HomeMy WebLinkAbout2018-01-29 City Council Summary Minutes CITY OF PALO ALTO CITY COUNCIL
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Special Meeting
January 29, 2018
The City Council of the City of Palo Alto met on this date in the Council
Chambers at 6:04 P.M.
Present: DuBois, Filseth, Fine, Holman, Kniss, Kou, Scharff, Tanaka, Wolbach
Absent:
Special Orders of the Day
1. Introduction of Mayor Helena Balthammar of Linköping, Sweden and
the Linköping Delegation.
Mayor Kniss: We are in the middle of a wonderful visit from Linköping,
Sweden, one of our Sister Cities. We have been really enjoying them for
more than a day now. I know that they have had a wonderful opportunity to
spend time in our City today and out at Stanford and up at Foothill Park. Let
me ask Mayor Helena Balthammar of Linköping, Sweden—I know the
Linköping delegation has actually gone out to eat. We welcome you. Would
you like to come up to the mic and say a few words of welcome that will go
out over the air? Now, you're being recorded and taped. Thank you for
being here. Hi, Helena. Go right ahead, start in.
Helena Balthammar: Thank you for having me here and also the Linköping
delegation. Mayor Liz Kniss, Vice Mayor Eric Filseth, and members of Palo
Alto City Council, and ladies and gentlemen, it's an honor and pleasure, of
course, to be standing here beside you. Our Sister City relationship between
Palo Alto and Linköping started 30 years ago. As the Mayor of Linköping
City, Helena Balthammar is my name. I'm the chairman or chairwoman in
the Council of Linköping. We are celebrating our 30th anniversary, which all
started with a collaboration between Linköping University and Stanford
University. I would like to say a special thank you also to the Neighbors
Abroad, which has contributed to the Sister City relationship during these 30
years. The Sister City relationship has grown and developed quite a lot,
during the last couple of years especially. We've built a platform of strength
in the cooperation, and it's now time for us to draw up the long-term plan of
action to further enhance the cooperation between our cities. There will be
different representatives from different sectors, such as students, teachers,
lecturers, business partners, official (inaudible) and elected politicians,
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involved in the cooperation between our cities also in the future. As we
know, cities around the world face many challenges. Those whose job is to
meet and deal with these challenges often find themselves having a close
choice between meeting the present-day needs of inhabitants or looking
forward to the future and trying to decide which options are the best for the
city and for the citizens. Linköping is, of course, no exception. Over the
years, we who work in the service of the city have realized we cannot do it
all alone, so we've evolved over time a close relationship between the
business community and the university aimed at advancing and promoting
our city. Visiting Palo Alto during this week are not only representatives
from the City administration but also people that work in companies involved
with cutting-edge solutions to (inaudible) those situations. These people like
pushing the boundaries of knowledge and look for like-minded companies to
share and exchange knowledge. For us, Palo Alto characterizes cutting-edge technology and innovative solutions. I think we can learn a lot from each
other. There are other, of course, interests from my perspective. Both
cities, Palo Alto and Linköping, face the big issues of the climate and social
change, how to expand, grow, and prosper and develop wealth whilst at the
same time focus on sustainability. For example, without a reliable
(inaudible) energy, our societies will shrivel and die but how to meet these
energy needs without harming the planet. In Linköping, the City Council has
decided that Linköping will be carbon-neutral by 2025. Of course, there are
many activities ongoing in Linköping, and hopefully we will be able to
accomplish this goal. One of the contributions to reach this goal is also
cooperation between Sister Cities. We think we can share and also learn
from each other, of course. Another interesting area that we would like to
collaborate from is the Business, Entrepreneurship and Math (BEAM) project.
As I understand, it stands for Business, Entrepreneurship, and Math, which
you're exploring here in Palo Alto. We're very interested in encouraging
entrepreneurship and bringing together business and students to push
boundaries and find new sustainable solutions and make easier life for
citizens. BEAM creates a public-private partnership by providing high school
students practical projects and internships. Early today, some of my colleagues were visiting Gunn High School to hear more about the BEAM
project. They were really impressed, of course, by this initiative that you've
made here. As I understand, the BEAM family has grown and includes some
of your Sister Cities, Heidelberg, Enschede, and Oaxaca. It's a fantastic
(inaudible) by Gunn High School. Of course, I will also try to be (inaudible) High School when I'm here in Palo Alto. I'm also very pleased during this
visit to talk more about the long-term plan between our cities and the action
plan that we can do together. This is my first trip to Palo Alto, but I'm sure
that this will not be the last one. What I've learned about Palo Alto so far
and what I've seen, I've seen great similarities between our cities. One
thing is very obvious. Palo Alto and Linköping, both cities, are very
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innovative and forward-thinking and keen to go beyond the expected. As a
Mayor of Linköping, I extend a warm invitation to all of you and to the City
of Palo Alto to visit our city in Sweden. Thank you for your time, and thank
you also for your hospitality during our stay here in Palo Alto. Thank you.
Closed Session
2. CONFERENCE WITH CITY ATTORNEY-EXISTING LITIGATION
Santa Clara County Superior Court, Case No. 17CV309030
Subject: John Tze and Edgewood SC LLC v. City of Palo Alto, et al.
Authority: Government Code Section 54956.9(d)(1)
Vice Mayor Filseth: With that, I'm going to move that we go into Closed
Session.
Council Member Wolbach: Second.
Vice Mayor Filseth: The subject is a conference with City Attorney on
existing litigation, Santa Clara County Superior Court Case Number
17CV309030, subject John Tze and Edgewood SC LLC versus City of Palo
Alto, et al., pursuant to Government Code Section 54956.9(d)(1).
MOTION: Council Member KOU moved, seconded by Council Member
Wolbach to go into Closed Session.
Vice Mayor Filseth: All in favor. Motion passed with Council Member
Holman not present.
MOTION PASSED: 8-0 Holman not present
Mayor Kniss: … To adjourn to a Closed Session. We anticipate being back
out here in just about an hour. Thank you all. We'll see you then.
Council went into Closed Session at 6:16 P.M.
Council returned from Closed Session at 7:56 P.M.
Mayor Kniss: Greetings everyone. We have just left Closed Session. We're
reporting the Council voted 7-2, Kniss and Tanaka no, to authorize the City
Attorney to appeal the decision in the Edgewood Plaza ruling at the
appropriate time. That takes us back to our regular Agenda at 7:55. Thank
you, those who have waited 'til we came out of Closed Session.
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Agenda Changes, Additions and Deletions
Mayor Kniss: Under Special Orders of the Day, we were welcoming Mayor
Balthammar of Linköping. She has left and gone out to dinner with her
colleagues. That takes us to Number 2, Agenda Changes and Additions and
Deletions. I heard none today.
James Keene, City Manager: Madam Mayor, if I just might under this
category rather than the City Manager Comments just point out one change.
It's really more a timing issue that relates to Item Number 13 on the Council
Agenda, which is a public hearing relating to amending the Accessory
Dwelling Unit (ADU) Ordinance. I would just say that that time is listed as
tentatively from 10:00 P.M. to 10:45 P.M. That would be a
misrepresentation of the scope of what this item is. Really, 15 minutes
would be a more appropriate time to have scheduled it for because the
public hearing really is limited only to an Amendment to bring the ADU in
accordance with new State law with not larger discussion. Just for your
planning purposes, the Council and the public should anticipate at least for
planning a 15-minute session at the end of the evening, not 45 minutes.
Thank you.
Mayor Kniss: … Item Number 13, we also have a continuation of Item
Number 12. That's on your Agenda saying the Staff requests this item be
continued to February 5th.
Council Member Scharff: I'll move (inaudible).
Council Member Holman: Second.
MOTION: Council Member Scharff moved, seconded by Council Member
Holman to continue Agenda Item Number 12 “PUBLIC HEARING: Adoption of
a Resolution to Continue the Evergreen Park Mayfield Residential Preferential
Parking Program (RPP) With Modifications…” to February 5, 2018.
Mayor Kniss: All those in favor of this, moving the item. Passes I think
probably unanimously and takes us back to the regular Consent Calendar.
MOTION PASSED: 9-0
City Manager Comments
Mayor Kniss: Now, I think we're going on to City Manager Comments.
James Keene, City Manager: Thank you, Madam Mayor and members of the Council. Three items to report. First of all, just a reminder that tomorrow,
January 30th, at 10:00 A.M. our community is invited to join the Mayor and
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other City officials for a groundbreaking ceremony for the Rinconada Fire
Station Number 3 Replacement Project at 799 Embarcadero Road. The
replacement of this very outdated fire station is part of the Infrastructure
Plan adopted by the City Council in 2014. We will demolish the existing
wood-frame structure built in 1948 starting on Wednesday of this week with
the replacement building to be built on the same site. We anticipate the
replacement station, which will be Leadership in Energy and Environmental
Design (LEED) Silver, to open in March of 2019. For more information, go to
our newly designed infrastructure website at cityofpaloalto.org/infrastructure
where you can find information about all of the projects in the plan. Again,
a reminder of groundbreaking tomorrow, January 30th, at 10:00 A.M., Fire
Station 3. Secondly, just more acknowledgement and recognition from the
Council's leadership in the Healthy City area. For the first time, the
American Lung Association has given Palo Alto their highest scores possible for our efforts to reduce smoking and tobacco sales to minors. The 2017
scores were triggered by your recent restrictions on smoking in multifamily
units and the new permit program and restrictions on tobacco sales. We join
31 cities nationwide in getting straight As.
Council Member Scharff: I think we went from a D.
Mr. Keene: From a D to an A. That is correct. Lastly, just a reminder that
this Saturday, February 3rd, the Council will hold its annual Retreat
generally focused on setting your Priorities for the next calendar year. That
will begin formally at 9:00 A.M. in the El Palo Alto Room at the Mitchell Park
Community Center. I think we'll be gathering at 8:30 A.M. for coffee in
advance of that. The Retreat is scheduled to occur between 9:00 A.M. and
3:00 P.M. this Saturday at Mitchell Park. In addition to talking about the
Council Priorities for the year, assuming that the Council tracks close to the
recommendations out of Policy & Services Committee (P&S) based on the
preliminary suggestions from the City Council under your existing process,
we should have some opportunity to have some deeper discussions on some
of those potential Priorities, such as housing, budget and finance, and grade
separation along the corridor. The meeting is public and open to all the
community. Again, this Saturday, February 3rd. That's all I have to report.
Mayor Kniss: Thank you very much.
Oral Communications
Mayor Kniss: I think we have the names up on the board. Why don't you
come in the order in which your card was received? Dr. Horowitz.
Ken Horowitz: Thank you. Good evening. (Inaudible) about a topic I mentioned last week. I have a little dog-and-pony show here. I got this
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over at 7/11. This is a 20-fluid-ounce Coca-Cola. I just want to show you
how much sugar goes into 20 ounces. It's 17 packets of sugar. If you get a
double Gulp, which you can also get at 7-11, it's about 50 packets of sugar.
I didn't have enough sugar, but it's a lot. What I'm asking the Council to do
is—I want to thank Council Member Tanaka because I met with him on
Sunday—consider a Colleagues' Memo to decide if you really want to take up
a Sugar Beverage Tax. This is not a Sales Tax. It's a tax that is now going
around the Country. Berkeley was the first city to do it; it was Measure D. I
have a bunch of different copies of items. I've been working on this for
about a month. I want to share this with the City Clerk, and she can scan it
in to you. Measure D was passed in Berkeley. There was another measure
passed just a couple of years ago in Albany, California. I have a ballot
measure, which has all the questions you could ever want to know. I also
have a copy of the Ordinance. This would not be hard work for our Staff because the ordinance has been written so many times. It's all there. I also
have Frequently Asked Questions because this is something that comes up
all the time, who's going to pay for it, how are we going to collect it, all this
other stuff. One of the things that's done both in Berkeley and Albany is
they have a contract with MuniServices, and that's how they collect the tax.
What I'd like to see done is to decide if you as a City Council want to discuss
this further and put a Colleagues' Memo out. I thought it would be great as
a legacy for Council Members Scharff and Holman if we could get a Sugar
Tax passed this November. This particular tax would fund both nutritional
programs and preventative dental services. I mentioned last week that
currently no dentists in our town accepts Denti-Cal patients. If this fund
could help augment particularly preventative services …
Mayor Kniss: Ken, thanks but …
Mr. Horowitz: I'm sorry. I went over.
Mayor Kniss: Do come to us …
Mr. Horowitz: I'll be at your meeting …
Mayor Kniss: You can come back again.
Mr. Horowitz: I'll come back again.
Mayor Kniss: Thanks. Our next speaker is Sea Reddy, followed by Bill Ross.
Sea Reddy: Good evening, Mayor and the City Council and citizens of Palo
Alto and neighborhoods. Last week we had a meeting with the—facilitated
by County Supervisor Simitian, extremely well organized, well attended,
quite a few inputs. I had this brilliant idea that if they really want to have
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housing issues taken care of and all that, why don't we move the Stanford
mall to somewhere else—only person to the population uses Neiman Marcus
and Bloomingdale—and make that a facility for housing, build ten-story
buildings, and move all the technology center. The more I think about it, we
do need more expansion of Stanford. The only place we can do it is between
Palo Alto and Menlo Park, and that's a great place to do it. Thank you. I
want to let you know that January 30, 1948, 70 years ago, Mahatma Gandhi
was killed, assassinated by a fanatic Hindu. I think we can learn from all of
that. Thank you.
