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Councilmember McGovern said it appears that the renovated 1906 house only has two bedrooms; however, she confirmed with the Planning Director it actually has three bedrooms and also that all proposed homes will be three bedrooms. Councilmember Thorne confirmed with the City Manager that there was a balance between $2 and $3 million in the park in-lieu fee account which was established in 1988 which restricts the funds to park acquisition only. Councilmember Thorne asked if the Council could change its policy on what the funds could be used for, and City Manager said it could and this would need to be agendized for a future meeting. Councilmember Thorne questioned how often lead-based paint and asbestos issues arose with historic properties, and Planning Director Iserson said this occasionally occurred and the developer would need to take steps to safely remove and dispose of any such items. Councilmember Cook-Kallio confirmed that the height of the adjacent condominiums to the south was 28 feet, the apartments to the north were 30 feet, and the new homes would be 4-5 feet taller than those. Mayor Hosterman opened the public hearing. Jon Harvey, addressed the City Council, supported the project, felt it would be great for downtown economic vitality and he urged the Council's approval of the application. Mayor Hosterman closed the public hearing. Councilmember Sullivan said he supports the project and what the City is trying to do in the downtown with the specific plan for additional housing, supports walk able communities and high density, but was bothered by the fact that there was opposition at the Planning Commission meeting. He felt there was a dynamic emerging between long-time downtown residents and some of the new projects and that there was a disconnect between what the new housing should look like relating to massing and design. He thought the Council needs to step back, get some residents together with the development community and business leaders and work through some of the issues in order to achieve support. Councilmember Cook-Kallio said she would be interested in listening to a discussion between developers and downtown residents for future proposals; however, did not agree with putting this project on hold. Councilmember McGovern agreed, said she visited the property, the buildings being demolished were built in the 1970's and are not very attractive. The homes replacing them are a great improvement and the house being retained will actually serve as a focal point at the corner. She said there are areas where residents are concerned about people buying small houses and making them larger, she was willing to listen to these conversations, but for this project she wanted to move forward with the condition that staff look at some design issues for a balcony and trellis or softening to the front facades of elevation D, as well as funding to help with the Bernal Park. Councilmember Thorne said he appreciates the additional funds for Bernal Park, liked the higher density in the downtown and the project's walk-ability and access to the ACE Train. He agreed that the Council should review designs for future projects. City Council Minutes 5 October 16, 2007