will not adversely affect the
orderly development of property or the preservation of property values.
F. The proposed Development Agreement will promote and encourage the
development of the Project by providing a greater degree of requisite certainty.
Section 4. The City Council hereby approves the Development Agreement in the
form attached subject to such minor technical conforming changes as may be approved by the
City Attorney. This approval is based on the City Council's consideration of and reliance on the
Final EIR and in accordance with the plans, details and descriptions contained therein, and in
the Resolution certifying the Final EIR.
Section 5; This Ordinance shall be effective thirty (30) days following its adoption.
INTRODUCED at an Adjourned Regular Meeting of the City Council of the City of
Cupertino the 15th day of October 2013, and ENACTED at an Adjourned Regular Meeting of
the City Council of the City of Cupertino the 19th day of November, 2013, by the following
vote:
Vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
RECUSE:
ATTEST:
Members of the City Council:
Mahoney, Wong, Chang, Santoro
None
None
None
Sinks
I I- zz -L3
Grace Schmidt
City Clerk
APPROVED:
Orrin Mahoney
Mayor, City of Cupertino
STATE OF CALIFORNIA )
COUNTY OF SANTA CLARA )
CITY OF CUPERTINO )
I, GRACE SCHMI-DT, City Clerk and ex- officio Clerk of the City
Council of the City of Cupertino, Califomia, do hereby certify the attached
to be a true and correct copy of Ordinance No. 13 -2114, which was
enacted on November 19, 2013, and that it has been published or posted
pursuant to law (G.C. 40806).
IN WITNESS WHEREOF, I have hereunto set my hand and seal
this 20th day of November, 2013.
GRACE SCHMIDT, City Clerk and Ex- officio Clerk
of the City Council of the- �—'Jty °of Cupertino, California
Ordinance Certiticate