Mayor Kniss: Thank you, Sea. Our next speaker is Bill Ross.
Bill Ross: Good evening. I'm here tonight requesting confirmation that
you've received the League of California Cities' proposed letter in opposition
to Senate Bill (SB) 827. It's been available now for 8 days. It's a
compelling argument to oppose this legislation. It basically overrides local control. More specifically, it's applicable to Charter cities. It would prohibit
the imposition of any controls dealing with density, minimum parking, or
design review associated with high-density residential projects, which could
be in any residential zone, within a half mile of a major transit stop or
quarter mile of a high-quality transit corridor, the latter being El Camino
Real. Literally, there is no residential neighborhood of the City that wouldn't
be affected by this. I would think you would also recall that we've done this.
Regardless of your view in the Comprehensive Plan, you engaged in a
comprehensive study about increasing residential zoning for affordable
housing that's subject to review by the Department of Housing and
Community Development. You're being stripped of the land use power. I
would respectfully ask where's the appeal in this process. It doesn't have
one. Do I go to a transit agency? I would also note that there's no
provision for affordable housing. This is the kind of legislation that you
should oppose. Again, if it hasn't been brought to your attention by Staff,
the League has done a very concise letter of opposition. I would respectfully
request your consideration of drafting that letter and sending it to the
appropriate individuals. Given the schedule, the most immediate one would
be to Senator Dodd for the Government and Finance Committee in the State Senate. Thank you.
Mayor Kniss: Thanks, Mr. Ross. Bob Moss and then Herb Borock.
Bob Moss: Thank you, Mayor Kniss and Council Members. I was thinking
about the Council Priorities issues. One of the things that came to mind was
what are the priorities of the people that live in Palo Alto or that work in Palo Alto. As you know, the annual survey hot topic is traffic and parking. I
think it would be one of the things that should be looked at and addressed.
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I don't think most of you are aware of this. Forty or 45 years ago, Palo Alto
had its own bus system. The buses ran down residential streets, Greer and
Charleston and Middlefield. The City merged with Valley Transportation
Authority (VTA), and VTA said, "We will keep the system the same." They
kept their promise for almost 6 months, and then all bus routes disappeared.
It would be a good idea to take a serious look at reinstituting a City bus
system. One simple way to start will be to talk to Stanford about expanding
the Marguerite system. The buses are already there; the Staff is already
there. Maybe the City can pay to extend the routes that they use to ones
that go through more residential neighborhoods and then run more hours of
the day. It's worth trying, at least talking to Stanford and seeing if they're
willing to cooperate with us. It may help address one of our biggest
problems, which is traffic and parking. The second thing, when you look at
the issues and what you're going to be talking about, is what is the capital cost going to be for these various topics you're going to be considering on
Saturday. If some of these projects have very large capital costs, you may
want to postpone doing anything until the economy starts to sink, which I
think is going to happen in 6-12 months. The costs are going to go down.
It wouldn't be a bad idea to suggest some capital improvements to look at
doing but to hold off actually proceeding with them until the costs come
down or are more reasonable.
Mayor Kniss: Thanks, Bob. Herb Borock, then Arthur Keller and Stephanie
Muñoz.
Herb Borock: Mayor Kniss and Council Members, 4 days ago the City issued
a Request for Proposals (RFP) for our Rail Program Management Services.
The current contract is with Mott MacDonald. That was signed on October 4,
2016, which is a 2-year contract. Mott MacDonald is also the contractor for
two station area planning contracts in Madera and Tulare funded by the
California High Speed Rail Authority. I believe that Mott MacDonald has a
potential conflict of interest working for the City of Palo Alto because it
receives funds from the High Speed Rail Authority and especially since Mott
MacDonald is working on rail issues that include the Caltrain corridor funded
in part by the High Speed Rail Authority, and they'll be used by the High Speed Rail Authority. Under the current contract, as of October 27, 2017 we
expended over $629,000 to Mott MacDonald. Thank you.
Mayor Kniss: Thanks very much. Arthur Keller and then Stephanie Muñoz.
Arthur Keller: Madam Mayor, Council Members, I am Vice Chair of the
Environmental and Water Resources Committee for the Santa Clara Valley Water District; however, I am speaking on my own capacity in this. The City
Clerk is handing out materials that I put together. You may be aware of the
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San Francisquito Creek Joint Powers Authority as a Save Our Bay project
which is joint with—involving East Palo Alto, Menlo Park, and Palo Alto. The
East Palo Alto and Menlo Park projects have been, in terms of consideration
of the alternatives, completed back in 2016. The Palo Alto portion is
delayed. It was supposed to be done in 2016. This website that I gave you
for the Joint Powers Association (JPA) says it's supposed to be done in 2017.
It's still not complete. I'm wondering where it was. I brought this up to the
JPA. Unfortunately, the City's representative to the JPA was not at the
meeting. If you see the other three sheets, it's about resilience by design,
which is a project funded by the Rockefeller Foundation, which is considering
the issues of tidal flooding and resilience from sea level rise for East Palo
Alto, Palo Alto, Mountain View, and Sunnyvale. This project is a short-term
project over the next five months or so. It would be rather useful if the JPA
and the City were to complete the alternatives analysis so they could be fed into this project funded by the Rockefeller Foundation. I'm requesting that
Staff find out what the status of this project is and complete it because I
think that—this is something that I've been following along and initiated.
The JPA should look at this through the City's participation. We should
complete this project and move on. Thank you.
Mayor Kniss: Thank you very much. Last speaker, Stephanie.
Stephanie Muñoz: Good evening, Mayor Kniss and Council Members. If you
looked in the Palo Alto Weekly this last issue, you'll find besides an
interesting coverage of the Council and the new Council and the Mayor some
remarks about housing and about the schools. To my surprise, the Palo Alto
schools are not as rich as one would think considering that we have all this
very wealthy property value, which is relatively new. You would think that
they'd be very well off, and they're not. The City and the State are going to
have to take an earnest look at where the money is going in the School
District and whether in fact Property Tax being the majority contributor is
the best way to go. I'm not sure that this has ever been looked at since we
had Prop 13. Because the businesses—unless we get a split roll. The
businesses are also profiting by Prop 13, which we all are grateful for
because it means we're not pushed out of our houses. I would say in connection with that that it would be the greatest mistake not to pursue
building the nicest apartments you could think of on Cubberley High School.
Cubberley High School, Cubberley High School. I notice that Supervisor
Simitian has proposed housing by the Courthouse. That's a great idea. You
eventually are going to have to offer rental housing to all the teachers, and it should be glorious. It should be gorgeous because the ones that have
houses now are the old ones that are retiring. Thank you.
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Mayor Kniss: Thank you for speaking. That's our last card, which takes us
back to our regular Agenda for this evening.
Consent Calendar
Mayor Kniss: Would you care to move approval?
Council Member Scharff: Move approval.
Vice Mayor Filseth: Second.
MOTION: Council Member Scharff moved, seconded by Vice Mayor Filseth
to approve Agenda Item Numbers 3-9.
3. Adoption of a Park Improvement Ordinance for Peers Park Dog Off-
Leash Exercise Area.
4. Resolution 9734 Entitled “Resolution of the Council of the City of Palo
Alto to Establish a One-time Contribution of $17,100 to the Art in
Public Spaces Fund and Approve Budget Amendments in the Capital
Improvement Funds for the Art in Public Spaces Capital Improvement
Program Project (AC-86017) to Purchase Already Installed Creative
Seating Elements on University Avenue.”
5. Adoption of an Ordinance Amending Section 2.08.120 of Chapter 2.08
and Section 2.30.270 of Chapter 2.30 of Title 2 of the Palo Alto
Municipal Code to Update job Titles of Attorneys in the City Attorneys’
Office to Conform With Changes Adopted by Council in the FY 2018
Annual Budget.
6. Approval and Authorization for the City Manager to Execute Contract
Number C18168129 With Kennedy/Jenks Consultants in the Total
Amount Not-to-Exceed $715,369 to Provide Design Services for
Primary Sedimentation Tanks Rehabilitation and Equipment Room
Electrical Upgrade Project at the Regional Water Quality Control Plant -
Capital Improvement Program Project WQ-14003.
7. Approval to Submit a National Endowment for the Arts Grant
Application Requesting $25,000 to Animate the Cubberley Community
Center Campus Through Public Art.
8. Adoption of a Successor Memorandum of Agreement Between the City
of Palo Alto and SEIU Local 521 Hourly Unit for a Four-year Term
Expiring June 30, 2021.
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9. Finance Committee Recommendation to Accept Macias Gini &
O'Connell's (MGO) Audit of the City of Palo Alto's Financial Statements
as of June 30, 2017, and Management Letter.
Mayor Kniss: Could you vote on the board?
MOTION PASSED: 9-0
Mayor Kniss: That takes us on to Oral Communications. Let me correct an
error. Jeff Hoel, we forgot to have you speak regarding Consent. Would you
come forward now? We'll think of it as Oral Communications, if that's okay
with you.
Jeff Hoel: It's not okay with me.
Mayor Kniss: We'll consider it reopened, Jeff.
Mr. Hoel: I wanted to speak on Item 4, the benches on University Avenue.
In a way this is an aftershock from last week's discussion about University
Avenue. It suggests that the way to pay for artwork on University Avenue is to take the money from various utilities. I don't understand why that's a
good idea. I think there's a State law that says, at least for some utilities,
they can't be used to subsidize other things. In addition, the suggestion is
that the utilities gas, water, and fiber should pay equally for this artwork. I
don't see any explanation for why that's a good idea. Last week with
respect to the trench work on University Avenue, you decided that Staff
should come back to Council so that Council can decide how much each of
the three utilities ought to pay. It seems to me that this is another example
of the same thing. Thank you.
Mayor Kniss: Thanks, Jeff. Essentially, we reopened, so let's pass the
Consent Calendar once again.
Council Member Scharff: I make the Motion.
Vice Mayor Filseth: Second.
Mayor Kniss: Could you vote on the board. That passes unanimously.
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Action Items
10. Approval of the Fiscal Year (FY) 2017 Comprehensive Annual Financial
Report (CAFR) and Approval of Conforming Amendments to FY 2017
Budget in Various Funds; Acceptance of the FY2019 - FY2028 Long
Range Financial Forecast; and Discussion and Potential Direction
Regarding Budgeting for City Pension Liabilities.
Mayor Kniss: We're going to begin with Item Number 10. We're a little
behind schedule, but I think we'll probably catch up. The first item is to
approve the 2017 Comprehensive Annual Financial Report (CAFR), known as
the CAFR, and approval of conforming amendments to 2017 Budget and
various funds, acceptance of the 2019-Fiscal Year (FY) 2028 Long Range
Financial Forecast (LRFF), and discussion and potential direction regarding
budgeting for City pension liabilities. I think we're going to begin tonight
with the CAFR. I'm going to look to Staff to introduce this. The item is
going to be conducted by the Vice Mayor tonight, who was the Chair of
Finance last year. Greetings. We need one of you to start.
James Keene, City Manager: Just so we are clear, we have combined these
two portions from the Finance Committee meeting that were at the meeting
at the same time to allow a fluid Question and Answer (Q&A) from the
Council on both of these items. Our thinking is that Staff may give—are you
going to give two PowerPoint presentations or one?
Kiely Nose, Office of Management and Budget Director: One.
Mr. Keene: One PowerPoint presentation, so that would be combined. We
would obviously entertain questions and comments from the Council on both
the CAFR and the Long Range Financial Forecast. You might want to identify
to which you are speaking on this item. I'll have more to say in the course
of the Council's discussion.
Ms. Nose: Good evening, Council. I am Kiely; I'm the Budget Director. As
Jim alluded to, we'll do one PowerPoint this evening to go through both the
CAFR and the Long Range. Tonight, what we're looking for from the Council
are three main things; to approve the FY 2017 CAFR and the conforming
amendments, to accept the General Fund Long Range Financial Forecast, as
well as have a discussion about pension obligations and assumptions associated with those to help inform the development of future policies and
procedures as well as the FY '19 Budget process just as a matter of—to
norm all. Ultimately, the Long Range Financial Report is a planning
document. It's something that the organization does on an annual basis to
help us be prudent in our financial planning and inform our future policy. It truly is a snapshot, a point in time. Things are changing on a daily basis
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obviously. As for the CAFR, the CAFR really is a point in time as well. It's a
look back. It is our financial ending point as of June 30, 2017, and it gives
us the launching point from where we're going to forecast forward. In 2017,
we met with the Finance Committee to go over the Comprehensive Annual
Financial Report with our outside financial auditors, Macias Gini and
O'Connell, (MGO). Ultimately, we had a clean audit for FY 2017. The
Committee unanimously approved the outside auditor's opinion; however,
the CAFR itself as well as the conforming budget amendments were a 3-1
vote, which is why it's now on an Action Item this evening. In 2017 in the
General Fund, we ended the year with about a $48.1 million Budget
Stabilization Reserve (BSR). That's about $5.9 million above what we had
anticipated when we were developing the FY '18 Budget. Overall, that's
about $2.8 million in excess revenues, so revenues exceeded budgeted
targets by $2.8 million. Expenses fell below budget levels by about $3 million. Combined, that's how you get that gap. As of December 31—that
says 2018; it really should say 2017, so my apologies—the BSR is estimated
at $42.8 million. It's about 20 percent of your General Fund Adopted Budget
for FY '18. That's above the Council-approved target of 18.5 percent. One
of the discussion points at the Finance Committee for FY '17 was how our
General Fund revenues, primarily our taxes, were doing. What we wanted to
do is highlight on this slide 4 years of actuals, FY '14-FY '17 actuals. The
yellow bar is FY '18's Adjusted Budget. This is a little preemptive, but
ultimately in the next month you guys should have a report coming to the
full Council for midyear adjustments. That's us doing net zero cleanup
adjustments between revenue categories. The primary changes that you'll
see is we're going to reduce the Sales Tax estimate by about $1.3 million.
