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CC SR 20151117 01 - Green Hills Memorial Park Appeal of PC DecisionCITY OF RANCHO PALOS VERDES PUBLIC HEARING Date: November 17, 2015 Subject: Green Hills Memorial Park Appeal of Planning Commission Decision regarding Annual Compliance Review (Case No. ZON2003-00086) Subject Property: 27501 Western Avenue 1. Report of Notice Given: City Clerk Morreale 2. Declare the Hearing Open: Mayor Knight 3. Staff Report & Recommendation: City Attorney Dave Aleshire City Manager Doug Willmore 4. Public Testimony: Appellant: Green Hills Memorial Park Applicant: Green Hills Memorial Park 5. Council Questions: 6. Rebuttal: 7. Council Deliberation: 8. Declare Hearing Closed: Mayor Knight 9. Council Action: Public Hearing Cover Page CITY OF RANCHO PALOS VERDES MEMORANDUM TO: FROM: DATE: SUBJECT: REVIEWED: HONORABLE MAYOR & CITY COUNCIL MEMBERS DAVE ALESHIRE, CITY ATTORNEY NOVEMBER 17, 2015 GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION REGARDING ANNUAL COMPLIANCE REVIEW (CASE ZON-20030086); LOCATION: 27501 WESTERN AVENUE DOUG WILLMORE, CITY MANAGER lt/k.J Project Manager: So Kim, Senior Planner RECOMMENDATION Adopt attached Resolution No. 2015-__ partially upholding the decision of Planning Commission and partially modifying the conditions of approval of the CUP and permitting continued operation of Mausoleum with conditions to minimize impacts. FISCAL IMPACT Conducting the appeal hearing will have no fiscal impact. However, if the City Council partially upholds the appeal regarding modifications to the conditions of approval requested by Green Hills, the cemetery will be entitled to a 50% refund of the appeal fee. EXECUTIVE SUMMARY The Planning Commission reviewed and considered the 1-year compliance review with great care and imposed conditions, including the requirement to for Green Hills to apply for a variance. Other than some minor revisions to the conditions of approval requested by Green Hills, staff recommends that the City Council affirm the Planning Commission's decision, subject to the changes to the conditions of approval discussed in this report . 01203.002 5/273300. 7 2 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 2 SITE DESCRIPTION Green Hills Memorial Park cemetery is located at 27501 Western Avenue in the northeast corner of the City, bordering the City of Lomita, the City of Rolling Hills Estates, and the City of Los Angeles. The cemetery was first established in 1948 and, at the time, was located within an unincorporated area of Los Angeles County. The site became part of the City of Rancho Palos Verdes when the "Eastview" area was annexed in 1984. The property is approximately 121-acres in size, and is a privately owned and operated cemetery facility. The cemetery operates Monday through Sunday, from sunrise to sunset, and consists of ground burials, mausoleum buildings, an office building, mortuary, chapel, flower shop, and a maintenance yard and related buildings. I. BACKGROUND The City has taken three significant actions regarding Green Hills Memorial Park that have bearing on the appeal currently before the City Council. Each of these, the 1991 Master Plan, the 2007 Master Plan Revision, and the 2014 Annual Compliance Review, are described below: A. 1991 Master Plan On September 25, 1984, the Planning Commission approved Conditional Use Permit No. 93, allowing the construction of a new 16-foot high mausoleum building and lawn crypt interment area with 7,900 cubic yards of backfill at Green Hills Memorial Park, known as Park View Terrace, in what is now known as Area 12 of the property. The mausoleum building, however, was never constructed and the approval expired. Subsequently, on July 12, 1988, the Planning Commission approved Grading Permit No. 1129, allowing 13,300 cubic yards of grading necessary for new lawn crypts in the cemetery. To avoid future incremental projects similar to those described above, it was determined that a master plan was a better tool to allow a phased development of the cemetery site over an extended period of time. Therefore, following the submittal of Conditional Use Permit No. 155, on August 14, 1990, the Planning Commission approved a Master Plan for a portion of the site development and the entire grading plan for the Green Hills Memorial Park cemetery site. The Master Plan segmented the cemetery site into different "Areas" where mausoleums and/or ground interments were approved, including an estimation of the total amount of grading necessary to develop and improve each Area. The Planning Commission's decision was appealed to the City Council by the applicant, citing concerns with several conditions of approval relating to phasing, setbacks, and placement of a proposed mausoleum expansion. Residents of the Vista Verde Condominiums appeared at the public hearings before the Planning Commission and voiced opposition to mausoleum buildings and ground interments being located too close to their properties. On February 19, 1991, the City Council upheld the appeal, thereby approving a Master Plan for the entire Green Hills Memorial Park property with several modifications to the Planning Commission's original decision (Resolution No. 91-7, attached). 01203.0025/273300.7 3 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 3 The 1991 Master Plan called for phased development of the cemetery site that was contemplated to occur over the next 1 DO-years. The Master Plan allowed 194,340 cubic yards of grading (97, 170 cu. yds. of cut and 97, 170 cu. yds. of fill) to be balanced on site (i.e., no import or export), including re-grading of the remaining 45-acres of undeveloped area on the property. The Master Plan also allowed construction of 2.44-acres of mausoleum buildings, 11.87-acres of "garden" burial sites, 27.21-acres of ground burial sites and 3.72-acres of roads. On March 28, 1995, Conditional Use Permit No. 155, Revision "A" was approved by the Planning Commission. Revision "A" modified a condition of approval regarding mausoleum building height, thereby increasing the maximum downslope building height from 25'-0" to 30'-0". On March 10, 1998, the Planning Commission approved Revision "B" to allow the removal of three underground fuel tanks that were not anticipated in the original approval of the Master Plan. In addition to these two Conditional Use Permit revisions, between 1991 and 1998 several other approvals were granted for projects at Green Hills at the staff level because they were deemed to be consistent with the Master Plan. During the remainder of 1998 and into 1999, the City received complaints from nearby residents regarding noise, dust, and other impacts related to the remedial grading operations. Eventually, the City became aware (through Green Hills' own admissions) that the remedial grading had exceeded the scope of activity approved under Grading Permit No. 2050, and a "Stop Work" order was issued on October 27, 1999. After a meeting between City Staff and Green Hills, the "Stop Work" order was lifted with the understanding that Green Hills would perform only minor grading to complete the remedial buttress fill that was necessary to properly complete the remediation, would not import any additional material, and would properly apply for an amendment to the Master Plan. In response to further unauthorized grading, the City issued additional "Stop Work" orders between 2000 and 2002, which were ultimately lifted based on continued assurances from Green Hills that an amendment to the Master Plan was forthcoming. Ultimately, on February 19, 2003, Case No. ZON2003-00086 was submitted, which was a Revision to the Green Hills Master Plan. 8. 