HomeMy WebLinkAbout2008-03-24 City Council Agenda Packet
1 03/24/08
Agenda posted according to PAMC Section 2.04.070. A binder containing supporting materials is available in the Council
Chambers on the Friday preceding the meeting.
Special Meeting
March 24, 2008
Council Conference Room – 5:30 PM
ROLL CALL
1. Interview of Candidates to the Architectural Review Board
REPORT
Council Chambers - 6:00 PM
CLOSED SESSION
2. CONFERENCE WITH LABOR NEGOTIATOR
Agency Negotiator: City Manager and his designees pursuant to
Merit Rules and Regulations (Frank Benest, Russ Carlsen, Darrell
Murray, Eddie Kreisberg, Lalo Perez, Sandra Blanch)
Employee Organization: Service Employees International Union
Authority: Government Code Section 54957.6(a)
3. CONFERENCE WITH REAL PROPERTY NEGOTIATOR
Authority: Government Code Section 54956.8
Property: 3281 E. Bayshore Road, APN 8-5-005
Negotiating Party: John Anderson, AR Automotive, LLC dba Anderson
Honda
City Negotiator: Frank Benest, Bill Fellman, Susan Barnes, Lalo Perez,
Donald Larkin
Subject of Potential Negotiations: Price and Terms of Lease
ORAL COMMUNICATIONS
Members of the public may speak to any item not on the agenda; three minutes per speaker. Council reserves the
right to limit the duration of Oral Communications
03/24/08 2
APPROVAL OF MINUTES
January 22, 2008
February 04, 2008
CONSENT CALENDAR
Items will be voted on in one motion unless removed from the calendar by two Council Members.
4. 2nd Reading Ordinance Adding Chapter 18.14 (“Below Market
Rate Housing Program”) to Title 18 (“Zoning”) of the Palo Alto
Municipal Code (passed on March 10, 2008, vote 7-0, Klein, Kishimoto absent)
5. Adoption of a Resolution Summarily Vacating a Public Utility Easement
at 1401 Parkinson Drive
CMR:175:08 ATTACHMENTS
AGENDA CHANGES, ADDITIONS, AND DELETIONS
HEARINGS REQUIRED BY LAW: Applications and/or appellants may have up to ten minutes at the outset of the
public discussion to make their remarks and put up to three minutes for concluding remarks after other members
of the public have spoken.
OTHER AGENDA ITEMS: Public comments or testimony on agenda items other than Oral Communications shall be
limited to a maximum of five minutes per speaker unless additional time is granted by the presiding officer. The
presiding officer may reduce the allowed time to less than five minutes if necessary to accommodate a larger number of speakers.
UNFINISHED BUSINESS
6. Policy and Services Committee Recommendations for Approval of
Updated Below Market Rate (BMR) Program (continued from March 17, 2008)
CMR:173:08 ATTACHMENTS
REPORTS OF OFFICIALS
7. Approval of Ideal Candidate Profile for City Manager Position
REPORT ATTACHMENTS
PUBLIC HEARINGS
8. Approval of a Tentative Map and Record of Land Use Action to Create
Six Residential Condominium Units on a .57 Acre Lot at 433 W.
Meadow Drive (Continued from February 19, 2008) *
CMR:178:08 ATTACHMENT
9. Approval of : 1) a Tentative Map and a Record of Land Use Action to
Subdivide the Elks Lodge Site (4249 and 4251 El Camino Real) into
Two Lots; and 2) a Vesting Tentative Map and a Record of Land Use
Action for 4249 El Camino Real to Subdivide the Residential Lot into a
45 Unit Common Interest Development. *
CMR:179:08 ATTACHMENT
* This item is quasi-judicial and subject to Council's Disclosure Policy
03/24/08 3
REPORTS OF COMMITTEES AND COMMISSIONS
ORDINANCES AND RESOLUTIONS
COUNCIL MATTERS
10. Proposal to Assign Staff to Review Potential Access from Wilkie Way to
SummerHill/Elks Lodge Project
11. Colleagues Memo from Mayor Klein and Council Members Kishimoto
and Barton Regarding Authorization to Host Youth and Business Tri-
City Summit: Preparing the Next Generation.
COLLEAGUES MEMO
12. Proposal to Assign Staff to Review Potential Changes to the Process for the Architecture Review Board (ARB) Review of Large Projects 13. Proposal to Assign Staff to Review the Pros and Cons of Requiring Public vs. Private Streets (including clearance for refuse hauling)
COUNCIL COMMENTS, ANNOUNCEMENTS, AND REPORTS FROM CONFERENCES
Members of the public may not speak to the item(s).
CLOSED SESSION
This item may occur during the recess or after the Regular Meeting.
Public Comments: Members of the public may speak to the Closed Session item(s); three minutes per speaker.
ADJOURNMENT
Persons with disabilities who require auxiliary aids or services in using City facilities, services, or programs or who
would like information on the City’s compliance with the Americans with Disabilities Act (ADA) of 1990, may contact
650-329-2550 (Voice) 24 hours in advance.