You see sales taxes plateauing from a growth standpoint. Whereas, Utility
Users Tax has healthy growth. We're actually going to recommend that we
increase that budget estimate in FY '18 by about $1.5 million. Those will
offset each other. Overall, our revenues for FY '18 continue to track at
budgeted levels overall. In FY '17, as you guys saw, they were about $2.8
million above budget. Enterprise Funds. In FY '17, overall customer
revenues were up in 2017 due to the number of rate changes that we had approved—that the Council had approved. Combined, there's a surplus of
about $7.2 million primarily associated with water, electric, and airport.
Airport does have a negative reserve. You can see that at the bottom right,
$2.9 million. That reflects the loan that the General Fund continues to make
to the Airport Fund as we are transitioning out of the previous County leases and to our own fixed-base operator leases. That transition took place back
in April, so this will be the first Fiscal Year in 2018 that we will see a full 12
months at the new negotiated leases. Moving on to the Long Range
Financial Forecast. Looking forward, this is a 10-year look. Obviously, as
you go out in the outer years of the forecast, the data gets a little bit more
hedging and blanket assumptions. Ultimately, a perfect forecast would show
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a city is able to afford current service delivery every single year throughout
the entire forecast. As you can see in this graph, in FY '19 there's a
projected gap of $2.6 million. If we did absolutely nothing as an
organization, the organization would turn right, meaning it will turn to a
positive surplus in about 2024. However, this is just a plan. Going back to
the purpose of a Long Range Financial Report, this is to show us where we're
headed so that we can proactively plan. The City every year adopts a
balanced budget. It's not to say that we will adopt a budget with a $2.6
million gap. The next slide is the chart showing the actual numbers behind
that graph that you guys had just reviewed. If you look at the total General
Fund revenue, revenues are growing in the steady state of about 3-4
percent in the near term. In the out years, they dip down to the 2.83
percent range. On the expense side, you can also see in the first 5 years
expenses are around 3-4 percent. Whereas, in the out years they do drop down to 2.7 percent and even 1.5 percent in 2027. That reflects that
significant rate of growth that you saw in the last chart. Looking at the
year-over-year change. Like I alluded to before, annually the City brings
forward a balanced budget. If we or when we bring forward a balanced
budget as part of the FY '19 Budget process and recommend reductions or
increases in revenue to the tune of $2.6 million on an ongoing basis, you'll
actually see the red line on the chart—it gives you your operating margin.
That operating margin assumes that you either spend or solve any surplus
or gap year over year. Once the City adjusts FY '19's Budget for that $2.6
million structural difference, you can see it's actually shown as breaking
even or actually with slight surpluses throughout the forecast period. Again,
this goes to that being proactive. As we solve this, we'll be positive moving
forward.
Mr. Keene: If I just might state because you'll probably be much less
familiar with this than the Finance Committee or our Staff. The base case is
one set of assumptions that are driving this graph, and the Staff will add
some other assumptions into or on top of the base case. You'll see that
those assumption changes, which in most cases are just a few, start to
affect the curve of those lines in the other alternatives. Thanks.
Ms. Nose: Before we get into the assumptions behind that base case, let's
talk about what's not included. When forecasting, there are a number of
assumptions. The finance team does their best to make the right
assumptions and anticipate everything that's happening over the next 10
years. However, there is a significant number of known unknowns, as we like to call them. These are costs and revenues that we don't yet know
enough about. We're not quite sure how to include them. What this list is
intended to do is be strategic so that we as an organization can continue to
look at both what is forecasted through this Long Range as well as what's
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not and look through decisions and really make sure that we're focusing on
the important items. Major things on this list include the capital
Infrastructure Plan. Last week, we talked about the significant gap in the
2014 City Council-approved Infrastructure Plan. Something that's on the top
of our mind is how do we adjust for that gap in 2019 and moving forward to
ensure that we meet those commitments. Other major changes or
upcoming unknowns are we have a number of future labor contracts that will
be open starting July of this year, I believe, and continuing all the way
through December of 2018. As we move into those labor agreements, we
don't quite know what the strategies will be or ultimately what we reach
agreement on with those groups. Other ones are City-owned assets.
Coming forward to the Council soon in February will be a discussion over the
Avenidas commitments that we have made as well as how to fund those. I
believe it's next week you guys will be hearing about Junior Museum and Zoo (JMZ) and the first phase as well as the second and the additional
funding that's necessary for those improvements. There continue to be a
number of other outstanding priorities like grade separation. We have a
Parks Master Plan that has just been completed, a Cubberley Master Plan
that's underway. These are all a number of initiatives that the Council and
the community are undergoing. We just haven't yet factored any of them
into these Long Range financial numbers. Lalo just reminded me that we
will start talking about our labor agreements in February with the full
Council. On to what is included in this forecast. Major revenue
assumptions. Total sources, as I alluded to before, are about 2, 3 percent to
4 percent growth. We do expect steady receipts to continue in both FY '18
and FY '19 with taxes growing about 3.7 percent compared to the '18
Adopted Budget. You can see significant healthy growth in property taxes,
about 6 percent. Other taxes are growing about 4 percent on an annual
basis. In the out years, though, we have the compound annual growth rate,
so the team looks at not only what our 10-year history of revenues have
been but they also take in other considerations that we know of. For
example, if we know that there's going to be a large development, we will
take that into consideration. If we know that there will be a hotel coming online, we'll take that in consideration. As you saw in the previous slide, if
hotels have not necessarily pulled a permit and there's not a forecasted date
for them to come online, those revenues are not assumed in this forecast.
On the non-tax side, annual growth is primarily adjusted based on salaries
and benefits for cost of living increases. For that, it's because the primary driver of our other revenues are services. For those services, we charge
fees based on our average cost to deliver them. As we have our Staff
delivering most of those services, that's how it grows. On the major
expense projections, at a very high level what we do every year is we
actually refresh the employee data. We will look at a point in time and
actually sync our actual employee data with our budget system and then
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update for all of the outer year growth numbers. For example, we'll use all
of the rates that California Public Employees Retirement System (CalPERS)
provides us as well as our actuary Bartel for the outer years that CalPERS
doesn't provide us. If we are in contract with labor groups, we assume the
negotiated increases approved in those contracts; however, if we are not in
contract with a labor group, we assume just 2 percent on the salary side.
On the non-salary side, we really look at everything the Council has
approved, everything from one-time and ongoing adjustments that were
approved in the last budget all the way through any general, Monday-night
decision that the Council has made. For example, in August or maybe
September, the Council approved a significant change in our janitorial
services contract. This forecast assumes that change and the approved
changes that the Council made back then. Ultimately, we've annualized for
anything and any decisions that the Council has made up until December at this point. In the outer years and for other non-known growth areas, we
assume between a 2 or a 3 percent Consumer Price Index (CPI). It just
depends on the contracts as well as the expenses that we're modeling.
That's the base case. In addition to that, there are four alternative
scenarios that were presented in this report, three of which the Finance
Committee has already seen and the fourth which the Finance Committee
actually asked for. Base case we'll always refer to as the base case.
Alternative Scenario 1 changed the discount rate for our pension
contributions. Currently, CalPERS has a phased-in approach to bring us to a
7 percent discount rate. This Alternative 1 assumes no phase-in. It
assumes the 7 percent discount rate as of FY '19. The phase-in period, I
think we are in year 2, so you have one more year after that. Scenario 2 is
a 6.2 percent discount rate beginning in FY '19 as well. If we wanted to
reduce that discount rate from the 7 percent even lower, we could. We'll go
into the details in a second. The third scenario, major tax revenue
sensitivity analysis, we just looked at the history of how our taxes perform
during a recession period, picked a year—I don't have a crystal ball; I'm
sorry I don't know when the recession is coming—and just modeled it as a
data point for the Council to have. The fourth one was adjusting the expense growth beginning in FY 2024, really maintaining that 3-4 percent
expense growth. Let's go through …
Mr. Keene: That was the one that …
Ms. Nose: The Finance Committee requested, yes. Quickly, Alternative 1.
This is, like we said, moving to a 7 percent discount rate in FY '19 as opposed to around FY 2021, when CalPERS would have phased it in. What
this means is immediately in FY '19 our pension payment will go up by about
$4.6 million. Your rates for Miscellaneous and Safety Employees would
increase at about a 15-17 percent year-over-year change. Now, CalPERS as
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an organization is moving towards the 7 percent. What this scenario does is
it just accelerates it. As you can see, compared to that $2.6 million dollar
gap we're about $7 million negative in this scenario. However, again, if you
look at that red line, the operating margin, should the organization solve
that $7 million on an ongoing basis, we do show financial solvency. Actually,
you show surpluses as you go through the 10-year forecast. Scenario …
Mr. Keene: Let me just start restating a few of these points just to make it
simple. Again, the thinking right now under the base case assumption we've
been using has identified a funding gap of approximately $2.6 million for FY
'19 Budget, the upcoming budget we'll be presenting. Everything that Kiely
has been saying to give you the difference between the blue one-time
surplus or shortfall line and the net operating margin line is predicated on
the fact that in Fiscal Year '19 in these graphs the budget that we would
propose and the Council would adopt would close that $2.6 million gap in an ongoing, permanent, structural way. Again, under Scenario 1 the discount
rate changes that $2.6 million gap to a $7 point whatever it is million gap.
Again, you see in 2020 the net operating margin is above zero. That
assumes we would have to propose a budget that was balancing that $7.5
million, or whatever the number was, gap in an ongoing structural way.
That'll get more intense as you look at some of these other options. Thanks.
Ms. Nose: Exactly. Thank you, Jim. You bring me back to the intent of
these alternatives is actually to model isolated variables that the Council and
the public can then compare against the base case to see the impacts of
those isolated variables. We really have, when we're modeling these
numbers, just isolated for the variables that we've described. It doesn't
really adjust anything beyond that. On Alternative Number 2, this was a
scenario that many months ago the Finance Committee had asked for. This
is driven by Wilshire Associates' forecast for CalPERS. It's CalPERS' outside
consultants that looked at what the 10-year forecast of CalPERS' rate of
return would be. Their consultants provided a rate of about 6.2 percent.
This assumes a 6.2 percent discount rate beginning in FY 2019. Compared
to the base case, it's about an $8.6 million increase in your annual pension
contributions. Across the 10 years, it's over $33 million. Now, these rates, the rates that CalPERS gave us, in the base case compared to what a 6.2
percent discount rate case would look like are showing year-over-year
increases of over 30 percent. For example, on the Safety side, the base
case assumes a 55.6 percent on salaries; whereas, this Alternative Scenario
Number 2 assumes a 73.4 percent rate on Safety salaries. This actually drops the gap in FY '19 to about $11 million. It would take until the seventh
year of this forecast for it to right itself without any other action from the
Council. Again, should we choose to or should the organization solve on an
ongoing basis that $11 million gap, if we did it in a year, in 2020, it would
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turn to a surplus. Whether it's revenues or expenses, as long as it's
ongoing, it'll right itself.
Lalo Perez, Director of Administrative Services and Chief Financial Officer:
Good evening. Lalo Perez, Chief Financial Officer. Let me insert here a
quick update from CalPERS. In December, CalPERS had a Board meeting to
discuss the discount rate. They had a numerous number of Cities' Staff and
elected officials attend the meeting, urging the Board not to make a change
because it was going to severely impact those particular cities' financials.
Ultimately, the Board decided to leave the discount rate as it was and the
plan to move forward to a 7 percent discount. The 6.2 percent would be a
number that we would use to inform ourselves. It's not necessarily a
CalPERS action number. The other piece that they talked about and carried
over to next month is the discussion about when there's a—let's pick a loss.
They don't make the 7 percent target, and they make 6 percent. There's a 1 percent difference in the discount rate of the earnings. There were
discussions about amortizing that instead of 30 years to 20 years. What
that means is, if you think about it as your home mortgage, typically when
you get a home mortgage, you get a 30-year mortgage. That's what I'm
talking about the amortization. It is prudent to have a short amortization if
you can afford it. Some agencies can, and some others cannot. The League
is casting a survey from various agencies to determine what the flavor is, if
you will, on the desire of having 20 years versus 30 years. That's going to
be the next month's Board meeting. Those are two updates in regards to
Public Employees Retirement System (PERS) and their current actions.
