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He further stated that HUD needs a cushion in case expenses go up, so they will not process projects at statutory maximum rents. Mr. Levy said that with refer- ence to Mr. Edgar's statement that this would be setting a precedent, that the Section 235 project is not the same as is being proposed in that there is not a developer making a profit, rather it is a moral commitment from dedicated people in the community and that the project would be beneficial to the community and to the City. He further commented that it is not a question of "can you waive the fees", but "will you waive the fees". Councilman Herlihy expressed the feeling that there was a conflict in the figures of the reports and that the project had been plagued with problems since its conception. He commented that he did not think it was the Council's preroga- tive to transfer these fees to the taxpayers for this project, and not allow others. Councilman Kinney stated the deliberations were not a conflict of interest between Councilmen and Church Membership, and the social nature of the project would be of such great benefit to the community that he felt the fees should be waived in order to allow the project to be constructed. Councilman Mori commented that while we are committed to developing a bal- anced community, to forgive the fees for this project would set a bad precedent and also this is a moderate income project not low income, therefore, difficult to justify. He stated there is a moral commitment for this type of project but there is also a financial commitment on the part of the sponsoring organization for the project. Councilman Pearson expressed his concern regarding the waiving of Park Dedication fees, stating it would Jeopardize the Park fund and have a drastic affect on every development. Mayor Reid commented that this is perhaps one of the most difficult decisions this Council has had to face in that members of the City Government do have a responsibility to encourage and provide housing for all of the various income people in the community. He stated he concurred with the staff recommendations that it would be a mistake to waive the fees for this project and that possible alternatives should be looked at by the City and the sponsoring organization. It was moved by Councilman Mori, and seconded by Councilman Pearson, that the request of Pleasanton Greens for a reduction in fees for construction of their project, be denied. The roll call vote was as follows: AYES: Councilmen Herlihy, Mori, Pearson, and Mayor Reid NOES: Councilman Kinney ABSENT: None Mayor Reid encouraged representatives of Pleasanton Greens and the City to pursue other alternatives with regard to this project. Mayor Reid recessed the meeting at 10:00 P.M. Mayor Reid reconvened the meeting at 10:05 P.M. Report of the CinTManager~ Re:.. Rezonin~ of certain parcels in Macka7 Mayor Reid stated this matter was continued from the meeting of December 18, 1972. Mr. Edgar presented the staff report and displayed maps showing the three Purchase Parcels in question, stating that Purchase Parcel No. 1 is completely built out, Purchase Parcel No. 2, which will include the subject commercial and apartment site, has been finaled, major improvements have been sized and were physically installed in 1971, and construction has been partially completed, and on Purchase Parcel No. 3 there are no final units and the tentative map has expired. He concluded that the commercial and multiple development in the area are too far along to enable the City to effectively change its mind and alter the zoning significantly, and he recommended that Mackay be retained as the developer in order to keep density reduced. 3. 1/22/73