CMR:175:08 Page 1 of 2
TO: HONORABLE CITY COUNCIL
FROM: CITY MANAGER DEPARTMENT: ADMINISTRATIVE
SERVICES
DATE: MARCH 24, 2008 CMR: 175:08
SUBJECT: ADOPTION OF A RESOLUTION SUMMARILY VACATING A PUBLIC
UTILITY EASEMENT AT 1401 PARKINSON DRIVE
RECOMMENDATION
Staff recommends that Council approve the attached Resolution summarily vacating a public
service utilities easement (PUE) located at 1401 Parkinson Drive.
DISCUSSION
The owner of the property at 1401 Parkinson Drive plans to remove the existing building and
redevelop the property. The new building will encroach on the City’s existing PUE. As a
condition of approval for the project, the Utilities Department required the owner to grant the
City a new PUE to replace the existing PUE and to pay for the relocation of a portion of the
utilities located within the PUE to be vacated. Staff has notified AT&T (formerly SBC)
Communications as well as the City Utilities, Public Works and the Planning Department of the
proposal to vacate the PUE, and all concur with the vacation. This PUE is not necessary for any
present or future use and it may be summarily vacated in accordance with Section 8333 of the
California Streets and Highways Code.
RESOURCE IMPACT
The easement vacation processing fee of $1,200, as set forth in the Municipal Fee Schedule, has
been paid.
POLICY IMPLICATIONS
The recommendation does not represent any change to City policies. The Planning Department
has determined that the vacation of the PUE is in conformity with the Palo Alto Comprehensive
Plan.
ENVIRONMENTAL REVIEW
The proposed summary vacation of the PUE is categorically exempt from review under the
California Environmental Quality Act (CEQA) pursuant to Title 14 California Code of
Regulations Section 15305 as a minor alteration in land use limitations.
CMR:175:08 Page 2 of 2
PREPARED BY:
MARTHA MILLER
Sr. Financial Analyst, Administrative Services
DEPARTMENT HEAD APPROVAL:
LALO PEREZ
Director, Administrative Services
CITY MANAGER APPROVAL:
EMILY HARRISON
Assistant City Manager
ATTACHMENTS
Attachment A: Summary Vacation Resolution
Attachment B: Location Map
cc: Property Owners
CMR: 173:08 Page 1 of 6
TO: HONORABLE CITY COUNCIL
FROM: CITY MANAGER DEPARTMENT: PLANNING AND
COMMUNITY ENVIRONMENT
DATE: MARCH 17, 2008 CMR: 173:08
SUBJECT: POLICY AND SERVICES COMMITTEE RECOMMENDATIONS FOR
APPROVAL OF UPDATED BELOW MARKET RATE PROGRAM (BMR)
ELEMENTS
RECOMMENDATION
The Policy and Services Committee (P&S) and staff recommend policy changes to the Below
Market Rate (BMR) Program (see Attachment A), preparation of implementing legal documents,
including revised deed restrictions and other enforcement and disclosure documents, and further
analysis of program elements identified under Goal #2 of Attachment A as part of the next Housing
Element revision.
BACKGROUND
Over the past three years, City staff and a consultant team analyzed the City’s Below Market Rate
(BMR) Program, adopted in 1974 and governed by Policy H-36 in the Housing Element of the
Comprehensive Plan. The study undertaken by staff and the consultant team included an economic
and policy analysis of the program intended to maximize the effectiveness of the BMR Program
though the increased production of affordable owner and rental units. The analysis provided expert
advice regarding improvements in legal documents, program enforcement and methods of increasing
the efficiency of routine administrative procedures. The study was also intended to provide an
objective and statistically reliable view of the program from the perspective of the BMR owners.
In December 2006, after completion of the preliminary study, the Human Relations Commission
(HRC) discussed the report recommendations. Generally, the HRC was supportive of the overall
study recommendations but did not specifically act on the report or on any particular policy
recommendations. The HRC was primarily concerned with the BMR ownership program and, in
particular, the limited appreciation allowed under the current appreciation formula. Subsequently,
staff worked closely with the Palo Alto Housing Corporation (PAHC), the City’s contracted BMR
Program administrator, and the consultant team to develop a set of recommendations based on the
study conclusions for program improvements. The BMR Committee of PAHC’s Board of
Directors reviewed the study in June 2007 providing additional input regarding potential
modifications to the BMR Program. Staff developed its recommendations and forwarded the BMR
8
CMR: 173:08 Page 2 of 6
Study to the Policy and Services Committee for discussion at the September 2007 meeting.
One key recommendation of the BMR Study was preparation of a BMR ordinance to codify Policy
H-36 in the Housing Element. On March 10, 2008, the Council approved a BMR ordinance that
identifies the purpose and authorizes the adoption of procedures to assist in the implementation of
the program. Modifications to that ordinance may need to be prepared to address specific developer
requirements and affordability standards for owner and rental units if recommended policy changes
to the BMR program are adopted as part of this recommendation.
