CITY OF RANCHO SANTA MARGARITA PLANNING COMMISSION STAFF REPORT

CITY OF RANCHO SANTA MARGARITA PLANNING COMMISSION STAFF REPORT DATE: March 6, 2013 TO: FROM: BY: SUBJECT: City of Rancho Santa Margarita Planning Commission Kathleen Haton, Development Services Director ~ Nathaniel G. Farnsworth, Senior Planner-tJ7 Planning Application RSM 12-044: Conditional Use Permit to Modify the Conditions of Approval for Alcohol Sales for an Existing Movie Theater located at 30632 Santa Margarita Parkway, Rancho Santa Margarita, California Recommendation That the Planning Commission: 1. Receive staff presentation and report. 2. Commission questions of staff. 3. Open public hearing. 4. Receive public testimony. 5. Close the public hearing. 6. Commission discussion and deliberation. 7. Adopt Resolution entitled: Background/Discussion EXECUTIVE SUMMARY A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY. OF RANCHO SANTA MARGARITA, CALIFORNIA, APPROVING PLANNING APPLICATION RSM 12-044 FOR A CONDITIONAL USE PERMIT TO MODIFY THE CONDITIONS OF APPROVAL FOR ALCOHOL SALES FOR AN EXISTING MOVIE THEATER LOCATED AT 30632 SANTA MARGARITA PARKWAY, RANCHO SANTA MARGARITA, CALIFORNIA This item was continued from the February 6, 2013 Planning Commission meeting. The applicant, Marty Hannigan of Sanderson J Ray Development on behalf of Cinepolis Luxury Cinemas, has submitted Planning Application RSM 12-044 for a Conditional Use Permit (CUP) to modify the conditions of approval for alcohol sales for an existing movie theater located at 30632 Santa Margarita Parkway previously approved under Resolution No. PC 12-02-01-01. The proposed project would not involve any expansion or modification to the building. The proposal requests to allow minors within all 03/06/13 Item 5.1

RSM 12-044 Cinepolis Luxury Cinemas March 6, 2013 Page 2 auditoriums at all times during regular business hours and to allow the two-drink limit to be removed under special circumstances. Pursuant to California Environmental Quality Act (CEQA) Guidelines Section 15301, Staff recommends that the Planning Commission determine that the proposed project is exempt from CEQA under the Class 1 categorical exemption since it involves the operation of private facilities involving no expansion of an existing use beyond that existing at the time of the lead agency's determination. A copy of the Notice of Exemption has been included as Attachment 2. Staff has prepared the required findings related to the proposed CUP according to Section 9.08.110 of the Rancho Santa Margarita Zoning Code. The proposed project is in conformance with the Rancho Santa Margarita General Plan and the Rancho Santa Margarita Zoning Code (RSMZC) and is considered compatible with existing uses. Given the analysis contained in this report, Staff recommends that the Planning Commission approve the proposed project subject to the recommended conditions of approval contained within the draft Resolution provided as Attachment 1. BACKGROUND Cinepolis Luxury Cinemas, the world's fourth largest cinema franchise, has leased the movie theater space previously occupied by Edward's Theater located at 30632 Santa Margarita Parkway within the Santa Margarita Town Center shopping center. This location is one of five theaters in the United States, with all five theaters located in Southern California. Cinepolis recently completed a multi-million dollar renovation to the existing movie theater and opened their doors to the public on December 15, 2012. The approved plans, provided as Attachment 5, show the remodeled theater building. As a part of the renovation, Cinepolis replaced all of the seating within each of the six theater auditoriums with new plush reclining leather chairs, which each include a small adjustable table built into the armrest. Each chair features an in-seat waiter service button in which customers may place food and beverage orders. To allow for the larger aisles and spacious seating, the total number of seats in the theater auditoriums was reduced from 1,4 72 total seats to 509 total seats. A copy of the approved floor plan has been included as Attachment 4. The new theater also features an extensive food and drink menu beyond the standard movie choices (e.g., popcorn, sodas and candy). This new food selection features gourmet finger foods, artisan sandwiches and sushi, as well as espresso drinks, specialty cocktails, wine and craft beers. The applicant currently possesses a Type 47 license from the State Department of Alcoholic Beverage Control (ABC), which allows for the sale of beer, wine and distilled spirits in conjunction with a restaurant. The ABC is the agency responsible for issuance and regulation of all alcohol licenses within the State, subject to any local jurisdiction requirements, such as requiring the approval of a CUP. A copy of the ABC license has been included as Attachment 6.

RSM 12-044 Cinepolis Luxury Cinemas March 6, 2013 Page 3 In addition to the conditions of approval established by ABC, the City implemented several other restrictions related to the sale of alcoholic beverages through the conditions of approval approved through Resolution No. PC 12c02-01-01. A copy of this approval has been included as Exhibit A to Attachment 1. These conditions include the restriction that no patrons under 21 years of age are permitted within the auditoriums when alcohol is being served. Furthermore, no more than two alcoholic beverages may be served to any patron per movie screening. The applicant has submitted Planning Application RSM 12-044 for a CUP to modify the existing conditions of approval related to alcohol sales. Specifically, the applicant has requested the ability to allow minors into each of the auditoriums at all times. Additionally, the applicant has requested the ability to remove the two-drink limit for special occasions. These issues are discussed in greater detail below. STATEMENT OF THE ISSUES Issue 1 : Review Process The Land Use Table provided in RSMZC Section 9.03.080 (Table 9.03.4 Commercial Districts) indicates that the sale of alcoholic beverages requires a CUP. Although the property already has a CUP to allow the sale of alcoholic beverages, the applicant has requested a modification to the conditions of approval from the previously approved CUP. Condition of Approval 3 from Resolution No. PC 12-02-01-01 states that if any changes are proposed to alter the use, an amendment of the CUP is required. In order to approve the CUP, the Planning Commission must hold a public hearing and make findings supported by fact. These findings include: consistency with the General Plan, consistency with the Zoning Code, compatibility with surrounding uses and that the project will not be contrary to the general welfare of the community. Specifically, Staff believes that the proposal is consistent with policies established within the City's General Plan since it expands the selection of conveniently located goods and services and contributes to the business environment to the benefit of residents and adjacent businesses. A public notice was mailed to all property owners within 300 feet of the subject property notifying them of the public hearing. In addition, a public notice was posted at City Hall, Orange County Fire Authority Station No. 45, Trabuco Canyon Water District, on the City's website, at the subject site, and published in the January 25, 2013 edition of the Orange County Register. The following divisions and agencies were given an opportunity to comment on the project: Building, Code Enforcement and Police Services. Staff received comments and conditions from Police Services, which have been included in the draft Resolution provided as Attachment 1. Issue 2: Alcohol License Modifications The applicant has requested that the City modify Condition of Approval 15 from the previously approved Resolution No. PC 12-02-01-01. Condition 15 states, "No persons