Ms. Nose: Thanks, Lalo. Just a quick recap to put in perspective the base
case, the first alternative, and the second alternative as these are the three
cases that look at the different scenarios of modeling pension costs. The red
shaded area is the base case. Over the 10-year forecast, the City would be
contributing in the General Fund alone $357 million. In Alternative 1, that
acceleration of the 7 percent discount rate, we actually see about $1 million
in savings. That's because you're not phasing it in. Whereas, the underlying
assumptions remain the same as CalPERS' out years. In Alternative 2, if we
as an organization were to plan financially at a 6.2 percent discount rate, you can see the $391 million. That's $33 million more over the 10-year
forecast period. What's important to keep in mind throughout all of these
figures is these are just the General Fund contributions. There are a number
of other funds the City has where a majority—not a majority—a significant
portion of Staff are in all of our Utility funds. These are Enterprise Funds. These forecasted costs would be baked into or could be planned as part of
the annual development of those rates. Just to know, these numbers have
all been stated just for General Fund purposes. Moving away from the
pension variables, Scenario Number 3 was looking at that revenue
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sensitivity. About 60 percent of the General Fund's revenue comes from
taxes. Looking at the past recessions and how this organization and the
community and tax base have reacted in a recessionary period, we looked at
that history, averaged it out, and chose a year. Right now it's modeled in FY
2021. You can see that even in the first year revenues would dip over $11
million. You see about 2 years of reductions in revenues, and then you also
see it starting to come out. That's the typical recovery period that Palo Alto
sees. Obviously, we have a strong tax base here in this community and this
organization. Normally, if you look at the history of revenues, a number of
them simply plateau. If you look at things like Property Tax, they plateau.
Other more economically sensitive revenues like Sales Tax or Transient
Occupancy Tax do see dips. We're rather resistant, and we don't see the
significant declines as other organizations. This is really just a planning tool.
There is nothing on the horizon that says or forecasts one way or another when the next recession will hit. Just a piece of context for the Council. The
last scenario is looking at that outer year of expense growth. In the base
case, when you look at the expense growth in FY 2024, the latter 5 years
basically of the forecast, the growth rate starts to decline; whereas, the
revenues maintain the steady growth. The reason for that is actually the
rates for pension reduce in the outer years of the forecast. It also only
assumes 2 percent CPI increases across the board whether it's salary,
whether it's contracts. What we modeled in this fourth scenario beginning in
2024 all the way through 2028 is instead of that 2 percent, we modeled 3
1/2 percent. What you can see if you look at this operating margin graph is
you no longer see that significant rate trajectory of surpluses in those outer
years. You see it moderate, and you see the organization from a forecasting
standpoint just hover around that zero line. This is something the Finance
Committee had asked at our December meeting, and we just did a blanket
increase. In conclusion, we have looked at the future in the Long Range
Financial Report. It really looks at current service levels. Important to note,
it doesn't look at any increases in service levels or changes in service levels.
It just assumes the status quo and adjusts for increases in costs and
revenue growth. It is really intended to help make those daily policy decisions. It is not in and of itself an approved budget or anything. It is
simply something to help inform the Council. As an organization, the City
continues to face a number of priorities. It will continue to be important that
we are strategic as an organization to ensure that we're reviewing all
obligations from a comprehensive standpoint and hitting a balanced approach. By that, I mean not taking one-off Monday-night meetings in
isolation but really ensuring that we as a Staff are informing Council of the
plethora of priorities across the board so that Council can make an informed
decision. The competing priorities are obviously going to require some
structural adjustments to the City's financials that we will work on with the
Council and the Finance Committee through the budget process. This is for
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us to give guidance on the FY '19 Budget process, the things and strategies
that we as a Staff will bring forward ultimately in the City Manager's
recommended budget. It's, again, a planning tool.
Mr. Keene: If I could restate before the Vice Chairman and former Finance
Committee Chair last year speaks. I would repeat what Kiely mentioned at
the beginning, the recommendation on this item. You have the Southgate
Residential Preferential Parking (RPP) item tonight and one other item that
shouldn't take too much time, but Southgate may take your time. That is
really to approve the 2017 Comprehensive Annual Financial Report. I would
really say that is almost a housekeeping duty. That is a report of fact. It is
looking backward, and it really is a matter of you accepting that. Secondly,
to approve these conforming amendments that Kiely mentioned, that are
related to last year's appropriations, which again is a cleanup issue. The
third is to accept the Long Range Forecast as we put forward. You're talking about base case, Attachment B, certainly as a starting point. Again, please
this is a long-range plan. The further out we go, the less viable the
projections really are. More than anything, it's to help inform your nearer-
term thinking also about 2019 and maybe the next year. We'd really ask
that you consider quick action on that. The fourth recommendation is a little
bit different and different than what we've done in years past, which was at
the Committee's request in a sense. We do invite some discussion much
more on these pension obligations and the assumptions. That's what we
really spent a lot of time on, looking in Kiely's presentation on what some of
these alternative implications mean both as far as—the pension policy issues
we didn't talk that much, but we talk about the impacts on the City's budget
and the finances as a result of those. I would encourage the Council, if
anything, if you're interested in the pension obligations piece of this, you
really look at being able to move ahead, put the other items as much as
possible behind you generally, and focus on Item Number 4. That's really
where there is a lot of—there is a lot of discretion on the part of the Council.
Thanks.
Vice Mayor Filseth: At this time, if there are any speakers who wish to
speak to this topic—seeing none—now is the time to do that. Seeing none, we will proceed. I think what I will do is I will move the Staff
recommendation.
Council Member Scharff: Second.
MOTION: Vice Mayor Filseth moved, seconded by Council Member Scharff
to:
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A. Approve the City’s 2017 Comprehensive Annual Financial Report
(CAFR); and
B. Approve conforming amendments to the Fiscal Year 2017 Budget
Appropriation for various funds; and
C. Accept the Fiscal Year 2019 to 2028 General Fund Long Range
Financial Forecast (Base Case); and
D. Provide direction on assumptions informing the City’s calculation of
pension liabilities and annual contribution goals and implications to the
City Manager’s FY 2019 Proposed Budget.
Vice Mayor Filseth: Then I'll speak to it briefly. First of all, I want to thank
the Staff, which has done an exhaustive job of analyzing this data. At this
point tonight, I believe we're not here to discuss policy and directions and
budgets and actual actions but merely to review the analysis that the Staff
has presented, which I think they've done a whale of a lot of work on. It's very useful. I recommend we just accept it. A couple of points on this.
Much of this discussion and the focus of the Finance Committee as directed
by the Council back in June last year was to dig into how we account for the
pension obligations. When I say pension, I also mean retiree medical as
well; although, they are distinct, but they follow the same sort of trajectory.
I want to point out that what this speaks to is we've had a run of good
years. We've got a lot of good work done. Our streets are in fantastic
shape. We've done a lot of back infrastructure investment that lagged in the
2000s and particularly right after the recession. Pensions is only one of a
set of financial parameters that the City needs to chart a careful course
through going forward. We may spend some time talking about it tonight as
the Finance Committee did in the last 6 months, but people shouldn't get
distracted that that's the only thing that counts in the City. We have a
number of things. We did put a particular focus on this because the Council
directed Finance to do that in the second half of this year. I will comment
on the overall—first of all, you have several scenarios. Which scenario do
we work to? The plan of record is the plan of record until there's a new plan
of record. The plan of record is we follow the CalPERS. CalPERS manages
our pension accounting and finances. Until we decide to make such a change to that, that's the way we're going to proceed. The rest of this is to
inform our perspective on that—I'll come back to that—to prepare for the
contingency that we may have to someday take over our pension accounting
ourselves or least big pieces of it. Currently, it's all done by CalPERS. I also
want to point out that our ability in the long term to balance our books is predicated on significant expense control in the out years that Scenario 4
presented. I hope that's not—everybody needs to be cognizant of that.
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With that, let me say a few remarks adding to what the Staff said about the
results of some of the work we did in the last two quarters on this particular
area. First of all as everybody knows, we have a very large unfunded
pension and retiree medical liability. The exact size of it varies depending on
some of your assumptions. I believe our best estimate is it's somewhere in
the range of $800 or $900 million, so approaching $1 billion if you include
everything. There are a number of causes of that. I apologize for dragging
people through the wonky weeds here. I'll try to be very high level about
that. The root cause, if you had to pick one, is the expected return that
CalPERS will get on our Pension Fund investments. Historically, CalPERS has
overestimated the yield they'll get. CalPERS invests our Pension Fund.
What that has meant is that we and other cities in California have not saved
enough each year to cover the costs of each year's pension costs. That's the
so-called discount rate, which CalPERS has been lowering periodically over the last several years. It was over 8 percent, and then it was 8 percent, and
then it was 7.5 percent, and now it's going to 7 percent. There's not
universal agreement on what it should be, on what reality is. Most
observers agree it's lower than 7 percent. We picked 6.2 percent as an
alternate scenario for a variety of reasons, some of which Budget Director
Nose mentioned. We wanted to quantify what the difference is between our
City finances, assuming CalPERS' investment returns versus 6.2 percent.
Alternate Scenario 2 is the primary alternate one. The difference in discount
rates, the investment return error, really has two impacts. One is the size of
our unfunded liability, which is many hundreds of millions of dollars. The
other is how much we're spending on benefits each year. We wanted to
know—we were specifically looking at costs. We wanted to know how
much—the difference we're actually spending versus how much CalPERS
says we're spending and collecting money from each year. That's actually in
the Staff Report. If you look at Page 532—I won't do too much of this, but I
think this is pretty important—you see a bar chart that looks something like
this. The short answer is, if you look across the Miscellaneous and Safety
plans, our true expenses for that year's pension benefits are between 6 and
8 percent higher than we report. It's several million dollars. It's the two layers. It's the top two layers, the teal one and the purple one. Those are
the difference in what it truly costs us to fund the commitments we've made,
depending on how much you expect CalPERS to make. The Employer Rate
(ER) pension cost, the gray box, that's what we actually give to CalPERS to
invest. That goes into our Pension Fund, and CalPERS invests it. The top two layers is the additional amount we would need to have given them in
order to fully cover the cost of that year's pension obligations. That
amounts to between $5 and $10 million in the General Fund each year. The
question is what happens to that money. We spent it, but we didn't give it
to CalPERS. The answer is it's added to the unfunded liability. Essentially,
we're borrowing it from the future. You can think of it as we're not paying
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enough on our credit card to pay down our balance. Once we add that to
the liability, it then grows every year. Essentially it collects interest. At
least that's the easiest way to think about it. If it collects 7 percent a—if we
have a gap of $10 million and it collects 7 percent interest a year, then in 10
years it's doubled to $20 million. In 20 years, it's doubled to $40 million.
Over time, that difference compounds pretty dramatically. If every year
you're doing that, that's how you get to an $800 million liability, which is
where we find ourselves today. I don't know if everybody followed that
exactly. Essentially, the root cause is the difference. It doesn't seem like
much, but the root cause is the difference between that 7.375 percent and
the 6.2 percent or whatever it is that CalPERS is really likely to earn. That's
where the Unfunded Actuarial Liability (UAL) comes from. The lesson here is
if we want to solve this problem, we need to stop adding to the debt every
year. First, we need to understand what it truly is, and that was the function of Alternate Scenario 2. That doesn't necessarily mean we need to
cut expenses $8 million tomorrow. We need to recognize that we're
financing $8 million of our expenses with money we've borrowed from the
future, and that money is going to grow year over year at 7 percent. People
should understand, by the way, that the unfunded liability grows every year
even if CalPERS hits its targets. It grows about 7 percent a year. What we
wanted to do was measure the impact on the Operating Budget, and that's
what you see here. When you look at the difference between—in fact, if
you've got the chart of alternate scenarios, I think it's Page 13. The
difference between the base case, if you look at 2019, $2.5 million versus
negative $2.5 million versus Alternate Scenario 2 $11.1 million. The
difference is that difference in benefit cost assuming the two different rates
of return. What we do with that remains to be seen. This is something we
have to keep track of because this is going to be a significant piece of what
we do. As far as the other scenarios, those are interesting. The accelerated
phase-in of a 7 point discount rate is actually a bigger impact than I thought
it would be. The primary ones to consider are the base case and Alternative
Scenario 2. There are a variety of policy questions of what should we do
about that, most of which we're not going to address tonight. This has been the analysis. The analysis was conducted by our actuary, John Bartel, so it's
an independent analysis. With that, I will stop.
Mr. Perez: Vice Mayor, I apologize. We should have given you another
update. This is a good time to do that because it's important for the Council
to know the number. We got the update from Mr. Bartel's firm on what the unfunded liability is at 6.2 percent. We didn't get a chance to put it in the
report because it came in afterward. Let me give you a couple of numbers
so that you can have that information. I think it's key to your point.
CalPERS gave us their report. Based on their rate of return assumption, the
unfunded liability is $405 million Citywide.
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Vice Mayor Filseth: Is that for both pension and Other Post Employee
Benefit (OPEB) or just pension?
Mr. Perez: No, this is just pension. If we add the OPEB, which is retiree
medical—that's what OPEB covers—it's $156 million. Keep in mind that the
OPEB actuary is done every 2 years. That would total $561 million. It is
due to be updated this spring, so we will bring to Council through the
Finance Committee those updated numbers. That's at the PERS rate. We
take the 6.2 percent scenario, and the numbers goes from $561 million to
$665 million total. That is using 6.2 percent and keeping the $156 million of
the retiree medical.