DISCUSSION
Policy and Services Committee (P&S)Review: The P&S Committee discussed the BMR study and
staff recommendations on September 11, 2007. Attachment d is the action minutes for that meeting
with the policy changes and actions recommended by P&S. The Committee supported the staff
recommended Policies 1b through 1k in Attachment A and recommends adoption of those policies to
the City Council. The Committee discussion focused on Policy 1a, which recommends that
appreciation for ownership units be increased from the current one-third of the percent change in the
Consumer Price Index (CPI) to the full CPI. Although the Committee supported the recommended
change to the full CPI, there was discussion of retroactively applying the change in the appreciation
formula for current BMR unit owners. The Committee did not forward a recommendation to the full
Council but referred this issue to the Planning and Transportation Commission (PTC) for further
discussion and recommendations regarding the retroactivity of the appreciation formula to the date
each owner purchased their BMR unit. The Committee also recommended that the City Council
direct staff to further analyze and make recommendations on Policies 2a, b and c listed under Goal
#2 of Attachment A as part of the next Housing Element revision. Finally, the Committee requested
that the PTC review and comment to Council on the viability of further pursuing each of these three
new policy proposals.
Planning and Transportation Commission (PTC) Review: The PTC met on October 10, 2007 to
discuss the BMR Study recommendations and the specific referral from P&S regarding appreciation
retroactivity for current BMR owners. Staff described the deliberations of P&S and explained the
issues the retroactive application of additional appreciation that would affect most of the BMR units
in the program since there are only a few that are currently receiving full CPI. Several BMR unit
owners addressed the Commission and urged support for the retroactive appreciation. The PTC
unanimously supported the concept of full CPI appreciation for all of the existing BMR units that
are currently not receiving full CPI appreciation. The PTC recommended approval of the staff
recommendations list on Attachment A. The PTC also had several additional recommendations for
either modifying the BMR Program or that warranted further study. These included:
• Evaluating possible methods to address the impact of increased homeowner dues on BMR
homeowners
• Developing a cap on BMR unit appreciation
• Eliminating the depreciation deduction for unit improvements
• Modifying preference criteria to provide a preference for City and PAUSD employees
• Providing periodic review of the BMR program to ensure optimum operations
• Exploring “rounding up” fractional units on projects with less than 30 units
• Changing policy to allow developers to provide smaller BMR units than the market rate
CMR: 173:08 Page 3 of 6
component only if more units are provided that equal or exceed the square footage from the
original requirement
Staff will study the last item as part of the Housing Element update; the other PTC recommendations
are being considered currently as part of the implementation of the BMR study.
Staff Recommendation:
Staff recognizes the concern about the effect upon BMR owners of the low appreciation realized
under the current one-third of CPI appreciation formula that has been in place since 1983; however,
staff continues to recommend against a retroactive increase to the BMR appreciation rate for current
owners for the reasons described in both the P&S and PTC attached staff reports. Further analysis
has since been completed on:
• The effect that the retroactive application of the full CPE would have on the overall policy
objectives of the BMR program as a whole,
• The likelihood of loss of units in specific projects if resale prices exceed what buyers will
pay;
• The relationship to the condition of older units at resale; and
• How the retroactive change would be actually put into place if adopted.
Staff continues to recommend that an incentive mechanism, which would increase resale prices, for
units which are in good condition at resale will be a more effective approach in addressing the City’s
overall program objectives, but still provide benefits to long-term owners who have had the low
appreciation. Staff has developed a proposed BMR Home Maintenance and Replacements Credit;
this credit would provide additional funds to sellers based on how long their unit has been under the
one-third of CPI formula and on the condition of the property at resale.
Staff proposed an incentive reward system based on the condition of BMR units at resale in the
October 11 staff report to the PTC (see page 4). Since then, staff has explored this concept in more
detail and tested it using different variables such as length of ownership, condition of unit at
purchase and at sale, and has concluded that it is a viable concept which would benefit both sellers
and the BMR program as a whole. This system would provide sellers with a financial benefit at
resale based on each year of one-third CPI appreciation. If the unit is determined to be in good
repair and condition, the seller will receive full credit. The amount of the credit will be reduced if the
unit needs repair by the estimated cost of bringing the unit up to reasonable standards for resale.
Staff believes that the Home Maintenance & Replacements Credit is preferable to a blanket
retroactive appreciation increase because it addresses the maintenance issues with the aging BMR
housing stock while offering a financial incentive to owners to take good care of their units. The
maximum amount of the credit is based on the length of time the unit was owned by the seller under
the one-third of CPI formula, so long term owners would have a greater benefit similar to the
concept of the retroactive CPI proposal. To be fair to an owner who purchased a unit that was
already in deteriorated condition, the total estimated repair and renovation costs would be allocated
only to the seller’s period of ownership. For those very low-income owners who have no financial
capacity to repair or renovate their unit, staff proposed a limited renovation loan program (see page 7
of the P & S staff report).
CMR: 173:08 Page 4 of 6
Staff proposes an annual credit of $1,500 per each year of ownership as a workable amount. The
longest a current unit has been under the one-third CPI is 24 years; this means the current maximum
credit would be $36,000. While this would be less than the increase to a typical 24 year old unit
with the retroactive CPI, it is still a significant sum of money given that the owner needs to only
have performed the normal maintenance, repairs and replacements expected as part of home
ownership.