2007 Master Plan Revision Following submittal of the Master Plan Revision in February 2003, the application remained incomplete for several years. During this time, the applicant made further modifications to the original request, including refining the amount of grading that would be necessary to construct each of the future proposed mausoleum buildings. Staff deemed the project complete for processing on November 22, 2006. Once deemed complete, an Initial Study/Mitigated Negative Declaration was prepared to assess the project's environmental impacts. The intent of the 1991 Master Plan was to allow for the orderly development of the cemetery over a 100-year time frame. Unfortunately, the Master Plan seriously 01203.0025/273300.7 4 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page4 underestimated the grading quantities necessary to construct the mausoleum buildings and preparation of the ground interments throughout the cemetery site. Therefore, the intent of the 2007 Master Plan Revision was to better specify the areas of development and the grading quantities necessary for ultimate build-out of the cemetery site. The Master Plan Revision included an acknowledgement that the actual quantity of grading that had been conducted between 1991 through 2004 was 288,814 cubic yards (cut and fill), which was a significant increase to the 194,340 cubic yards of grading (1/3 increase) approved by the 1991 Master Plan. In addition, it proposed a total of 643,259 cubic yards of additional grading, which includes 97,964 cubic yards of import for all the various proposed mausoleum buildings, and all cut and fill associated with ground burials throughout the cemetery site for the life of the Master Plan. The imported fill material would be conducted in phases as each mausoleum building is constructed over the next 30-to 50-years. Another significant aspect of the 2007 Master Plan Revision was that it proposed a number of modifications to the mausoleum buildings approved in the 1991 Master Plan. Of specific interest to this appeal was the request to make a sizable addition to the previously approved mausoleum building in Area 11, known as the Pacific/Memorial Terrace Mausoleum. The original mausoleum location was south of the existing maintenance yard, and had a 22, 187 square foot building footprint. Apparently, the initial application submitted in 2003 proposed to increase the building footprint to 33,668 square feet, which is also reflected in the February 27, 2007 staff report. However, as shown in the Master Plan Amendment Submittal Package, the building was actually proposed to increase to 60,548 square feet in size (1.39 acres), as indicated on Roman numeral page V, and extend significantly to the west and to the east of its originally approved location, as can be seen by comparing page M-E (1991 site plan) with page M-A (2007 site plan). Furthermore, the Master Plan Amendment Submittal Package makes the first references to the interments on the roof of the mausoleum in the description of Area 11 on Roman numeral page 5 and the building cross sections depicted on pages 11-C and 11-0. On February 27, 2007, the Planning Commission conducted the first public hearing regarding the Master Plan Revision. On April 24, 2007, the Planning Commission took additional testimony from the applicant and the public, and considered staff's analysis of the document entitled: "Modifications to Conditions of Approval Proposed by Applicant." In its report, staff indicated which modifications to the conditions of approval proposed by Green Hills were acceptable to staff, those that would be acceptable with further modification, and those that were unacceptable to staff. The proposed modifications to Condition No. 7 regarding the minimum required setbacks for above-ground structures was listed, along with a number of other conditions referred to only by condition number, as a change that was acceptable to staff, but was not specifically discussed or analyzed in the report. The proposed change is as follows, with the new language show in underlined and italicized text: 01203.0025/273300.7 5 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 5 7. Setbacks for above ground structures, including but not limited to mausoleums (except the Pacifica Mausoleum and the Mausoleum shown in Area 11 of the Master Plan Revision) and crypts shall be as follows: North: 80'-0" or no closer than the northern perimeter road, whichever is greater (8'-0" for the western-most portion of the Mausoleum shown in Area 111. South: 40'-0" East: 25'-0" West: 5'-0" At the conclusion of the public hearing, the Planning Commission approved an update to the Green Hills Master Plan (P.C. Resolution No. 2007-33, attached), which incorporated the proposed modification to Condition of Approval No. 7 shown above. By the added language, the critical northern setback was reduced from 80 feet to 8 feet The Planning Commission's decision was not appealed to the City Council. The updated Master Plan approval in 2007 also included a condition requiring the Planning Commission to perform an operational review of the Green Hills Memorial Park Master Plan on an annual basis. In accordance with Condition of Approval No. AQ-1 and provided the property owner complied with the Planning Commission's approved Master Plan, Green Hills was permitted to move forward with obtaining permits and construct the improvements identified in the Master Plan without a public hearing. Since approval of the Green Hills Master Plan Revision in April 2007, the Community Development Department has issued approvals for construction of different components of the approved Master Plan. Most notable among these, as related to the current appeal, are the following: • February 2008 -First phase of the Pacific/Memorial Terrace Mausoleum building in Area 11. However, plans were not submitted into the Building and Safety Division, and the Planning Division approval expired. • May 2008 -Preparation of lawn crypts in Area 1, located between the existing Pacifica Mausoleum and the proposed mausoleum building in Area 11 at the northwest corner of the cemetery site. This approval included the grading and construction of a tractor ramp to provide access to the top of the future mausoleum building in Area 11. This project was completed. • In November 2011, Planning Division approval was again granted for the first phase of the Pacific/Memorial Terrace Mausoleum building in Area 11. A building permit was issued in February 2012, and construction began in April 2012. The project was constructed and completed in September 2013. With the completion of the Pacific/Memorial Terrace Mausoleum in Area 11, the City began receiving numerous inquiries and complaints from residents in the adjacent 01203.0025/273300.7 6 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 6 Vista Verde Condominium complex regarding the Mausoleum's visual and view impacts, and the close proximity of burial preparation and ceremonial activities on the roof of the mausoleum building. In response and in compliance with the CUP, staff brought forward an operational review of the Green Hills Master Plan to the Planning Commission to address the concerns with the Pacific/Memorial Terrace Mausoleum, as well as with any other concerns raised by the public concerning the operation of the cemetery. C. 2014 Master Plan Operational Compliance Review On February 25, 2014, the Planning Commission reviewed staff's suggested mitigation measures and conditions to address operational concerns raised by condominium owners in the adjacent City of Lomita, regarding Green Hills' Memorial Terrace/Pacific Mausoleum building located in Area 11 of the approved 2007 Green Hills Master Plan. The Commission also heard some options from the Green Hills representatives that they believed could be implemented to address some of the concerns, and heard testimony from some of the Vista Verde Condominium owners regarding the impacts associated with the mausoleum building and the activities that are conducted on the rooftop, including burials. After hearing public testimony and discussing the cemetery operations, the Planning Commission continued the public hearing to March 11, 2014, to allow staff to draft a resolution imposing up to a 90-day moratorium on all rooftop ground interments/burials on the Pacific/Memorial Terrace Mausoleum, while staff finalized mitigation measures to address specific noise, visual, and privacy impacts identified by the Planning Commission based on public testimony. However, the Planning Commission did not impose the temporary moratorium because at the March 11th hearing, the attorneys representing Green Hills and the Vista Verde Condominium Association requested that the hearing be further continued to the April 22, 2014 Planning Commission meeting to allow time for the parties to meet and come to an agreement on mitigation measures to address operational impacts associated with the Pacific/Memorial Terrace Mausoleum. In accordance with both parties' request, the Planning Commission continued the public hearing to April 22, 2014. On April 22, 2014, the Planning Commission continued the hearing to May 13, 2014, again at the request of both parties, so they could have additional time to resolve some remaining issues. On May 7, 2014, staff received an email from Ms. Ellen Berkowitz (counsel for Green Hills) requesting the opportunity to make a presentation before the Planning Commission of the concepts and methods they had developed to address the concerns raised by the Vista Verde Condominium owners. On May 13, 2014, the Planning Commission heard the presentation from Green Hills regarding possible methods to address concerns raised by the Vista Verde Condominium owners. Although it appeared that some progress and common ground had been achieved between Green Hills and the condominium association, individual 01203.0025/273300. 