HomeMy WebLinkAbout2014-11-03 City Council Summary Minutes
11/03/2014 116-029
Special Meeting
November 3, 2014
SPECIAL ORDERS OF THE DAY .................................................................31
1. Summer Science Program (Heidelberg) .............................................31
2. Resolution 9465 entitled “Resolution of the Council of the City of Palo
Alto Expressing Appreciation to Donna Grider Upon Her Retirement.” ...33
CITY MANAGER COMMENTS .....................................................................35
ORAL COMMUNICATIONS ........................................................................35
CONSENT CALENDAR ..............................................................................36
3. Approval of a Contract with Independent Police Auditor in the Amount
of $27,500 Per Year for a Period of 1 Year, with Possibility of Renewal
for up to Two Years, with Compensation Not to Exceed a Total of
$82,500 ........................................................................................36
4. Ordinance 5279 entitled “Ordinance of the Council of the City of Palo
Alto Adding Chapter 4.60 to the Palo Alto Municipal Code Regarding
Business Registration Program (First Reading: October 6, 2014
PASSED 8-0 Klein absent).” .............................................................36
5. Ordinance 5280 entitled “Ordinance of the Council of the City of Palo
Alto Approving and Adopting a Plan for Improvements to El Camino
Park (First Reading: October 20, 2014, PASSED: 9-0).” ......................37
6. Ordinance 5281 entitled “Ordinance of the Council of the City of Palo
Alto to Amend Section 2.08.130 of the Palo Alto Municipal Code, Office
and Duties of the City Auditor, to Reflect Changes in Audit Practices
and Clarify the Requirements for Reporting Work Products of the Office
of the City Auditor (First Reading: October 6, 2014 PASSED: 8-0 Klein
absent).” .......................................................................................37
7. Policy and Services Committee Recommendation to Accept the Report
on the Status of Audit Recommendations (June 2014) ........................37
8. Approval of Second Amendment to Contract S14151557 with Bartel
Associates, LLC for Actuarial Services in a Total Amount Not to Exceed
$103,000 ......................................................................................37
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9. Approval of and Authorization for the Mayor to Sign a Letter of Support
for the National Register Nomination of the Woman’s Club of Palo Alto
Building at 475 Homer Avenue .........................................................37
10. Request for Authorization to Increase Existing Contract with Newdorf
Legal by an Additional $40,000 For a Total Contract Not to Exceed
Amount of $105,000 for Legal Services Related to Litigation Matters ....37
ACTION ITEMS .......................................................................................37
11. Comprehensive Plan Update: Initial Discussion of the Scope and
Schedule of the Planning Process, Including Concurrent Zoning
Changes (Note: Given the Complexity of These Issues, This will be the
First of Two Discussions, with the Second Discussion and Council
Action on November 17, 2014) ........................................................37
14. Review and Approval of a Letter from the City of Palo Alto to the
Environmental Protection Agency (EPA) on the Proposed Rule Change
to Waters Protected Under the Clean Water Act .................................52
12. Finance Committee Recommends Proposed Changes in Development
Impact Fees: Direction to Draft Ordinance Implementing New Public
Safety Facility and General Government Facilities Impact Fees .............53
13. Approval of Fiscal Year 2014 Reappropriation Requests for the
Municipal Services Center to be Carried Forward Into Fiscal Year 2015 .65
COUNCIL MEMBER QUESTIONS, COMMENTS AND ANNOUNCEMENTS ............66
ADJOURNMENT: The meeting was adjourned at 11:31 P.M. ........................67
MINUTES
11/03/2014 116- 31
The City Council of the City of Palo Alto met on this date in the Council
Chambers at 6:10 P.M.
Present: Berman, Burt, Holman, Klein, Kniss, Price, Scharff, Schmid,
Shepherd
Absent:
SPECIAL ORDERS OF THE DAY
1. Summer Science Program (Heidelberg)
Thomas Fehrenbach, Economic Development Manager, advised that the City
was exploring a Smart City Partnership with Heidelberg, Germany. This was
an opportunity to highlight the Summer Science School, a program
sponsored by Heidelberg.
Sarah, senior at Gunn High School, attended the International Summer
Science School in Heidelberg, Germany, to learn about science in a different
way. Students chose one field of science on which to focus and over one
month researched a project, conducted experiments, and attended
workshops.
Owen, senior at Palo Alto High School, added that one feature of the
program was exposure to German culture. He interacted with local
students, took trips to neighboring cities, and was generally immersed in
German culture. Students from around the world attended the program.
Sarah made lasting friendships with some of the 23 students from 10
countries.
Owen thanked John Ernest Foundation for providing an opportunity to attend
the Summer Science School.
Mr. Fehrenbach noted Nicole Huber, Chief of Staff for Heidelberg, was
visiting the City.
Alexander Johnson, John Ernest Foundation, reported the goal of the John
Ernest Foundation was to turn dreams into reality for individuals. The John
Ernest Foundation attempted to reflect the diversity and complexity of the
human spirit.
Council Member Berman inquired about the students' activities in the science
labs.
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11/03/2014 116- 32
Owen explained that during the first week students explored different
workshops to sample all fields of science. In the remaining three weeks,
students attended one institute to conduct research. He chose cancer and
medical research.
Sarah chose nuclear physics.
Council Member Berman asked if they chose those areas before attending
the school or after the first week.
Sarah chose her area going into the program. At the end of the month, each
student gave a presentation.
Council Member Berman inquired about the strangest thing they ate.
Owen remarked that schnitzel was an unusual name but a basic food.
Council Member Burt asked the students to compare Heidelberg and Palo
Alto.
Sarah indicated Heidelberg was old and historical while Palo Alto was
modern.
Owen remarked that both cities focused on youth and science.
Vice Mayor Kniss inquired whether the students traveled while attending the
program.
Owen explained that the program organized one trip a week, and on free
days students organized their own trips.
Vice Mayor Kniss asked about the selection process.
Owen advised there was an application process.
Mr. Johnson reported students were chosen by their peers to be John Ernest
Fellows. The Foundation chose students who might not have such an
opportunity otherwise.
Vice Mayor Kniss believed being chosen by one's peers was special.
Council Member Scharff asked how the students learned about the program.
Owen learned about the program through a prior Fellow.
MINUTES
11/03/2014 116- 33
Council Member Scharff inquired about the interaction between the John
Ernest Foundation and the program. He asked if both students were John
Ernest Fellows.
Owen indicated they were now Fellows.
Council Member Scharff asked if students applied to the John Ernest
Foundation or the Summer Science Program.
Owen applied to the program.
Mr. Johnson explained that the John Ernest Foundation provided Fellows with
assistance.
Council Member Holman inquired whether the students learned about the
communities of the other students.
Owen commented that other students had similar opportunities and the
community focused on science.
Council Member Holman asked if there was anything in the community itself
that the students might have learned.
Owen spent time comparing and contrasting cultures with other students.
Mayor Shepherd was impressed by the students' achievements. This was a
great way to launch the City's relationship with Heidelberg.
2. Resolution 9465 entitled “Resolution of the Council of the City of Palo
Alto Expressing Appreciation to Donna Grider Upon Her Retirement.”
Mayor Shepherd thanked Ms. Grider for her service to the City.
Council Member Price read the Resolution into the record.
Donna Grider, City Clerk, felt it was a great privilege to work for the City of
Palo Alto. She worked with her team to accomplish much during her tenure.
Joan Dentler, representing Senator Jerry Hill, presented Ms. Grider with a
certificate on behalf of Senator Hill.
Robert Moss remarked that Ms. Grider was the best City Clerk with whom he
had worked. She integrated new technology and was an asset to the
community and Council. He thanked her for her service. The community
was well served by her dedication and community activities.
MINUTES
11/03/2014 116- 34
Sea Reddy believed Ms. Grider did a good job of taking care of citizens. He
wished her the best. Ms. Grider had a great deal of integrity.
Council Member Schmid advised that Ms. Grider was welcoming, helpful, and
knowledgeable.
Council Member Price thanked Ms. Grider for her professionalism, attention
to many personalities and Council Members, and dedication to her work.
Council Member Holman believed Ms. Grider was impartial and always open
and welcoming to community.
Vice Mayor Kniss remarked that Ms. Grider was polite, always composed,
and did a remarkable job as City Clerk.
Council Member Scharff indicated Ms. Grider was a great help to him and the
Council and always exhibited warmth.
Council Member Klein gained a deep appreciation for Ms. Grider when he
served as Mayor. Ms. Grider served as the face of the City and was always
patient with complaints and inquiries.