Staff believes that adoption of a retroactive full CPI would have several problematic effects
including:
• A fundamental policy, to serve homebuyers from a broad range of incomes from very low
income to the upper moderate category, would be eroded. Presently, very low and low
income homebuyers can achieve home ownership by purchasing the lower-priced resale
BMR units. Incorporating some $40,000 to $50,000 into the resale price by giving the
current owner more appreciation will price these units out of reach to a large segment of the
buyers now on the waiting list since currently these potential buyers cannot afford the high
prices of new BMR units.
• The additional resale proceeds will not be enough for owners to purchase market rate units in
Palo Alto or in the Bay Area especially for the owners who are already living on limited
retirement incomes.
• There is no benefit to the BMR program as a whole from the adoption of the retroactive
appreciation.
• Retroactive appreciation not tied to the condition of the unit gives the same financial reward
to the seller whose unit has been allowed to deteriorate as it does to those sellers who have
invested in good upkeep and renovation.
• Projects where the BMR units have limited buyer appeal will become much more difficult to
resell with the retroactive appreciation added into the resale price;
• Units must be resold in a timely manner under the current deed restrictions or else the City
has to make the choice to take title itself or release the unit from the program;
• Projects with a history of large special assessments will have resale prices which will
approach prices for brand new units and, if in poor physical condition, they will not sell at
all.
There are eight developments with a total of 63 BMR units where the BMR units have deficiencies
that reduce buyer appeal, including a past history of large special assessments, poor location, small
square footage or rooms, unattractive layouts, and / or high original sales price. In some cases, all of
these factors are present, and in others, only one or two apply. PAHC has found these units
challenging to sell; most buyers on the waiting list would rather just wait for something better. If the
physical condition of one of these units is also poor, then almost no one is willing to buy that unit.
Factoring retroactive appreciation into the resale price will compound PAHC’s difficulty in finding
buyers for this portion of the BMR housing stock. With lower resale prices in the past due to the
one-third CPI formula, the City has been able to recoup its expenditures when forced to acquire units
to prevent their loss from the program. With the addition of the retroactive appreciation, the City
might have to use housing funds to write down the resale price to lower levels to resell certain units.
CMR: 173:08 Page 5 of 6
Attachment G describes the credit proposal in more detail and provides a few samples of
calculations comparing additional BMR unit value derived under the staff recommended credit to the
retroactive appreciation at full CPI.
RESOURCE IMPACT
There will be no impact to the General Fund with implementation of any of the potential BMR
program changes; however, there could be a significant impact to the Housing Fund if the retroactive
appreciation for existing BMR unit owners is approved. To avoid these potential costs, the City
Attorney has advised staff that any retroactive appreciation program would need to be implemented
at the time of sale of the residence. This would avoid revising deed restrictions since the legal costs
of modifying the deed restrictions for individual properties would be extremely significant for the
City.
POLICY IMPLICATIONS
The overall focus of the BMR Study was to identify policies and procedures which would make the
BMR program a more effective and efficient tool to address Palo Alto’s affordable housing needs.
Broad housing policies were examined as well as routine procedural matters in administration of
BMR unit sales. Several of the new policies from the study are based on two common underlying
principles:
1) New residential expansion and development should contribute at some level towards
solutions to the City affordable housing problems; and
2) The BMR program should contribute more effectively to the creation and preservation of
affordable rental housing to a much greater degree than in the past.
A rewrite of the BMR Program sections of the Housing Element would more clearly support these
two guiding principles of the BMR Program.
ENVIRONMENTAL REVIEW
The BMR Study recommendations pertain to the administration of the BMR housing program which
is categorically exempt under Section 15326 of the California Environmental Quality Act (CEQA).
PREPARED BY: ___________________________________
Catherine Siegel
Advance Planning Manager
DEPARTMENT HEAD REVIEW: ________________________________________
STEVE EMSLIE
Director of Planning and Community Environment
CITY MANAGER APPROVAL: ________________________________________
EMILY HARRISON
Assistant City Manager
CMR: 173:08 Page 6 of 6
ATTACHMENTS
A. BMR Program Update: Summary List of Staff Recommended Actions for Council Approval
B. Inventory of BMR Units [Completed and Occupied Units and Pipeline]
C. City Manager’s Report dated September 11, 2007 to Policy and Services Committee
D. Minutes from P&S Committee meeting of September 11, 2007
E. Staff report to PTC dated October 10, 2007
F. Minutes from PTC meeting of October 10, 2007
G. Description of Home Maintenance and Replacements Credit
H. Below Market Rate Housing Program Economic/Policy Analysis and Recommendations
Prepared by Keyser Marsten Associates, In.c and Anderson & Associates (City Council Only)
COURTESY COPIES
Palo Alto Housing Corporation, Marlene Prendergast, Executive Director
Bonnie Packer, Palo Alto Housing Corporation Board of Directors
Lanie Wheeler, Palo Alto Housing Corporation Board of Directors
Silicon Valley Association of Realtors
Home Builders Association of Northern California, Southern Division
______________________________________________________________________________
CMR: 178:08 Page 1 of 3
TO: HONORABLE CITY COUNCIL
FROM: CITY MANAGER DEPARTMENT: PLANNING AND
COMMUNITY ENVIRONMENT
DATE: MARCH 24, 2008 CMR: 178:08
SUBJECT: APPROVAL OF A TENTATIVE MAP AND RECORD OF LAND USE
ACTION TO CREATE SIX RESIDENTIAL CONDOMINIUM UNITS ON
A .57 ACRE LOT AT 433 W MEADOW DRIVE
RECOMMENDATION
Staff and the Planning and Transportation Commission (PTC) recommend that the City Council
approve the proposed Tentative Map to create six residential condominium units at 433 West
Meadow Drive, based upon findings and conditions contained within the draft Record of Land
Use Action (Attachment A).