7 7 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 7 residents continued to voice their concerns and opposition to what Green Hills was proposing. In order to allow the parties to continue to meet to address the issues, the Planning Commission continued the hearing to the August 12, 2014 meeting, with the direction that the parties continue to work toward an agreement on the mitigation measures to address the operational impacts associated with the burials on the roof of the mausoleum building; otherwise, it was indicated that the Planning Commission will need to impose mitigation measures to address the issues raised by the adjacent property owners. On August 4, 2014, staff was notified by Green Hills counsel via email that the parties had not reached any agreement and that the condominium association had advised them that the only agreement they are willing to accept is that the cemetery no longer would conduct any burials on the roof of the mausoleum building. Given that no agreements had been reached between the parties, staff recommended that the Planning Commission impose specific mitigation measures to address the observed visual, privacy, and noise impacts associated with the rooftop burials and to amend the Green Hills Master Plan to prevent further expansion of the Pacific/Memorial Terrace Mausoleum, which had been suggested by Green Hills. On August 12, 2014, the Planning Commission reviewed and considered staff's recommendations. In addition, the Commission considered the City Attorney's oral recommendation made at the meeting that the submittal of a variance application was necessary to allow the mausoleum to encroach into the Code-required, 40-foot setback. After hearing public testimony and discussing the cemetery operations, the Planning Commission directed Green Hills to submit an "after-the-fact" variance application to seek approval to allow the existing Pacific/Memorial Terrace Mausoleum building to remain encroaching 32-feet into the required 40-foot property line setback and directed staff to review Green Hills' existing Master Plan, including the conditional use permit and variance, to make sure that Green Hills was in compliance with all of their conditions of approval. This motion was approved on a 7-0 vote. The Planning Commission also agreed to close the public hearing and directed staff to bring back a resolution on the consent calendar at the next Planning Commission meeting to impose a number of operational conditions on the cemetery to avoid/minimize impacts to the adjoining neighbors from burial activity on the roof of the mausoleum. This motion was supported by a 6-1 vote, with Commissioner Gerstner dissenting. The Resolution implementing this directive was presented to the Planning Commission on August 26, 2014. Although the draft resolution was placed on the Consent Calendar, staff suggested that it be removed, as staff had some additional comments regarding the resolution language and because there were requests from the public to speak regarding the item. Since the public hearing was closed, the discussion on August 26th was limited to the language in the draft Resolution and whether it accurately reflected the motion that 01203.0025/273300. 7 8 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 8 passed on August 12th. During the August 26th meeting, there were many questions from Commissioners regarding additional potential violations of the Master Plan. Since the public hearing was previously closed, the Planning Commission agreed to continue the item to October 28, 2014, and directed staff to re-notice the public hearing to allow for continued discussion of all aspects of the operational review of the Master Plan. On October 28, 2014, the Planning Commission opened the public hearing and considered additional public testimony, and also considered a Master Plan Compliance Review prepared by an independent third party reviewer (Lilley Planning Group)1. As a result of the additional information revealed from the third party compliance review and deliberation by the Planning Commission, the Planning Commission directed staff to return on November 11, 2014 with a Resolution that memorialized the following actions: 1) Imposed a moratorium on ground burials/interments and sales of burial plots on the rooftop of the Pacific/Memorial Terrace Mausoleum building located in Area 11 of the Master Plan, and imposed a moratorium on above-ground burials and placement of other large structures within the 5-foot setback area along the western property line in the area south of the Pacifica Mausoleum building, which would remain in effect until final City Council action was taken on the issue of interments and structures in the required setbacks; 2) Directed Green Hills to submit a variance application within 30-days to seek approval to: (i) allowed the existing Pacific/Memorial Terrace Mausoleum building to remain encroaching 32-feet into the required 40-foot property line setback; (ii) allowed the existing 13 below-ground burials and 6 additional burials in companion spaces that are located within the 16-foot setback in the northwest corner of the cemetery site between the west property line and the maintenance yard; and, (iii) allowed existing structures and above-ground burials within the 5-foot setback area along the western property line in the area south of the Pacifica Mausoleum building; 3) Imposed a number of conditions on the cemetery to avoid/minimize impacts to the adjoining neighbors from burial activity on the roof of the Pacific/Memorial Terrace Mausoleum building in Area 11 of the Green Hills Master Plan (Condition 1.3), if the moratorium on rooftop burials was ever lifted by the City Council; and, 4) Allowed Green Hills to proceed with submittal of construction plans into Building and Safety plan check for the administration building addition that was approved by the Planning Commission on July 22, 2014. The Planning Commission continued the public hearing to November 11, 2014, to allow continued discussion of the proposed actions. At that meeting, after further 1 Lilley report follow up. 01203.0025/273300. 