RSM 12-044 Cinepolis Luxury Cinemas March 6, 2013 Page4 under the age of 21 years shall be permitted within any auditorium when alcohol is available to be sold within said auditorium. No more than two (2) alcoholic beverages shall be sold or served to a patron in any auditorium per showing or event. Beer must be served in distinctive containers not to exceed 16 ounces and wine and other distilled spirits in distinctive containers not to exceed 8 ounces." Based on the applicant's letter of justification (see Attachment 5), Condition 15 would be modified to remove the age restriction when alcohol is being served. Furthermore, the applicant has requested the ability to remove the two-drink limitation for special occasions when an individual or corporation rents an entire auditorium for a private event. When evaluating this proposal, Police Services evaluated both the safety of patrons within the theater complex and the public safety impact to the general public outside the theater. Based on the ambient lighting requirement and other ABC conditions of approval, City staff would support removing the age requirement for any of the theaters. Additionally, staff believes that the exemption from the two-<;lrink limit should not be an issue provided the business receives written authorization from the City for each event. This will allow staff the ability to review each of these events on a case by case basis. The specific criteria for this exemption are included in Condition 15. It appears that, based on the experiences of other cities with similar establishments, this would not cause any problems for public safety, with the appropriate supervision of theater employees. If the Planning Commission is inclined to modify the age restriction contained within Condition 15 as requested, staff would also recommend eliminating Condition 16, which requires signage outside of age-restricted auditoriums. This condition becomes unnecessary if minors are permitted in all auditoriums at all times. SUMMARY Staff believes that the proposed application is in compliance with the Rancho Santa Margarita General Plan and the RSMZC. Furthermore, the proposed operations are compatible and consistent with the other businesses in the Santa Margarita Town Center shopping center. Therefore, Staff recommends that the Planning Commission approve Planning Application RSM 12-044 subject to the conditions of approval contained within the proposed Resolution. Alternatives Considered The Planning Commission could determine that the findings cannot be made to approve the proposed project or portions of the project and deny the application or portions of the application; or amend the recommended conditions of approval. Fiscal Impact Not applicable.

RSM 12-044 Cinepolis Luxury Cinemas March 6, 2013 Page 5 Attachments 1. Planning Commission Resolution Approving Planning Application RSM 12-044 Exhibit A- Resolution No. PC 12-02-01-01 Exhibit B- Alcoholic.Beverage Exception Request Form 2. Notice of Exemption for Planning Application RSM 12-044 3. Vicinity Map 4. Floor Plan 5. Letter of Justification 6. License from the Department of Alcoholic Beverage Control

RESOLUTION NO. PC- A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY OF RANCHO SANTA MARGARITA, CALIFORNIA, APPROVING PLANNING APPLICATION RSM 12-044 FOR A CONDITIONAL USE PERMIT TO MODIFY THE CONDITIONS OF APPROVAL FOR ALCOHOL SALES FOR AN EXISTING MOVIE THEATER LOCATED AT 30632 SANTA MARGARITA PARKWAY, RANCHO SANTA MARGARITA. CALIFORNIA WHEREAS, on September 29, 1994, the County of Orange Planning Commission approved Planning Application PA 94-0119 a modified conceptual site plan for Phase II of the Town Center shopping center; and WHEREAS, on November 18, 1996, the County of Orange Planning Commission approved Planning Application PA 95-0195, authorizing the construction of a movie theater in the Town Center; and WHEREAS, on December 19, 2002, the City of Rancho Santa Margarita adopted the Rancho Santa Margarita General Plan; and WHEREAS, on May 11, 2007, the City of Rancho Santa Margarita Zoning Code went into effect; and WHEREAS, on February 1, 2012, the Planning Commission approved Resolution No. PC 12-02-01-01, which is attached hereto as Exhibit A, approving Planning Application RSM 11-036 for a Site Development Permit for the expansion of an existing movie theater and a Conditional Use Permit for the movie theater utilize an 800 square foot outdoor dining area and to authorize a California Department of Alcoholic Beverage Control license type 47 (on-sale general eating place) for the property located at 30632 Santa Margarita Parkway; and WHEREAS, the applicant, Sanderson J Ray Development, has submitted Planning Application RSM 12-044 for a Conditional Use Permit to modify the conditions of approval to the Conditional Use Permit approved pursuant to Resolution No. PC 12-02-01-01 for alcohol sales for the existing movie theater located at 30632 Santa Margarita Parkway, to eliminate the restrictions prohibiting persons under the age of 21 years to be permitted within any auditorium when alcohol is available to be sold within said auditorium and requiring the posting of signs relating to such prohibition; and WHEREAS, Planning Application RSM 12-044 is considered a "project" pursuant to the California Environmental Quality Act (CEQA); and 910771.1 Attachment 1