BACKGROUND
The application requested is a six-unit residential condominium subdivision. The project site is a
.57 acre parcel with a single house and two accessory structures at the southerly intersection of
West Meadow Drive and Wilkie Way as shown on the location map (Attachment B). The
project site is in the RM-15 zone and has a Multiple Family Residential land use designation
allowing up to 8 units on the parcel. The property to the southwest is developed with a two-story,
two-unit residential structure and is zoned RM-15. The property to the southeast is developed
with approximately eleven attached residential units contained within two structures and is zoned
RM-15. The properties across West Meadow Drive and Wilkie Way from the project site are
zoned R-1 and R-2.
The condominiums would be accessed from a private drive along the West Meadow Drive
frontage. The private drive bisects the property, with three units to the south and three to the
north. The four units along the street frontages have their entrances oriented toward the street.
All garages are accessed via the private drive. The layout of the street network and adjacent
properties does not provide any opportunity for the street to connect through to another street.
The driveway and common areas will be maintained through the Convenants, Conditions, and
Restrictions (CC&Rs).
The footprint of the units defines the locations of the individual condominium units. The
remainder of the parcel will be commonly owned and maintained via CC&Rs and will contain
driveway area, private open space, landscaped public open space (primarily along the street
frontages) and a common use area at the entrance to the project. The project site contains 36
mature trees, including four protected oaks trees, which will be retained.
______________________________________________________________________________
CMR: 178:08 Page 2 of 3
DISCUSSION
Staff and City departments have determined that the Tentative Map application is in compliance
with zoning, subdivision, and other codes and ordinances.
The Tentative Map plan set includes information on the existing parcels and onsite
conditions. The drawings are in compliance with the applicable provisions of the City’s
Subdivision Ordinance. These plans contain all information and notations required to be
shown on a Tentative Map (per PAMC Sections 21.12), and conform to the design
requirements concerning the creation of lots, streets, walkways, and similar features
(PAMC 21.20).
BOARD/COMMISSION REVIEW AND RECOMMENDATIONS
On February 13, 2007, the Planning and Transportation Commission (PTC) conducted a public
hearing and recommended (7-0-0-0) that the City Council approve the Tentative Map to create
six residential condominium units at 433 West Meadow Drive, based upon the findings and
conditions contained within the draft Record of Land Use Action. At the hearing,
Commissioners had questions regarding zoning compliance, private roadway placement, tree
protection, private yards, the Public Utilities Easement (PUE), and common area irrigation. No
members of the public spoke on this proposal. Staff explained the project’s compliance with
zoning, advantage of street location for the street frontage and protection of all oaks on site,
inclusion of private yards in condominiums, and the PUE’s location over the entire site (except
building envelopes). The applicant showed the location of a seventh water meter to be used for
irrigation of common areas. Draft minutes from the PTC hearing are included as Attachment C.
RESOURCE IMPACTS
The cost and/or revenue impacts to the City associated with the tentative map include parks,
library and community facilities fees, and traffic impact fees. Such fees are paid prior to issuance
of building permits at the rates in effect at that time. All development review costs have been
recovered through permit fees.
POLICY IMPLICATIONS
The proposed map is consistent with the Comprehensive Plan in that the site is designated for
multi-family residential. The Architectural Review Board (ARB) was presented with staff’s
analysis of zoning and policy conformance during their review of the ARB application.
ENVIRONMENTAL REVIEW
An Initial Study and a Mitigated Negative Declaration were prepared and approved in
conjunction with the Architectural Review of the 0.57 acre site. The Initial Study/Mitigated
Negative Declaration included the condominium map within the project description and analysis.
No further environmental review is required.