7 9 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 9 discussion and further modifications to the Conditions of Approval, which were read into the record, the Planning Commission adopted P.C. Resolution No. 2014-29 (see attached Exhibit G). The resolution contained all of the four items cited above. Within the 15-day appeal period, Green Hills counsel submitted an appeal letter dated November 25, 2014 on behalf of Green Hills appealing the Planning Commission's decision to City Council (see attached appeal letter Exhibit D). Green Hills counsel submitted a subsequent letter dated January 15, 2015, alleging due process violations (see Exhibit E). Based on the amount of late correspondence received prior to the January 20, 2015, meeting, and a City performance investigation, the City Council continued, and ultimately directed staff to re-notice, the public hearing for a future date. The delay was extensive with the hearing not finally scheduled until September 1, 2015. This was largely due to the City's investigation of the matter through an independent outside firm and then the efforts of the parties to resolve the matter by performing an appraisal and participating in a mediation. At the September 1 hearing, after extensive testimony, the Council directed staff to prepare a resolution largely upholding the Planning Commission's actions including the points outlined above. However, before a resolution could be prepared, effective September 15, 2015, the City contracted with Aleshire & Wynder as the new City Attorney2 and instructed that they review the legal status of a number of potential disputes. The additional delay in hearing the appeal has been, in part, to allow new legal counsel time to review all the information relating to this appeal, and to make recommendations. After meeting with staff and all parties, the appeal hearing was re-noticed for November 17, 2015. The appeal hearing is a de nova hearing per Section 17.80.070(F)3 , and the City Attorney has made substantially different recommendations from those previously. The City Attorney recommends a mediation process, to attempt to resolve the disputes and compensate the homeowners as described below, and would require Green Hills and future developers to indemnify the City for legal expenses. The filing of the appeal stayed the moratorium imposed by the Planning Commission. A number of burials have since occurred on the roof of the Pacific Terrace/Memorial Terrace Mausoleum. However, during the time that the appeal has been pending, Green Hills has voluntarily complied with the operational conditions included in the Planning Commission's decision to mitigate the impacts of the rooftop burials. In addition, Green Hills has modified the interments located along the western property line to move them outside the required 5-foot setback area, although final verification of setback compliance is still pending. Finally, Green Hills counsel has 2 The process of having a new city attorney was independent of the Green Hills matter and was a five- month process which included soliciting proposals, evaluations of the bids, and interviews and selection, all undertaken competitively. 3 A de nova hearing means that new evidence can be produced and the decision can be made on the basis of the new evidence, and is not limited to the record made at the Planning Commission. RPVMC § 17.80.0?0(F). 01203.0025/273300.7 10 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 10 recently submitted requested modifications to the Conditions of Approval that were added or modified by the Planning Commission on November 11, 2014. The suggested conditions recommended by staff are described in the "Summary of Changes to Conditions per Green Hills Compliance Review" attached as Exhibit A. II. DISCUSSION A. Summary of Recommendations Since the Planning Commission's consideration of Green Hills' review, the City has changed legal counsel. Based on the new City Attorney's advice, staff recommends the following: 1. Uphold Green Hills' appeal and relieve them of the requirement to obtain a variance. 2. Uphold Green Hills' appeal and eliminate the requirement of a moratorium on roof burials at the Pacific Terrace Mausoleum (Area 11 ). 3. Amend/clarify the enumerated conditions of operation to avoid/minimize impacts to the adjoining neighbors from burial activity on the roof of the Pacific Terrace/ Memorial Terrace Mausoleum building in Area 11 of the Green Hills Master Plan (Condition 1.3). 4. Add a condition that requires the project applicant to indemnify and defend the City of Rancho Palos Verdes from any claims and actions relating to the validity of the approvals and operation of the Green Hills cemetery complex; and requiring Green Hills to enter into a detailed indemnity agreement.4 (Condition 41) 5. Add a condition requiring Green Hills to offer to mediate the disputes with Green Hills and offer compensation equivalent to any loss in value suffered by the Vista Verde homeowners, with the details of the mediation process subject to agreement by the parties. (Condition 40) B. Analysis The above recommendation to the City Council includes partially reversing the Planning Commission's directives (i) to require Green Hills to obtain a variance for the Pacific Terrace Mausoleum, and (ii) to impose a moratorium to temporarily cease rooftop burials at the site. This recommendation differs from that provided by the former City Attorney, for the reasons outlined herein. While the legal issues and analysis is complex, 4 The City Attorney will be adding this obligation to all future development approvals so that the cost of defending the approvals will be borne by the developers or benefitted party. 01203.0025/273300.7 11 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 11 and normally such advice might be provided confidentially to the Council, the nature of this lengthy dispute, and the change in the City's legal position, requires that some public explanation and analysis be provided, which we will attempt in summary fashion below. 1. Concept of Vested Rights and Legal Concerns With Variance Requirements. a) Justification for Variance. Upon advice of counsel, the Planning Commission imposed a requirement that Green Hills obtain a variance to permit the 8 foot setback of the Pacific Terrace Mausoleum where the underlying zoning requires 40 feet, and the prior CUP conditions required an 80 foot setback. A variance is "an administrative or quasi-judicial act permitting minor deviations from existing land use regulations so that the landowner does not suffer undue hardship, but which does not violate the overall established land use regulatory scheme.5 Section 65906 of the Government Code limits the circumstances under which a variance is appropriate: a variance "shall be granted only when, because of special circumstances applicable to the property, including size, shape, topography, location or surroundings, the strict application of the zoning ordinance deprives such property of privileges enjoyed by other property in the vicinity and under identical zoning classification. (Emphasis added.) The former City Attorney reasoned that as the underlying zoning required a 40 foot setback, RPVMC § 17.28.040(A)(2), the CUP which had required 80 feet could not reduce the setback to less than 40 feet without requiring a variance6 . Accordingly the Planning Commission was advised to require Green Hills to obtain an "after the fact" variance. We have termed it "after the fact" because by the time this condition was imposed, November 11, 2014, the Mausoleum had been constructed pursuant to building permits issued by the City in February 2012 and where construction was completed in September 2013 (i.e., 14 months after completion of construction). These facts raise the question as to whether Green Hills had vested rights which could not be disturbed by the after-the-fact requirement to obtain a variance. b) Vested Rights Generally In California, a developer is determined to have vested rights when they have (i) obtained a validly issued permit and then (ii) incurred substantial construction in reliance on such permit. This is known as the Avco7 rule. (1) Building Permit Pursuant to CUP Confers Vested Right. 5 Milagra Ridge Partners, Ltd. v. City of Pacifica, 62 Cal. App. 4th 108, 118-19 (1998) 6 A variance might have been difficult to legally grant for a property of some 121 acres where the 80 foot setback had been a part of the 2007 Master Plan. See footnote 16. 7 Avco Community Developers, Inc. v. South Coast Regional Commission, 17 Cal. 3d 785 (1976) discussed in more detail below. 