Council Member Berman added that Ms. Grider was extremely helpful and
patient with inquiries.
Council Member Burt noted Ms. Grider viewed her role as serving the
community and she was proud of serving the community. On behalf of the
Council and community, he thanked Ms. Grider for her dedication.
Mayor Shepherd appreciated watching the City Clerk's team work for the
City of Palo Alto. The Clerk's Office performed at a high level.
James Keene, City Manager, on behalf of Staff thank Ms. Grider for her good
work. A great deal of work was required to make meetings run smoothly.
MOTION: Vice Mayor Kniss moved, seconded by Council Member Price to
adopt the Resolution expressing appreciation to Donna Grider upon her
retirement.
MOTION PASSED: 9-0
MINUTES
11/03/2014 116- 35
CITY MANAGER COMMENTS
James Keene, City Manager, announced the California Avenue Streetscape
Project was scheduled to be completed in March 2015. Decorative glass
jewels used in sidewalks were approved for sidewalk use and consistent with
other sidewalk finishes. Staff was planning a marketing and outreach effort
during the holidays to support and promote patronage of California Avenue
businesses. Sculptures by Joe O'Connell and Blessing Hancock were now lit
at night. The California Statewide Local Roads and Needs Assessment 2014
Report highlighted Palo Alto for proactively managing and investing in a
street maintenance program with an overall Pavement Condition Index (PCI)
score now at 78. Major construction at Rinconada Library was complete;
however, the library was not yet open to the public.
ORAL COMMUNICATIONS
Stephanie Munoz suggested the City construct a condominium building at
Cubberley Community Center and rent the units to teachers. That would
pay back the cost of the $13 million in five years. The value of 100 living
units was $13 million, and also the value that Buena Vista residents were
willing to contribute to low-income housing.
Stephanie Lahat invited everyone to participate in the November 27, 2014
Applied Materials Silicon Valley Turkey Trot. The Turkey Trot had raised and
donated $4 million over the past nine years. She encouraged the Council
and City management to register for the Mayor's Cup Challenge.
Council Member Scharff noted the City held the Mayor's Cup Challenge
trophy from 2013.
Mayor Shepherd was rallying Council Members and City management to
register.
Robert Moss recalled the City having an outbreak of graffiti approximately 20
years ago. He removed graffiti in the areas of Barron Park, Ventura, and El
Camino Real. He urged the Council to have the Public Works Department
promptly clean graffiti in order to discourage additional graffiti.
James Keene, City Manager, reported the City's 311 app allowed residents to
report graffiti so the Public Works Department could remove it.
MINUTES
11/03/2014 116- 36
Sea Reddy spoke regarding the election the following day. More women
were needed on the Council. Council Members with integrity were also
needed.
Dr. Martell had filed a complaint against the City as she was injured at a Palo
Alto public facility. The City Attorney failed to provide her with surveillance
video of her accident. She requested a hearing in order to confront her
accusers. The City's case was based on hearsay. She requested the Council
order the City Attorney to stop harassing her and to dismiss the lawsuit.
CONSENT CALENDAR
Victoria Sullivan, Palo Alto Woman's Club President, spoke regarding Agenda
Item Number 9. She thanked the Council for supporting the nomination of
the Woman's Club of Palo Alto to the National Register of Historic Places.
The Club House was important to the architectural history of Palo Alto. A
listing on the National Register would be the highlight of the centennial
celebration of the Club House in 2016.
Council Member Holman recalled current and prior Councils had supported
the activities of the Woman's Club. She thanked them for helping to
preserve the institution in the community.
Vice Mayor Kniss felt it was important for the facility to be maintained and
sustained.
Wayne Douglass spoke regarding Agenda Item Number 3. The Independent
Police Auditor was a successful program and should be expanded to include
EMTs and firefighters.
MOTION: Council Member Price moved, seconded by Council Member
Berman to approve Agenda Item Numbers 3-10.
3. Approval of a Contract with Independent Police Auditor in the Amount
of $27,500 Per Year for a Period of 1 Year, with Possibility of Renewal
for up to Two Years, with Compensation Not to Exceed a Total of
$82,500.
4. Ordinance 5279 entitled “Ordinance of the Council of the City of Palo
Alto Adding Chapter 4.60 to the Palo Alto Municipal Code Regarding
Business Registration Program (First Reading: October 6, 2014
PASSED 8-0 Klein absent).”
MINUTES
11/03/2014 116- 37
5. Ordinance 5280 entitled “Ordinance of the Council of the City of Palo
Alto Approving and Adopting a Plan for Improvements to El Camino
Park (First Reading: October 20, 2014, PASSED: 9-0).”
6. Ordinance 5281 entitled “Ordinance of the Council of the City of Palo
Alto to Amend Section 2.08.130 of the Palo Alto Municipal Code, Office
and Duties of the City Auditor, to Reflect Changes in Audit Practices
and Clarify the Requirements for Reporting Work Products of the Office
of the City Auditor (First Reading: October 6, 2014 PASSED: 8-0 Klein
absent).”
7. Policy and Services Committee Recommendation to Accept the Report
on the Status of Audit Recommendations (June 2014).
8. Approval of Second Amendment to Contract S14151557 with Bartel
Associates, LLC for Actuarial Services in a Total Amount Not to Exceed
$103,000.
9. Approval of and Authorization for the Mayor to Sign a Letter of Support
for the National Register Nomination of the Woman’s Club of Palo Alto
Building at 475 Homer Avenue.
10. Request for Authorization to Increase Existing Contract with Newdorf
Legal by an Additional $40,000 For a Total Contract Not to Exceed
Amount of $105,000 for Legal Services Related to Litigation Matters.
MOTION PASSED: 9-0
ACTION ITEMS
11. Comprehensive Plan Update: Initial Discussion of the Scope and
Schedule of the Planning Process, Including Concurrent Zoning
Changes (Note: Given the Complexity of These Issues, This will be the
First of Two Discussions, with the Second Discussion and Council
Action on November 17, 2014).
Mayor Shepherd recalled earlier in the year the Council supported a
framework to re-engage the community regarding the long delayed
Comprehensive Plan Update (Update) and to keep the Update on a timeline
for completion by late 2015. On August 6, 2014, the Council paused the
timeline to ask Staff to revise the scope and breadth of the Update; to
consider potential changes to the City's Zoning Code and Zoning Map for
commercial areas; and to conduct a Study Session regarding commercial
zoning changes.
MINUTES
11/03/2014 116- 38
Ideas from the Study Session held on September 8, 2014 were summarized
in Attachment A. The Staff Report identified the possibility of adding one or
two more zone change concept items without interrupting the
Comprehensive Plan Update schedule. On November 17, 2014, the Council
would take action based on the current discussion.
Hillary Gitelman, Planning and Community Environment Director, added that
the current discussion would be continued on November 17 with action being
taken at that time. On August 6, 2014, the Council requested Staff provide
baseline data related to the Comprehensive Plan Update, reevaluate the
breadth and scope of the Comprehensive Plan Update process, and consider
whether commercial zoning changes could occur ahead of or concurrent with
the Comprehensive Plan Update. The Comprehensive Plan and zoning were
directly related because one implemented the other. On September 8,
2014, the Council outlined ideas for potential commercial zoning changes.
Staff published and disseminated a volume of materials that provided
existing conditions data on 14 different topics. The Comprehensive Plan
called "Embracing the New Century" was adopted in 1998. Because of
elapsed time, many of the objectives had been met and new opportunities
were now available. Updating the Comprehensive Plan provided a good legal
foundation for decision making in the future. An updated Comprehensive
Plan could help the City manage the pace of growth and respond to key
issues. The Comprehensive Plan Update process was an opportunity for a
collaborative conversation and interaction with the community regarding
critical issues. Hopefully the Comprehensive Plan would reflect the collective
wisdom of the community. The Comprehensive Plan set zoning and zoning
set regulations to implement policy. The Council offered 19 ideas at the
Study Session which Staff grouped into four categories. The categories
were: changes in use or density; preserving local retail; parking
requirements; and other zoning changes. Zoning amendments could be
examined and pursued in advance of and concurrent with the
Comprehensive Plan Update. The Council identified specific zoning changes
it wanted to consider, and those changes could be pursued ahead of or
concurrent with the Comprehensive Plan Update. In the Staff Report, Staff
suggested a prioritization of ideas related to retail preservation and parking
exemptions and suggested ideas to be considered concurrent with the
Comprehensive Plan Update. Staff used three different criteria to evaluate
each.