PREPARED BY: __________________________________
JENNIFER CUTLER
Associate Planner
______________________________________________________________________________
CMR: 178:08 Page 3 of 3
DEPARTMENT HEAD: __________________________________
STEVE EMSLIE
Director of Planning and Community Environment
CITY MANAGER APPROVAL: __________________________________
EMILY HARRISON
Assistant City Manager
ATTACHMENTS
A. Draft Record of Land Use Action
B. Planning & Transportation Commission Staff Report, February 13, 2008
C. Excerpt of the Draft Planning & Transportation Commission Minutes, February 13, 2008
D. Initial Study and Mitigated Negative Declaration, adopted October 23, 2007
E. Tentative Map (Councilmembers only)
COURTESY COPIES
Forrest Mozart, West Meadow Oaks, L.P., Applicant/Owner
______________________________________________________________________________
CMR: 179:08 Page 1 of 7
TO: HONORABLE CITY COUNCIL
FROM: CITY MANAGER DEPARTMENT: PLANNING AND
COMMUNITY ENVIRONMENT
DATE: MARCH 24, 2008 CMR: 179:08
SUBJECT: APPROVAL OF 1) A TENTATIVE MAP AND A RECORD OF LAND USE
ACTION TO SUBDIVIDE THE ELKS LODGE SITE (4249 AND 4251 EL
CAMINO REAL) INTO TWO LOTS; AND 2) A VESTING TENTATIVE
MAP AND A RECORD OF LAND USE ACTION FOR 4249 EL CAMINO
REAL TO SUBDIVIDE THE RESIDENTIAL LOT INTO A 45 UNIT
COMMON INTEREST DEVELOPMENT
RECOMMENDATION
Staff recommends that City Council approve:
(A) The Tentative Map which proposes to subdivide the Elks Lodge site, located at 4249
and 4251 El Camino Real, into two lots, based upon the findings and conditions
contained within the draft Record of Land Use Action (Attachment A-1); and
(B) The proposed Vesting Tentative Map to subdivide the 3.97-acre portion of the Elks
Lodge site, located at 4249 El Camino Real, into 45 multi-family condominium
residential units, private streets and a 0.48 public park, based upon the findings and
conditions contained within the draft Record of Land Use Action (Attachment A-2).
The Planning and Transportation Commission (PTC) made no recommendation on the proposed
Vesting Tentative Map and Record of Land Use Action for 4249 El Camino Real. Two motions
taken at the March 24, 2008 hearing, one to approve with conditions and one to deny, ended in
tied votes.
BACKGROUND
The proposed Palo Alto Elks/SummerHill project is the second phase of a redevelopment plan
for the approximately 8 acre site owned by the Benevolent and Protective Order of Elks (BPOE).
The entire Elks Lodge site is proposed to be redeveloped in three phases:
Phase 1
Juniper Homes is developing five parcels fronting Wilkie Way with five single-family
detached homes. The development was approved by the City on July 30, 2007. Three of the
______________________________________________________________________________
CMR: 179:08 Page 2 of 7
five homes have received ARB approval and the remaining two homes have received staff-
level ARB approval, with input from the ARB.
Phase 2
The middle 3.9-acre parcel would front Deodar Street and would be located between the
Juniper Homes development and the future Elks Lodge. SummerHill is in the process of
acquiring this site to develop 45 multi-family units and a 0.48-acre park. The project was
reviewed by the ARB in four public hearings, one of which was a preliminary review, and
was approved on October 30, 2007. The Tentative Map to subdivide one lot into two was
considered by the PTC on November 22, 2007. The Vesting Tentative Map for the
residential project was considered by the PTC on March 12, 2008.
Phase 3
The approximately three-acre site fronting El Camino Real retained by BPOE would be
developed for a new Elks Lodge. The preliminary architectural review of conceptual plans
by the Architectural Review Board in a public hearing on August 2, 2007 provided a forum
for comments on a two-story, 40-foot tall building over a one-level underground parking
garage. The new Elks Lodge development plans have not yet been finalized or submitted for
formal ARB review and action.
DISCUSSION
The Tentative Maps proposed by SummerHill Homes (SummerHill) on behalf of the property
owner, BPOE, involve two components:
(1) Tentative Map for a two-lot subdivision of the approximately 7-acre Elks Lodge site to
enable the construction of a new Elks Lodge on a 2.82 acre parcel (Lot 1) to be retained
by BPOE; and a second, 3.97 acre parcel (Lot 2) to be purchased by SummerHill for its
proposed multi-family development. Approximately 0.34 acres of the Elks Lodge site,
currently public access via an easement for a portion of Deodar Street, would be
permanently dedicated.
(2) Vesting Tentative Map to subdivide the resulting 3.97-acre residential portion into 45
multi-family condominium units, private streets and dedicated public park.
The remainder of the 7-acre site will be developed with a new Elks Lodge by the property owner,
and will be subject to a subsequent Architectural Review Board (ARB) design review process.
Council requested both map applications be presented at a single hearing to facilitate its
evaluation.
The project site is in the RM-15 and RM-30 zones, with a Multiple Family Residential
Comprehensive Land Use Designation, which allow the proposed uses. The residential project
includes five pairs of attached units and 35 detached townhome-style units that range from two
to three-story buildings. An approximately 0.34-acre of the Elks Lodge portion of the site is
being dedicated to the City as a public right of way to establish Deodar Street, which will be
constructed with pedestrian walkways on both sides. The residential development and Vesting
Tentative Map include a 0.48-acre dedicated public park, located at the eastern edge of the site,
designed to serve residents of this project and neighboring developments, but open to the public
at large. The park exceeds the 0.23-acre size required by the Parkland Dedication Ordinance.
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The park will be dedicated as parkland with a public access easement over it, retained in
ownership and maintained by the project homeowners association.