01203.0025/273300.7 12 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 12 To qualify as a vested right then, there must be validly issued permits along with substantial construction in reliance on the permit. A conditional use permit (CUP) can lead to obtaining a vested right, although the nature of the rights is determined by the conditions of the permit itself and the city's ordinances. In 1991, the City Council adopted Resolution No. 91-7, which approved a master plan (the "Master Plan"), a CUP, and a grading permit for Green Hills Memorial Park, to govern the long-term development of their cemetery property. In 2007, the Master Plan, the CUP, and the grading permit were revised and updated, per P.C. Resolution No. 2007-33 (attached). This Resolution reduced the setback to 8 feet. Thereafter in February 2012, the building permit for the Mausoleum was issued with the City apparently of the belief that the issuance was proper. While grading permits might not produce a vested right, clearly, a validly issued building permit does under California law, as discussed below. (2) Argument that building permit not validly issued countered by RPVMC permitting CUP to supersede zoning. A permit can be invalid if: it is issued in violation of applicable law; issued under misrepresentation of material facts by the applicant, or if obtained by fraud; in conflict with the general plan; and in conflict with public policy. Invalidity can apply to either the permit as a whole, or to certain conditions of a permit. The Planning Commission action in P.C. Resolution No. 2014-29 (November 2014) requiring a variance was based on the theory that the 8 foot setback condition was invalid as being in violation of the zoning code because the 8 foot setback condition is contrary to the 40 foot setback requirement provided for in the zoning code. RPVMC § 17.28.040(A)(2). However, RPVMC Section 17.60.050(8) provides as follows: "Conditional use permits may be granted for such period of time and upon such conditions and limitations as may be required to protect the health, safety and general welfare. Such conditions shall take precedence over development standards otherwise required by the underlying zoning of the subject site." On its face, this language would appear to give the 8 foot setback "precedence" over the underlying 40 foot setback of the zoning. However, the former City Attorney took the position that this language permits variance from the underlying zoning only if it, in effect, promoted the general welfare. If the variation from the development standards was contrary to the general welfare then it could not be approved. However, to grant a CUP, the following finding must be made: 01203.0025/273300.7 13 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 13 "6. That conditions regarding any of the requirements listed in this paragraph, which the planning commission finds to be necessary to protect the health, safety and general welfare, have been imposed: a. Setbacks and buffers .... " RPVMC § 17.60.050(A). In fact, in 2007 in Resolution 2007-33 the Planning Commission made these findings. The Planning Commission found that conditions have been imposed to protect the health, safety and general welfare, including concerning setbacks and buffers, and the 8-foot setback was one of the approved setbacks. So the argument that it is not compatible is directly contrary to the recommendations of staff and findings of the Planning Commission. Moreover, legal counsel for Green Hills has argued that discretionary authority given by the ordinance in the granting of a CUP to vary from the underlying zoning contains no qualification that this only applies if it ''promotes" general we/fare.8 It is a general rule of statutory construction that courts "are generally bound by a statute's plain text and are not permitted to add words to a statute to accomplish a purpose ... not apparent from the face of the statute."9 . Thus, in the absence of language in the zoning code that expressly restricts the "takes precedence" to where the change is more restrictive, and not less, it would appear that there is no basis for adding this qualification to the express provisions of Section 17.60.050(8). Here, the underlying zoning was for 40 feet, but by the 2007 CUP, the setback was reduced to 8 feet. It can certainly be argued that this reduced the general welfare of the adjoining property owners. However, the Planning Commission found to the contrary in granting the CUP. Moreover, it is not clear that such a change imposed through the CUP was beyond the Planning Commission's authority in 2007. Section 17.60.050(8) provides broad authority to vary from the zoning standards. There is no language that says the change can only be more restrictive. Accordingly, there are strong arguments that the granting of the CUP was sufficient and no variance was required. (3) The Requirement of Substantial Construction is met. Besides a validly issued permit, second prong of the vested right test is that there has been substantial construction in reliance on the permit. What is "substantial construction"? This rule comes from the California Supreme Court case Avco Community Developers, Inc. v. South Coast Regional Commission.10 . In that case, a developer of a subdivision, part of which lay within the jurisdiction of the California Coastal Zone Commission, sought a writ of mandate to compel the Commission to grant an exemption from provisions of the California Coastal Zone Conservation Act of 1972 requiring 8 See letter from Ellen Berkowitz dated September 1, 2015, attached as Exhibit F. 9 Lucent Technologies, Inc. v. State Bd. of Equalization, 241 Cal. App. 4th 19 (2015) (internal citations omitted). 10 Id. 01203.0025/273300. 7 14 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 14 issuance of a permit for any development within the Coastal Zone. The Supreme Court, held, that the developer had not obtained vested rights to proceed with the development without a permit by virtue of the fact that, prior to the effective date of a permit requirement, it had obtained approval of a planned unit development and had spent $3,000,000 to subdivide and grade the property, and to make certain improvements on the land, such as installing utilities. The Court stated that: "[i]t has long been the rule in this state and in other jurisdictions that if a property owner has performed substantial work and incurred substantial liabilities in good faith reliance upon a permit issued by the government, he acquires a vested right to complete construction in accordance with the terms of the permit."11 However, while in spending $3,000,000 Avco had spent considerable resources to improve the property, it had failed to obtain the necessary building permits prior to the effective date of the Coastal Commission's requirements. Substantial expenditures in reliance on a building permit created a vested right but would not if based only on a grading permit. Following Avco, the rule has generally been that merely spending money, or even grading the site is insufficient. Instead the developer must advance to obtaining building permits and pouring foundations. Here, Green Hills had an amended Master Plan and a CUP which, consistent one with the other, permitted them to construct the mausoleum with an 8 foot setback. Green Hills submitted structural plans in November of 2011 and building permits issued in February 2012. These in and of themselves would not have created vested rights, but in April they began construction, and on September 11, 2013, the mausoleum was completed and finaled by the City. Thus, unlike the situation in Avco, here the building permits have issued, and in addition, not only the foundations but the building itself has been completed and operations have gone on for over a year; thus, the substantial reliance standard articulated in Avco has been satisfied. (4) Estoppel. A vested right may also arise under the theory of estoppel. So even if the condition reducing the setback from the required 40 to 8 feet is assumed to be invalid, Green Hills has argued that they detrimentally relied on the CUP and the subsequent building permits, which were issued in conformance with the Master Plan and the conditions of the CUP. To establish a claim of estoppel against the government a litigant must prove five elements: (i) the party to be estopped (here, the City) must be aware of the facts; (ii) the party to be estopped must intend that its conduct shall be acted upon; (iii) the other party must be ignorant of the true state of facts; (iv) the other party must rely upon the conduct 11 Id. at 791. 