MINUTES
11/03/2014 116- 39
Staff recommended proceeding immediately with a Zoning Ordinance(s) to
address retail preservation and parking exemptions; scheduling a work
session in January 2015 related to pace of growth; scheduling a series of
community workshops regarding policy choices; utilizing community
workshops to reconcile the Planning and Transportation Commission's
(P&TC) work with existing Comprehensive Plan goals, policies, and
programs; performing impact analyses of policy choices; and drafting a
Zoning Ordinance concurrent with the Comprehensive Plan Update. A
potential timeline would be holding a work session with the Council in
January 2015; in early 2015 presenting a draft Zoning Ordinance and
preparing for community workshops; and holding community workshops in
the spring of 2015.
Council Member Klein urged Ms. Gitelman to differentiate between
suggestions from individual Council Members and actions taken by the
Council. Staff should not write an Ordinance incorporating all 19 ideas as
the ideas had not been approved by a majority of the Council.
James Keene, City Manager, believed Staff's orientation was to design a
process that could include Council Member suggestions. Staff would be clear
about any Council direction given to Staff.
Council Member Klein felt the recommendations exceeded the Council's
original intent that 90 percent of the Comprehensive Plan would remain
intact. He inquired whether the Comprehensive Plan Update process would
merely update the Comprehensive Plan to reflect the passage of time or
reconsider many of the policies.
Ms. Gitelman reported many goals and policies in the Comprehensive Plan
did not need revision; however, some policy choices were now available. It
would be a mistake not to confront those choices in the context of the
Comprehensive Plan Update. The list of policy choices was not long, but it
was important.
Council Member Klein did not wish to mislead the public. The program
seemed to be more than an update of the Comprehensive Plan.
Mr. Keene remarked that some people would not want to make changes,
because they presumed outcomes of existing policy. Those outcomes could
be different and could become apparent while discussing choices.
Council Member Klein inquired about criticisms that the P&TC worked behind
closed doors.
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11/03/2014 116- 40
Ms. Gitelman advised that when Staff brought the P&TC recommendations to
the Council in February, there was some discussion that P&TC
subcommittees had worked on language that did not surface until it was
presented to the Council. Some Council Members suggested updating the
Comprehensive Plan utilizing the existing language as the basis.
Council Member Klein did not believe the P&TC acted improperly.
Ms. Gitelman did not intend to suggest the P&TC acted improperly. The
P&TC did a great deal of work over many years in reviewing the
Comprehensive Plan language.
Council Member Klein questioned whether a problem existed for many
issues. Threshold questions were not reflected in the Staff Report. With
respect to Recommendation Number 1, he did not see evidence of a problem
or a definition of retail.
Ms. Gitelman noted the Study Session provided a handful of issues related to
retail preservation. Staff had not performed an analysis of the issue and
probably would not in the next two weeks. If the Council agreed, Staff
would prioritize an analysis and Ordinance language.
Council Member Klein indicated Staff should determine whether there was a
problem and the degree of problem, if any, before presenting an Ordinance
to the Council.
Ms. Gitelman would do so if the Council agreed it was a priority.
Council Member Klein suggested Staff utilize sales tax data to determine the
types of establishments producing an increase in sales tax. He asked if
comments regarding the County Expressway System referred to the existing
program.
Ms. Gitelman answered yes.
Council Member Klein referred to page 118 regarding potential commercial
zoning changes discussed at the Study Session. He preferred it state
suggestions by individual Council Members. Scenario 3 would place Caltrain
in a trench with a 2-percent grade south of Oregon Expressway. He did not
believe a trench could be financed or built within the timeframe of the
Comprehensive Plan and questioned the inclusion of that scenario.
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11/03/2014 116- 41
Ms. Gitelman heard the Council's interest in that project. An analysis and
dialog about operational and safety improvements could be useful. The
feasibility and timeframe could be discussed within the context of the
Comprehensive Plan Update.
Council Member Klein personally did not believe a trench was possible,
especially at a cost of $500 million.
Council Member Price felt it was appropriate to consider a trench option in
planning scenarios. Given the amount of funding and attention given to the
topic over the last five years, it would be prudent to have some discussion.
She asked if references to the Environmental Impact Report (EIR) were
really to the program EIR.
Ms. Gitelman replied yes.
Council Member Price was not familiar with a Users' Guide to a
Comprehensive Plan and requested a brief explanation or example of a
Users' Guide.
Ms. Gitelman explained that after a Comprehensive Plan was adopted, Staff
wanted to provide some type of guide or online tool to make the
Comprehensive Plan widely available and searchable.
Council Member Price felt that would be useful. She inquired whether Staff
was requesting guidance on the direction of the recommendations. It would
be irrational to assume the items could be performed quickly. They would
be part of the ongoing discussion with the community to determine the
implications of various planning scenarios and to define issues and
programs.
Ms. Gitelman remarked that all of the ideas were complex and would require
a great deal of work.
Council Member Price asked if Council Members should comment regarding
issues to be addressed concurrent with the Comprehensive Plan.
Mr. Keene suggested Council Members comment at the current time to help
inform the discussion on November 17.
Council Member Price expressed concern regarding modifying the Floor Area
Ratio (FAR) contained in the hotel overlay and in Community Commercial (2)
(CC(2)) zoning along California Avenue.
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11/03/2014 116- 42
Reducing the FAR could be problematic from an economic development
standpoint. She inquired whether the proposed outreach budget included
additional outreach efforts outlined in the Staff Report.
Ms. Gitelman reported PlaceWorks would perform the majority of the
outreach related to the Comprehensive Plan. If the Council approved the
contract with Flint Strategies, Flint Strategies would handle other Our Palo
Alto events and activities.
Council Member Price asked if the proposed budget would cover the
additional outreach.
Ms. Gitelman felt the six recommendations could be accomplished within the
scope and budget allocated for the Comprehensive Plan Update. If more
items were added or the timeframe extended, Staff would need to
reevaluate the budget.
Council Member Burt explained that two questions could result from the
Council wishing to substantially change the pace of development prior to the
completion of the Comprehensive Plan and Zoning Ordinance updates. The
first question was which changes to density and use listed in Attachment A
could be implemented without triggering the need for a new EIR. The
second question was could a growth management program be implemented
on an interim basis while completing the Comprehensive Plan and zoning
updates.
Ms. Gitelman wanted to consult with the City Attorney and respond to the
second question on November 17. An interim Ordinance would require Staff
to make particular findings. With respect to the first question, any one
change probably would not create impacts that would trigger an EIR. The
concern was whether collective changes would diminish the attractiveness of
one type of development and, therefore, stimulate another. Changes in
density could be comfortably paired with the Comprehensive Plan Update.
Council Member Burt was concerned that the Staff proposal would not go as
far as he would like in the next two years. Staff did not indicate the amount
of change or which changes could be problematic. The Council would need
some meaningful guidance as to changes that could be made without
triggering an EIR.
Ms. Gitelman provided a professional recommendation to pair the collective
group and include them in the Comprehensive Plan Update, because they
were clearly defensible and clearly provided an opportunity for community
input.
MINUTES
11/03/2014 116- 43
If the Council wanted to segregate some ideas and advance them ahead of
the Comprehensive Plan Update, Staff was open to that discussion; however,
Staff would need to review other ongoing initiatives and reprioritize them.
Council Member Burt did not believe Staff could move items through the Palo
Alto process in a timeframe Ms. Gitelman was suggesting. He failed to see a
difference between implementing zoning changes in parallel with the
Comprehensive Plan and moving some portion of changes ahead of the
Comprehensive Plan, because Staff would be performing the same amount
of work in the same two-year period.
Ms. Gitelman felt Staff could work on a subset of ideas and potentially
present an Ordinance to the Council within three or four months. The
balance of ideas would occur during the Comprehensive Plan Update
process. The majority of work on the Comprehensive Plan Update would
occur in 2015, so that the Council could adopt a Comprehensive Plan Update
and Zoning Ordinance in early 2016.
Council Member Burt was skeptical that certification of a final EIR, adoption
of the Comprehensive Plan, and implementation of a Zoning Ordinance could
be accomplished in early 2016. The City's hotel overlay and marketing
campaign had been successful; however, modifying the FAR could allow
better and more compatible designs. He inquired whether Staff assumed
costs for future grade separations would be fully funded by the City.
Ms. Gitelman had not reviewed financing. Staff offered the scenario because
it had impacts and benefits.