Vice Mayor Filseth: The $156 million presumably goes up too. If you look at
the sensitivity analysis chart on Packet Page 411, a difference in 1 percent
on the discount rate translates to between 35 and 40 percent increase on
the total UAL, so the pension would go up. OPEB will go up too.
Mr. Perez: I'm in full agreement with you. What we'll do when we discuss
this with the Finance Committee is provide those options, and you can
select.
Vice Mayor Filseth: As of what date was that?
Mr. Perez: The $156 million?
Vice Mayor Filseth: The $405 million.
Mr. Perez: The $406 million is as of 6/30/16.
Vice Mayor Filseth: The unfunded liability grows 7 percent a year even if
CalPERS hits its targets for the year.
Mr. Perez: There are other assumptions besides the discount rate as well.
Vice Mayor Filseth: The mathematics is they essentially collect interest;
although, it's how you calculate future values and present values. The
unfunded liability grows 7 percent a year even if CalPERS—even if we stop
contributing, even if you hit the discount rate, the unfunded part still grows
7 percent a year. A year and a half is another 10 percent bigger than that.
If you take their $665 million and add another 10 percent, then at this point
you're over $700 million. That may be.
Mr. Perez: Just one last one. CalPERS also gave us what if it was 3 percent,
and that would be $1 billion for pension alone.
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Vice Mayor Filseth: For pension alone if it were 3 percent. There is a raging
academic discussion about should the discount rates be much lower than
that, which probably is beyond the scope of this.
Mr. Perez: Yes. Thank you for that.
Vice Mayor Filseth: Thank you.
Council Member Scharff: I'll speak to the second. I think I'm going to be a
little longer than Eric was. I agree with Eric that we should just pass the
CAFR. In fact, I wanted to point out this is now my ninth year on Council.
This is the first time the CAFR has ever come to Council. It doesn't belong
here. As you said, it is a look backwards. It's not even clear to me frankly—
I've given up on this question—why do we—it's like audit reports—approve
them. We're not really saying—they're factual data. The person has done
the report. This is it. It's more of an acceptance. Again, we shouldn't really
talk too much about the CAFR. In terms of the Long Range Financial Forecast, I thought your presentation was great, Kiely. Lalo, really
appreciate it. I always learn something when I look at this. Eric has made
some really good points. We have to figure out some way to stop this from
growing bigger. That's really what the task is. I don't think we can pay it
off really quickly. If we stop it from growing bigger, that's really what we
should try and work towards as a community. I'm not sure—in listening to
Kiely, it struck me as that's more than possible. We just need to figure out
how we get there. That's a good task for the Finance Committee to be
thinking about this year, about how we do that. I think that's already in our
Work Plan; we don't need to add that in there, do you think or do you think
we do? I wasn't quite sure what was in our Work Plan since I wasn't on
Finance last year.
Vice Mayor Filseth: I don't think we have a Work Plan yet.
Mr. Keene: First of all, we are planning to come to the Finance Committee
twice during budget season targeting February 20th and then March 20th as
a second date to support this much deeper dive into this unfunded liabilities,
pension, those issues. Obviously, as the Vice Mayor had indicated, there are
lots of other long-term issues that are at play, that are beyond the base case
scenario, that is more in the purview of the Council to make some policy or value choices. We would see that those would be some conversations that
Finance would take up too, new revenues, how we fund our infrastructure,
other things like that.
Council Member Scharff: It seems to me that, in watching Finance over the
years, the way you get traction on this is you make baby steps and don't try and solve the whole thing at once. It strikes me that the next baby step is
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to say in years in which CalPERS doesn't meet its 7 percent, how do we put
that money into—what do we call it, the 115 trust? That's really the
concept, or the concept is we basically assume they're not going to meet it,
so we put the money in based on a 6.2 percent—that way we have more
certainty for our own budgeting—or something along those lines. The next
question is how do you fund that and is that something the people of Palo
Alto want to fund. Long term, they need to. Where most cities get
themselves in trouble is they say, "We would have to cut services
dramatically to do that. We're not going to do that." Other cities aren't
going to do that, so what you need to do is plan for future revenues to pay
for that in some way, be that we don't just expand our … That's the other
thing I was going to do. I was going to ask Vice Mayor Filseth to look at that
with me. I wanted to go back and look at where we were since I've on
Council in 2010. I wanted to look at your Long Range Financial Forecast and see what part of reality they actually have now that I have 9 years of them
roughly. There was one year we didn't do one, if you remember. I was
going to do that, take a look at that and see how this process actually works
and how useful it is over the long term. I just wanted to give you a heads
up.
Vice Mayor Filseth: I see Lalo nodding (crosstalk).
Council Member Scharff: Lalo's thinking, "I'm going to retire before he does
that."
Ms. Nose: I will be very forthcoming. My first year that I was here, I
actually did that myself. Obviously it's not for FY '18 or '19; it was probably
FY 2016. It was interesting to see. It forecasted ebb and flow based on the
year that it was being forecasted and what the financial outlook was that
year. In some years over the 10 years, that same year was negative; other
years it was positive. It really trended with the general sense of the
economy.
Council Member Scharff: It did trend the way we thought it would.
Ms. Nose: It changed year over year based on what was happening in the
economy. Let's say it was FY '16. Obviously, 10 years prior to that in 2006,
we had tons of surplus. However, as you went from 2006 all the way through the 10 years to get to FY '16, certain years it was positive and
certain years it was negative because, as you went through the economic
recession in 2008, 2009, all of a sudden 2016 wasn't looking so great. You
would see negatives in the Long Range Financial those years. You really saw
…
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Mr. Keene: I would guess that—just picking 2010, at that point in time we
were in the end of the world as we know it. I'm sure the way we looked at
the future was pretty bleak; therefore, the fact that things ended up not
being quite so bad, somebody could say, "You've gone crazy spending
money in comparison to what you thought you would do back in 2010."
Interesting to see.
Vice Mayor Filseth: If I can interrupt for just a second. The Finance Chair's
suggestion that maybe one way to parse this problem—again, I want to not
get ahead of ourselves—is to start looking at the problem of what do we
have to do to stop this from compounding greater than it is right now as
opposed to paying off the existing obligation. That's a sensible idea. What
we have to do is get the accounting right. You can't fix what you can't
measure. We have to scale it correctly. I think that's what this exercise has
been about. What do we do for the next steps? If the Finance Chair wants to make a Motion that we put something on the Finance Committee Work
Plan, that seems like something we could do tonight if the City Manager
agrees.
Council Member Scharff: I'm fine with that if you want to do that.
Vice Mayor Filseth: An Amendment would be—what were your words? We
should direct the Finance Committee to …
Council Member Scharff: I would say direct Staff to come back to the
Finance Committee to look at ways to arrest the growth.
Vice Mayor Filseth: To look at ways to arrest the growth of the liability.
INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE
MAKER AND SECONDER to direct Staff to return to the Finance Committee
to look at ways to arrest the growth of liabilities.
Mr. Keene: That begs the question of looking at the implications of the
choices that you would consider.
Vice Mayor Filseth: Absolutely.
Council Member Scharff: That's the point of a Finance Committee.
Vice Mayor Filseth: There is an intermediate step that's conceivable.
Essentially, what we do right now is borrow money from the future to fund
current expenses. We could simply account for that. We could simply accrue the difference to the future liability. Today we don't recognize that at
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all. Whether to stop doing that is a policy choice, but at least we could
account for it too.
Council Member Scharff: I'm just going to jump in on that, and then I think
I'm done. I just wanted to say that my concerns with accounting for stuff is
that we hurt our bond liability because other cities do not do it. I actually
think we should not necessarily account for it in a way that is different than
other cities because that hurts our ability to finance stuff in the future. If
I'm wrong, you guys can … That's my underlying concern. From a practical
point of view, we need to recognize it, not necessarily in the books, and
solve it, which is much more useful.
Mr. Keene: Our understanding is this is the kind of conversation you would
have at the Finance Committee, where there's a chance to talk through in a
deeper dive the actual implications of various definitions that you might
apply.
Vice Mayor Filseth: That's entirely correct. It's not stuff we should decide
tonight at this Council.
Mr. Keene: I promise you if you did decide it tonight, I can guarantee you
will regret it if you did it tonight, whatever it is.
Mayor Kniss: Moving on. We have three who wish to talk right now, Adrian
then Cory then Tom. Also a reminder that we have people here to talk
about the next item, which is parking on Southgate. We've gone on for
some length of time. It's complicated, but I would urge you to think brief.
Council Member Fine: I will be brief. Thank you, Madam Mayor. Also,
many thanks to Staff for all this work on this project. At a high level, this is
a pretty clean, routine-in-a-good-way look-back on our budget. As the Vice
Mayor mentioned, this is not a policy choice we're making tonight. Hopefully
we do just pass this. I do have a couple of philosophical questions I think
we should all consider as we work through this year, particularly for the
Finance Committee, but just to drive this home. As the Vice Mayor
mentioned, this is perhaps an $800 million, maybe $1 billion problem. The
reason that's an issue for us in the City is that it will begin to crowd out
other services. We will begin looking at things like libraries, police services,
etc., to figure out how do we fund and address this issue. That's really the crux of the problem. Just a couple of questions for my Colleagues that don't
need to be answered tonight. It will be important for the Finance Committee
to look to a plan to increase our pension pay-downs. We're currently doing
our Section 115, but it's only about $3.5 million, something around that. It's
really a drop in the bucket so far. The Vice Mayor is correct that we do need to stop adding to the debt. We have an obligation to be conservative. I do
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think Scenario 2 is perhaps the most appropriate, even if it is aggressive.
We also have to look at paying more on an annual basis. A few other
comments that stood out to me. We've been using a Section 115, which is
roughly a sinking fund, for the pension obligations. It just occurred to me
that may be something we want to look at in terms of budgeting for grade
separations. We don't have any funding mechanisms in place for them yet,
but we're beginning to get an idea of what that magnitude of cost will be.
That may be something for our Finance Committee to consider. Two other
quick things. One, just so the public knows, our sales taxes were pretty
much flat in this past year. That may be related to Amazon eating our brick-
and-mortar stores, but we should consider that in terms of our future
finances going forward. Also, last point. A few weeks ago the City of
Mountain View looked at a couple of funding strategies to finance
transportation and other obligations in their city. One, they looked at increasing their transit-oriented tax, essentially the Hotel Tax, which we may
do again. It's currently funding our Infrastructure Plan. They also looked at
a Marijuana Tax, but that ship has passed us by here in Palo Alto since we
have decided we don't want those stores in our City. Finally, they're looking
at a Business Tax, essentially a Headcount Tax or a Payroll Tax. Last year,
we voted against moving forward with that because of other obligations due
to Staff. Given the current needs of our transportation investments and
other infrastructure investments, it may be something for us to consider.
We should be looking at different sources, new sources going forward to pay
for our various services and obligations here in the City. Otherwise, I'm
happy to support this Motion and hope we can get it done quickly. Thank
you all very much.
Mayor Kniss: Thank you, Council Member Fine. Now, we're on to Council
Member Wolbach.
Council Member Wolbach: I want to express a lot of gratitude for the
Finance Committee for the work they took on when we assigned it to them.
They would have done it anyway. Also to the Staff who has worked very
hard on helping us have a clearer picture on the Council and in the
community. I really appreciate that. That's very important. It's easy to be scared by something that you can see, but it's even easier to be scared by
something you can't see and you can't understand. When we're just scared
but we don't have an understanding, we tend to make bad decisions as
human beings, always. As tough as it is to look at these numbers and to
look at these details and to start to get a better handle on it, as tough as it is to look it in the face, it's better to have that understanding. On the
question of what we can do to arrest the growth of liabilities, I'm glad that's
going back to Finance Committee. I actually want to echo the sentiment
that we not make any motions tonight, that was expressed by Council
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Member Fine about maybe exploring some of the same things that Mountain
View is exploring. The possibility of an additional tweak to our Transient
Occupancy Tax (TOT), our Hotel Tax, to a level which would not hurt the
hotel industry because it is an important part of our income, and we don't
want to crush it, but to make sure that we can maximize in a reasonable
way what we can collect from TOT. Also, over the last year or more now
I've had a number of informal conversations with counterparts in other cities
from Menlo Park, Mountain View, Sunnyvale, Cupertino about employee
headcount taxes or other sorts of business license taxes. I'm excited to see
that Mountain View is moving forward with exploring that. We obviously had
some discussion of that a couple of years ago in 2016. We decided not to
move forward with that at that time. I'm not ready to say we should make a
Motion to put that back on the Agenda. I think we're going to talk about
that on Saturday. It's one of the things that we're—this question of how we tackle our big financial challenges in the City is probably going to be one of
our main Council Priorities for the year. It's important to look at the revenue
side as well as the expenditure side. With grade separation, with other
infrastructure needs, with transportation needs, and with the
pension/medical needs, and wanting to be fair to our employees but
understanding we have to make some tough choices, we have to look to all
potential sources. If the discussion of an Employee Headcount Tax,
especially our larger businesses, is reopened in Palo Alto, perhaps with a
discount or an exemption for businesses that contribute to our
Transportation Management Association (TMA), I'd be open to that
conversation. Maybe a preview for Saturday and future conversations.
