TO: HONORABLE MAYOR FROM: Christopher Burton
AND CITY COUNCIL
SUBJECT: SEE BELOW DATE: February 16, 2023
Approved Date
2/16/23
COUNCIL DISTRICT: 6
SUBJECT: ADMINISTRATIVE HEARING ON THE ENVIRONMENTAL APPEAL OF THE PLANNING DIRECTOR’S RELIANCE ON THE APOLLO
RESIDENTIAL PROJECT ADDENDUM TO THE DOWNTOWN
STRATEGY 2040 FINAL ENVIRONMENTAL IMPACT REPORT AS
THE ENVIRONMENTAL CLEARANCE FOR APPROVAL OF SITE
DEVELOPMENT PERMIT, FILE NOS. H21-048/ER21-276 & T21-043
RECOMMENDATION
a) Conduct an Administrative Hearing to consider the environmental appeal of the Planning Director’s reliance on the Apollo Residential Project Addendum to the Downtown Strategy 2040 Final Environmental Impact Report in accordance with the California Environmental Quality Act for a Site Development Permit and Vesting Tentative Map (File Nos. H21-048 and T21-043), to allow the demolition of the existing buildings on- site (totaling approximately 15,908 square feet) and construct a 20-story residential tower with up to 471 units and 7,661 square feet of ground floor retail, on an approximately
1.1-acre site.
b) Adopt a resolution denying the environmental appeal and upholding the Planning Director’s reliance on the Apollo Residential Project Addendum to the Downtown Strategy 2040 Final Environmental Impact Report in accordance with the California Environmental Quality Act, as amended, and finding that:
(1) The City Council has independently reviewed and analyzed the Addendum for the Apollo Residential Project, and related administrative records related to Site Development Permit No. H21-048; and
(2) The Addendum for the Apollo Residential Project was prepared and completed in full compliance with the California Environmental Quality Act of 1970, as amended, together with State and local implementation guidelines; and COUNCIL AGENDA: 2/28/23
FILE: 23-278
ITEM: 10.4
HONORABLE MAYOR AND CITY COUNCIL
February 16, 2023
Subject: Apollo Residential Project CEQA Appeal Memorandum
(3) Reliance on the Addendum for the Apollo Residential Project reflects the independent judgment and analysis of the City of San José, as the lead agency for the Apollo Residential Project; and
(4) Preparation of a new, subsequent, or supplemental environmental document is not required because the appeal does not raise any new significant impacts that have not already been analyzed or addressed in the Apollo Residential Project Addendum and none of the following events occurred as outlined in Section 21166 of Public Resources Code: (i) substantial changes are proposed in the project which will require major revisions of the environmental report; (ii) substantial changes occur with respect to the circumstances under which the project is being undertaken which will require major revisions in the environmental impact report; or (iii) new information, which was not known and could not have been known at the time the environmental impact report was certified as complete, becomes available. Further, a new, subsequent, or supplemental environmental impact report is not required because no impacts outside the scope of the Downtown Strategy 2040 Final Environmental Impact Report were identified in section 15168 of the California Environmental Quality Act Guidelines.
SUMMARY AND OUTCOME
On November 9, 2022, the Planning, Building, and Code Enforcement (PBCE) Deputy Director (Hearing Officer) for the Planning Division, acting on behalf of the PBCE Director, held a public hearing to consider the Apollo Residential Project Addendum to the Downtown Strategy 2040 Final Environmental Impact Report (DTS 2040 FEIR) (Exhibit A), Site Development Permit No. H21-048 (Exhibit B), and Vesting Tentative Map Permit No. T21-043. The California High- Speed Rail Authority (Authority) submitted a short comment letter on November 8, 2022. The Authority’s letter describes how the Authority intends to possibly use the project site for replacement parking spaces for Diridon Station as part of the future buildout of the High-Speed Rail project and the Apollo Residential Project would not be compatible with the Authority’s planned use of the parcel and conflicts with the Authority’s approved project.
The Hearing Officer considered all the information in the administrative record, including the Initial Study-Addendum; a comment letter from Adams, Broadwell, Joseph & Cardozo; the Authority’s letter; and information presented at the public hearing and determined that the Apollo Residential Project Addendum to the DTS 2040 FEIR was the appropriate environmental clearance under California Environmental Quality Act (CEQA) for the proposed project, and approved the Site Development Permit and Vesting Tentative Map Permit, File Nos. H21-048 and T21-043.