01203.00251273300.7 15 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 15 to its injury; and (v) the other party's injury to its personal interests if the government is not estopped exceeds the injury to the public interest if the government is estopped.12 Where a City seeks to revoke a permit issued in error, it may be "estopped" from doing so where revocation would be inequitable. A number of cases have applied this standard, some approving estoppel and some rejecting it. For example in Millbrae 13 a developer who had spent $600,000 had no vested right to proceed, but in another case, 14 the City of Long Beach could not claim an interest in the tidelands because thousands of citizens relied on the understanding that the tidelands were private. In a Ninth Circuit Court of Appeals case, 15 the court held that the city was estopped from revoking the building permit it had previously issued to the Congregation pursuant to a settlement agreement. In Congregation, the city's building department spent approximately three months reviewing the plans in conjunction with an agreement that the deputy city attorney also reviewed. As part of the process, the city demanded numerous changes to the plans, with which the Congregation complied. After the review process the city issued a building and grading permit, and the Congregation started renovation work in accordance with the approved plans. Congregation spent in excess of $21,000 on permit fees and over $15,000 on demolition. In finding that the city should be estopped from revoking the building permit, the court reasoned that the city had ample opportunity to review both the plans and the agreement before granting the building permit. Moreover, the court found that the issuance of a valid building permit by the city was essentially a representation that the Congregation's plans were in accordance with the terms of the settlement agreement. Generally, estoppel is only applied against the government under extraordinary circumstances. Applying the estoppel factors, it has been suggested that Green Hills presented plans and drawings which were not always clear and created confusion on the part of staff. Nevertheless, the language of the condition itself changing the setback from 80 feet to 8 feet (a 90% reduction), was clear and contained in the staff report and resolution before the Planning Commission. Knowledgeable planners with years of experience with the project could have anticipated the public controversy when building commenced but recommended the change. Here a court could conclude that the City is estopped from revoking the setback condition in Green Hills' CUP based on the amount of money spent building the mausoleum, the 2007 Master Plan and CUP 2007-33, which clearly stated the change in setback, and the investment of many people in the Mausoleum where their loved ones are buried. In balancing the equities between the developer and the City, even though there are equities on behalf of the homeowners, we do not believe the developer's actions are so egregious that the City could deprive the 12 Driscoll v. City of Los Angeles, 67 Cal. 2d 297, 305 (1967); La Canada Flintridge Development Corp. v. Dept. of Transportation, 166 Cal. App. 3d 206, 219 (1985). 13 Millbrae Ass'n for Residential Survival v. City of Millbrae, 262 Cal. App. 2d 222 (1968). 14 City of Long Beach v. Mansell, 3 Cal. 3d 462 (1970). 15 Congregation ETZ Chaim v. City of Los Angeles, 371 F.3d 1122 (9th Cir. 2004). 01203.0025/273300. 7 16 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 16 developer of its rights under the permits, particularly since completion of the Mausoleum and sale of rights therein. c) Right to Due Process. Another problem with requiring Green Hills to obtain a variance arises from the nature of the variance hearing. Case law provides that for a hearing to afford due process rights, the hearing body must have the ability to undertake the requested action.16 Accordingly, a variance hearing would only be appropriate if the City Council could grant the variance. Here the argument seems to be that obtaining the variance is necessary as a technicality. But the reality is that if the City were to require the variance, it must be assumed that the variance could be denied (and in fact we see some legal arguments against the validity of a variance)17 . But if the variance were denied, it would follow that the City's position would be that the Mausoleum must be removed. This then would bring the City into litigation over the vested rights of the developer, Green Hills. We are unaware of the costs of construction of the Mausoleum, the revenues which have resulted from the sale of burial plots, or the anticipated sales of future burial plots. Nor have we attempted to estimate claims for interference with contract rights and pain and suffering of parties related to the burials within the Mausoleum if they are disturbed (were that even legal) and the disputes which would arise were the Mausoleum removed, but collectively these claims and the legal fees to resolve the claims could easily exceed many millions of dollars. It would seem the height of folly to pursue a legal proceeding where one of the two outcomes would expose the City to such legal proceedings and potential damages. Maybe the assumption was that there was a high likelihood the variance would be granted, but this would appear to also prove the point that given the construction of the Mausoleum two years ago, such a variance proceeding was in the order of a legal fiction. 16 People v. Broad, 216 Cal. 1, 7, 12 P.2d 941, 943 (1932) ("The rule is well settled that to constitute due process of law in regard to the taking of property the statute should give the parties interested some adequate remedy for the vindication of their rights.") 17 A variance is "an administrative or quasi-judicial act permitting minor deviations from existing land use regulations so that the landowner does not suffer undue hardship, but which does not violate the overall established land use regulatory scheme. 17 Section 65906 of the Government Code limits the circumstances under which a variance is appropriate: a variance "shall be granted only when, because of special circumstances applicable to the property, including size, shape, topography, location or surroundings, the strict application of the zoning ordinance deprives such property of privileges enjoyed by other property in the vicinity and under identical zoning classification. (Emphasis added.) Nothing in the record suggests that an undue hardship exists as to Green Hills' property, including size, shape, topography, location, or surroundings. Thus there is a legitimate argument against the City Council being be able to make the necessary findings to support the granting of a variance in this case. Accordingly, we think the better argument is that RPVMC Section 17.60.050(8) contains sufficient authority to grant a CUP which alters the requirement of the underlying zoning without requiring a second potentially inconsistent legal proceeding of a variance. 01203.0025/273300. 7 17 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 17 d) Summary of Reasons Not to Require a Variance. In summary, the City Attorney must recommend against requiring Green Hills to seek a variance at this time because: (i) the express language in the Municipal Code states that the conditions in the CUP can supersede the zoning; (ii) the Planning Commission expressly found the CUP did not have an adverse effect on surrounding property and promoted health and safety when it granted the CUP, (iii) Green Hills obtained a vested right as described above, (iv) the equities between the developer and City do not support equitable estoppel, and (v) proceeding with a variance leaves the City conducting a pro forma hearing where a denial of the variance would subject the City to potential liabilities of millions of dollars. We cannot recommend this action, despite the good faith of the Planning Commission in recommending it or that of the City Council in previously considering it. 2. Moratorium on rooftop burials a) Moratorium imposed under police powers Besides the variance, it was recommended, and the Planning Commission imposed, a moratorium on rooftop burials under the authority to annually review the CUP, not under the state law statute governing zoning moratoria.18 State law authorizes a city, pursuant to a noticed hearing and findings that a particular use is a current and immediate threat to the health and safety, to adopt a 45-day interim urgency ordinance to cease permitting that use (a moratorium). Interim urgency ordinances can be extended for up to a total of two years, and are commonly referred to as moratoriums. Here, the Planning Commission did not invoke the statutory authority for a moratorium, as its intent was to enact a permit condition that would halt rooftop burials temporarily. Thus, the "moratorium" is being analyzed here as a condition of operation. As such, it may be impermissible either as preempted by state law or as a temporary taking. b) Preemptive concerns State regulations of dead bodies and cemeteries are found, respectively, in Division 7 19 and Division 820 of the Health and Safety Code, but local government "may by ordinance prescribe such standards governing burial, inurnment, and entombment and such standards of maintenance for cemeteries, including mausoleums and columbariums, as it shall determine to be reasonably necessary to protect the public health or safety, assure decent and respectful treatment of human remains, or prevent 1a Gov't Code§ 65858. 