WHEREAS, the Planning Commission finds that the project is categorically exempt from CEQA per Section 15301 of the CEQA Guidelines (14 Cal. Code Regs. Section 15301 ); and WHEREAS, the Planning Commission of the City of Rancho Santa Margarita has considered information presented by the applicant, City Staff, and other interested parties at a Public Hearing held on February 6, 2013, and March 6, 2013. NOW, THEREFORE, the Planning Commission of the City of Rancho Santa Margarita DOES HEREBY RESOLVE as follows: SECTION 1. Environmental Documentation. Pursuant to California Environmental Quality Act (CEQA) Guidelines, it is determined that the project is categorically exempt from CEQA pursuant to the Class 1 categorical exemption set forth in CEQA Guidelines Section 15301 it involves the operation of private facilities involving no expansion of an existing use beyond that existing at the time of the lead agency's determination. SECTION 2. Pursuant to Section 711.4 of the California Fish and Game Code, this project is exempt from the required fees, as it has been determined that no adverse impacts to wildlife resources will result from the proposed project. SECTION 3. The proposed project will not have a significant unmitigated impact upon Coastal Sage Scrub habitat, and therefore will not have any impact on the subregional Natural Communities Conservation Planning (NCCP) Program. SECTION 4. In accordance with Section 9.08.110 of the Rancho Santa Margarita Zoning Code, the following findings for approving the Conditional Use Permit for Planning Application RSM 12-044 are made: (A) GENERAL PLAN Finding: That the proposed use will be consistent with the objectives, policies, and general land uses and programs specified in the City's General Plan. The proposed project is located within the General Commercial Land Use designation of the City's General Plan. General Commercial development provides for retail uses that rely on automobile traffic and attract customers from a city-wide and/or regional area. Specifically, the proposed project is consistent with the following goals and policies of the General Plan: Economic Development Element Policy 1.3: Promote the development and retention of retail uses (e.g., restaurants, specialty stores) that serve local needs, expand the selection of conveniently located goods and services, and help the City to compete for retail sales tax revenue with the region. And Economic Development Element Policy 9l077l.l

2.5: Promote a synergistic business environment by encouraging businesses to locate where they can benefit residents and adjacent businesses and discouraging businesses that would be detrimental to the local business environment. The proposed project would modify conditions of approval related to alcohol sales by allowing minors in all areas where alcohol is being served to the public. This modification would not allow minors to be served alcohol, but would simply allow them to be present in areas where alcohol is being served, similar to a restaurant that serves alcoholic beverages. The increased flexibility in alcohol sales would likely result in an increased sales of alcoholic beverages within the theater, positively contributing to the range of food and beverage choices thereby increasing the attractiveness of the area as a premier entertainment destination location. (B) ZONING Finding: That the proposed use is consistent with the provisions of the Rancho Santa Margarita Zoning Code. The use, operation, and improvements proposed, subject to the specified conditions, are consistent with the provisions of the Rancho Santa Margarita Zoning Code (RSMZC) regulations applicable to the subject site. Consistent with the General Plan designation, the site containing the proposed use maintains Commercial - General (CG) zoning. Within this zoning district, movie theaters and restaurants require the consideration of a Conditional Use Permit (CUP). Since the movie theater, and its associated restaurant, already has a CUP, the proposed CUP is solely for modifications in the operation of the sale and service of alcoholic beverages. (C) COMPATIBILITY Finding: That the location. size. design and operating characteristics of the proposed use will not create unusual noise. traffic or other conditions or situations that may be objectionable. detrimental. or incompatible with other permitted uses in the vicinity. The proposed project consists of minor modifications to existing conditions of approval for an existing movie theater related to the sale of alcoholic beverages. The CUP would allow for the business to admit persons under the age of 21 into any auditorium when alcohol is being served. This is already permitted with the Type 47 License issued by the State Department of Alcoholic Beverage Control. Consumption of alcoholic beverages will be carefully monitored by the business to ensure that no minors are served or consume any alcoholic beverages. The proposed modifications would not create any unusual noise, traffic or any other conditions or situations that may be objectionable, detrimental or incompatible with other permitted uses in the vicinity. (D) GENERAL WELFARE Finding: That the proposed use will not result in conditions or circumstances contrary to the public health and safety and the general welfare. 91077!.1

The proposed development and use is in conformance with the RSMZC and will be subject to conditions of approval, ensuring that its operations remain in conformance. The Conditions of Approval sufficiently satisfy any concerns related to public health and safety and the general welfare. The CUP would allow for the business to admit persons under the age of 21 into any auditorium when alcohol is being served. This is already permitted with the Type 47 License issued by the State Department of Alcoholic Beverage Control. Consumption of alcoholic beverages will be carefully monitored by the business to ensure that no minors are served or consume any alcoholic beverages. Furthermore, allowing minors to be in areas where alcoholic beverages are served is consistent with other businesses in the City with a type 47 License. SECTION 6. Based on the above findings, the Planning Commission of the City of Rancho Santa Margarita DOES HEREBY APPROVE Planning Application RSM 12-044 to modify the conditions of approval to the Conditional Use Permit approved pursuant to Resolution No. PC 12-02-01-01 for alcohol sales for the existing movie theater located at 30632 Santa Margarita Parkway, subject to the following Conditions of Approval: General Conditions of Approval *The following Conditions of Approval shall be binding on and enforceable against, and. whenever used herein. the term "applicant" shall mean and refer to, each of the following: the project applicant, Sanderson J Ray Development, Cinepolis Luxury Cinemas, the owner(s) and tenants(s) of the property, and each of their respective successors and assigns. Condition 1: Zoning Regulations The City's approval of Planning Application RSM 12-044 ("Permit"), which includes a Conditional Use Permit, constitutes approval of the proposed project only to the extent that the project complies with the City of Rancho Santa Margarita Zoning Code (RSMZC) and any other applicable zoning regulations. Approval does not include any action or finding as to compliance of the project with any other applicable ordinance, regulation or requirement. Condition 2: Time Limit This approval is valid for a period of 12 months from the date of final determination. If the use approved by this action is not established within such a period of time, this approval shall be terminated and shall be null and void. Further, the Permit shall become null and void if the uses permitted hereunder are discontinued or abandoned for the period outlined in the RSMZC. 9l077l.l

