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Mr. Swift stated that staff's current recommendation is that Council grant the variances for the setback and the height so that the building may remain. Staff differs from the Planning Commission's decision in that it would add a condition to the conditions of approval that would state: the use of the second floor as a second unit is not approved, and the second floor of the existing detached accessory building shall not be used as a second unit, living area or sleeping area. Prior to issuance of a building permit to modify the existing building, the applicants/property owners shall remove the existing kitchen facility and record a restrictive covenant specifying that the second floor shall not be used as a living area, sleeping area, and/or second unit. He noted that condition two of the Planning Commission's approved conditions of approval is different than staff's with respect to the time frame for bringing the existing structure into code compliance. The Planning Commission omitted staff's recommended condition three in that it approved allowing the second unit to remain. Mayor Pico pointed out that the only real difference between staff's recommendations and what was approved by the Planning Commission is that staff is recommending against occupancy or use of the second unit as a separate residential unit. In response to an inquiry by Ms. Ayala, Mr. Swift said that all requirements of the Building and Fire Codes must be met in order for the existing structure to be retained. Mr. Campbell wondered why staff did not want the second unit to be used as a residence. Mr. Swift said that staff is unable to make the required findings to support a second unit on the second floor of the accessory building because there are no unusual cimumstances to support such a finding on this lot. Staff believes that allowing a second unit on the second floor of a detached structure would set an unwelcome precedent to the City's new second unit ordinance. Allowing second units on second stories as close to property lines as the second unit ordinance allows will almost always raise difficult issues of privacy to neighbors. In this instance, the building does not even meet the second unit ordinance's relaxed setback rules. While adding residential units in the downtown is a laudable goal now contained in the Downtown Specific Plan, it is not a legitimate basis for granting a variance. He recognized the need to rezone the zoning district for First, Second and Third Streets. The zoning designation that it should become needs to be specially drawn as none of the City's standard zoning designations fit the development pattern that occurred in the last century to today. Staff routinely grants rear and side yard variances to allow accessory structures to replace the old tin buildings and single-vehicle garages, which populated these lots at some point in time. The neighbors almost uniformally support these variances because the existing structures were replaced. Staff has not supported two-story accessory structures except in rare cases. In this particular instance, staff can support the two-story structure primarily because of what has been built around it that precludes the privacy issues that normally occur. Staff has routinely supported height variances that would allow the pitch of a single-story accessory structure such as the garage located at the corner of Neal and First Streets to match the slope of the roof of the buildings that are being emulated to fit in with the neighborhood. These height variances have not been granted to create second-story units. Pleasanton City Council 14 09/07/04 Minutes