On November 15, 2022, Liz Scanlon, on behalf of Santa Clara Valley Transportation Authority Manager and Chief Executive Officer Carolyn Gonot and the Authority’s Northern California
HONORABLE MAYOR AND CITY COUNCIL
February 16, 2023
Subject: Apollo Residential Project CEQA Appeal Memorandum
Regional Director Boris Lipkin, submitted an appeal (Exhibit C) of the environmental determination for the Apollo Residential Project along with a letter commenting on the adequacy of the Initial Study-Addendum to the DTS 2040 FEIR prepared for the project under CEQA. The letter cited an October 6, 2022 memorandum from the City of San José’s Department of Transportation (DOT) (Exhibit D) that detailed potential conflicts between the Apollo Residential Project and planned transit infrastructure and facilities of regional and statewide significance, including the California High-Speed Rail project and the Diridon Integrated Station Concept (DISC). The appeal also claims that the environmental review conducted for the Apollo Residential Project under CEQA was inadequate and requests that a full environmental impact report be prepared. No site development permit or vesting tentative map appeals were filed.
BACKGROUND
The Background information is attached as Exhibit E to this memorandum.
ANALYSIS
The appellants’ claims are below in bold. PBCE’s responses follow the appellants’ claims.
1) The Apollo Residential Project site is located entirely within the footprint of the proposed California High-Speed Rail Project
The appellants claim the Apollo Residential Project site is located entirely within the footprint of the proposed High-Speed Rail project and thus conflicts with planned transit infrastructure and facilities of regional and Statewide significance. The Apollo Residential Project Addendum discusses the project in relation to the planned and existing transit facilities, including High- Speed Rail, in Section 4.17 Transportation.
DOT’s October 6, 2022 memorandum notes that the Apollo Residential Project site is located entirely within the footprint of the Alternative 4 alignment of the proposed High-Speed Rail project. Diridon Station, as well as the Apollo Residential Project site, are located within the San José to Merced and the San José to San Francisco segments of the High-Speed Rail project.
The DOT memorandum notes that the Authority provided a figure showing specific conflicts between the proposed High-Speed Rail project and the Apollo Residential Project to the Apollo Residential Project’s applicant on February 17, 2022. DOT’s memorandum also states that construction of the High-Speed Rail project has been a City priority for multiple years, and that on March 1, 2022, the City and the Authority signed a Memorandum of Understanding which sets forth both entities’ shared commitment to extending the High-Speed Rail project to and through the City of San José and Diridon Station, developing the DISC as an intermodal hub beyond the addition of the High-Speed Rail to existing rail services, and protecting and preserving future rail right-of-way to enable both the High-Speed Rail and the DISC.
HONORABLE MAYOR AND CITY COUNCIL
February 16, 2023
Subject: Apollo Residential Project CEQA Appeal Memorandum
On April 28, 2022, the Authority certified the environmental impact report for the San José to Merced segment of the project and selected Alternative 4 as the preferred alternative alignment for the High-Speed Rail project. Alternative 4 includes the proposed Apollo Residential Project site for various transportation purposes. In August 2022, the San José to San Francisco segment of the High-Speed Rail project received environmental clearance. The DOT memorandum notes that, with project-level clearance, the Authority is able to move forward with the construction of its project and acquire property within its approved footprint. However, no final engineered plans have been approved for the San José to Merced or San José to San Francisco segments of the High-Speed Rail project, and no dedicated funding is currently in place to construct the improvements. The Authority may need to acquire the Apollo Residential Project site in order to develop the alignment as analyzed in the August 2022 environmental clearance for its San José to San Francisco segment.
As previously mentioned, the baseline for evaluating the Apollo Residential Project is the date the City decided to prepare an Addendum for the project, which occurred in October 2021, prior to the April 2022 approval of the Environmental Impact Report/Environmental Impact Statement (EIR/EIS) for the High-Speed Rail Merced to San José and the August 2022 approval of the EIR/EIS for the High-Speed Rail San José to San Francisco segments. Considering that the preferred High-Speed Rail alternative alignment was not available under the baseline conditions, the site is currently owned and controlled by the Apollo Residential Project applicant, and the proposed Apollo Residential Project is consistent with the City’s General Plan, zoning, and other regulatory requirements. The City, as a local land use authority, is responsible for processing applications consistent with its General Plan, zoning, and other regulatory requirements.
Therefore, substantial evidence supports the Hearing Officer’s determination that the Apollo Residential Project did not conflict with the High-Speed Rail transit plan under the baseline conditions and the proposed Apollo Residential Project is consistent with City requirements.
