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7-Eleven: 'Gaps in the process'
December 24, 2012, 05:00 AM By Bill Silverfarb Daily Journal staff
Residents passionate about closing down a 7-Eleven in San Mateo will have to wait at least until Jan. 14 to find out whether the City Council will go against the recommendations of city staff and determine the market to be non-conforming with the city's zoning laws.

The Planning Commission, comprised of five appointed citizen volunteers, has already made the determination that city staff somehow bungled the process to let a 24-hour convenience store open up at the former Stangelini's Italian Deli & Hilltop Market at 501 N. San Mateo Drive, which closed two years ago.

Residents near the store, however, have hinted that the process may have also been corrupted and used the power of subpoena to force city officials, including Councilman Jack Matthews, to testify before the Planning Commission Tuesday night on what exactly transpired and whether any conflicts of interest or undue influence existed in the process.

The lawyer for 7-Eleven, Stephen Jamieson, called the neighborhood's "character assassination” of city staff "unforgivable” Tuesday night, in a five-hour meeting, after some residents claimed one city planner was "incompetent” and a "liar.”

Planning commissioners were quick to defend city staff, however, and said it was not corruption that brought the 7-Eleven to the predominately residential neighborhood but rather "gaping holes in the process” as Planning Commissioner Joshua Hugg put it Tuesday night.

The Planning Commission is recommending to the City Council to determine that the 7-Eleven is "not” a legal non-conforming use of the property.

City code dictates that since the market use was discontinued for at least six months that the land must be returned back to residential, as it is technically zoned.

But a competing legal opinion from within the City Attorney's Office, given in an email in March, was enough to abruptly end a public process as Portfolio Development Partners sought a zoning code amendment to push the discontinued use part of the code past the six-month mark.

The opinion, given by interim Assistant City Attorney Cecelia Quick, determined that, although the market use had been discontinued that the owners, Isaac Choy and Susan Lin, had no intent to abandon a market use for the property even though the Hillsborough doctors marketed it for a medical/dental office use.

Once Quick gave her controversial opinion on the matter, building permits were issued, the property was sold and 7-Eleven signed a lease with a 30-year term with PDP.

The store has been open a little more than two weeks and neighbors have demonstrated at least twice now in front of the store to protest its presence.

City planners had repeatedly told other interested parties in the matter, including Matthews and his architectural firm, that a market use was no longer possible on the site and that it must be reverted back to residential.

For his part, Matthews said he only had one conversation with city staff on the matter way back in November 2010 and was unaware a competing legal opinion no longer required PDP to secure a zoning code amendment.

The zoning code amendment being sought, however, would not have just applied to the 501 N. San Mateo Drive property but to every non-conforming property in the city.

There were questions Tuesday night as to why so many city planners worked on the project and why it was eventually turned over to Senior Planner Lisa Ring, whose conversation with Quick about the citywide amendment led to the opinion that the owners had no intent to abandon a market use.

Ring said Tuesday night she had no idea of the prior legal determinations on the property and did not know the lot was technically zoned residential.

Principal Planner Stephen Scott, however, testified that he did tell Ring prior to a Feb. 29 neighborhood meeting on PDP's request for a zoning code amendment that the market use for the site had discontinued.

Ring also said she had no idea that 7-Eleven was the intended tenant leading up to the neighborhood meeting. Ring was assigned the case away from Associate Planner Julia Yeh some days before the neighborhood meeting to better manage Yeh's workload, according to Tuesday night's testimony.

The exact date Ring was assigned the case came into question Tuesday night as residents questioned how the legal determination for the property could have changed so quickly based on a telephone conversation and subsequent email. Ring actually announced at the Feb. 29 neighborhood meeting that PDP held that a zoning code amendment may no longer be required.

Ring was questioned during her testimony to the Planning Commission on how the legal determination for the property could have been changed in just two days since Ring was assigned the case Feb. 27.

She said she was assigned the case before Feb. 27, however, but no one on staff could verify exactly what date she took over the case from Yeh.

Matthews was also questioned about phone calls he made to city staff in the weeks leading up to Feb. 29 but testified Tuesday he was calling about different projects.

"We are architects, not lobbyists,” Matthews testified. "I ask questions of staff from time to time but do not advocate for staff to take a specific position.”

Internally, city officials have discussed the possibility of Matthews being investigated by the Fair Political Practices Commission for his contacts with city staff if he did so on behalf of his clients.

The Planning Commission determined Tuesday that discontinuance was enough to revert the lot back to residential but also said it was clear Choy and Lin had abandoned the market use since they gutted the building of all of its refrigeration and utility, added carpet and marketed it for a medical/dental office. City staff, however, concludes that the 7-Eleven does have the right to occupy the spot based on city code.

"The improvements made were inconsistent with a market use,” Planning Commission Chair Dianne Whitaker said.

Planning Commissioner Chris Massey said he was troubled by accusations that someone did something corrupt within the city and explained that there were clear deficiencies in the process.

Planning Commissioner Kelly Moran agreed, saying: "There is no sense of any malfeasance on any part of city staff.”

Hugg said city staff's intentions were "honest” but the process needs to be improved.

Perhaps the harshest words for 7-Eleven and PDP were delivered by Moran and echoed by fellow Commissioner Rick Bonilla who questioned how they relied upon a legal opinion in an email to invest millions into the project.

PDP bought the property at the end of August for about $1 million and 7-Eleven claims to have already spent close to that just to open the store.

"Someone spending $1 million on a forwarded email seems crazy to me. I don't think any logical person would do that,” Moran said.

At some point, Bonilla said, the intent of the code is that someday the non-conforming use will go away.

Commissioners said that a non-conforming use is a limited right and that "there has to be an end.”

PDP and 7-Eleven, however, contend their losses will be in the $8 million range if the market use is discontinued and have threatened to sue the city if the 7-Eleven is forced to close.

Massey said Tuesday night, however, that the discontinuance and abandonment occurred well before PDP or 7-Eleven were involved in the project. Those findings could help the City Council determine that the building permits issued to PDP for 7-Eleven were done so in error.

When the council takes up the issue again in January, Matthews will have to recuse himself from the proceedings, which were started by Mayor David Lim after residents near the market started complaining about the excess crime and traffic a 7-Eleven will bring to the neighborhood and the lack of a true public process.

Bill Silverfarb can be reached by email: silverfarb@smdailyjournal.com or by phone: (650) 344-5200 ext. 106.

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