Council Member Burt noted other possible means to fund grade separations.
It was inappropriate to mislead the community into thinking that grade
separations would necessarily be solely or predominantly funded from local
tax dollars. He asked if only high growth scenarios within the EIR
considered grade separations.
Ms. Gitelman proposed pairing grade separations with one of the scenarios
that contained an annual cap on office and Research and Development
(R&D) growth. Scenario 2, slow growth, was paired with County Expressway
improvements. Scenario 3 was paired with Caltrain grade separation.
Scenario 4 was paired with significant investments in transit.
Council Member Burt inquired about reasons for pairing those.
Ms. Gitelman wished to define a range of simple scenarios to illuminate
policy choices. Staff could pair growth levels with transportation
investments; however, a review of those scenarios would never end.
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11/03/2014 116- 44
Council Member Burt asked if Staff assumed the need for grade separations
was driven by the pace of growth in Palo Alto.
Ms. Gitelman replied no. The Council would be able to mix and match
scenarios to illuminate policy choices. The Council would not choose one
scenario over another.
Council Member Burt noted a growing community concern about enormous
residential rent increases. He inquired whether participants at Our Palo Alto
events wanted more discussion of initiatives for renter rights.
Ms. Gitelman advised that Staff held a couple of workshops on housing
affordability where similar ideas were raised. Comprehensive Plan
workshops focused primarily on the location and amount of housing and
types of units.
Council Member Burt was interested in including residential rental rates
within community discussions without a predetermined outcome. He
requested Colleagues comment on inquiring with the Leadership Group
whether a Council liaison would be beneficial. The Council was responsible
for success of the outreach program, but had no participation in the
outreach program.
Vice Mayor Kniss recalled a Council Member was assigned to the community
group in the prior Comprehensive Plan Update. She was disappointed by the
lack of public attendance for the discussion. Obtaining and retaining retail
was an issue for most cities. She asked Staff to comment on methods to
retain areas for local-serving retail uses.
Ms. Gitelman reported local-serving retail required further definition or
discussion. She wished to confirm the Council's intent was not to change
some retail requirements in marginal areas and whether any policy changes
were necessary to achieve that goal.
Vice Mayor Kniss commented that some retail stores were very popular in
areas similar to California Avenue. The Council should discuss formula retail.
She supported the variety of restaurants located Downtown. There did not
appear to be a large number of chain restaurants in Downtown. She
inquired about Staff's interpretation of amortizing non-retail uses in
Downtown with ground-floor retail protections.
Ms. Gitelman reported amortizing non-retail uses would require a great deal
of effort; therefore, she would need more definition from the Council before
pursuing that.
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11/03/2014 116- 45
Vice Mayor Kniss did not have a good overall definition of retail uses. She
asked if Staff could provide a map of the Downtown area and a definition of
retail on November 17.
Ms. Gitelman could provide a map and a description of the Code regulation
regarding ground-floor retail uses.
Mr. Keene indicated there could be a gradation of uses that appeared to be
less retail than others.
Vice Mayor Kniss requested Staff emphasize the marginality of some retail
stores in Area A.
Council Member Holman requested the status of the California Avenue Area
Plan and asked if that could be brought forward on an interim basis in order
to protect the area.
Ms. Gitelman reported in February 2014 the Council received the P&TC's
recommended version of the California Avenue Area Plan. The original
intention was for that to be analyzed in the Comprehensive Plan EIR and
adopted when the Update was adopted. It would be distinct from a Precise
Plan for the Fry's site.
Council Member Holman indicated the Staff Report did not mention interim
actions to protect the area from piecemeal development.
Mr. Keene advised that the recommendation regarding pace of growth was
designed to deal with that. One Council Member had commented regarding
an interim acceleration of pacing of commercial development on an annual
basis. That could be a means to micro-target the California Avenue area.
Ms. Gitelman remarked that the existing Comprehensive Plan had allowed
the current rate of growth and development. The Comprehensive Plan
Update was a method to reexamine those issues and the California Avenue
area in the manner that the P&TC considered in the proposed Area Plan.
Council Member Holman felt the scenarios presented the community with
false scenarios. They appeared to be mix and match. She requested Staff's
feeling about that.
Ms. Gitelman wanted an effective means to analyze impacts of potential
policy choices and wanted to avoid analyzing the impacts of many
combinations of various choices. It was logical to group them to allow
testing and to allow the Council to choose among them. Staff's pairings
would allow the Council to do that.
MINUTES
11/03/2014 116- 46
Council Member Holman suggested beginning with a menu and developing
scenarios through a community effort. She requested Staff comment
regarding development that displaced local independent businesses.
Ms. Gitelman did not have specific information. She had heard this concern
from area merchants and patrons but had no hard data.
Council Member Holman noted the definition of retail was contained in the
City Code. She inquired whether it was possible to eliminate Conditional Use
Permits in retail areas. Conditional Use Permits often caused problems.
Ms. Gitelman would respond on November 17. Interim Ordinances had their
own set of findings and issues that Staff had to investigate.
Council Member Holman asked if non-retail uses in Downtown with ground-
floor retail protections was an issue of amortization or Code enforcement.
Ms. Gitelman was aware of few or no Code violations related to ground-floor
uses that were not retail. The issue was nonconforming uses that were in
existence before ground-floor retail controls were enacted or uses that fell
under one of the exceptions.
Mr. Keene reported Staff performed a spot check on every one of those in
the Downtown area.
Council Member Holman did not want people to be concerned regarding
regulation of chain stores and setting quotas for formula retail. The Council
did not discuss eliminating chain stores, only limiting them. She asked Staff
to clarify the definition of formula retail and chain store.
Ms. Gitelman indicated other jurisdictions had defined formula retail and set
a limit on the number of formula retail establishments allowed within a
commercial district. Staff could review precedents and best practices from
other communities and pursue those further in the next few months with
Council approval.
Mr. Keene could not imagine the City adopting a formula from another
jurisdiction. The City would develop its own formula.
Council Member Holman inquired about an interim change to prevent
conversion of basements to non-ancillary office or general office.
Ms. Gitelman could analyze whether conversions were a trend and, if so,
determine needed Code changes in the next few months.
MINUTES
11/03/2014 116- 47
Council Member Holman wished to take some broad action now and reserve
study and detailed action for a later time.
Ms. Gitelman advised that Staff had obtained a great deal of data regarding
Downtown and could accomplish a review in the next few months.
Council Member Holman asked if Staff knew of a short-term means to
address office density until the Business Registry was in effect.
Ms. Gitelman had not considered ways to address office employment
density, she understood it would be part of the Comprehensive Plan Update.
She would review whether requiring a use permit for more office uses would
accomplish the goal.
Council Member Holman requested that be moved forward. Zoning changes
that slowed the pace of development seemed to conflict with additional
incentives for small lot consolidation along El Camino Real.
Ms. Gitelman explained that the list was comprised of Council Member ideas
offered during the Study Session. They could conflict. Small lot
consolidation grew from the Housing Element discussion.
Council Member Holman stated parking exceptions were always a high
priority. The Code was clear regarding Design Enhancement Exceptions
(DEE). She did not understand why that would require revision.
Ms. Gitelman placed DEEs on the list for further discussion. The Code was
written to provide DEEs for small items rather than items requiring a
variance. She did not believe Code changes were needed.
Council Member Holman inquired whether Staff would revise specific areas of
the Code or the Code in general to increase clarity. Topics such as
mezzanine and grandfathering could be addressed in the near term.
Ms. Gitelman envisioned some revisions in the short term and concurrent
with the Comprehensive Plan Update. Staff did not have the ability to
conduct a comprehensive Code revision.
Council Member Holman recalled that Neighborhood Commercial (CN)
Zoning increased FAR from 0.9 to 1.0 if the additional 0.1 FAR was retail.
She asked if reverting to the former FAR would require a community
discussion.
Ms. Gitelman believed Staff had Council direction to review the CN Zone
along El Camino Real in the context of the Comprehensive Plan Update.
MINUTES
11/03/2014 116- 48
Council Member Holman commented that adoption of the South El Camino
Real Design Guidelines occurred in 2012 rather than 2014.
Council Member Scharff inquired whether the Council could utilize relevant
data in mixing and matching scenarios.
Ms. Gitelman responded yes. Staff attempted to prepare an analysis that
would allow the Council to mix and match elements.
Council Member Scharff was interested in having the broadest range that
provided the best data. He inquired whether grade separations could be
paired with a low-growth scenario and whether the pairings were important
as long as the data was included.
