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OPENPUBLICA · PUBLIC MEETING RECORD

Record of Proceedings

South San Francisco Planning Commission Special Meeting Jan 24, 2019: Cannabis CUP and Development Agreement Amendment

Planning Commission — Thursday, January 24, 2019

BodySouth San Francisco, California

SessionPlanning Commission

DateThursday, January 24, 2019

StatusFILED

Video Record

0:00 / 50:40

Transcript — VerbatimClick a timed line to jump · ⧉ to share it

0:04

Commissioner Zhang to introduce a motion to appoint or let the uh an ad hoc chair and vice chair since both our chair and vice chair are not here tonight.

0:16

I would like to just to my comments.

0:19

Yes, I would like to uh motion to um uh elect and uh chair first then and the chance uh the candidate being uh commissioner uh commissioner is there a second second like to make a motion to appoint that off for the vice chair for this meeting.

0:46

Do that with the column normally Mr.

0:50

Wong Okay, I will call to order the meeting of the South Subscope Planning Commission for the January 24th.

1:04

We'll maybe still for the Pledge of Allegiance Allegiance to the flag of the United States of America and the calling for which it says one nation under God.

1:30

Commissioner Zhang?

1:31

Here commissioner Shahade?

1:33

Here Commissioner Evans here.

1:36

Complained Chair Wong?

1:38

Here Chair Faria here and Vice Chair Murphy is absent this evening.

1:46

Agenda review uh Chair Faria um one request uh for for the planning commission to consider uh we have an item item uh three and three eight uh perhaps considering uh taking that item first and then uh taking the second item after that.

2:07

Okay, with that we have any oral communications from the audience okay with that we'll move on to the consent calendar and approve the minutes from uh the November 15th and the December 20th meetings.

2:27

We'll do them both at once or things.

2:30

Okay.

2:31

I'd like to go ahead.

2:36

Meeting minutes of November 15, 2018, and meeting minutes of December 20th, 2018.

2:44

We're the second second.

2:46

Okay.

2:54

Commissioner Zhang.

2:55

Yes.

2:56

Commissioner Shahade?

2:57

Yes.

2:57

Commissioner Evans, yes.

3:00

Chair Faria?

3:01

Yes.

3:01

And Commissioner Evans is absent this evening.

3:05

I mean Commissioner Rick V.

3:07

Okay.

3:11

With that, Madam Clerk, we will move on to item three for our agenda adjustment.

3:17

So maybe we have it reading of item three.

3:23

Report regarding a third amendment to the development agreement for the sale of city-owned properties at 418 Linden Avenue and 201 to 219 Grand Avenue.

3:33

Okay, with that I'll open up public hearing.

3:37

Take it away, just take it back.

3:43

Yeah.

3:47

Yes, for the county.

3:50

Commissioners, uh my name's Michael Appen and I'm going to be able to do that.

3:52

The mic's not amplifying your voice, it's just the cabin as for speaking.

4:00

Uh good evening, Commissioners.

4:02

My name's Mike Lappman.

4:03

I'm with I'm uh economic development coordinator with the economic development department, and I work with Julie Bernard, who's also my is the interim deputy director of the housing and the housing and economic development division of the ECD department.

4:22

Well we're also uh tonight uh the executive president vice president of Rome is with us.

4:29

So there are questions that are uh uh directed towards Rome.

4:34

That could certainly certainly answer those questions.

4:37

Um the uh uh item in front of you is a an item that is only for the DA.

4:44

This is not for entitlement.

4:46

Uh this is uh a uh third amendment to uh development agreement that was approved initially back in uh 2017 uh with the uh the approval of the project uh through Rome.

5:01

So it's basically it does not include any changes to the development itself.

5:09

There are no changes to parking standards, there are no changes to the number of units, there's no changes to the design, there's no changes to the building itself or the configuration.

5:19

What we're looking at are changes to the development agreement in terms of the length of time, where it's uh which would be the expand uh the extension of the one year and the ability to allow the department developer to go ahead and demo the property.

5:37

So those are the two, those are the two key areas.

5:40

In addition to that, there is a change in the uh basically the affordability requirements, which would be to go from the existing 20% uh affordability to 100%.

5:53

The reason why they would like to do the 100% is to allow them to it basically widens their ability to look for financing.

6:02

So uh that's essentially that in a nutshell, that's the project that you're looking at in terms of the uh the DA amendment.

6:10

The um uh the council had looked at this uh amendment uh in a closed session.