1s Health & Saf. Code § 7000 et seq. 20 Health & Saf. Code§ 8100 et seq. 01203.0025/273300. 7 18 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 18 offensive deterioration of cemetery grounds, structures, and places of interment."21 State regulations also provide that owners of burial plot have property rights in such plots.22 Thus, regulations that the City imposes relating to setbacks, height of walls, size of structures, vegetation, etc. are not preempted, provided that such regulations do not affect existing burial plot property rights, or otherwise conflict with the standards for disposal of dead bodies and the state law cemetery provisions. The latter include definitions, provisions relating to property rights, requirements of compliance with the technical codes (such as building and plumbing codes) for mausoleums and colombariums, maintenance of cemetery grounds, rules relating to the operation of public and private cemeteries, and cemetery districts, and pet cemeteries. The moratorium on rooftop burials may be preempted by state law to the extent that the condition prevents otherwise lawful burials. Additionally, the condition might run up against the property rights of people who have already purchased plots on the roof of the Pacific Terrace Mausoleum. No case law interprets the preemptive scope of the state laws. The result of a legal dispute over the boundaries of the City's authority is thus uncertain, and it is therefore not advisable to undertake a course of action that might lead to liability for the City. Therefore it is recommended that the moratorium not be imposed on rooftop burials at this, especially since Green Hills has been willing to take steps to mitigate the impacts of the rooftop burials on the neighbors. c) Taking concerns A moratorium on the rooftop burial operations of the Pacific Terrace Mausoleum may constitute a compensable temporary taking by the City. As noted above, the moratorium at issue is not an interim urgency ordinance adopted pursuant to Section 65858 of the Government Code, but rather a temporary condition prohibiting rooftop burials. The Fifth Amendment of the United States Constitution provides that private property shall not "be taken for public use without just compensation."23 The Just Compensation Clause applies to the states, as well. The courts have distinguished between physical takings, when a government entity acquires a property to convert it to a public use, and a regulatory taking, which can occur when all economic use of a property 21 Health & Saf. Code§ 8115. This section further provides that local regulations shall not "supersede[] any provision of this division or Division 7 (commencing with Section 7000)," nor can a city or county "authorize[] the adoption of local standards in conflict with such provisions, except that city or county ordinances adopted pursuant to this section shall prevail over the rules and regulations of any private or public cemetery to the extent of any conflict." See also Health & Saf. Code§ 8113(b). 22 Health & Saf. Code § 8600. 23 The California Constitution's equivalent provision is found in Section 19 of Article I. 01203.0025/273300. 7 19 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 19 is prohibited by regulation.24 A physical acquisition of private property (either through eminent domain or inverse condemnation) automatically triggers just compensation.25 By contrast, whether a regulation constitutes a taking "necessarily entails complex factual assessments of the purposes and economic effects of government actions."26 A regulatory taking is not limited to circumstances where the regulation deprives the private property owner of the economic use of their property on a permanent basis. A temporary deprivation of the economic use of property, however brief, can under certain circumstances constitute a taking of property requiring compensation. Whether a delay in the use of property constitutes a compensable taking also "requires careful examination and weighing of all the relevant circumstances."27 Generally, moratoriums on specific land uses throughout a jurisdiction, for specifically limited periods when supported by strong justification, do not constitute temporary takings.28 The High Court explained that "with a temporary ban on development there is a lesser risk that individual landowners will be singled out to bear a special burden that should be shared by the public as a whole. At least with a moratorium there is a clear reciprocity of advantage, because it protects the interests of all affected landowners against immediate construction that might be inconsistent with the provisions of the plan that is ultimately adopted. While each of us is burdened somewhat by such restrictions, we, in turn, benefit greatly from the restrictions that are placed on others. In fact, there is reason to believe property values often will continue to increase despite a moratorium."29 One of the important factors that the courts will look at to determine whether a taking has occurred is the duration of the moratorium, and whether that is reasonable in light of its purposes. While the moratorium condition here does not affect all similar land uses, the analysis is analogous, and the courts will look at similar factors considered in determining whether moratoriums on land uses are, on balance, not compensable takings. The moratorium condition here is of concern because (i) it lacks a defined length of time,30 (ii) no guidance has been provided to Green Hills or the City regarding what needs to be accomplished, and by when, in order to lift the moratorium, (iii) the rooftop burials have been occurring for some time and were contemplated in the Master Plan, (iv) a number of people have already purchased plots, and might have a need for their plots 24 Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Agency, 535 U.S. 302 (2002). 25 Id. at 322. 26 Id. at 323. 27 Id. at 335. 2s Id .. 29 Id. at 341 . 30 Note that an interim urgency ordinance adopted pursuant to Section 65858 of the Government Code, which imposes a moratorium on specific land uses throughout a jurisdiction, can only be adopted for 45 days initially, and can only be extended for a total maximum of two years. Thus, state law itself ensures a time limitation. 