The two-lot Tentative Map was continued from the January 22, 2008 City Council hearing to
allow staff and the applicant to respond to Council’s request for the provision of pedestrian and
bicycle access to Wilkie Way. The Council had also expressed concerns about the use of private
streets to provide access across the site and a preference to review the subject two-lot subdivision
at the same time as the residential condominium subdivision in order to analyze the project as a
whole. The Vesting Tentative Map to subdivide 45-unit condominium residential units was
heard on March 12, 2008 by the PTC to enable both Tentative Maps to be heard at the March
24, 2008 City Council hearing.
Pedestrian Access
There has been considerable discussion by the City Council, ARB, and PTC, as well as input at
public hearings, regarding pedestrian and bicycle access to Wilkie Way and El Camino Real
from and to the proposed SummerHill development. The proposed five-lot development by
Juniper Homes is situated along Wilkie Way, adjacent to the subject site. The applicant for the
Juniper Homes development was receptive to providing a pedestrian and bicycle access along the
existing emergency vehicle access route enabling access to Wilkie Way. However, residents of
the Charleston Meadows neighborhood were opposed to such access. The Juniper Homes Final
Map approval was granted by the City Council without this type of easement. This decision
eliminated the direct option for connectivity from Wilkie Way to the proposed park and
residences of the SummerHill development. The ARB was also concerned about the lack of bike
and pedestrian connectivity between the existing and new neighborhoods and agreed that it was
an important aspect of community design. It made a unanimous resolution in favor of
connectivity. Several members of the public spoke both in favor of and against providing a
connection to Wilkie Way. The PTC had also expressed concern regarding the lack of
connection to Wilkie Way during the November 28, 2007 hearing on the two-lot tentative map.
SummerHill has proposed bicycle and pedestrian access easements from Deodar Street to the
public park. The park would also have direct access to the public Deodar Street. Should a future
easement opportunity arise on the adjacent Dinah’s property, the project also includes a four-foot
wide public access easement along Street A to facilitate pedestrian and bicycle connectivity from
Deodar Street to an adjacent new access point at Dinah’s property.
Applicant’s Alternatives
In response to City Council’s requests, the applicant has provided an alternative point of
connection. If the City acquires access rights on the adjacent Dinah’s property on or before
March 24, 2009, the applicant is offering to incorporate into this tentative map a new access
point, with a 4-foot wide sidewalk, at the southeastern perimeter of the site to lead to the public
park from the adjacent property. This would allow a shorter pedestrian/bicycle route from
Wilkie Way to the park. Should this alternative connection path be provided, the applicant
would withdraw the offer to provide access along Street A as discussed above. However, the
applicant has also indicated that SummerHill would be open to maintaining both access points.
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In response to concerns regarding private streets, the applicant will dedicate public access
easements over all of the private streets, including the sidewalks. The applicant’s detailed
proposal is provided as Attachment F.
BOARD/COMMISSION REVIEW AND RECOMMENDATIONS
The Commission recommended at the public hearing held on November 28, 2007, that the City
Council approve the two-lot Tentative Map to subdivide the Elks Lodge into two lots, as
submitted, based on the findings and conditions contained within the draft Record of Land Use
Action (Attachment A-1).
On March 24, 2008, three members of the PTC voted to recommend that the City Council
approve and three members voted to recommend that City Council not approve the Vesting
Tentative Map to subdivide the 3.97-acre portion of the Elks Lodge site into 45 multi-family
condominium residential units, private streets and 0.48-acre public park (Commission Tuma was
absent). Because there was no majority vote either for or against the recommendation, the
Commission took no action on the proposed condominium Vesting Tentative Map. The
Commissioners who voted against the Vesting Tentative Map were concerned that the lack of
public streets conflicts with policies L-17, T-23, T-25 and C-30 of the Comprehensive Plan.
Specifically, they were concerned with the project’s narrow private streets, lack of traditional on-
street parking, and potential impact on Wilkie Way. The Commissioners who voted to
recommend approval of the Vesting Tentative Map also made additional recommendations,
including: 1) retaining the original proposed four-foot wide public access easement along Street
A instead of the new applicant-proposed alternative point of connection near the park, 2)
accepting the public access easements to be dedicated on all the internal private streets and
sidewalks, and 3) requiring that the City pay for park maintenance instead of the project’s future
Homeowner’s Association.
The staff has the following comments in response to the concerns raised:
The project as proposed meets planning objectives for the City of Palo Alto. The proposed
development is consistent with the Comprehensive Plan, the Zoning Ordinance and the
development direction of the larger general area. The applicant proposal of 11.4 units per acre is
at the lower end of the allowed density range for the site’s Multi-Family Comprehensive Plan
Land Use and the Zoning District (RM-15 and RM-30) designations. The Housing Element
targets an estimated 97 dwelling units for the entire Elks Lodge site. The project would add to
the City’s diversity of housing types, create a safe and attractive neighborhood, respect the
adjacent uses, and preserve the site’s natural features, including a minimum of 30 mature trees.
The design of the project was thoroughly reviewed by City staff and the ARB over the course of
the past year and through four ARB public hearings. The proposal meets all safety and design
requirements per applicable codes and City staff, including the number of guest and resident
parking spaces, open space and street width/configuration. The inclusion of private streets in the
project is consistent with previous developments, including those within the project’s vicinity.
