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City Attorney responded that there could be financial implications, but that the Council should not make it the only driving factor. Instead, Council needs to take into account that this is a Land Use decision and authority set by the Zoning Code. Another Council Member and City Attorney Thompson discussed that the current 16 homes and 14 property owners were based upon existing regulations and General Ptan and current zoning. The City Attorney further stated that the lots are developable and Council had asked owners to work together on an EIR to evaluate environmental impacts together and develop infrastructure to support that as a group effort. Also, in Phase 2, people would be able to seek to obtain permits. Each of the applicants have to check with the City to ensure that they are in compliance with the EIR and regulations. According to the same Council Member, this is the creation of the Laurel Way Home Owners Association (HOA) in that they would have to pay upfront costs. Also, the property owners would have to secure all the rights of the property, and enter into a maintenance agreement and improvement agreement of Phase 1. Cordilleras Heights HOA was provided as an example. The Council Member asked if the HOA can put an indemnification and the City Attorney responded that they can do an insurance agreement with a promise to pay for any liabilities like a failure of the slope. One other Council Member had a procedural question to discuss the EIR and certifying an EIR but not approving a project. He mentioned that certifying an EIR means three things: meets California Environmental Quality Act (CEQA) requirements, there is an independent judgment, and mitigation. He would like to get into the EIR first and then move forward with the other issues. Another Council Member asked several questions regarding: any available lots that are not buildable or developable; possibly controlling slope requirements; and clarification about merging of lots. Mr. Lyon responded that physically these lots are buildable. With regards to the slope requirements, he mentioned that these help determine newly created lots or subdivisions and these help meet the needs of requirement and the neighborhood's characteristic. Lastly, Mr. Lyon did reiterate that lots can be merged, but it is not required. Furthermore, as a free market response, he said that the lots can be aggregated to build a large home. Vice Mayor Gee wanted to bifurcate the issues. He asked staff to explain what an EIR is and Mr. Lyon said that it provides the information for Council to make an informed and educated decision. Then, he asked for confirmation that both geological and geotechnical items were reviewed and covered and that the project was peer reviewed. Mr. Lyon confirmed those statements as correct. Lastly, Vice Mayor Gee questioned what governs an EIR: General Plan or Zoning and Mr. Lyon said both apply depending on the scale you are looking at. Mr. Lyon used an economics approach: macroeconomics versus microeconomics. He stated that the General Plan is considered macro; whereas, the Zoning is micro. More importantly he added that both apply to this project and staff looked at the General Plan and past plans. Mr. Lyon went on to say that you cannot ignore one or the other. CITY COUNCIL September 23, 2013 MEETING MINUTES PAGE 12 MINUTE BOOK NO. 64 Page No. 447