01203.0025/273300.7 20 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 20 during the moratorium, and (v) Green Hills has been willing to make some accommodations to mitigate the impact of the rooftop burials on the neighbors. Damages to Green Hills would potentially be the lost business during the pendency of the moratorium. We do not have estimates of what these might be. In addition, plot owners have property rights in their plots. The moratorium might constitute a temporary taking as to them if it prevents them from using their plot burials. That the prohibition is temporary may be of little comfort if a plot owner is forced to bury someone, or is himself buried, elsewhere for the pendency of the condition. Possibly it has been assumed that the legality of this condition might be resolved quickly by the courts, or the enforcement of the condition might be suspended until there is a judicial ruling. However, there really is no assurance that a judicial proceeding would be quickly resolved. d) Conclusion Ultimately the issue of the validity of a moratorium will come down to one of reasonableness. The following issues are a cause for concern: (i) the lack of a defined period for the moratorium; (ii) the lack of clarity about what needs to be achieved in order to lift the moratorium; (iii) the fact that the burials have been going on for some time and were contemplated in the original approval; (iv) the fact that Green Hills has evidently sold plots to a substantial number of people with no notice that there would be any problems; and (v) Green Hills has been willing to make some accommodations to mitigate the impacts of the burials. Of course, on the other hand, these practices only 8 feet from the condos can impact the quality of life for the condo owner. On balance, however, the City Attorney does not feel that it is reasonable to recommend any action to the City Council which could result in monetary liability. Clearly it is possible that this matter could proceed fairly expeditiously to court, and the court could uphold or invalidate the moratorium, and the City could suspend enforcement during this period. Still, once the City takes this action a door has been opened exposing the City to damages. Where the City does not have extremely strong arguments on its side, such a course is unwise. 3. City Attorney's Alternative Approach to Variance and Moratorium Part of the delay from the January 20, 2015, initial Council hearing on the Green Hills appeal of the Planning Commission compliance review until the September 1, 2015, was that the parties agreed to participate in a mediation process. Although there was a useful exchange of views, ultimately no agreement was reached. At the time many of the owners were either not represented by legal counsel or a number of different attorneys were involved. Subsequently there has been a consolidation of representation. 01203.00251273300.7 21 MEMORANQUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 21 The City Attorney believes that a mediation process is a fundamentally correct approach to the problem, and thinks it should be retried under somewhat different circumstances. The circumstances are as follows: 1. Motivations: Green Hills is motivated to agree to a new process in light of the substantial cost and uncertainties it would have faced challenging the variance process and moratorium. The Vista Verde owners would also face no longer having the City front the cost of the legal actions with Green Hills. 2. Indemnity: The City Attorney would add the conditions to this and future land use approvals that the developer bear the expense of defending the validity of the actions. A condition would be added to the CUP and a detailed indemnity agreement would be negotiated. 3. Appraisal: Even though we have no reason to question the old appaisal, to get agreement with Vista Verde, we'd go through a new appraisal process. If the parties cannot agree on the appraiser, then Green Hills and Vista Verde would each select for and pay for an appraiser. The value of the loss would be fixed at the average of the two highest appraisals, with the old appraisal also considered. Green Hills would be liable for 100% of the appraised loss. The details of this process could be negotiated when and if Vista Verde comes to the table. 4. Mediation: With completion of the appraisal, the parties would participate in another mediation. In addition to Green Hills participation, City would participate and would contribute up to $200,000 to any mediated agreement, being our estimate of what the City would save on legal fees if litigation is avoided. 5. Mitigation: The conditions primarily contemplated to minimize impacts would be added to the CUP. Since we evolved these concepts, we have met with Green Hills and legal counsel for Vista Verde. We have a tentative agreement with Green Hills reflected in the recommended conditions of approval. Although legal counsel for Vista Verde is generally aware of our recommendations, they will continue to press the Council to uphold the Planning Commission action, as you will hear at the hearing. They believe requiring the variance and imposing a moratorium will create the most pressure on Green Hills. While we understand this position, we believe this excessively exposes the City. The circumstances are unfortunate, but given the vested rights of Green Hills, the variance path potentially ends in an order to demolish the Mausoleum and subjects the City to millions of dollars of liability. Several years ago the Town of Mammoth Lakes was determined to have acted improperly in not granting development approvals and subsequent trial on damages led to a judgement in excess of $30 million subjecting the 01203.00251273300.7 22 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 22 Town to bankruptcy. The Town actually to this day does not believe it acted improperly but this is a potential outcome under our judicial system. RPV has been down a similar road in the Monks litigation. In lieu of this course of action we have negotiated and advocate: not requiring variances or imposing moratoriums creating potential for awards of damages; requiring developer indemnification; initiating a new appraisal process with the developer required to pay for losses; requiring mediation to determine the specific claims; having the City contribute what it would pay in attorney fees to settlement-pay the homeowners instead of the attorneys. Of course, we the City cannot compel the parties to reach agreement, though we can provide incentives. There is certainly a good chance agreement will not be reached and in such case we may face claims from the condominium owners. Claims have been already presented. We hope that offering what we would pay in attorney fees to the condominium owners will help. But if it does not result in an agreement, we think the City has strong defenses and immunities, which include the statute of limitations (the City original approval was in 2011) and under Sections 820.2 and 815.2 of the Government Code we are not liable for damages resulting from the exercise of discretion in issuing approvals. Nor is the existence of the Mausoleum a public nuisance. We believe any claims brought by the condominium owners can be successfully defeated. Notwithstanding the above, we recognize the equities of the situation and hope to participate in a mediation which can appropriately compensate the Vista Verde homeowners. CONCLUSION Notwithstanding that concluding the September 1, 2015 hearing the City Council was inclined to follow the Planning Commission's recommendations, following additional analysis of the City's legal exposure and the vested rights which have accrued to Green Hills based upon the City's approvals in 2007 and the completion and operation of the Mausoleum since, we recommend the compliance review be completed by imposing the mitigating conditions recommended, requiring Green Hills to offer to participate in mediation with the Vista Verde Homeowners, and requiring that Green Hills bear the expense of defending their entitlements. ALTERNATIVES Principal alternatives are: 01203.0025/273300. 7 23 MEMORANDUM: GREEN HILLS MEMORIAL PARK APPEAL OF PLANNING COMMISSION DECISION November 17, 2015 Page 23 1. Proceed with upholding Planning Commission action and require Green Hills to obtain a variance and impose a moratorium on aboveground burials, which would be suspended until the variance was granted or a judicial determination were made. 2. Approve the compliance review without the requirement of a variance, or a moratorium on rooftop burials, and not require Green Hills to participate in a mediation or defend its entitlements. Attachments: A. Summary of Changes to Conditions per Green Hills Compliance Review (To be delivered at or before the Public Hearing) B. Resolution No. 2015---- • Exhibit A -Conditions of Approval C. Green Hills Appeal Letter dated November 25, 2014 D. Green Hills Letter dated January 5, 2015 E. Green Hills Letter dated September 1, 2015 F. Planning Commission Resolution No. 2014-29 G. Public Correspondence 01203.0025/273300.7 24 (Attachment B - 1) (Attachment C - 1) (Attachment D - 1) (Attachment E - 1) (Attachment F - 1) (Public Correspondence - 1)