Ms. Gitelman could change the pairings. It was logical to pair the increase in
roadway capacity with a low-growth pattern.
Council Member Scharff believed good data led to better policy decisions.
He supported a broad range of choices in the EIR. He would not support
most high-growth scenarios; however, high-growth scenarios could provide
different data. He expressed some concern related to scenarios as opposed
to matrixes. He wished to obtain good data without alarming the community
regarding the different scenarios. He asked if Staff expected the Council to
approve or disapprove each item on the list.
Ms. Gitelman hoped the Council would consider Staff's recommendation and
make small modifications. If the Council chose to make major modifications,
then she hoped the Council would assist in reprioritizing other initiatives.
The Council could utilize the recommendation as a base for action.
Council Member Scharff asked if Staff expected the Council to determine
which items to work on.
Ms. Gitelman requested specific direction regarding items to prioritize ahead
of the Comprehensive Plan Update and items Staff should not consider in the
context of the Comprehensive Plan Update.
Council Member Scharff felt parking items would be fairly easy to analyze
and bring forward.
Ms. Gitelman agreed. Staff recommended proceeding with many items
listed on Packet Pages 123-124 in the soonest possible timeframe.
Council Member Scharff was not convinced good design related to FAR. He
wished to expand that conversation as to the goal the Council was
attempting to achieve.
MINUTES
11/03/2014 116- 49
He did not believe formula retail protections would preserve neighborhood-
serving retail. In order to protect neighborhood-serving retail, areas that
were marginal for retail should retain retail requirements. Zoning for more
retail and creating more retail would likely preserve neighborhood retailers.
That should be included in a discussion of formula retail. The important
points were good data, the goal, and ways to achieve the goal. The Wells
Fargo Bank Building in Downtown should change to retail. The Council
should consider Forest Avenue retail for protections. Retail should extend
from University Avenue to Forest Avenue. Through 2030, the
Comprehensive Plan should not only protect retail but also expand retail
throughout Downtown. He did not want to eliminate Conditional Use
Permits, because they provided a useful mechanism in certain
circumstances. However, Conditional Use Permits should be approved by
the Council rather than the Planning Director. The Council should carefully
consider a definition of retail and the issue it was attempting to solve. The
Council needed to be careful not to make scoping of the four scenarios a
vision for the community.
Council Member Schmid indicated the fundamental question was whether to
tweak the Comprehensive Plan or take a fresh look at it. The Council should
begin with growth, because housing, housing affordability, traffic, parking,
retail, and density locations all flowed from the rate of growth. Bounding
scenarios of growth would give the Council and public an opportunity to
participate in the process. He understood the original intent of the
Leadership Group was to help the Council engage different community
groups. Now it appeared that the Leadership Group had taken an advisory
role; however, it was not appointed to provide advice and consent.
Ms. Gitelman reported the Leadership Group was formed to assist Staff with
community engagement related to the Comprehensive Plan Update. The
Leadership Group had done that. In that context, the Leadership Group was
helpful to Staff in understanding how various paths would or would not
attract engagement and participation.
Council Member Schmid wished to clearly distinguish that stakeholder
groups focused on particular community stakeholders and did not represent
the public.
Ms. Gitelman did not understand the distinction. Staff solicited applications
from the community and appointed members skilled in reaching a broad
audience.
MINUTES
11/03/2014 116- 50
Council Member Schmid requested Staff circulate a list of the members of
the Leadership Group and their affiliations. One element missing in the
community discussion was the financial side. He was surprised that financial
issues were not central to the discussion.
Ms. Gitelman explained that the EIR and planning process had not been
scoped to include fiscal issues. Fiscal issues were not typically analyzed in
an environmental document or the Comprehensive Plan itself. If the Council
wished to review fiscal issues, then Staff would need additional expertise to
perform fiscal analysis later in the planning process.
Council Member Schmid would favor that. Important decisions about who
paid and who benefited were made along every step of the way.
Mayor Shepherd noted California Avenue merchants had organized regarding
formula retail, and requested an update on that.
Ms. Gitelman advised that some California Avenue merchants and patrons
were interested in limiting formula retail. That was one of the reasons Staff
placed formula retail on the list to examine in the first few months of the
year.
Mayor Shepherd believed California Avenue merchants formed a broad
stakeholder group that could be incorporated into the outreach process. The
Council needed a definition of retail. She inquired about possible actions to
resolve issues with the grant for the Fry's site.
Ms. Gitelman advised that the City did receive a grant for planning related to
the Fry's site; however, funds would not be released until July 2015. The
Council could discuss whether to wait for release of grant funds or to seek
other funding sources early in 2015 when Staff presented the scope of work
and grant agreement.
Mayor Shepherd requested Staff attempt to advance that discussion. She
also wanted to understand the impacts of the North County Courthouse not
functioning as a courthouse.
Molly Stump, City Attorney, understood there had been some changes in the
Superior Court's operations; however, the location continued to function as a
courthouse. She would obtain updated information.
Mayor Shepherd wanted to receive an update regarding the entire California
Avenue area if changes in activity occurred there.
MINUTES
11/03/2014 116- 51
Stephanie Munoz was surprised to discover the shuttle was a full-fledged
transportation system. Transportation systems and density were symbiotic.
People would be angry and disappointed if commercial development had to
be permitted in order to pay for a transportation system. To obtain
community support, the Council should oppose the extension of High Speed
Rail from San Jose to San Francisco.
Sea Reddy questioned whether the Council knew what the community
wanted. The Comprehensive Plan needed to be updated more often than
every 20 years. The Council could provide incentives for people to provide
input. The Council should understand what the community wanted and
implement that.
Ellen Forbes, League of Women Voters President, supported the Council's
efforts to align the Comprehensive Plan with current civic priorities. She
requested the Council work effectively to complete the Comprehensive Plan
without undue delay.
Herb Borock indicated the community was divided with respect to whether
development had implemented or ignored the Comprehensive Plan. He read
the definition of retail services from the Zoning Code.
Vice Mayor Kniss asked if there was a date on the definition of retail
services.
Mr. Borock advised that the definition was currently effective.
Vice Mayor Kniss inquired about the date the section was written and made
law.
Mr. Borock stated the printed version of the Zoning Code indicated the last
Ordinance update was Number 5059 in 2009.
Mayor Shepherd inquired whether Staff had sufficient information to prepare
for the November 17, 2014 meeting. The Council did not discuss in-depth
items B, C, D. and E, except for the concept of a matrix rather than
scenarios.
Ms. Gitelman wanted to assimilate Council Member comments and discuss
them with the City Manager and City Attorney. Staff would respond to
questions they were not able to answer and return with the six-part Motion
adjusted to reflect Council comments.
Mayor Shepherd asked if Staff would seek additional direction or definitive
action at the November 17 meeting.
MINUTES
11/03/2014 116- 52
Ms. Gitelman requested direction on next steps related to the
Comprehensive Plan Update and zoning changes before and during the
Comprehensive Plan Update.
Council Member Holman would not be available on November 17 and hoped
Staff would want full Council attendance to address the item.
Mr. Keene reported attendance would be a matter for the Council to decide.
Mayor Shepherd was not aware that Council Member Holman would not be
present on November 17.
Council Member Holman made other plans prior to learning of the November
17 discussion.
Mayor Shepherd noted Council Agendas were full through the end of 2014.
Vice Mayor Kniss preferred to have all Council Members in attendance for the
November 17 discussion.
Mayor Shepherd also wanted full attendance; however, Agendas were full.
She would attempt to reschedule the item from November 17.
Mr. Keene would know within the week whether the item could be continued
from November 17.
MOTION: Council Member Scharff moved, seconded by Council Member
Klein to move Agenda Item 14 forward to hear it before Agenda Item
Numbers 12 and 13.
MOTION PASSED: 9-0
14. Review and Approval of a Letter from the City of Palo Alto to the
Environmental Protection Agency (EPA) on the Proposed Rule Change
to Waters Protected Under the Clean Water Act.
Mayor Shepherd advised that the Environmental Protection Agency (EPA)
and U.S. Army Corps of Engineers had published a rule change which
redefined the scope of waters protected under the Clean Water Act. Staff
recommended the City send a comment letter in response to the rule
change. Comments were due November 14, 2014.
Richard Hackmann, Management Analyst, reported the City was concerned
with the impacts resulting from implementation of the rule change. Wording
of the rule change would create less certainty. Staff did not recommend the
City oppose improvements made to the Clean Water Act.