Condition 3: Compliance Failure to abide by and faithfully comply with any and all conditions attached to this action shall constitute grounds for the modification or revocation of said action by the City of Rancho Santa Margarita Planning Commission. Condition 4: Indemnification As a condition of issuance of this approval, the applicant shall, at its sole cost and expense, defend, indemnify, and hold harmless the City, its officers, employees, agents, and consultants, from any claim, action, or proceeding brought by a third-party against the City, its officers, agents, consultants and employees, which seeks to attack, set aside, challenge, void, or annul an approval of the City Council, Planning Commission, or other decision-making body, or staff action concerning this project, or which alleges a violation of a NPDES permit related to the approved use. The City agrees to promptly notify the applicant of any such claim filed against the City and to cooperate in the defense of any such action. The City may, but is not obligated to, at its sole cost and expense, elect to participate in the defense of any such action under this condition. Condition 5: Protest Pursuant to Government Code Section 66020, the applicant is informed that the 90-day period in which the applicant may protest the fees, dedications, reservation or other exaction imposed on this project through the conditions of approval has begun. Condition 6: Payment of Fees The applicant is responsible for paying all charges related to the processing of this Permit within 30 days of the issuance of the final invoice or prior to the issuance of building permits for this project, whichever occurs first. Failure to pay all charges shall result in delays in the issuance of required permits or the revocation of the approval of this Permit. Condition 7: Acceptance of Conditions This Permit shall not become effective unless and until the Applicant provides written acknowledgement to the Development Services Director that they have received a copy of, and accepted these conditions of approval. The signed acknowledgment and approval must be provided to the City within 20 days of final approval of this Permit. Development Services Conditions of Approval Condition 8: Modification to Alcohol Sales in the Auditoriums Condition of Approval 15 to Resolution No. PC-12-02-01-01, attached hereto as Exhibit A, is hereby amended in its entirety to read as follows: 910771.!

No more than two (2) alcoholic beverages shall be sold or served to a patron in any auditorium per showing or event. Beer must be served in distinctive containers not to exceed 16 ounces and wine and other distilled spirits in distinctive containers not to exceed 8 ounces. The Development Services Director shall have the authority to approve, conditionally approve, or deny requests for exceptions to this Condition for private screenings or other special events, on a case by case basis. All requests for exceptions to this Condition shall be in accordance with the process established by the Development Services Director, and shall be subject to the following minimum requirements: 1) The applicant must make the request to the Development Services Director no less than fourteen days prior to any private screening or other special event held within any auditorium. This request shall be submitted in writing utilizing a form provided by the City, and shall include any and all information determined by the Development Services Director to be necessary to evaluate the request. Until and unless modified by the Development Services Director, the applicant shall utilize the form attached hereto as Exhibit B to make requests for exceptions to this Condition. 2) Since no fee is established for review of a private screening or other special event held within an auditorium, the applicant shall pay the appropriate rate established within the City's adopted User Fee Schedule to reimburse the City for the actual costs incurred by the City in reviewing the request. 3) No request for an exception to this Condition for any private screening or other special event shall be deemed granted until the applicant obtains written approval from the Development Services Director or his/her designee. 4) The applicant shall comply with any and all conditions imposed by the Development Services Director on the approval of a request for an exception to this Condition. The applicant's failure to comply with any such conditions shall constitute a violation of this Permit. 5) If at any time in the future, the Development Services Director determines that this process should be modified, the Development Services Director may, at his/her sole discretion, implement additional conditions or requirements for processing exceptions to alcohol sales in the auditoriums, in addition to the minimum requirements set forth above. Condition 9: Modification to Signage for Alcoholic Beverage Restrictions Condition of Approval16 to Resolution No. PC-12-02-01-01, attached hereto as Exhibit A, is hereby deleted in its entirety. Condition 10: Previous Conditions Valid Except as expressly modified herein, all previously approved Conditions of Approval to Planning Application RSM 11-036, approved pursuant to Resolution No. PC-12-02-01-910171.1

01, which is attached hereto as Exhibit A, are hereby incorporated herein by reference, and shall remain in full force and effect. PASSED, APPROVED AND ADOPTED this 6th day of March 2013. Unless an appeal is filed by 5:00 p.m. on March 21, 2013, the decision shall become final and effective on March 22, 2013. MARK McQUAID, CHAIR ATTEST: MARIA FERRIS, DEPUTY CITY CLERK STATE OF CALIFORNIA COUNTY OF ORANGE CITY OF RANCHO SANTA MARGARITA ) ) ) ss I, Amy Morales, Planning Secretary of the City of Rancho Santa Margarita, California, DO HEREBY CERTIFY that the foregoing is a true and correct copy of Resolution No. PC- adopted by the Planning Commission of the City of Rancho Santa Margarita, California, at a regular meeting thereof, held this 6th day of March 2013, by the following vote: AYES: NOES: ABSENT: ABSTAIN: MARIA FERRIS, DEPUTY CITY CLERK 910771.1

RESOLUTION NO. PC -12-02-01-01 A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY OF RANCHO SANTA MARGARITA, CALIFORNIA, APPROVING PLANNING APPLICATION RSM 11-036 INCLUDING A CONDITIONAL USE PERMIT TO ALLOW FOR THE EXPANSION OF A MOVIE THEATER TO INCLUDE OUTDOOR PATIO DINING AND ALCOHOL SALES AND A CHANGED PLAN TO ALLOW FOR THE REMODEL OF AN EXISTING MOVIE THEATER LOCATED AT 30632 SANTA MARGARITA PAR'r\VI/AY, RANCHO SANTA MARGARITA, CALIFORNIA WHEREAS, on September 29, 1994, the County of Orange Planning Commission approved Planning Application PA 94-0119 a modified conceptual site plan for Phase II of the Town Center shopping center; and WHEREAS, on November 18, 1996, the County of Orange Planning Commission approved Planning Application PA 95-0195, authorizing the" construction of a movie theater in the Town Center; and WHEREAS, on December 19, 2002, the City of Rancho Santa Margarita adopted the Rancho Santa Margarita General Plan; and WHEREAS, on May 11, 2007, the City of Rancho Santa Margarita Zoning Code went into effect; and WHEREAS, the applicant, SMS Architects, has submitted Planning Application RSM 11-036 for a Site Development Permit requesting approval of the expansion of an existing movie theater and a Conditional Use Permit for the movie theater utilize an 800 square foot outdoor dining area and to authorize a California Department of Alcoholic Beverage Control license type 47 (on-sale general eating place) for the property located at 30632 Santa Margarita Parkway; and WHEREAS, Planning Application RSM 11-036 is considered a "project" pursuant to the California Environmental Quality Act (CEQA); and WHEREAS, the Planning Commission finds that the project is categorically exempt from CEQA per Section 15301 of the CEQA Guidelines (14 Cal. Code Regs. Section 15301); and WHEREAS, the Planning Commission of the City. of Ranch0 Santa Margarita has CPr!sideredinfprrnatipn.preseQted.by tbe.. appiicetnt,.city StC!ff. and othe:!r interested parties at a Public Hearing held on February 1, 2012. Exhibit A