2) The Apollo Residential Project Site is Located Within the Transit Boundary of the DISC Plan
The appellants claim the project site is located entirely within the proposed Transit Boundary of the DISC Plan and again, conflicts with planned transit infrastructure and facilities of regional and Statewide significance. The Apollo Residential Project Addendum discusses the Apollo Residential Project in relation to planned and existing transit facilities, including the DISC, in Section 4.17 Transportation.
To plan for the substantial growth of Diridon Station, the City of San José, the Peninsula Corridor Joint Powers Board, the Santa Clara Valley Transportation Authority, and the Authority (collectively the Partner Agencies) formed a public agency partnership in July 2018 to work on a station design effort called the DISC Plan. The Metropolitan Transportation Commission joined this partnership in 2020. DOT’s October 6, 2022 memorandum notes that the City of San José is one of the lead agencies for the DISC.
HONORABLE MAYOR AND CITY COUNCIL
February 16, 2023
Subject: Apollo Residential Project CEQA Appeal Memorandum
The Concept Layout figure (shown below) sets forth a spatial layout for a future expanded Diridon Station. The Concept Layout was accepted by City Council on February 4, 2020. To accommodate the potential future growth of passenger rail, the Concept Layout anticipates widening the rail right-of-way north and south of Diridon Station, including a portion of the Apollo Residential Project site. However, the preferred DISC Concept Layout is still preliminary, as the plans have yet to be finalized or reconciled with the Preferred Alternative for High-Speed Rail that received environmental clearance in August 2022. Environmental review for the DISC, that will include analysis under both CEQA and the National Environmental Policy Act, has not been initiated; no clear timeline exists for construction, although it is anticipated to occur before 2040; and no dedicated funding is currently in place to construct the improvements.
As conceptualized, the DISC, if it were to be approved for implementation, would require the acquisition of land surrounding the station to accommodate future rail services, and this process has yet to be defined or initiated. Discretionary approval by the lead agency would also be required for any project necessary for the realization of the DISC and would be subject to environmental review. A significant portion of the project site is located within the conceptual DISC Transit Boundary. As depicted below in the DISC Conceptual Planning-level Transit Boundary figure, the project site is located adjacent to the existing rail corridor in a key location within the DISC Conceptual Transit Boundary Line where the tracks fan out north of the station.
HONORABLE MAYOR AND CITY COUNCIL
February 16, 2023
Subject: Apollo Residential Project CEQA Appeal Memorandum
As the Apollo Residential Project site is located next to the existing rail corridor within the DISC Conceptual Transit Boundary Line, the Local Transportation Analysis prepared for the Apollo Residential Project concluded that the project would encroach into the DISC Conceptual Transit Boundary Line. However, the DISC is a conceptual plan that discusses potential changes that could be made to expand Diridon Station but is not under consideration for approval as a project for implementation. As such, the proposed Apollo Residential Project would not interfere with any approved or finalized plan under CEQA since the DISC is conceptual.
3) The DISC Transit Boundary was Incorporated in the Amended Diridon Station Area Plan (DSAP)
The appellants claim the DISC Transit Boundary was incorporated into the DSAP Amendment.
It is assumed that with this claim, the appellants argue that the DISC can be considered a planned transit facility, and as such the Apollo Residential Project would conflict with a plan, ordinance, or policy addressing the circulation system, creating a significant and unavoidable transportation impact under CEQA. The Apollo Residential Project Addendum discusses the project in relation to the DSAP in Section 4.17.2 of the Initial Study, summarized below.
The DSAP Addendum’s Transportation section analyzed the Apollo Residential Project’s proximity to several major transit services. The project site is located approximately 800 feet from the Diridon Transit Center and is immediately across Santa Clara Street from the northern throat into the station, within the boundaries of the Diridon Station Area Urban Village planning
HONORABLE MAYOR AND CITY COUNCIL
February 16, 2023
Subject: Apollo Residential Project CEQA Appeal Memorandum
area. The DSAP land use diagram conceptualizes the Apollo Residential Project site as an Employment/Commercial land use area.
The DSAP was adopted by City Council on June 17, 2014 (City Council Resolution No. 77098), and the most recent amended DSAP was adopted by City Council on May 25, 2021 (City Council Resolution No. 80021). The DSAP Addendum to the DTS 2040 FEIR analyzed the proposed increases in density and development capacity that would be added to the plan, including the project site, as part of the DSAP Amendment, and the DISC Plan is briefly discussed within the DSAP Amendment and the conceptual station boundary and track layout are shown on plan maps.