MINUTES
11/03/2014 116- 53
Staff recommended the letter request the EPA reinitiate the rule change
process in order to engage impacted stakeholders in the process.
MOTION: Vice Mayor Kniss moved, seconded by Council Member Price to
approve the draft letter from the City of Palo Alto to the Environmental
Protection Agency on a proposed rule change defining the scope of waters
protected under the Clean Water Act.
Mr. Hackmann indicated Mr. Materman of the San Francisquito Creek Joint
Powers Authority recommended a change in language regarding the flood
plain.
INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE
MAKER AND SECONDER to change the wording in the first sentence under
Flood Protection and Floodplain Management from “Palo Alto lies within a 50-
square mile floodplain” to “Palo Alto lies within a substantial floodplain”.
INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE
MAKER AND SECONDER to correct the number of residents to the current
value.
Council Member Klein was not aware of any city that did not share the City's
views as expressed in the letter.
MOTION AS AMENDED PASSED: 9-0
12. Finance Committee Recommends Proposed Changes in Development
Impact Fees: Direction to Draft Ordinance Implementing New Public
Safety Facility and General Government Facilities Impact Fees.
Lalo Perez, Administrative Services Director, recalled in March 2014 Staff
presented a list of projects that justified implementation of a Public Safety
Facility fee and a General Government Facilities fee. Staff presented a
nexus study to the Finance Committee in May 2014 and recommended
setting fees at 75 percent of the maximum level. At-places was a
memorandum regarding the setting of fees. Because the Finance Committee
voted 3 to 1 in support of the recommendation, the item was placed on the
Agenda as an Action Item. The Finance Committee expressed concerns
regarding the residential fee being unfairly high. Although fees were split
approximately 60/40 between residential and non-residential uses, the fee
based on per person served was closer to a 50/50 split. Table 19
summarized projected income from new fees, which also demonstrated a
more equal distribution of fees between residential and non-residential uses.
MINUTES
11/03/2014 116- 54
One challenge was the lack of data regarding number of employees;
however, Staff hoped the Business Registry would provide better data. The
Finance Committee was also concerned about the category breakdown.
Existing fees included a category that was different from the categories
proposed for the new fees. Categories for existing fees were implemented
more than ten years ago. Since that time, categories were standardized and
Staff proposed use of the standardized categories. Categories for existing
fees could not be changed to standardized categories unless the fee itself
was changed. Should the Council approve the new fees, Staff would return
with an Ordinance authorizing the new fees and a Resolution setting the
fees. Fees would be effective 60 days after adoption of the Ordinance and
would apply to new developments that had not received building permits
prior to the expiration of the 60-day period.
Council Member Berman reported the Finance Committee's discussion
primarily concerned the number of jobs in Palo Alto and the ratio of fees
charged to residential and non-residential uses. He inquired whether Staff
received new information to determine the ratio was 49 percent for
residential uses and 51 percent for non-residential uses.
Mr. Perez clarified that Staff's presentation to the Finance Committee did not
sufficiently explain the ratio.
Council Member Berman noted the Finance Committee voted 3 to 1 in favor
of the Staff recommendation.
Mayor Shepherd requested additional comment concerning the Finance
Committee's discussion of a 60/40 fee split.
Council Member Berman recommended Members of the Finance Committee
share the concerns they raised at the meeting. He requested Staff explain
changes that resulted in the 60/40 split shifting to a 49/51 split.
Mr. Perez explained that the proposed residential fees and non-residential
fees as stated in Table 20 resulted in the 60/40 split discussed at the
Finance Committee meeting. Calculating the fee per person served resulted
in the 49/51 split. The Finance Committee wanted a 50/50 split; however,
the consultant expressed concerns about that.
Council Member Berman added that the City could not choose a ratio and
make the fee fit that ratio.
Mr. Perez indicated Staff did not have good data regarding the number of
employees. The Finance Committee discussed delaying the new fees until
good data was available.
MINUTES
11/03/2014 116- 55
Council Member Berman remarked that the per person served calculation
provided a different analysis of the ratio.
Mr. Perez advised that the projected revenue from the two new fees would
be split approximately 50/50 between residential and non-residential uses.
Council Member Berman suggested the fees could be adjusted once reliable
data was obtained through the Business Registry.
Mr. Perez indicated an adjustment of the fees would require a new nexus
study utilizing new data. The Finance Committee discussed the multiple
sources of job and employee numbers.
James Keene, City Manager, reported the City had an established body of
work and tried and true methodologies. The recommendation was to impose
the fees and to begin collecting revenue. He wanted to obtain the highest
accuracy possible; however, that would be achieved in the future. Staff was
committed to a possible adjustment of the fees.
Council Member Klein inquired about the time period for collecting the
$35.64 million dollars stated in Table 19.
Mr. Perez responded through 2035.
Council Member Klein stated Table 19 indicated collections of $22.5 million,
approximately half the estimated cost of a new Public Safety Building. He
asked about the accounting procedure for collecting fees after construction
of the building.
Mr. Perez advised that the Council could adjust the fee downward so that net
expenses matched fees collected or allow the fee to continue at the same
level.
Council Member Klein offered a hypothetical scenario of constructing a Public
Safety Building in the next 12-18 months through other funding sources. He
asked what would happen with the fee for the following 20 years.
Mr. Perez explained that identified revenue must be reduced from the
amount of the expense. The Council would have to reset the fee to the net
amount that was unfunded.
Mr. Keene inquired whether future fees could repay an expense paid from
other sources.
MINUTES
11/03/2014 116- 56
Nathan Perez, Vice President of David Taussig and Associates, clarified that
fees could repay debt service or fund other public safety capital facilities with
a useful life of more than five years.
Council Member Klein requested Mr. Perez assume there were no other
facilities.
Mr. N. Perez reported that the Government Code required the City to credit
fees if there were no other capital needs on which to spend the fee in five
years.
Council Member Klein asked if the City could borrow against the fee.
Mr. N. Perez replied yes.
Mr. Perez clarified that the challenge in borrowing against the fee was
predictability of the fee revenue for a credit rating.
Council Member Klein believed the City would have to identify other public
safety capital needs in order to utilize the fee. The fee would not have an
impact on the Public Safety Building if it was constructed in the next year or
two.
Mr. Perez commented that only 15 percent of the cost could be allocated to a
development impact fee. Variables of cost and time would require Staff to
revisit the whole process.
Council Member Klein calculated the fee could contribute $7.5 million
towards the $50 million cost of a Public Safety Building.
Nancy Nagel, Senior Management Analyst agreed that $7.5 million would be
the maximum amount projected from collection of the fee over 20 years.
Mr. N. Perez suggested the amount would be $8 million, because collection
was a product of the pace of development in Palo Alto. If the Public Safety
Building was constructed at a lower cost than estimated, then the nexus
study would be incorrect. He vetted the cost of the needs list with Staff who
typically provided conservative cost amounts.
Council Member Schmid was interested in equivalent dwelling units. Table
19 indicated the amount was split roughly 50/50, because non-residential
uses were growing twice as fast as residential uses. Therefore, non-
residential uses were in essence paying half the amount of residential. The
Fire Study and Police Blotter seemed to imply that public safety was
spending roughly half their time on the daytime population.
MINUTES
11/03/2014 116- 57
He questioned the need for residents to pay twice as much as visitors when
visitors consumed more City services.
Mr. Keene clarified that the City was collecting a fee for capital facilities
rather than operating costs. The volume of calls for service did not directly
correlate with the need to invest in facilities. The Council could not utilize
service calls to determine who benefited from City services.
Mr. N. Perez added that there was a tension between relative fee levels and
absolute fee amounts. If the amount collected from fees was approximately
50/50, then the tension became more balanced.
Council Member Schmid was concerned that the resident equivalent paid
twice as much as a business equivalent.
Ms. Nagel explained that the non-residential fee was calculated per 1,000
square feet. Residential fees were calculated per unit or home or multiple
family unit. Those two calculations were not the same, because 1,000
square feet assumed a certain number of employees. A single family home
was assumed to house 2.7 people. A single family home would pay $4,500
for both fees at the maximum level. A commercial space would pay only
$2,500, but paid for only 1.5 people.
Council Member Schmid noted 1,000 square feet was assumed to hold 4
people for a commercial space.
Mr. N. Perez reported the term equivalent dwelling unit did not necessarily
mean 1,000 residential square feet equaled a dwelling unit. It was a method
to standardize measurements for purposes of allocations within the
residential categories.