NOW, THEREFORE, the Planning Commission of the City of Rancho Santa Margarita DOES HEREBY RESOLVE as follows: SECTION 1. Environmental Documentation. Pursuant to California Environmental Quality Act (CEQA) Guidelines, it is determined that the project is categorically exempt from CEQA pursuant to the Class 1 categorical exemption set forth in CEQA Guidelines Section 15301 it involves the minor alteration of private structures involving negligible expansion of an existing use beyond that existing at the time of th-e-read agency's determination. The only expansion of use includes the 1,480 square foot expansion of the building and the addition of an 800 square foot outdoor dining area in an existing patio area. SECTION 2. Pursuant to Section 711.4 of the California Fish and Game Code, this project is exempt from the required fees, as it has been determined that no adverse impacts to wildlife resources will result from the proposed project. SECTION 3. The proposed project will not have a significant unmitigated impact upon Coastal Sage Scrub habitat, and therefore will not have any impact on the subregional Natural Communities Conservation Planning (NCCP) Program. SECTION 4. In accordance with Section 9.08.170 of the Rancho Santa Margarita Zoning Code, the following findings for approving the Site Development Permit for Planning Application RSM 11-036 are made: rl (A) GENERAL PLAN Finding: That the proposed project will be consistent with the objectives, policies, and general land uses and programs specified in the City's General Plan. The proposed project is located within the General Commercial Land Use designation of the City's-General PJan. GeneraL Commercial development p[qvides fqr retail ~SE)Sth9t rely on automobile traffic and attract customers from a city-wide and/or regional area. Specifically, the proposed project is consistent with the following goals and policies of the General Plan: Land Use Element Policy 2.3: Ensure that new development and land uses are architecturally consistent and compatible in scale and style with existing development. The proposed project uses a corporate style of architecture for the new building that is complimentary to the immediately surrounding structures in the vicinity, which also utilize individual architectural styles. Land Us13 Element Policy 2. 7: Ensure that new d13velqpment is coropatible with the physical characteristics of the site, surrounding land uses, and available infrastructure. -~~~-~~fb~~~:m~~ji~f! ~f~a~~~ :n;:~~~i~~e ~~~~Ll~~ti~;~~c~~e~~erior improvements Ll 2

I. Economic Development Element Policy 1.3: Promote the development and retention of retail uses (e.g., restaurants, specialty stores) that serve local needs, expand the seiection of conveniently located goods and services, and help the City to compete for retail sales tax revenue with the region. And Economic Development Element Policy 2.5: Promote a synergistic business environment by encouraging businesses to locate where they can benefit residents and adjacent businesses and discouraging businesses that would be detrimental to the local business environment.. The proposed project provides an updated movie theater and a restaurant experience for the City's residents as well as positively contributing to the regional draw of the Town Center shopping center area, contributing to the range of food and beverage choices thereby increasing the attractiveness of the area as a premier entertainment destination location. (B) ZONING Finding: That the proposed project is consistent with the provisions of the Rancho Santa Margarita Zoning Code. The use, operation, and improvements proposed, subject to the specified conditions, are consistent with the provisions of the Rancho Santa Margarita Zoning Code (RSMZC) regulations applicable to the subject site. Consistent with the General Plan designation, the site containing the proposed use maintains Commercial - General (CG) zoning. The new construction is proposed using of the existing building footprint and satisfies the develop ment.standards for new construction as stated in the RSMZC. (C) COMPATIBILITY Finding: Thaf the location, size, design and operating characteristics of the proposed project will not create unusual noise, traffic or other conditions or situations that may be objectionable, detrimental. or incompatible with other permitted uses in the vicinity. The proposec;! project replaces an existing movie theater and adds a restaurant use and in the same location on the subject site, minimizing impacts to the existing circulation and parking. Since the proposed theater will remove nearly 1,000 seats, its operations will be not be objectionable, detrimental or comparable to other surrounding. The proposed theater will also feature a restaurant with an outdoor dining area similar to other restaurants withiq the area. (D) GENERALWELFARE Finding: That the proposed project will not result in conditions or circumstances contrarv to the public health and safety and the general welfare. The proposed development and use is in conformance with the RSMZC and will be subject to conditions of approval, ensuring that its operations remain in conformance. - --- -- 3

The Conditions of Approval sufficiently satisfy any concerns related to public health and safety and the general welfare. SECTION 5. In accordance with Section 9.08.110 of the Rancho Santa Margarita Zoning Code, the following findings for approving the Conditional Use Permit for Planning Application RSM 11-036 are made: n :. (A) GENERAL PLAN Finding: That the proposed use will be consistent with the objectives. policies, and general land uses and programs specified in the City's General Plan. The proposed project is located within the General Commercial Land Use designation of the City's General Plan. General Commercial development provides for retail uses that rely on automobile traffic and attract customers from a city-wide and/or regional area. Specifically, the proposed project is consistent with the following goals and policies of the General Plan: Land Use Element Policy 2.3: Ensure that new development and land uses are architecturally consistent and compatible in scale and style with existing development. The proposed project uses a corporate style of architecture for the new building that is complimentary to the immediately surrounding structures in the vicinity, which also utilize individual architectural styles. o... Land Use Element Policy 2.5: Preserve and enhance the quality of Rancho Santa Margarita by abating any non-conforming buildings and uses. The proposed project includes approvals for a Conditional Use Permit (CUP) for certain operational characteristics of the movie theater and restaurant uses; which include an outdoor dining area and alcohol sales. The previous movie theater was approved prior to the requirement of a CUP and was a legal nonconforming use. The approval of this application-will bring the movie theater into conformance with the City's Zoning Code. Economic Development Element Policy 1.3: Promote the development and retention of retail uses (e.g., restaurants, specialty stores) that serve local needs, expand the selection of conveniently located goods and services, and help the City to compete for retail sales tax revenue with the region. And Economic Development Element Policy 2.5: Promote a synergistic business environment by encouraging businesses to locate where they can benefit residents and adjacent businesses and discouraging businesses that would be detrimental to the local business environment. The proposed project provides an updated movie theater and a restaurant experience for the City's residents as well as posltively contributing to the regional draw of the Town Center shopping center?rea, contrj!:juting to the range of food and t:>ever11ge choices tljereby increasing the attractiveness of the area as a premier entertainment destination location. u 4