Mayor Kniss: Thanks, Cory. Tom.
Council Member DuBois: It's good to have an opportunity to comment on
the Long Range Forecast. I would like to understand the way you did the
scenarios a little bit better. As I understood it, you were isolating a variable,
and then you just assumed that we would make up any debt in that year. Is
that …
Ms. Nose: We've been focusing on Alternative Number 2. In the base case
scenario for pension … In this scenario, in the base case, CalPERS provides us with estimated employer contribution rates. It's a percentage on salary
based on the assumptions in their actuary reports. They are assuming right
now a phased-in approach to getting to a 7 percent discount rate. They
gave us rates for I want to say 7 years, and then we used Bartel and
Associates for the outer years. The base case assumes that CalPERS percentage on the projected salaries. Now, what Alternative Scenario
Number 2 does is—we asked Bartel and Associates to redo those employer
contribution rates based on a different discount rate, based on that 6.2
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percent. What Bartel came back with was revised employer contribution
rates. In the second alternative, the only variable that has been changed is
that rate of assumption. We've taken the CalPERS rate of employer
contributions and replaced it with the Bartel rate.
Council Member DuBois: Are you assuming we balance the budget each
year?
Mr. Keene: There are two ways to look at this chart, if I could jump in to do
it easily. Let's say that we're starting in 2019. That shift from the base in
adding this additional variable of a 6.2 percent return would say in 2019 that
we're at a little bit more than $10 million in the hole. We have two choices.
One would be each year we figure a pay-as-you-go, not a structural change.
I'll oversimplify it. Each year we draw from reserves on the gap to pay it off.
That means we would be doing that draw on reserves, and we wouldn't get
to above zero until 2025. What we've done in the same time is drained all of our reserves in order to get there. In the alternative, which is basically what
our practice has been as a City when confronting these kinds of gaps, we
would close that gap in 2019 in 1 year by, let's say, eliminating the City
Manager Department, the City Attorney Department or whatever.
Council Member DuBois: That's what I understood you to be saying, and
that's pretty brutal. My whole point on these scenarios was I can
understand you maybe not wanting to show where those cuts would happen
until they're real, but they need to be shown in some way. It hides a lot of
very severe cuts the way it's presented.
Mr. Keene: That's why we said we wanted to talk about the implications
when we were at Finance. There's a sense of put some texture on this.
Council Member DuBois: Even a line of we need to make up $X million—if
you were doing a business plan and you were losing money, you wouldn't
make it all up in 1 year. You would show how you pay it down over time.
Vice Mayor Filseth: Can I throw a comment in on this? You're absolutely
right. If I can echo something the City Manager discussed earlier in the day,
the City knows how to do this stuff. We have experience. Obviously, we're
not going to do details tonight. It's just important to be aware that these
are some choices that we're likely to come to depending on how the overall financial picture shakes out. People should be aware this is coming.
Council Member DuBois: The way it's presented to us, particularly if we're
not on Finance Committee, is important. That's all I'm saying. It's hidden.
I'm glad Council Member Fine brought it up. One of the more troubling
issues to me was that Sales Tax has been flat for not 1 year but for 5 years
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or more. You only showed 5 years. We've talked about that in the past.
We need to be lobbying at the State and Federal levels for how do we deal
with taxes on services. As the economy has shifted from products to
services, there's been a huge loss of tax revenue. Even in a booming
economy, we're flat on Sales Tax. We talked about infrastructure. That's
going to go to Finance, but we need some really severe value engineering.
There are going to be some tough cuts there. On pensions and unfunded
liabilities, we have a challenge of not getting too far ahead of ourselves. It's
similar to Social Security. If we put this money in a fund and start to pay it
down, there may be some comprehensive correction at the State level to the
whole system. I do think the first step is being sure we account for it
properly. We need to make sure that happens, and then we need to decide
how we'd use the information and whether that is the idea of stopping
increasing the debt. We just need to be very careful that we don't commit our funds in a way that other cities don't, and we end up hurting the citizens
of Palo Alto by being more conservative. That's going to be a tricky balance
not to get ahead of ourselves. I appreciate the report, and I'm glad we're
moving forward and starting to account for this in a more transparent way.
That's the right first step.
Mayor Kniss: Thanks. The last light I have is from Greg Tanaka.
Council Member Tanaka: I also want to thank Staff for your work on this, a
lot of good work. It was quite illuminating. What Council Member DuBois
said is correct. We are in the best of times; we're in a booming economy.
We haven't seen an economy like this in quite some time. If you look at the
different scenarios, Scenario 2 accounts for a more realistic return than
CalPERS has. The unfortunate reality here is that we're not just looking at
Alternative Scenario 2. Scenario 3 is basically saying that at some point in
time we're going to have a recession. Is there anyone out there who doesn't
believe in the next 10 years we will not have a recession? It's inevitable
that we will have a recession. You can't just look at Scenario 2; you also
have to add on Scenario 3. If you thought Scenario 2 was bad, you've got
to take all the numbers from Scenario 3 and subtract [sic] them to that as
well. Something that Council Member Fine said is absolutely true; our Sales Tax revenue has been declining. In 2019 on Packet Page 511, our Sales Tax
Is dropping by 1.1 percent because of the internet, because of the change of
retail. If you look at how it's forecasted to happen in 2020, 2021, it jumps
up to minus 1.1 percent to 3.6 percent. In a retail environment where retail
is going downhill, we magically see a major swing in Sales Tax going positive. These scenarios are a little bit rosy. They look dire, but they're a
little bit rosy. Scenario 3 has to be added onto Scenario 2. Scenario 4
basically is trying to add some realism. One reason why the numbers go up
or look good towards the end is because we hold the line significantly on
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benefit cost and salary cost, but we haven't done that as a City. It's rarely
been below 2 percent. That's why I appreciate Scenario 4 because it shows
a more realistic growth of benefits and salaries. What you really have to do
is factor in, first of all, we're in the best of times. We're not going to see
these kind of Property Sales [sic] Tax increases or for this matter the kind of
Sales Tax increases that we've been getting or Sales Tax decreasing even
more. You've got to tack on Scenario 2, which is CalPERS is not getting the
return that they would like to get. You've got to tack on Scenario 3, which
says one day we're going to get a recession. Unfortunately, that's just
reality. Scenario 4 is very unlikely we're going to be able to hold expenses
down to 1-1.5 percent. It's probably north of 2 percent in terms of salaries
and benefits. The third leg here is infrastructure projects. We looked at, in
last Monday's meeting, because of this red-hot construction market, we've
seen just about every single infrastructure project come in way above what we expected. When I say way above, I mean 20 percent, 40 percent, 50
percent, massive increases. We promised the community to have a certain
amount of infrastructure projects completed. Yet, we have this looming
unfunded pension liability, OPEB. We have some structural changes in terms
of how the economy is working. It's going to be challenging for the City.
First of all, just to make it a little personal. My dad actually worked for the
City of Los Angeles (LA), and he gets a pension. He relies on it, and a lot of
city employees committed their service to the city and expect a pension. It's
actually a proper thing for the City to actually account for the pensions and
make sure that these pensioners get the pensions that they expect. At the
same time, the big challenge for us is we have to account for the difference.
I do support what was said earlier; although, I would like to do it sooner
than later. What's even more important is that we know what the true cost
is. When we approve raises, when we approve salary increases, when we
approve new positions, we have to account for not just the salaries and
benefits that show up right now but the pension liability, the true pension
and OPEB liability that is incurred. I've seen some numbers—if you take the
salaries and benefits and look at the true costs, it's almost a 2X cost. That's
something for us to not keep digging this hole, we have to do a better job in knowing what the true cost is and accounting for differences.
Mayor Kniss: Eric, you wanted to add a word or two.
Vice Mayor Filseth: I just wanted to add a word or two. First of all, thank
you, everybody, for tolerating through this. I hope people don't take this as
too much doom and gloom. The thing I want to point out is this is an issue, at least this discount rate and expenses and so forth, that nearly every
CalPERS member agency, city, and otherwise in the State of California has
to some degree, some more, some less. Everybody's got it. What we're
talking about is looking at ways to get in front of it. It's possible the State
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will step in and do something in the future. Hopefully, that will help
everybody. We're not unique in this. What we're trying to do is get ahead
of it. That's the way we should look at it. Thanks.
Mayor Kniss: Let me add just a word or two to this. One of the issues here
is also the sociology of it. The public worker has changed a great deal in the
last 30-40 years. The expectation at one point was very low pay and terrific
benefits. That's really changed through the years, and we have not changed
with that movement as it has affected especially us and businesses in the
Valley. Secondly, there's also—Lalo, you might just say a word about this.
The returns for CalPERS are erratic. I can remember when they were 18 or
20 percent. The latest one we have is 11.2 percent. What we look at is this
constant swing in CalPERS. I just read that the actual assets that they have
are running about $235 billion. Is that correct? Close to it?
Mr. Perez: That sounds about right.
Mayor Kniss: It's an enormous amount of money. With that come these
enormous swings. That's very hard for us to accept and understand why it
happens in such a way. We're waiting right now. The last time we know
what the returns were was last June, July, somewhere in there.
Mr. Perez: June.
Mayor Kniss: For the previous year. I imagine we'll get some midyear this
year, which we usually do.
Mr. Perez: Correct. We will review those.
Mayor Kniss: My admonition is not to get too excited about it. Given what
the market is doing, if CalPERS isn't up this time, I wouldn't understand
why. It is an enormous fund. It has a Board, as I recall. It's a big mix of
political, union, and some people from everyday walks of life. It's a
complicated Board. As we go forward on this, as Eric said, let's not look at it
with doom and gloom totally but look at it as this is a problem we have to
solve. It's all over California. The League of California Cities discusses it on
a regular basis. There are programs on this at every meeting we go to
that's a League meeting. We are not alone. We really have lots of
company. As we go forward over the next year, when Greg Scharff will be
heading up Finance, I hope one of your endeavors is to look at what are other cities doing and is there some city who has come up with a magic
answer, maybe Stockton.
Council Member Scharff: Madam Mayor, I was just going to say that my
experience is that Palo Alto is always at the forefront of everything and
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doing better than everyone else. Happy to look at that, but I'll be very
surprised.
Mayor Kniss: Then we will count on hearing from you that we are way
ahead and under budget and all of that.
MOTION AS AMENDED RESTATED: Vice Mayor Filseth moved, seconded
by Council Member Scharff to:
A. Approve the City’s 2017 Comprehensive Annual Financial Report
(CAFR); and
B. Approve conforming amendments to the Fiscal Year 2017 Budget
Appropriation for various funds; and
C. Accept the Fiscal Year 2019 to 2028 General Fund Long Range
Financial Forecast (Base Case); and
D. Provide direction on assumptions informing the City’s calculation of
pension liabilities and annual contribution goals and implications to the City Manager’s FY 2019 Proposed Budget; and
E. Direct Staff to return to the Finance Committee to look at ways to
arrest the growth of liabilities.
Mayor Kniss: Having said all that, if there are no other comments on that,
we have a Motion, which is here in front of you, and a second to that Motion.
Could you vote on the board? Passing unanimously.
MOTION AS AMENDED PASSED: 9-0
Mayor Kniss: This is, as we have said, primarily information tonight. The
CAFR from here on, I hope, will come on the Consent Calendar. The
discussion of where we're going long term is a really important one. As
we've mentioned, it takes balancing all of our needs and including pension
and OPEB at the same time.
Mr. Perez: Madam Mayor, if you don't mind, I would like to recognize Kiely,
Paul, and Steve for all the good work and also Tony (inaudible) and his team
on the CAFR and Tarun Narayan for the revenues. Thank you.
Mayor Kniss: Kiely, thank you. I think we should give you a round of
applause.
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Ms. Nose: The thank you really does go to Paul and Steve, who are the ones
behind all the numbers and the crunching and the estimates. Thanks, Paul
and Steve.
Mayor Kniss: You might get the credit, but you can just pass it on. Thanks.
Mr. Keene: The City Council clapping for the Staff who brings you a really
big, thorny problem and challenge.
11. Adoption of a Resolution Entitled “Resolution of the Council of the City
of Palo Amending the Southgate Residential Preferential Parking
Program (RPP) by Adjusting the Number of Employee Permits and
Making Clarifying Modifications;” and a Resolution Entitled “Resolution
of the Council of the City of Palo Alto Establishing a Two-hour Parking
Restriction in the Commercial Zones Adjacent to 1515 El Camino Real
and 1681 El Camino Real (Continued from December 11, 2017).”
Mayor Kniss: Now, we are going on to another big, thorny problem. We
have a neighborhood that has asked to be heard tonight. We're going on to
Number 11, which is Southgate Residential Preferential Parking (RPP). We
have Josh Mello and—Philip, I'm sorry. I don't know your last name.
Philip Kahmi, Transportation Programs Manager: Kahmi.
Mayor Kniss: Thank you. (Inaudible) number of people from Southgate who
want to speak to us. I have lots of cards. I would encourage Staff to move
through this with some alacrity so that we can hear from the members of
the public who are here tonight.
Josh Mello, Chief Transportation Official: Good evening, Mayor, members of
Council. I'm Josh Mello, the City's Chief Transportation Official. Giving you
a presentation tonight will be Philip Kahmi, our Transportation Programs
Manager. Following the presentation, we'll be glad to accept any questions
or comments.