6:17

The oh I'll go back and just sort of indicate in October 2818, Rome uh approached the city and with a request to extend the uh debt development agreement to look for new financing sources.

6:31

Due to construction constraints, the uh you know, as we all know, it's it's getting more, it's getting tougher to build projects here because of construction costs and other things like that.

6:42

They were finding that they had a gap in terms of their uh in terms of the project.

6:47

There was about an 8.5 million dollar gap.

6:50

They can correct me on that, but they had to basically figure out a way of getting that gap, and that that means that it had to go out to uh out to uh find new financing sources.

Discussion Breakdown — Share of Meeting

Affordable Housing█████████████████████████████29%

Cannabis Regulation█████████████████████████████29%

Public Safety███████████████████19%

Economic Development███████████11%

Procedural█████████9%

Planning Commission███3%

Summary of Proceedings

South San Francisco Planning Commission Special Meeting Jan 24, 2019: Cannabis CUP and Development Agreement Amendment

The South San Francisco Planning Commission held a special meeting on Thursday, January 24, 2019, at 7:00 p.m. in the City Manager's Conference Room at 400 Grand Avenue. With the Chair position vacant and Vice Chair JulieAnn Murphy absent, the commission selected ad hoc officers. The commission reordered the agenda to consider the Third Amendment to the Development Agreement for city-owned properties first, followed by a Conditional Use Permit (CUP) for a cannabis distribution operation. Both items were approved. No members of the public spoke during oral communications or the public hearings.

Agenda Review and Consent Calendar

The commission agreed to take Item 3 (Development Agreement amendment) before Item 2 (cannabis CUP).
The consent calendar—approval of minutes from the November 15, 2018 and December 20, 2018 regular meetings—was approved unanimously.

Development Agreement Third Amendment (418 Linden Avenue and 201–219 Grand Avenue)

Staff (Economic Development Coordinator Mike Lappman and Acting Deputy Director Julie Barnard) presented a request from developer Rome to amend the development agreement originally approved in 2017.
The amendment includes: a one-year extension to the agreement, authorization to demolish the existing buildings earlier than the completion of the agreement, and a change in affordability from 20% to 100% of the units. Staff stated there are no changes to the number of units, design, parking, or building configuration.
Rome Executive Vice President Alex Sanchez explained the project faced an approximately $8.5 million financing gap due to rising construction costs. The one-year extension would allow time to secure financing from tax credits, public funding (including cap-and-trade), and commercial debt. He noted the project's 100% affordable status (at 50% of area median income—$147,000 for a family of four in San Mateo County, equivalent to about $6,000/month) would improve competitiveness for funding.
Sanchez stated Rome has submitted 100% of construction drawings for building permits, and the cap-and-trade application is due February 11, 2019, with funding announcements anticipated in summer 2019. The project is estimated to cost over $50 million (about $600,000 per unit), with the city's contribution at roughly 20%.
Early demolition was requested because the two structures share a wall with an adjacent occupied building; Rome accepted all risk and responsibility for demolition per the license and demolition agreement.
Commissioner Evans expressed strong support for 100% affordable housing but voiced concern about whether the project would be back for a fourth amendment if financing failed. She also noted the history of a prior project failing due to rising costs.
Commissioner Zhang asked about risks of early demolition and characterized it as a potential win-win.

The commission adopted a resolution recommending that the City Council approve the Third Amendment, including the one-year extension. The motion passed unanimously (Commissioners Shihadeh, Tzang, Evans, Wong, and Faria in favor; Commissioner Murphy absent).

Cannabis Distribution Conditional Use Permit (329 Littlefield Avenue)

Associate Planner Edgar Maravilla presented a request by Green Light Distribution LLC (co-owners John Flutter and Lou Ham) for a CUP to operate a cannabis distribution facility in a 3,905-square-foot tenant space in the Mixed Industrial (MI) zoning district.
The business would conduct wholesale distribution only (no retail, no deliveries to individuals, no walk-up sales) and serve only properly licensed businesses. Hours of operation would be 8:00 a.m. to 5:00 p.m. Monday through Friday. Six parking spaces are provided.
The applicant submitted a security plan approved by the South San Francisco Police Department, including cameras, ID badges, and security and tracking software. Sergeant Mike Rudis stated that police are confident in the plan and can refine it if necessary.
The community benefit contribution is $1,000 in 2019, $4,000 in 2020, and $5,000 per year from 2021–2023, to fund drug/alcohol abuse education at high schools or similar health and safety programs. Staff and the City Attorney noted the amounts are negotiable and may be adjusted; the applicant explained the structured amounts reflect the expected opening timeline.
Commissioner Evans asked about corporate naming (Green Light Distribution LLC vs. Green Light Enterprise), background checks/fingerprinting (agreed to include), employee count (3–6 anticipated), product testing (tracked through licensed testing facilities), and capitalization (self-funded; the owners own the building).
A commissioner expressed personal concern about distribution centers generally and about recent Bay Area robberies; Sergeant Rudis responded that security measures are in place and can be enhanced.
The commission approved the CUP for a five-year term expiring in 2024, subject to the draft findings and conditions, and determined the project is categorically exempt under CEQA (Class 1, Section 15301, existing facilities). The motion passed (Commissioners Shihadeh, Evans, and Faria in favor; Tzang and Wong not clearly recorded in the transcript; Murphy absent).