\ (B) ZONING Finding: That the proposed use is consistent with the provisions of the Rancho Santa Margarita Zoninq Code. The use, operation, and improvements proposed, subject to the specified conditions, are consistent with the provisions of the Rancho Santa Margarita Zoning Code (RSMZC) regulations applicable to the subject site. Consistent with the General Plan designation, the site containing the proposed use maintains Commercial - General.(CG) zonif\g. Within this zoning district, movie theaters require the consideration of a Conditional Use Permit (CUP). Furthermore, restaurants that have unique characteristics, such as the sale of alcohol and outdoor dining require consideration of a CUP. The proposed restaurant includes both of these components in conducting its business and therefore is subject to CUP approval in order to establish its use. The proposed project will construct a new restaurant building ifq:jij;ftewitliinah existing movie theater building. (C) COMPATIBILITY Finding: That the location, size. design and operating characteristics of the proposed use will not create unusual noise, traffic or other conditions or situations that may be objectionable. detrimental or incompatible with other permitted uses in the vicinity. The proposed project replaces an existing movie theater and adds a restaurant use and ih the same location on the subject site, minimizing impacts to the_ existing circulation and parking. 'Since the proposed theater will remove nearly 1,000 seats, its operations will be not be objectionable, detrimental or comparable to other surrounding. The proposed theater will also feature a restaurant with an outdoor dining area similar to other restaurants within the area. (D) GENERAL WELFARE Finding: That the proposed use will not result in conditions or circumstances contrarv to the public health and safetv and the general welfare. The proposed development and use is in conformance with the RSMZC and will be subject to conditions of approval, ensuring that its operations remain in conformance. The Conditions of Approval sufficiently satisfy any concerns related to public health and safety and the general welfare. SECTION 5. Pursua11t to California Business and Professions Code Section 23958.4, the Planning Commission finds that public convenience or necessity would be served by the issuance of an alcohol license (ABC License Type 47) to the - applicant The movie -:theater is prap-c;sing tocrdd a rrew restaurant with a Type "47 5

0 alcohol license. Although there is an over-concentration of licenses of this type in this geographic area, the proposed use would not be successful without this component. Customers of the restaurant exp-ect the sale of beer, wine and distilled spirits in a restaurant offering a broad food menu complement. Furthermore, although there may be a perceived over-concentration of alcohol licenses within this Census Tract, it is important to acknowledge that this Census Tract comprises the entire General Commercial Zoning District in the City. Moreover, the City's concentration of alcohol licenses is less than nearly every other city in the County of Orange (with the exception of Laguna \Noods) and is far below the County's average. r -~- SECTION 6. Based on the above findings, the Planning Commission of the City of Rancho Santa Margarita DOES HEREBY APPROVE Planning Application RSM 11-036 subject to the following Conditions of Approval: General Conditions of Approval Condition 1: Zoning Regulations The City's approval of Planning Application RSM 11-036 ("Permit"), which includes a Ct:Janged Plan and a Conditional Use Permit, constitutes approval of the proposed project only to the extent that the project complies with the City of Rancho Santa Margarita Zoning Code (RSMZC) and any other applicable zoning regulations. Approval does not include any action or finding as to compliance of the project with any other applicable ordinance, regulation or requirement. Condition 2: Time Limit [1 j This approval is valid for a period of 12 months from the date of final determination. If the use approved by this action is not established within such a period of time, this approval shall be terminated and shall be null and void. Further, the Permit shall become null and void if the uses permitted hereunder are discontinued or abandoned for the period outlined in the RSMZC. Condition 3: Precise Plan Except as otherwise provided herein, this Permit is approved as a precise plan as set forth in the site plan approved through Planning Application RSM 11-036. After the Permit has been approved, if any changes are proposed regarding the location or alteration of any use or structure, an amendment of the Permit is required for approval. Minor changes may be approved by the Development Services Director at his/her discretion. u ' 6

\ Condition 4: Compliance Failure to abide by and faithfully comply with any and all conditions attached to this action shall constitute grounds for the modification or revocation of said action by the City of Rancho Santa Margarita Planning Commission. Condition 5: Indemnification As a condition of issuance of this approval, the applicant shall, at its sole cost and expense, defend, indemnify, and hold harmless the City, its officers, employees, agents, and consultants, from any claim, action, or proceeding brought by a third-party against the City, its officers, agents, consultants and employees, which seeks to attack, set aside, challenge, void, or annul an approval of the City Council, Planning Commission, or other decision-making body, or staff action concerning this project, or which alleges a violation of a NPDES permit related to the approved use. The City agrees to promptly notify the applicant of any such claim filed against the City and to cooperate in the defense of any such action. -The City may; but--is-not-obligated-to-,-catits sole cost-and - expense, elect to participate in the defense of any such action under this condition. Condition 6: Protest Pursuant to Government Code Section 66020, the applicant is informed that the 90-day period in which the applicant may protest the fees, dedications, reservation or other exaction imposed on this project through the conditions of approval has begun. Condition 7: Payment of Fees The applicant is responsible for paying all charges related to the processing of this Permit within 30 days of the issuance of the final invoice or prior to the issuance of building permits for this project, whichever occurs first. Failure to pay all charges shall result in delays in the issuance of required permits or the revocation of the approval of this Permit. Condition 8: Acceptance of Co-nditions This Permit shall not become effective unless and until the Applicant provides written acknowledgement to the Development Services Director that they have received a copy of, and accepted these conditions of approval. The signed acknowledgment and approval must be provided to the City within 20 days of final approval of this Permit. Development Services Conditions of Approval Condition 9:. Conditional Use Permit.,._ Alcoholic Beverages License The Conditional Use Permit (CUP) portion of this Permit authorizes a Type 47 license issued by the California Department of Alcoholic Beverage Controi (ABG). 'fhis CUP 7