Mr. Kahmi: Thank you. I will try to go through this as quickly as possible.
I'll just give some history on the Southgate RPP. Southgate residents
petitioned for the formation of an RPP, citing that the primary parking
impact was from Palo Alto High School students using the Southgate streets
for parking. In May 2016, Staff worked with Paly to find parking for
students by identifying the students that are traveling the furthest and working with Paly to reserve parking permits for them. Staff also restricted
parking on El Camino Real in front of Palo Alto Unified School District
(PAUSD) offices and Paly from 4:00 to 6:00 P.M. to reserve parking for Paly
students and prevent employee commuters from utilizing it. On June 19,
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2017, the Council approved a Resolution to implement the Southgate RPP as
a 1-year pilot program. In October, permits went on sale. At this time,
Staff were contacted by businesses located in Southgate, who expressed
concern over the amount of employee permits allocated to Southgate
businesses. Although Staff had hoped to begin full enforcement in
November, conflict with the Utilities light-post painting project and rain
caused delays in completing RPP signage installation. Our enforcement
contractor provided warnings on cars parking without a permit until
December 12 when the signage install was completed and full enforcement
began. This is the Southgate RPP district. The table in this slide compares
parking occupancy prior to the RPP implementation taken in May 2016 to
parking occupancies taken twice this month on days with both Paly and
Stanford in session. You'll note that there's a difference in the parking
spaces or supply between the two studies. This is because the initial parking study had missed certain segments in the count. As an example, no supply
or occupancy was taken on El Camino Real service road or in front of the two
businesses. As such, Staff requested that the contractor that we are using
Citywide to conduct our parking occupancy studies count the practical supply
for parking in Southgate. That said, if we were to utilize the current peak
occupancy with the prior supply, the occupancy in Southgate would be 29
percent. This table includes information from the Business Registry on the
seven discrete businesses that are actually registered at the two business
addresses within Southgate. You'll note that one of the seven businesses is
not currently in operation. Staff has spoken to these businesses, and
including part-time staff they have approximately 70 affiliated employees.
The businesses have requested 19 employee permits in addition to the ten
that are currently designated to cover their full-time staffing needs. It
should also be noted that Staff checked with Planning Staff on the zoning,
and Council has approved these businesses for legal nonconforming use.
This slide, you'll note that some of the numbers are actually incorrect in your
printed version. The correct numbers are on the board. Specifically, the
number of parking spaces in Downtown is 6,743. The supply numbers for
Southgate currently and proposed, as mentioned on the previous slide, were incorrect. That said, this shows how the permit ratios of employee permits
to resident permits and employee permits to parking spaces compare across
the different districts and also compare to the proposal that's before you
tonight. Again, I'm noting that the businesses requested 19 additional
permits for their full-time staff. One of the recommendations tonight within the Resolution is to limit the amount of employee daily permits that are
allocated or that can be capped. Currently, there's no cap. We find that 90
employee daily permits were sold as of the 9th of this month. I'll go through
these next slides fairly quickly. These are the two business addresses,
showing their parking lot. It's a little bit difficult to see. The business on the
left address, 1515 El Camino Real, has a parking lot with ten spaces. The
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business on the right, 1681 El Camino Real, has a parking lot with five
spaces. The next three slides are parking occupancy at different times.
There's not a huge variance between the three different time points taken
throughout the day. You will see that the parking occupancy is slightly
higher along Churchill nearest the PAUSD offices. I'm just going to show
some photos of before the RPP was implemented and after. This is Mariposa
Avenue, before on the left and after on the right. This is Castilleja and
Manzanita, before on the left and after on the right. Escobita Avenue, you
can actually see that there's some red curb there and a car parked in front
of a fire hydrant. This is Escobita Avenue on October 30, 2014, obviously
before, and after. These are some photos of Portola Avenue at the corner
curve where there were some concerns with parking and the width of the
street there. This just gives you a sense of some of the occupancy. This is
approximately 30 percent occupancy on this block on Miramonte Avenue from Castilleja to Escobita. This is 42 percent occupied this side of the
block. This is nearest to El Camino Real on Portola. This is just a short
video riding my bicycle through there. With that, I'll move to the
recommendation. Happy to answer any questions. I'll turn it over for public
comment. The recommendation, I would like to request an Amendment.
There are two words missing from this first step in the recommendation,
which is after "adopt the following Resolutions: (1) A Resolution
(Attachment A) to amend the Southgate RPP Pilot Program, established by
Resolution 9688, to increase the maximum number of employee permits
from 10 to 25, conform the Resolution to that of other RPP zones, and
remove El Camino Real from the RPP district." It should say "… remove
portions of El Camino Real from the RPP district." "A Resolution (Attachment
B) establishing two-hour time-limited parking to be in effect on Monday
through Friday between the hours of 8:00 A.M. and 5:00 P.M. in two
locations in proximity to the Southgate RPP program area, namely: the east
side of El Camino Real starting at Churchill Avenue and extending
approximately 110 feet southeasterly …
Mayor Kniss: Excuse me. Could you show that on a map while you're
explaining it?
Mr. Kahmi: Thanks. The corner of Churchill, which is the most northern
street there. El Camino is running north/south on the bottom. The corner of
Churchill and El Camino, and it's the corner of Park Boulevard and El
Camino. That's where the two businesses are located. It's 1515 El Camino
and 1681-1691 El Camino.
Mr. Mello: Basically the frontages along the commercial properties would be
marked as 2-hour parking between 8:00 A.M. and 5:00 P.M.
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Mayor Kniss: Continuing along that, as I said, before we go the public. If I
look at this map and I follow where the Southgate sign is on your map, if I
go north, I get to Churchill. There are then a series of parking areas that
are available beside the administration building and the tennis courts. Are
you familiar with those?
Mr. Mello: That is north of Churchill. That is not subject to this Resolution.
We added parking to that area last year prior to implementing the Southgate
RPP in order to provide parking for the students that were being relocated
from the Southgate neighborhood. We did that in advance of establishing
the Southgate RPP.
Mayor Kniss: Can only students park there?
Mr. Mello: It's open to anyone, but there is no parking permitted between
4:00 and 6:00 P.M. That was done in order to open it up for high school
students but not allow commuters to park there, particularly from Stanford across the street. We assumed the 4:00 to 6:00 P.M. would accommodate
the high school students without accommodating folks who work 'til 5:00
P.M.
Mayor Kniss: That takes care of everything from Churchill up to
Embarcadero?
Mr. Mello: That's correct. There are two bus stops that we prohibited
parking in, but it is the entire stretch from Churchill to Embarcadero.
Mayor Kniss: What you're saying is you're taking out the Churchill area
down to essentially Evergreen Park.
Mr. Mello: No, it would be very short sections on Churchill and El Camino
directly abutting the two commercial properties at 1515 and 1681 El
Camino.
Mayor Kniss: If you'll just repeat one more time. You said one of the
businesses is not in business. Which business is that?
Mr. Kahmi: Actually both business addresses—there are seven discrete
businesses located within the two business addresses, 1515 El Camino and
1681 El Camino. One of the seven businesses that registered for business
has not gone into business at this time. Currently, six businesses are
operating at those two addresses.
Mayor Kniss: Unit D is the one that's not in operation, correct? On 1515.
Mr. Kahmi: I believe so.
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Mr. Mello: Palo Alto Dermatology is not in operation, but there is a business
in Unit D. It's just above, in the table there.
Mayor Kniss: Thank you.
Council Member DuBois: Could we follow up with quick questions, Liz?
Mayor Kniss: Before I hear from Council, if you don't mind—we've got a lot
of cards here. I'd like to start with cards as we frequently do. With that,
have you listed them all on the board, Beth? You can see your name as its
listed up there. When you see that coming, would you come to the front
and talk with us? Dr. Michael Papalian is first. David Boudreault, perhaps, is
second.
Michael Papalian: Hi there. Dr. Michael Papalian. I represent the surgery
center, which is Suite A, in the 1515 El Camino building. Twenty-three
percent, yes, 23 percent is the maximum, yes, maximum parking utilization
at peak time in the Southgate area, 23 percent. By your own study, 23 percent of the public roads that we all pay taxes to maintain for public use.
Even at 23 percent, the residents want to restrict the use of the public
roads. Respectfully, just because residents can raise their voices doesn't
mean it's right, doesn't mean it's fair. Twenty-three percent. We got rid of
a lot of the problem. I'm here to support Staff's recommendation to
increase the number of permits. There are offices in our complex with
doctors and nurses without any permits at all, zero. I would strongly ask in
addition that you change the recommendation from four permits per month
for employees to five because there are some months where there are five
Tuesdays, where there are five Thursdays. We have people who come in
once a week. If there are only four permits available, they can't park in the
fifth week. There are 5 weeks sometimes. That's a minor change that I'd
ask. The City Charter says we're supposed to work collaboratively with
businesses. Please don't shut us down. Already one business I'm aware of
is probably going to leave because of the parking issue. They just can't deal
with it; they have no permits, zero. Their staff can't park; their doctor can't
park; their nurses can't park. Thank you.
Mayor Kniss: Next speaker is—I won't try the name again. I think it's
Boudreault.
David Boudreault: You had it right the first time. The second "o" is a "d" in
my name. I'm David Boudreault. I'm one of the businesses at 1515 El
Camino Real. Myself and five employees work at that location. They work
8:00 A.M. to 5:00 P.M. every day. One of my staff is over 60, comes in from
far away, gets there about 8:00, 8:30 A.M. in the morning. Frequently, there's no parking on the west side of El Camino, and that's from
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Embarcadero to Serra, which is where you mentioned—where the Recreation
Vehicle’s (RV) park. On the west side of El Camino is where my staff and I
have been trying to park, but frequently there's no parking all the way from
Embarcadero to Serra. Then, you park in front of the university, and
frequently there's no parking from Churchill all the way to Embarcadero.
Then, you're left trying to shuttle your cars around with 2-hour parking,
which you can only do once, and then you're left parking wherever you can,
sometimes in Town and Country or wherever you can get parking, not
legally. Myself, I take calls at a couple of hospitals, where I cover
Emergency Room (ER)) calls, come in and out of my office. It severely
impacts patient care if I can't get in and out, find parking. Then, you're
forced to park in that small parking lot, which now patients who are coming
to us, frequently with dressings, drains that they have to carry with them,
are now struggling to find parking. It's been an inconvenience to say the least. This all came to be supposedly with a discussion being had with us,
which we were never involved in. Obviously, we would have voiced our
concern at that time. The whole program was initiated without any input
from us and really any input in reality in what it takes and how a business in
this space—when I came to this space, I was never told I wouldn't be able to
park there and neither could my employees. This came up on us. It's a
little frustrating. My time is up. Thanks.
Mayor Kniss: Bob Stillerman followed by Dorothy Tiong, perhaps. Thank
you.
Bob Stillerman: Good evening, Mayor and members of the City Council. I'm
a Southgate resident. I just want to make a couple of quick points. This is
a residential parking program that we're talking about, that was initiated at
the request of a Southgate committee that recognized the problem with
excessive Paly students parking, businesses parking, Stanford employees
parking in our very narrow streets of our neighborhood. As a result of
instituting the RPP, the parking has gotten a lot better. I wanted to thank
you for initiating that Resolution earlier last year. Frankly, the process that
the City has gone through in trying to resolve this issue is less than ideal. In
January, they held what I call stealth meetings, which were very poorly advertised and included no Agenda, no proposed resolution, and just a
bunch of people yelling at each other. On one hand we have the businesses;
on the other hand we have the residents, just shouting at each other. What
I'd urge you to do is put together a committee where we have
representatives from the businesses, representatives from the residents and the City, if they wish to be involved in it, and allow the remainder of the trial
plan to complete and then present a solution at that time. Thank you.
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Mayor Kniss: Thank you. You are welcome to come closer so that you can
pop up when your name is up. Dorothy, is it Tiong? Then, Rhett Atkinson
and Angela Lin.
Dorothy Tiong: Good evening. I'm the assistant manager for the landlord
property owner at 1515. I just want to request from the property owner's
perspective to be treated as any other property owner in the Southgate
neighborhood. I don't know if the Council's aware, but directly adjacent to
1515 El Camino and behind it—all those properties are multiunit housing. As
you recall, the Southgate Resolution allows up to six annual permits per
dwelling unit. Ten out of the eleven properties bordered by Portola,
Churchill, Madrono Avenue, and Manzanita Avenue are all multiunit. There
are 28 units in that stretch, which amounts to—they are allowed 168
permits. If we were to be considered residential units, not commercial—
there are six suites—we would be allowed 36 permits. Because we're considered commercial, we're not allowed the same number of permits as
any other property owner in the neighborhood. This is unfair treatment.
This is inequitable. What we are asking for is 29 permits in total at 1515
alone. It's a little confusing. It's 29 permits at 1515 plus nine at 1681.
What we're asking is just parity of treatment for the other property owners.
We're not even asking for 36 units. If we were residential, we wouldn't even
be here because we would have been allowed to have 36 permits. Because
we're commercial, we're subject to these additional restrictions. What we're
asking is that you grant 1515 29 permits plus 9 for 1681 for a total of 38
units. Thank you very much.