Items from Staff and Training Announcements

Staff noted that all commissioners are registered for planning commissioner training sessions on January 30 and another session in February 2019; Commissioners Evans and Shihadeh signed up for a League of California Cities meeting in March.
A closing staff remark indicated the Linden Avenue project could break ground as early as January 2020.

Key Outcomes

Unanimous approval of the consent calendar (November 15, 2018 and December 20, 2018 minutes).
Unanimous vote to recommend City Council approval of the Third Amendment to the Development Agreement, including a one-year extension, early demolition authorization, and 100% affordable housing requirement.
Approval of the Conditional Use Permit for the cannabis distribution facility at 329 Littlefield Avenue for a five-year term expiring in 2024, with CEQA Class 1 categorical exemption.

Meeting Transcript

Commissioner Zhang to introduce a motion to appoint or let the uh an ad hoc chair and vice chair since both our chair and vice chair are not here tonight. I would like to just to my comments. Yes, I would like to uh motion to um uh elect and uh chair first then and the chance uh the candidate being uh commissioner uh commissioner is there a second second like to make a motion to appoint that off for the vice chair for this meeting. Do that with the column normally Mr. Wong Okay, I will call to order the meeting of the South Subscope Planning Commission for the January 24th. We'll maybe still for the Pledge of Allegiance Allegiance to the flag of the United States of America and the calling for which it says one nation under God. Commissioner Zhang? Here commissioner Shahade? Here Commissioner Evans here. Complained Chair Wong? Here Chair Faria here and Vice Chair Murphy is absent this evening. Agenda review uh Chair Faria um one request uh for for the planning commission to consider uh we have an item item uh three and three eight uh perhaps considering uh taking that item first and then uh taking the second item after that. Okay, with that we have any oral communications from the audience okay with that we'll move on to the consent calendar and approve the minutes from uh the November 15th and the December 20th meetings. We'll do them both at once or things. Okay. I'd like to go ahead. Meeting minutes of November 15, 2018, and meeting minutes of December 20th, 2018. We're the second second. Okay. Commissioner Zhang. Yes. Commissioner Shahade? Yes. Commissioner Evans, yes. Chair Faria? Yes. And Commissioner Evans is absent this evening. I mean Commissioner Rick V. Okay. With that, Madam Clerk, we will move on to item three for our agenda adjustment. So maybe we have it reading of item three. Report regarding a third amendment to the development agreement for the sale of city-owned properties at 418 Linden Avenue and 201 to 219 Grand Avenue. Okay, with that I'll open up public hearing. Take it away, just take it back. Yeah. Yes, for the county. Commissioners, uh my name's Michael Appen and I'm going to be able to do that. The mic's not amplifying your voice, it's just the cabin as for speaking. Uh good evening, Commissioners. My name's Mike Lappman. I'm with I'm uh economic development coordinator with the economic development department, and I work with Julie Bernard, who's also my is the interim deputy director of the housing and the housing and economic development division of the ECD department. Well we're also uh tonight uh the executive president vice president of Rome is with us. So there are questions that are uh uh directed towards Rome. That could certainly certainly answer those questions. Um the uh uh item in front of you is a an item that is only for the DA. This is not for entitlement. Uh this is uh a uh third amendment to uh development agreement that was approved initially back in uh 2017 uh with the uh the approval of the project uh through Rome. So it's basically it does not include any changes to the development itself. There are no changes to parking standards, there are no changes to the number of units, there's no changes to the design, there's no changes to the building itself or the configuration. What we're looking at are changes to the development agreement in terms of the length of time, where it's uh which would be the expand uh the extension of the one year and the ability to allow the department developer to go ahead and demo the property.

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