#""'\ I' authorizes the sale of beer, wine and distilled spirits for consumption within the auditoriums and restaurant dining areas, including outdoor dining area, subject to all applicable ABC regulations for such areas. As determined by the Development Services Director, any substantial change, modification, or expansion of the designated dining areas under which the ABC license is issued shalt require an amendment of this Conditional Use Permit. There shall be no sale of alcohol for consumption off the premises. rl Condition 10: Conditional Use Permit- Outdoor Dining Area The CUP portion of this Permit authorizes the approval of an outdoor dining area in conjunction with the restaurant in the location and as shown on plans submitted and approved with.this Permit. As determined by the Development Services Director, nny substantial change, modification, or expansion of the outdoor dining area shall require aaamendment of this Conditional Use Permit. Condition 11: Uses within the Outdoor Dining Area ;lses and activities within the outdoor dining area as shown on the plans submitted and approved with this Permit are limited to food and beverage service. in conjunction with H1e ~egular operations of the restaurant. Seating and service to patrons within 'dle r;utdoor dining area is only authorized during the same hours of. operation of the restaurant's indoor dining area, and shall not be open to patrons or employees ['1_,_,.;eparately. No "bar-only" area, live entertainment, televisions; or amplification of music 01' voice is permitted within the outdoor dil1ing area. _J Condition 12: Hours of Operation The hours of operation for the restaurant dining areas, including the outdoor dining 3rea, are permitted between the hours of 10:00 am and 1 :00 am. - _::;ondition 13: -Sign Approval C:0nceptual approval is granted for those signs as shown on plans submitted and approved with this Permit, subject to all requirements of the applicable portions of the Santa Margarita Town Center Sign Program Design Criteria, and in accordance with the RSMZC. The applicant shall obtain all required sign and building permits applicable for such signage. Public Safety Conditions of Approval -com:lition N: Public Safety Elepartment-lnspections Applicant/operator understands and acknowledges that uniformed law enforcement officers shall, from time to time, inspect the establishment during hours of operation for l ' l j 8

purposes of enforcing any and all State and local laws related to the sale and consumption of alcohol on the premises. Condition 15: Alcohol Sales in the Auditoriums No persons under the age of 21 years shall be permitted within any auditorium when alcohol is available to be sold within said auditorium. No more than two (2) alcoholic beverages shall be sold or serited to a patron in any auditorium per showing or event. Beer must be served in distinctive containers not to exceed 16 ounces and wine and other distilled spirits in distinctive containers not to exceed 8 ounces. Cor:~dition 16: Signage for Alcoholic Beverage Restrictions The applicant shall post signs measuring no less than 12 by 12 inches with lettering no smaller than two inches in height that read, "No Alcoholic Beverages beyond this point" at all auditorium entrances within the auditorium when alcoholic beverages are not permitted to be served within said auditorium. 'fhe applicant shall also post. signs measuring no less than 12 by 12 inches with lettering no smaller than two inches in height that read, "No Persons under 21 Allowed" at any auditorium entrances when alcoholic beverages are being served. Such signage shall remain posted at all times _ when alcohol is being served within said auditoriums. Orange County Fire Authority Conditions of Approval Condition 17: Plan Submittal The applicant or responsible party shall submit the plan(s) listed below to the Orange County Fire Authority for review. Approval shall be obtained on each plan prior to the. -event specified. -' Prior to issuance of a building permit: Architectural (service codes PR200-PR285) Prior to r;;qncealing interior construction: Fire sprinkler system (service codes PR430-PR455), if the existing sprinkler system requires modification. Building Conditions of Approval Condition 18: Approval of Final Plans The applicant shall obtain approval from the Development Services Department for all final building plans in accordance with the approved plans stamped "Approved" as of ---. -... --------~-- - ------- -..... --------- -- - 9 -- -------------

the time of approval of the Permit. The applicant shall secure all required building permits, inspections, and pay all associated fee.s. Condition 19: Certificate of Use and Occupancy Prior to occupancy, the applicant shall apply for and obtain a Certificate of Use and Occupancy that has been reviewed and approved by the Development Services Department. PubliC Works Conditions of Approval Condition 20: Encroachment Permit Any work within the public right of way, including but not limited to, utility ctlllned.ions and traffic control, will require an encroachment permit from the Public Wo;ks Department. Conditiorr 21: C&D Permit in compliance with the City's required diversion rate, sixty percent (60%) of eons 1rudion and demolition materials associated with this project shall be diverted from the :andfiil.qondition 22: Sediment Control Measures The applicant shali implement and maintain the proper best management practices for sediment control during the construction phase of the project. [ ~ J Condition 23: Solid Waste Management Plan Tile applicant shall provide a plan, with concurrence from CR&R and the Property Management Company, regarding the proper handling/disposal/diversion of ::~dditi<mal food and.:>ther waste. This plan is to be reviewed and approved by the City';; ;=> :mlic Works Department. u 10

) PASSED, APPROVED AND ADOPTED this 1st day of February 2012. Unless an appeal is filed by 5:00p.m. on February 16, 2012, the decision shall become final and effective on February 17, 2012.?Jo~»~ PETER WHITIINGH~ ATIEST: STATE: OF CALIFORNIA COl.J.NTY OF ORANGE CITY OF RANCHO SANTA MARGARITA ) ) ) ss I, Amy Morales, Planning Secretary of the City of Rancho Santa Margarita,. California, DO HEREBY CERTIFY that the foregoing is a true and correct copy of Resolution No. PC 12-02-01-01 adopted by the Planning Commission of the City of Rancho Santa Margarita, California, at a regular meeting thereof, held this 1st day of February 2012, by the following vote: AYES: NOES:, ABSENT: ABSTAIN: Commissioners Eakin, Hayden, Leonard, Vice-Chair McGirr, Chair Whittingham None None None ~h'v~ 16\GA_(A_Qro_/. AMY MORAL@S'. DEVELOPMENT SERVICES SECRETARY 11