The amended DSAP notes on page 154 that, “Track approaches to the station will generally follow the existing northern and southern corridors, to the extent feasible, to leverage existing rail infrastructure, minimize overall community impacts, and minimize the need to acquire significant land.” As previously mentioned, the Apollo Residential Project site is currently owned and controlled by the project applicant, not by any of the Partner Agencies. The Authority and/or Partner Agencies may need to acquire the project site in order to develop the High-Speed Rail alignment as analyzed in the August 2022 environmental clearance for the Authority’s San José to San Francisco segment.
The DISC is a conceptual plan that discusses potential changes that could be made to expand the Diridon Station, but the conceptual plan is not under consideration for approval as a project for implementation. The inclusion of the DISC Transit Boundary into the amended DSAP does not negate the property rights of the Apollo Residential Project applicant. While the DISC Transit Boundary includes the project site, the Partner Agencies do not have the right to develop private land as part of the DSAP prior to acquiring or exercising legal control of the property. As such, the proposed Apollo Residential Project would not interfere with any approved or finalized plan or “conflict with a program, plan ordinance or policy addressing the circulation system,” with regard to transit services per CEQA Guidelines Appendix G, Section XVII.
4) Reliance on an Addendum is Inadequate CEQA Clearance for the Apollo Residential Project and an Environmental Impact Report is Required
The document in question is the Apollo Residential Project Addendum to the DTS 2040 FEIR that was certified in December 2018. As a programmatic document with some project-level analysis, the DTS 2040 FEIR evaluated the planned growth for the Downtown area to the year 2040. The proposed Apollo Residential Project was included in the planned growth for Downtown and the DTS 2040 FEIR. This Addendum to the DTS 2040 FEIR was prepared to address the specific details of the proposed project and whether there were any new significant impacts outside the scope of the DTS 2040 FEIR. The appeal letter alleges the Apollo Residential Project Addendum is inadequate because it identifies significant impacts and associated mitigation. This is incorrect. Identifying impacts and associated mitigation does not make the project ineligible for an Addendum to an environmental impact report, rather it provides project-specific analysis and mitigation to ensure the impacts are not more significant
HONORABLE MAYOR AND CITY COUNCIL
February 16, 2023
Subject: Apollo Residential Project CEQA Appeal Memorandum
than the document it tiers from (i.e., DTS 2040 FEIR). All of the impacts, even if there are no impacts, are stated and described after each resource section in the Initial Study that accompanied the Apollo Residential Project Addendum; mitigation measures identified in the DTS 2040 FEIR, as applicable, are also included after each impact statement within the analysis.
The analysis concluded that no new significant impact other than those identified in the DTS 2040 FEIR would occur as a result of the implementation of the Apollo Residential Project. The purpose of an addendum to an approved environmental impact report is to streamline environmental review, and the appropriateness of preparing an addendum to an environmental impact report is discussed in CEQA Guidelines section 15164. No additional subsequent or supplemental environmental impact report is required unless triggered by certain determinations, as discussed in CEQA Guidelines sections 15162, 15163, and 21166. In this instance, no determinations were made that would trigger the need to prepare a subsequent or supplemental environmental impact report. Therefore, an addendum to the DTS 2040 FEIR is the appropriate CEQA clearance for the Apollo Residential Project.
Separately, and outside of the CEQA process, the Apollo Residential Project is located in the Downtown Primary Commercial Zoning District and was properly and thoroughly reviewed under a Site Development Permit application pursuant to San José Municipal Code section
20.70.100 and Chapter 20.100.
The analysis and conclusions made in the Apollo Residential Project Addendum are accurate, adequate, and supported by facts and substantial evidence. None of the claims presented in the appeal provide additional substantial evidence that the Apollo Residential Project would result in a new significant environmental impact or a substantial increase in the severity of an environmental impact than determined in the Apollo Residential Project Addendum. The baseline for evaluating the Apollo Residential Project is the date the City decided to prepare an Addendum for the project, which occurred in October 2021, prior to the April 2022 approval of the EIR/EIS for the High-Speed Rail Merced to San José and the August 2022 approval of the EIR/EIS for the High-Speed Rail San José to San Francisco segments. Considering that the preferred High-Speed Rail alternative alignment was not available under the baseline conditions, the site is currently owned and controlled by the Apollo Residential Project applicant, and the proposed project is consistent with the City’s General Plan and other regulatory requirements, it can be reasonably concluded that the Apollo Residential Project did not conflict with the High- Speed Rail transit plan under the baseline conditions.