Council Member Schmid expressed concern that assumptions utilized in
developing standards did not match the characteristics of Palo Alto. He
asked if the statement on Packet Page 474 regarding the affordable housing
fee not being charged to office was true.
Mr. N. Perez advised that according to Municipal Code Section 16.47 it was
not charged to office.
Council Member Schmid remarked that office would account for twice the
number of people added to the daytime population, yet it did not pay a
housing fee. The report indicated a review of housing fees was not
performed, because it was covered in the Housing Element. The Housing
Element did not currently contain a housing fee. He asked why a nexus
study for housing was not performed.
MINUTES
11/03/2014 116- 58
Mr. Perez indicated a housing study was not performed, because it was a
different fee. Each impact fee was required to have its own nexus and
review. The housing fee would be presented to the Council separately with
its own nexus study.
Mr. N. Perez added that housing nexus studies were under litigation at every
level of California courts.
Molly Stump, City Attorney, reported a housing nexus study was under way.
The study would review both residential and non-residential fees.
Council Member Schmid felt the Council continued to make decisions
regarding development impact fees without data. A preliminary review of
transportation indicated fees were adequate. He requested the basis for
stating transportation fees were adequate.
Mayor Shepherd noted the Agenda Item concerned only the Public Safety
Facility fee and the General Government Facilities fee.
Council Member Schmid believed the Council was being asked to approve
the matrix.
Mr. Perez clarified that Staff did not recommend changes or seek action
regarding any fees other than the Public Safety Facility and General
Government Facilities fees.
Council Member Schmid asked if it was appropriate to state other fees did
not need review.
Mayor Shepherd stated that was not a part of the Agenda Item. Other fees
would be presented to the Council in the future.
Council Member Schmid asked why they were mentioned in the Staff Report.
Mayor Shepherd explained that Staff utilized data approved by the Council
earlier in the year.
Mr. Perez clarified that in the past the Council had requested a cumulative
total of impact fees to determine whether a fee of 75 percent of the
maximum amount allowed was appropriate. Staff did not make a
recommendation for those fees.
Council Member Schmid inferred the study made a discretionary decision
when it stated a preliminary review indicated fees were adequate for parks,
housing, and transportation. He inquired whether the study did not make a
discretionary decision.
MINUTES
11/03/2014 116- 59
Mr. Perez reiterated that a housing study would be presented separately.
Council Member Schmid inquired about a transportation study.
Mr. Keene presumed fees were not adequate for transportation, but could
provide a separate update on transportation in the future. Staff wanted to
add two fees to every development project and begin collecting funds. As
Staff obtained refined data, they would revisit the fees and adjust them.
Council Member Schmid asked if a vote supporting the item would endorse
the statement that a preliminary review indicated other fees were adequate.
Mr. Perez was not recommending any changes to those fees.
Mr. Keene advised that approval of the item would not be an endorsement of
the statement.
Mr. Perez reported the Council in March 2014 reviewed fees in conjunction
with a list of needs. For example, the Council discussed changing the parks
fee; however, the cost of projects on the needs list was not high enough to
justify changing the fee.
Council Member Schmid remarked that the March Council discussion was the
preliminary review.
Council Member Scharff reviewed the Council process for placing Committee
recommendations on the Consent Calendar or as an Action Item. The Staff
recommendation was for Council review and approval of the recommended
new Public Safety Facility fee and the General Government Facilities fee.
That was not the question or the Motion before the Finance Committee.
Staff should be requesting the Council to review the report and provide
input. He inquired whether the Council was to approve the report or the
fees.
Ms. Stump reported Council acceptance or approval of the report was
irrelevant. If the Council wished to implement the fees, then it needed to
direct Staff to return with an Ordinance to establish the fees. The Finance
Committee sought direction to draft an Ordinance.
Council Member Scharff asked if Staff or the Finance Committee sought that
direction.
Ms. Stump corrected her statement to Finance Staff rather than Finance
Committee.
MINUTES
11/03/2014 116- 60
Council Member Scharff understood capital projects with identified sources of
revenue could not be considered in a nexus study.
Mr. Perez concurred.
Council Member Scharff stated the Council had identified sources of revenue
for the Public Safety Building, Fire Station Number 3, and Fire Station
Number 4. He did not understand how the nexus study could be accurate if
the City had identified sources of revenue.
Mr. Perez reported the Council could direct Staff to remove any project for
which it believed revenues were guaranteed. Staff did not wish to make that
assumption.
Council Member Scharff asked if the Council discussed that.
Mr. Perez answered yes, and Staff understood the Council was in the process
of drafting a funding plan. The question was whether that funding plan
would materialize. The Transient Occupancy Tax (TOT) measure probably
would be approved by the voters; however, a recession could significantly
reduce that funding source. Staff would remove any project as directed by
the Council and return with an Ordinance containing an adjusted fee.
Mr. N. Perez explained that some of the information regarding the Public
Safety Building was less guaranteed or more speculative at the time he
drafted the needs list in 2013.
Council Member Scharff asked if Mr. Perez drafted the needs list prior to the
Council identifying funds for the Public Safety Building.
Mr. N. Perez developed the needs list in 2013. In 2013 he and Staff
collected data regarding facilities and cost estimates.
Mayor Shepherd understood impact fees were utilized to support facilities
that would be used more because of an increase in population. She
expected facilities to be built and a fee collected because additional people
caused more wear and tear on facilities. She asked how that was factored
into a fee. The capital improvement would begin to fail at some point.
Mr. N. Perez indicated impact fees could be utilized to replace and modernize
facilities or to purchase furniture, fixtures, and equipment (FFE), but not to
operate and maintain facilities.
Mayor Shepherd commented that fees would be used for those types of
things going forward.
MINUTES
11/03/2014 116- 61
Mr. N. Perez advised that impact fees became less and less of a tool as the
City became built out and the allocation to new development dwindled.
Mayor Shepherd remarked that placing restrictions on commercial space
could result in collecting even fewer fees.
Stephanie Munoz felt the presentation assumed some issues not in evidence.
A Public Safety Building would always be a problem, because the
communications center was inadequate with respect to earthquake safety.
Much of that had been taken care of through the mobile unit.
Council Member Holman referred to the two charts on Packet Page 418
regarding office fees and retail/industrial fees and the at-places
memorandum regarding commercial and office/institutional and industrial.
She asked what was commercial and where was retail.
Mr. N. Perez reported retail was commercial.
Council Member Holman inquired about reasons for retail paying more than
office/institutional when retail had fewer employees per 1,000 square feet
than general office. The City utilized and considered an outdated measure of
4 employees per 1,000 square feet. The report utilized 1.5 persons served
per 1,000 square feet for commercial, 1.25 persons served per 1,000 square
feet for general office, and 0.5 person served per 1,000 square feet for
industrial. She did not believe that could be supported.
Mr. N. Perez indicated multiplying those by 2 would result in 3 employees for
retail, 2.5 employees for office, and 1 employee for industrial.
Council Member Holman asked why retail would have more than office.
Mr. N. Perez explained that typically retail served more people than office.
Council Member Holman believed that was not the case in Palo Alto. She
asked if he used generalized numbers. Utilizing one number to calculate
parking demand and a totally different number to calculate the fees did not
make sense.
Mr. N. Perez had not seen the parking figures.
Council Member Holman stated it was a basic aspect of the City's Municipal
Code. To a skeptical person, the report appeared to manipulate the
numbers of persons served per 1,000 square feet to justify an even number
across the different sectors. She referred to the Minutes found on Packet
Page 464 regarding Palo Alto being relatively lower compared to peer
communities on the non-residential side.
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11/03/2014 116- 62
She stated that Council Member Schmid had asked if approving the fees
would also accept the fee rates in the tables. The Council should not accept
the other fees.
Mr. Keene asked if the Council was approving the other fees.
Mr. N. Perez answered no. Staff recommended adding the Public Safety
Facility and General Government Facilities fees to the list of fees.
Council Member Holman wished to ensure the Council was not accepting the
other fees.
Mr. Keene reported a Motion would not have the Council accept or
acknowledge existing fees. When the Council took a specific action on a
specific Motion, that action did not automatically readopt or acknowledge
every item in the Staff Report.
Council Member Holman asked about a means to arrive at some number that
was logical, defensible, and fair.