Date Received by City: Fee Included: CITY OF RANCHO SANTA MARGARITA CINE POLIS LUXURY CINEMAS REQUEST FOR EXCEPTION TO STANDARD LIMITATIONS ON ALCOHOL SALES FOR SPECIAL EVENT Pursuant to Condition of Approval No. 8 to Planning Application No. RSM-12-044, unless a request for an exception is approved by the Rancho Santa Margarita Development Services Director, no more than two (2) alcoholic beverages shall be sold or served to a patron in any auditorium per showing or even, and beer must be served in distinctive containers not to exceed 16 ounces and wine and other distilled spirits in distinctive containers not to exceed 8 ounces. In accordance with Condition of Approval No. 8, Cinepolis Luxury Cinemas hereby requests the Development Services Director grant an exception from the above limitation( s) for the below-described Special Event. The Development Services Director shall respond in writing to the applicant's request within five business days of the applicant's written request for exception. Type of Event:----------------------------- Date of Event: (Request must be made at least 14 days prior to Event) Time of Event: to Describe Exception(s) Requested: ------------------------ Area(s) for Which Exception(s) is Requested:------------------- Describe Planned Activities (attach separate sheet, if necessary):------------- Estimated Number of Persons at the Event: Will Minors be Allowed at the Event? YES NO. Will there be monitors or security personnel at the event? YES** NO **If YES, please attach a separate sheet describing the proposed security plan for the Event I declare upon penalty of perjury that the above information is true and correct to the best of my knowledge. I further understand that knowingly providing any false information is cause for the immediate denial or revocation of approval of my request. Signature of Authorized Representative of Cinepolis Luxury Cinemas Date Signed Print Name and Title Phone No. 1 E-mail Address Exhibit B

Determination of the Development Services Director Your Request for an Exception to the limitations on alcohol sales set forth in Condition of Approval No.8 to Planning Application No. RSM-12-044 is: Denied Approved Approved Subject to the Following Conditions **Failure to comply with all of the above Conditions shall constitute a violation of your Conditional Use Permit. Development Services Director City of Rancho Santa Margarita Date *The decision of the Development Services Director is appealable to the Planning Commission in accordance with Rancho Santa Margarita Municipal Code Section 9-08-100. 2

City of Rancho Santa Margarita 22112 El Paseo Rancho Santa Margarita, CA 92688 (949) 635-1800 NOTICE OF EXEMPTION To: _e_x"--- County of Orange Clerk-Recorder 12 Civic Center Plaza, Rm. 101 Santa Ana, CA 92701 Office of Planning and Research 1400 Tenth Street, Room 121 Sacramento, CA 95814 Project Title and File Number: Cineopolis Luxury Cinemas (RSM 12-044) Project Applicant: Cinepolis Luxury Cinemas 8910 University Center Lane, Suite 640 San Diego, CA 92122 Project Contact Person: Marty Hannigan Telephone Number: (949) 202-9990 Project Location: 30632 Santa Margarita Parkway Rancho Santa Margarita, CA 92688 Project Description: Conditional Use Permit for the modification of conditions of approval related to the sale of alcoholic beverages withio an existing 31,861 square foot movie theater on the property located at 30632 Santa Margarita Parkway. Public Agency Approving Project: City of Rancho Santa Margarita Rxempt Status: (check one) [ ] Ministerial (Sec. 21080(b)(l); 15268)); [ ] Declared Emergency (Sec.21080(b)(3);15269(a)); [ ] Emergency Project (Sec. 21080(b)( 4);15269(b)(c)); [X] Categorical Exemption (state type, section and class number) Section 15301 Class 1: Existing Facilities Reasons why project is exempt: Pursuant to Section 15301 of the CEQA Guidelines, the proposed project is exempt since it involves the operation of private facilities involving no expansion of an existing use beyond that existing at the time of the lead agency's determination. Lead Agency: City of Rancho Santa Margarita Contact Person: Nate Farnsworth, Senior Planner Telephone: (949) 635-1800 If filed by applicant: N/A 1. Attach certified document of exemption finding. 2. Has a Notice of Exemption been filed by the public agency approving the project? [X] Yes [ ] No Signature: Name & Title: Nate Farnsworth, Senior Planner Date: March 6, 2013 Attachment 2

RSM 12-0/ Cinepolis 30632 Santa M~::ngarita Parkway ~ Ill () ':1'.. 3 CD :::> w 0 500 1,000 2,000 3,000 4~00 ---- -- Feel Produced by City of Rancho Santa Margarita February 2013

case# Qsm I \-osg RESO # PG ld- -Q.}_--0 l-c> [ CONDITlOI\IAll Y APPROVED ON l~ I, :>ot-;r. BY THE CITY Of R S M PlANNING COMMISS!orv CASE PLANNER 0 ~ ""' "'-'""""- j f. ~ Cinepolis. J ~ LUXURY CINEMAS SAN T RANCHO SANTA MARGARITA,.CALIFORNIA AUDITORIUM #3 N E9 Ph. 49.757.32.40 www. ms-11l<:h.com EXHIBIT"A" PG10F2.. ARCHITECTS Attachment 4

~~~,~~~L;l-D~.~~~ ~~ ~ -- CASE#_~ RESO ur~\5::_:c:; ~\~d..::-::o~d-~o;;\~-o;;t,:\~--: CONDITIONAllY APPROVED 0111 \ -e)o \ / ->o 1, B'/ THE CITY Of R S M PlAIIINII\IG COMMISSIOIII CASE PlAIIli\IER () ~"S"-'" ~ L! AUDITORIUM #3 f ~ Cinepolis. t -~LUXURY CINEMAS A MARGA' RANCHO SANTA MARGARITA, CALIFORNIA CENTER 25JANUARY 2012 1764a Sky Park Clrcl~, S\B. B lrvlna, California 92814 Ph. 949.757.3240 www. ms-arc~.aom EXHIBIT"A" PG20F2 = ARCHITECTS