As stated above, the analysis in the Apollo Residential Project Addendum is consistent with the DTS 2040 FEIR as presented in the conclusions at the end of each chapter of the Apollo Residential Project Addendum. Therefore, the City has determined that preparation of a subsequent environmental impact report is not warranted.
CEQA statute and Guidelines section 15162(a) states that no subsequent environmental impact report would need to be prepared, if on the basis of substantial evidence and in light of the whole record, the Lead Agency determines the project would not result in new significant environmental effects or a substantial increase in the severity of the previously identified
HONORABLE MAYOR AND CITY COUNCIL
February 16, 2023
Subject: Apollo Residential Project CEQA Appeal Memorandum
significant effects of the previous environmental impact report due to project changes or new information and circumstances. Additionally, a subsequent environmental impact report would not be needed as long as any feasible mitigation measures or alternatives that now would substantially reduce one or more significant effects of the Apollo Residential Project would be adopted as project mitigation measures or alternatives. Based on the above analysis, the comments submitted by Liz Scanlon, on behalf of Carolyn Gonot (Santa Clara Valley Transportation Authority) and Boris Lipkin (Authority), represent an opinion and do not demonstrate with facts and analysis that a new environmental document is required pursuant to CEQA Guidelines section 15162.
Staff recommends that the City Council deny the CEQA appeal, uphold the Planning Director’s reliance on the Apollo Residential Project Addendum to the DTS 2040 FEIR and associated Mitigation Monitoring and Reporting Program (Exhibit F), and approval of the Site Development Permit and Vesting Tentative Map.
Policy Alternatives
For the Environmental Appeal, the City Council could either:
1. Deny the appeal and uphold the adoption of the Apollo Residential Project Addendum; or
2. Grant the appeal and require that additional environmental review be conducted, resulting in a new or revised environmental document prior to consideration of the Site Development Permit.
Climate Smart San José Analysis
The recommendation in this memorandum aligns with one or more Climate Smart San José energy, water, or mobility goals. The development of the project would:
• (Increase) Population density in growth areas
• (Provide) Homes near transit
• (Decrease) DTS 2040 FEIR vehicle miles traveled
EVALUATION AND FOLLOW-UP
If the City Council denies the appeal and upholds the Planning Director’s reliance on the Apollo Residential Project Addendum for the Site Development Permit, then the applicant may proceed with the acquisition of the necessary grading and building permits and implement the required mitigation measures to complete the development of the Apollo Residential Project.
COORDINATION
The preparation of this memorandum has been coordinated with the City Attorney’s Office.
HONORABLE MAYOR AND CITY COUNCIL
February 16, 2023
Subject: Apollo Residential Project CEQA Appeal Memorandum
PUBLIC OUTREACH
This memorandum will be posted on the City’s Council Agenda website for the February 28, 2023 City Council meeting.
Outreach was undertaken for this item in addition to the agenda posting described above. These outreach efforts are described below.
Staff followed City Council Policy 6-30: Public Outreach Policy to inform the public of the proposed project. A community meeting for the project was held via video conference on April 25, 2022. Notice of the public hearing for this appeal and associated materials were distributed to the appellants, applicant, and adjacent property owner(s). Staff has been available to answer questions from the public.
COMMISSION RECOMMENDATION AND INPUT
No Commission has taken action on this project.
CEQA
Apollo Residential Project Addendum to the Downtown Strategy 2040 Final Environmental Impact Report.
PUBLIC SUBSIDY REPORTING
This item does not include a public subsidy as defined in section 53083 or 53083.1 of the California Government Code of the City’s Open Government Resolution.
/s/
CHRISTOPHER BURTON, Director
Planning, Building, and Code Enforcement
For questions, please contact Robert Manford, Deputy Director, at (408) 535-7900.
ATTACHMENTS
Exhibit A: Apollo Residential Project Addendum to the Downtown Strategy 2040 Final Environmental Impact Report
Exhibit B: Site Development Permit, File No. H21-048
HONORABLE MAYOR AND CITY COUNCIL
February 16, 2023
Subject: Apollo Residential Project CEQA Appeal Memorandum
Exhibit C: Environmental Appeal
Exhibit D: City of San José Department of Transportation Memorandum, October 6, 2022
Exhibit E: Background Section of this Appeal Memorandum Exhibit F: Apollo Residential Project Addendum Mitigation Monitoring and Reporting Program