Mr. Keene indicated Staff and the consultant were clear that the existing
data and its alignment with the practice of setting fees supported the
recommendation. Staff acknowledged the potential to obtain refined data
that could support different conclusions in a year or two. Council Member
Scharff's point was slightly different and pertained to the amount of yield the
City could achieve over a 20-year period. The total amount of $96 million
included many projects on which fees could be collected for two years. After
two years, Staff could determine the nexus study was incorrect and
recommend adjusting the fee. Staff did not have a confident answer for
providing data methodology to support a significantly different conclusion.
The Council should proceed with the basic methodology for now or not
proceed.
Mayor Shepherd noted the City was not collecting the fee currently, and the
Council was not reviewing the methodology for collecting the fee. The
Council was directing Staff to draft an Ordinance. She asked if Council
Member Holman was concerned about the methodology. The breakdown
between residential and commercial was one element of that. She asked if
Council Member Holman was concerned about the calculation of the fee.
Council Member Holman was concerned about both aspects. She did not
wish to do nothing, but was having difficulty determining what to do.
Mayor Shepherd added that Staff would return with an Ordinance for Council
review.
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Council Member Holman stated without some kind of clarity regarding what
the Council expected Staff to provide, the current discussion was pointless.
Council Member Burt concurred with a need for clarification. He inquired
whether fees were calculated based upon facility needs and revenue sources.
Mr. Perez answered yes.
Council Member Burt advised that infrastructure planning and the impact
fees were developed in parallel over the past year and a half. The two were
not reconciled in the late spring or early summer of 2014. When the Finance
Committee discussed the item, the Council had not allocated revenue
sources for public facility needs. Staff should recalculate the basis in facility
needs after the election.
Mr. N. Perez commented that amounts always changed.
Council Member Burt clarified that amounts did not change to such a great
extent. From the $96 million listed for public safety facilities, $57 million for
the Public Safety Building should be removed.
Mr. N. Perez asked if the amount was 100 percent non-speculative.
Mr. Keene felt Staff should return with the item. The Infrastructure Funding
Plan occurred subsequent to development of the fees. The Public Safety
Building could cost more than estimated. The Council did not fund all items
on the infrastructure projects list; therefore, the fee revenues could be
reallocated to other projects.
Council Member Burt added that the Council could decide to fund 85 percent
of the Public Safety Building with funds previously identified. Based upon
existing policy direction, the Public Safety Building and Fire Station Number
3 did not belong on the list of needs. That alone was sufficient reason to
return the item for redirection. He inquired about the source for 1.25
persons served per 1,000 square feet contained in Table 20.
Mr. N. Perez advised that it was a standard California metric.
Council Member Burt noted the City's Zoning Code used a standard of 4
people per 1,000 square feet. The Council had discussed whether that
number was too low. The difference was not a nominal amount, and
ensuing calculations flowed from that number.
Mr. N. Perez explained that 2.5 was the number of employees per 1,000
square feet. The 1.25 was the number of persons served per 1,000 square
feet.
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Council Member Burt inquired whether Mr. Perez was discounting the
number by 50 percent.
Mr. N. Perez responded yes, because an employee was weighted as 50
percent of a resident.
Council Member Burt believed the Council wanted to return both items for
recalculation based upon office density. A second issue was public safety
needs that lacked a revenue source.
Mr. Keene felt comfortable with reviewing public safety facilities to
determine the amount of funding that could be set aside for collecting a fee.
The distribution of that fee would be affected by other changes. Staff could
review one component of the non-residential office piece in a short period,
but not necessarily the whole range of issues related to residential versus
non-residential. Staff would review the general Infrastructure Funding Plan
in relation to the fee.
Council Member Burt asked if the item would return to the Council or the
Finance Committee.
Mr. Keene indicated that would be the Council's discretion.
MOTION: Council Member Burt moved, seconded by Council Member
Berman to return to Finance Committee for review of both the appropriate
non-residential densities and corresponding calculations and review public
safety needs that do not have identified revenue sources.
Council Member Berman believed additional information had created more
questions to which the Council needed answers. The Finance Committee
considered fees on May 6, 2014. The Infrastructure Committee developed
the Infrastructure Funding Plan in early August 2014. A great deal had
changed since then. The Council needed a better understanding of numbers
in Tables 19 and 20.
Council Member Klein chastised Staff and the Finance Committee for their
poor review of the issues. The amount of fees collected over a short period
of time was not significant in comparison to a $57 million Public Safety
Building. Staff's reasons for delaying the item were not defensible. He
requested the City Attorney provide a definition of "without an identified
revenue source." The Council could consider creating a gap that could be
filled by the fee. The Council had not made legal promises regarding funding
of the fire station needs. The City would depend on the consultant's
expertise in a lawsuit; therefore, the Council had to rely on his methodology
or reject the fees.
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Council Member Holman inquired about the timing of returning the item to
the Finance Committee and then the Council.
Mr. Perez would attempt to present it at the December 16 meeting.
Mr. Keene could not make a commitment with respect to a timeline.
Vice Mayor Kniss stated the item should not have been presented to the
Council. She wanted the item to return quickly to prevent continued loss of
revenue and requested the item be presented to the Finance Committee at
its next meeting.
Mayor Shepherd noted $22,000 of the fees collected through 2023 could
support public safety needs. She wanted to understand if the Infrastructure
Funding Plan included revenues from the fees.
Mr. Keene would present the item as soon as possible. Staff could respond
to the Infrastructure Funding Plan component of the Motion more easily than
the methodological component. Staff would consider bifurcating the two
components.
MOTION PASSED: 9-0
13. Approval of Fiscal Year 2014 Reappropriation Requests for the
Municipal Services Center to be Carried Forward Into Fiscal Year 2015.
James Keene, City Manager, recommended the Council reject the
reappropriation requests and allow funding to return to the Infrastructure
Reserve. In the 2016 Budget, the Council could discuss the scope of the
project and appropriate funds.
MOTION: Council Member Scharff moved, seconded by Council Member
Holman to remove this from the reappropriations and bring it back by the
2016 budget.
Council Member Berman felt the City was overdue for a study of the
Municipal Services Center. The item did not pertain to or endanger the
Animal Services Center.
Mr. Keene clarified that Staff could return with a Budget Amendment in
Fiscal Year 2015 as an appropriation from the Infrastructure Reserve if the
Council wished.
MOTION PASSED: 9-0
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COUNCIL MEMBER QUESTIONS, COMMENTS AND ANNOUNCEMENTS
Mayor Shepherd provided copies of the Resolution regarding people
trafficking to the Police Chief and City Attorney for review.
Council Member Holman reported the Architecture Review Committee for the
Pedestrian Bicycle Bridge received 20 proposals and selected three. The
selection exercise was impressive.
Mayor Shepherd advised that Mr. Eggleston was timing the launch of the
Pedestrian Bicycle Bridge project to coincide with completion of the
Environmental Impact Report (EIR) process.
Council Member Holman added that project architects were receiving only
stipends for their expenses.
Council Member Price indicated the EIR for the El Camino Real Bus Rapid
Transit had been distributed. Public meetings were scheduled for November
20, 2014 at 8:30 A.M. and 5:30 P.M. Comments were due December 15,
2014. With respect to a potential bond measure in 2014, a process was
established based on the existing committee structure at the Santa Clara
Valley Transportation Authority (VTA). VTA Directors felt the process was
not sufficiently representative and expressed those comments at a
workshop. Subsequently Envisioning Silicon Valley initiated a new process
for a measure in 2016. Within a potential 2014 measure, funds were largely
allocated for freeway grade separations. A few people addressed the need
for additional funds for Caltrain grade separations with Mr. Guardino, and
the conversation continued.
Mayor Shepherd announced a joint Study Session with VTA regarding Bus
Rapid Transit was scheduled for November 17, 2014.
Council Member Schmid advised that a Santa Clara Valley Water District
Commission discussion of the drought raised the issue of the Plan Bay Area
forecast for 2 million new residents in the Bay Area over the next 30 years.
The Commissioner reported the Association of Bay Area Governments
(ABAG) invited a representative to participate in the updated forecast.
Council Member Burt requested Staff clarify the scope of the VTA Bus Rapid
Transit EIR as it affected the segment of El Camino Real within Palo Alto
prior to the Study Session. The VTA notice was ambiguous as to whether
the EIR included lane dedications in Palo Alto.
Mayor Shepherd indicated the EIR provided four different scenarios for Palo
Alto and one scenario included a dedicated lane.
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11/03/2014 116- 67
James Keene, City Manager, would provide that information prior to the
meeting.
ADJOURNMENT: The meeting was adjourned at 11:31 P.M.
ATTEST: APPROVED:
City Clerk Mayor
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