The fact that the applicant has also proposed public easements over the private streets and
sidewalks means that the public will be guaranteed access in perpetuity. The Tentative Maps
reflect the development plan set that was approved by the ARB and the Planning Director in
October 2007. The full detailed ARB approved plans are available for review at the Planning
and Transportation Division office.
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The City Attorney has advised that the current Comprehensive Plan and Zoning Ordinance do
not preclude the creation of private streets where the streets serve only the new development.
The findings by the minority of the Planning and Transportation Commission recommending
denial of the map due to lack of public streets are likely insufficient to withstand legal challenge
should the Council deny the map on that basis.
Nearly all of the large multi-family developments approved within the past several years have
included private streets. A change in policy to prohibit private streets would require an
amendment to the Comprehensive Plan and the Zoning Ordinance. However, a vesting tentative
map confers a vested right to proceed with a development in substantial compliance with the
ordinances, policies, and standards in effect at the time the application for approval of the map is
complete. Because this is a vesting tentative map, subsequent changes to the Comprehensive
Plan or Zoning Ordinance could not be made to apply to this project.
RESOURCE IMPACTS
There will be a resource impact when the Elks site is developed. SummerHill’s proposed 45 unit
condominium project and the new, two-story Elks building will result in additional revenues and
long-term cost impacts as this and other developments continue.
At this stage of the proposal, however, it is difficult to provide reasonable, estimated incremental
revenues. The transaction value for the 3.97 acre acquisition by SummerHill, for example, is not
available. Therefore, an estimate for documentary transfer taxes cannot be determined. Should
this project move forward, the City would realize new revenues as follows:
• One-time documentary transfer taxes from the sale of land to SummerHill and from the
sale of the condominium units
• Ongoing, incremental property taxes based on changing land values and the sale price of
the condominium units
• Ongoing Utility Users Tax from telephone usage and consumption of water, gas and
electric services
• Ongoing sales tax from the consumption of tangible goods within City boundaries
• One-time development impact fees including facilities and traffic fees
Direct costs associated with review of this development will be recouped through permit fees.
City service costs associated with this development and those developments implemented since
adoption of the last Comprehensive Plan will be addressed cumulatively in the forthcoming
update to that Plan.
POLICY IMPLICATIONS
The proposed map is consistent with the Comprehensive Plan in that the site is designated for
multi-family residential use and the continued use and renovation of the Lodge was expressly
permitted by prior action of the Council. The proposal to have the City maintain the proposed
public park, instead of the Homeowner’s Association, and to convert all private streets into
public streets have policy and resource impact implications. This would require changes to
existing policy and would potentially affect future projects.
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ENVIRONMENTAL REVIEW
The Initial Study and Draft Mitigated Negative Declaration discussed the potential impacts of the
two lot subdivision, the SummerHill Homes residential condominium development and the new
Elks Lodge development. The documents were made available for a 20-day public review period
between August 31, 2007 and September 19, 2007. No written public comments were received
during this review period. Two of the ARB public hearings allowed for additional public
comments after the review period. The Environmental Assessment found that the impacts
produced by the project, including the development of the multi-family homes and the new Elks
Lodge, would have less than significant impacts on the environment with the incorporation of
mitigation measures. These impacts are described in the assessment contained in Attachment E.
Since State law requires the adoption of an Initial Study and Mitigated Negative Declaration
prior to taking action on a discretionary project, these environmental documents were adopted on
October 25, 2007 by the Director of Planning and Community Environment, prior to the
approval of the ARB application for the proposed SummerHill Homes project.
PREPARED BY: __________________________________
ELENA LEE
Senior Planner
DEPARTMENT HEAD: __________________________________
STEVE EMSLIE
Director of Planning and Community Environment
CITY MANAGER APPROVAL: __________________________________
EMILY HARRISON
Assistant City Manager
ATTACHMENTS
A.1 Draft Record of Land Use Action for the Two-Lot Tentative Map
A.2. Draft Record of Land Use Action for the Vesting Tentative Map for the 45-unit
residential condominiums
B. CMR 100:08, dated January 22, 2008 (without attachments)
C.1. Planning & Transportation Commission Staff Report, November 28, 2007 (without
attachments)
C.2. Planning & Transportation Commission Staff Report, March 12, 2008 (without
attachments)
D.1. Excerpt of the Planning & Transportation Commission Minutes, November 28, 2007
D.2. Draft Excerpt of the Planning &Transportation Commission Minutes, March 12, 2008
E. Initial Study and Mitigated Negative Declaration, adopted October 25, 2007
F. Correspondence from the applicant, including the applicant’s Alternatives Connections
packet dated February 27, 2008
G. Applicant’s Project Description
H. ARB approved street perspectives and landscape site plan (Councilmembers only)
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CMR: 179:08 Page 7 of 7
I.1 Two-Lot Tentative Map (Councilmembers only)
I.2. Vesting Tentative Map (Councilmembers only)
COURTESY COPIES
James E. Baer, Premier Properties
Elaine Breeze, SummerHill Homes
Carlin Otto
Penny Ellson
Jean Olmsted
Denis Losé