Mayor Kniss: Thank you. Atkinson and then Angela Lin.
Rhett Atkinson: Hi, I'm Rhett Atkinson. I'm one of the anesthesiologists
that's worked at the plastic surgery center for the last 35 years. I have nine
partners that also help in that facility. I realize that parking is a problem in
Palo Alto and that regulations are often needed to solve the problem. I've
parked in that exact place for 35 years. I've never once had any problem
parking there. I've also noticed that the access road that goes down to that
always has parking. The only time there's any issue with parking is on
Thursday when the garbage trucks are there. It would seem to me that a legitimate business should be able to let their employees park on the curb
directly by their business. This has been taken away from us by these new
parking restrictions. This is a problem that was created, that really wasn't a
problem at all. That's really irritating. I would like to recommend that the
parking directly in front of a business be allowed for the business to park there. If not that, at least 29 permits be given because it's very difficult to
help people in that business. Thank you.
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Mayor Kniss: Thank you for speaking. Angela Lin and then Jennifer
Weintraub.
Angeline Lim: Good evening. My name is Angeline Lim, and I am one of the
partners of the woman-owned and operated small business at 1515 El
Camino Real. I spent 6 years of my life at Stanford doing plastic surgery
training, and I've spent another 10 years building my practice in a very
happy way in Palo Alto. The 1515 El Camino complex is a unique group of
plastic surgeons who have served the local, regional, and global
communities in so many ways. We have sewn up your children in the
emergency rooms when you bring them in. We have taken care of burn
patients. We have sewn fingers and hands back on and reconstructed
breasts for cancer patients. We've helped kids around the world have a
chance at a normal childhood when we repair their cleft lips. We care about
our community. We have great relationships with our patients. We are thoughtful employers, and we are good neighbors. We need Council's help
to continue to do these things well. At 1515 El Camino Real, there are seven
board-certified doctors regularly seeing patients in our offices. There are an
additional number of physicians who utilize our fully accredited surgery
center at 1515 El Camino Real. The surgeons, anesthesiologists, nurses, our
hardworking staff need to be able to come to work and take care of our
amazing patients without worrying about getting tickets because of a severe
shortage of parking permits available to the businesses. An additional 15
permits as recommended by Staff may be enough just for our complex at
1515 El Camino Real, but please don't forget about the other businesses
located within the Southgate district that need to be able to park as well.
Thank you for your thoughtful consideration tonight.
Mayor Kniss: Thank you for speaking. Jennifer Weintraub.
Jennifer Weintraub: Thank you for your time. Hello, I'm Dr. Jennifer
Weintraub. I am a surgeon practicing at 1515 El Camino. I founded my
surgical practice with Dr. Angeline Lim in 2007. We've been working there
since 2008. I'm also a longtime resident of Palo Alto. I own a home in Palo
Alto; I work in Palo Alto. The money that our business generates stays in
Palo Alto. Our business employs 100 percent women, and we work long hours. We're often seeing patients into the night. At this point, we're
walking down El Camino to our cars parked amongst the RVs. It is not safe,
and it is not sustainable. We simply cannot keep our business open if we
cannot have our employees driving to work and parking there. The property
taxes and also the business taxes that our business pays pays for services that not only the neighborhood but the entire City benefits from. We're
asking simply to continue working at our current location and to be able to
do so safely. We appreciate your time. Thanks.
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Mayor Kniss: Thank you. Keith Ferrell and then Jim McFall.
Keith Ferrell: Hello. I have maps here if you guys want to look at them, if
you need them. First and foremost, I want to just thank you for passing the
RPP back in June. As you saw with the pictures, the streets are lovely now,
back to where they were when I moved there in and my kids could roam the
streets freely. What we are asking is that you just take no action, that you
let the RPP roll on through the pilot program and we discover what issues
there are, and then we deal with them at the end of the pilot program. As
you can see, it's like Congress. We have residents here, business over
there. What it has done is pit residents against businesses, which I don't
think is a good idea. We would love to work with them, but we have not
been given an opportunity to. We were not given an opportunity before, and
the two meetings were iffy at best. It's still a brand new program. It just
started enforcement in December, so we still don't know how things are all shaking out. If you look at the occupancy study, it is 23 percent, which is
about what it should be. The streets closest to the businesses are more like
85, 70 percent. With additional permits, they'll be more like 90 or 100
percent. There is also parking north of Churchill as you saw. There are
regularly 10-12 open spots north of Churchill on El Camino, not where the
RVs are, on the safe side of the street along the district. Let's see. That is
it. I think we encourage everyone to get out of their cars, so I think this is a
good start. Also, if residents took six permits, there are 250 dwelling units,
500 spaces. That gives us approximately under two if everyone used them
and parked on the street. It's not six residents per person [sic]. Thank you.
Mayor Kniss: Greetings.
Jim McFall: Good evening. Jim McFall, I'm a Southgate resident, and I'm on
the Southgate parking committee. We submitted a letter to you, which you
should have in your packet, that explains some of the issues. Keith said a
lot of what I'm going to say, so I have a few more things to say instead of
that. Basically, our position is that this program just got started.
Enforcement only started in December. We're requesting Council allow the
program to continue as is and take no action tonight, see how it goes.
That's what a trial period is for, and that's what we're requesting. I'll just point out also—thank you. You saw the pictures; it's working. It's working
really well. One of the things that we came before you, that you listened to,
is the fact that Southgate is unique. The streets are very narrow. They're
one-way streets when cars are parked on both sides. We have significant
issues when cars do park there. Some of the standards, such as show rate and occupancy percentage, don't really apply here as they do in other
neighborhoods. Regarding the 2-hour parking in front of the businesses, I
don't understand that if you're in the parking district, the parking in front of
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your property whether it be business or residential should be included in the
district. Lastly, there are some zoning issues that came up in our review of
City documents regarding the approval for this property in 1988 and '89.
Clearly, the businesses are doing extremely well. If you look at what was
approved back then, it included a residential unit as well as retail space. I'm
curious what's happened with that. Clearly there's no residential unit; it
sounds like it's all medical practice. We would encourage Council to have
Staff look into that. We're certainly happy to share the information we've
obtained from City files regarding the approvals in 1988 and '89. Thanks
very much.
Mayor Kniss: Thanks very much. Susan Newman and then Christine
Shambora.
Susan Newman: Hi. I'm a resident of Southgate. Thank you for
implementing the RPP. It is helping us some. I have to say I'm not sure where you got the pictures from. I live on Portola near the corner of Portola
and Manzanita, near the footpath that goes from Southgate to Churchill over
to the businesses. I also use Madrono to enter and exit the neighborhood
multiple times a day. These are the areas that are most likely to be affected
by additional permits. I can just tell you from personal experience that the
occupancy rate on my street and Madrono is nowhere near 23 percent. If
something is going to be done to help these businesses, which I can hear
needs to be done, we need to consider some way of distributing the
additional parking throughout the neighborhood at least. There are
additional issues to be considered. I would urge you to give it some more
time, let us have more meetings, and figure it out. Thank you.
Mayor Kniss: Thank you for speaking. Susan Newman. Sorry, so sorry.
Christine Shambora.
Christine Shambora: Good evening. My remarks are going to be very brief.
A lot of what I wanted to say has already been said. I wanted to speak
because I want you to know that—I don't want you to interpret that I don't
care about this. I care passionately about it. It just so happens that I live
on Castilleja, and that situation has improved amazingly. I'm here out of
concern for the neighbors at the other side of our neighborhood, that are close to El Camino. This is just—15 more permits would just for them bring
back the nightmare we had before we instituted the RPP. I've been involved
in this from the very beginning. I want to say that the RPP has really
restored our quality of life in our neighborhood. I ask you not to change the
pilot until we've let it run its course and seen how it's going to work. I don't think any changes should be made. Thank you.
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Mayor Kniss: Thank you. Diane Morin and then Zoe Sarantis and Nancy
Shepherd.
Diane Morin: Could I have that map again please? When I came here
tonight—I've been part of no committee. I'm here for personal reasons. I
live on 1635 El Camino Real, which means I live close to the southern—it's
Invitro Fertilization (IVF) but there's also a dental, McKenna Dental in there
too. Now, we also have the recreation vehicles also there, parked for a long
period of time sometimes in front of those. Recently, in the past 2 years,
we've had bicycles—more than that, 5 years. We are a bicycle path to the
school. I've been very—you're always careful driving, but it's made me
much more concerned because we have many, many bikers. What I
specifically want to say, which hasn't been mentioned, is what I call a
frontage road. The road we're talking about, which they call the access road
where the two businesses are, is a two-way street, but there's only parking on one side because two cars can't fit side by side. What that means is that
for residents such as I it is difficult to move out into the road, to back out or
to back in, if there's parking on our road. It's an unusually narrow road.
First of all, I would say please keep the test in place that you've got right
now. Secondly, if you do, think about zoning, which is try to put parking
spots elsewhere in the neighborhood, not just on the access road, which is
where many of us live, residents not just businesses. I would ask that you
not change it. I would ask that you see whether the businesses, for
example, come up with creative ways to get their folks in and out, such as
vans, what we're asking Castilleja to do, what we're asking other businesses
to do. They're wonderful businesses. Hopefully, they can come up with
other ways in which to get their employees and to get their clients in and out
without having to take up all the parking spaces and, once again, turning our
road into a parking lot for them. Thank you very much.
Mayor Kniss: Thanks for coming. Is it Zoe Sarantis?
Zoe Sarantis: Yes, Zoe Sarantis. I'm a resident, and I live on the 1600
block of Portola Avenue, which is directly behind the 1681 IVF clinic. I
wanted to let the Council know that the occupancy on Portola isn't 22
percent. The reality is for us it's around 70-80 percent. It's an improvement. We were actually at 90-100 percent before RPP. The
situation is for us a lot of the traffic that we get, the congestion, is from
businesses on El Camino. We have the pathway. On the right-hand side,
we have (inaudible) pathway that leads to El Camino. That is heavily used
by pedestrians and by the medical staff that work on El Camino. We have a lot of traffic that comes and goes throughout the day, causing just traffic in
general and congestion. I'd like the City to take that into account when
assessing these options. I'd like to see the pilot continue and not any
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decisions made until we can get some real data here and really understand
what's going on. I have some personal experience with just the street being
very congested. My family was involved in a medical emergency about 18
months ago. We couldn't get an ambulance and the fire truck down on
Portola just because of the sheer number of cars parked on each side. We
just couldn't. We don't want to get to that point again of 90-100 percent
occupancy. We want some breathing space. I want to be able to park in my
driveway and actually reverse out without hitting a car. That's the situation
we face. A lot of the residents actually don't park in their driveways because
they can't get in or they know they can't get out because we're just so
tightly fit in. I just want you to take that into account. Thank you.
Mayor Kniss: Thanks for coming. Last speaker is former Mayor Nancy
Shepherd.
Nancy Shepherd: Good evening, and thank you. Thank you for taking this up. I actually wish it wasn't being taken up because I am going to support
the position of holding this pilot steady for the first trial period of 12 months
or so. This was one of the assurances that we were given during the
procedure that we went through. As most of you know, I was on Council
when we processed this policy. It was a policy that we were trying not to pit
businesses against residences. I do know that a lot of the stakeholder
meetings that happened with the Downtown permits actually brought a good
meeting of the minds and some common ground between the needs of the
businesses and the needs of the residences. The overall need for Palo Alto
to have less commuter traffic was always something that I was pro, for, on
City Council, as you know, working so hard on the Transportation
Management Association (TMA). I do ask that we—if we do make changes
to this pilot period, testing period, where we're trying out this program, if we
do bring changes, we actually bring changes with the right kind of data,
which includes options for getting commuters in. We also did ask
anecdotally to have the 1861 building over on El Camino Real, which is part
of a cluster of buildings, which is actually on their own City parcel, be part of
Evergreen Park because it is so—it's not really connected to Southgate
anymore even though it was part of the original map, apparently the cottage to the original Medical Foundation. Those are my comments. We also would
like to stand here. If you have any more questions from any of us, I've been
part of the team that's been working this through to make sure that we had
a thoughtful process and a real rational way to go forward on this. I'm sorry
that the businesses were not involved directly during that, but I had assurances that nobody—that there wasn't an interest at the time. At this
point, it would be nice to just keep this pilot going, and then rationally look
at adjustments as we go forward. Thank you.
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Mayor Kniss: Thanks. That's the end of our public speakers. I have lights
from Tom and from Adrian. Just to give you a sense of where I'm heading
on this is that I'm going to be looking at staying the course with the pilot
that we currently have in place. I also want to have a discussion about the
west side of El Camino, which clearly is where many people have tried to
park, and they're running into some problems there. As we decide what to
do tonight, I'm going to be discussing how we can look at that in a different
way. Tom.
Council Member DuBois: Thanks. I just have some questions for Staff. If
we make El Camino 2-hour only, are we removing permit parking? Is that
allowed there today?
Mr. Kahmi: In front of the businesses, it's currently marked as RPP parking
only.
Council Member DuBois: Is that the whole stretch from Stanford to Churchill?
Mr. Kahmi: It's actually just the frontages. It is RPP from Park Boulevard to
Churchill currently, all RPP. The recommendation in front of you is to
remove the RPP parking in front of those business addresses.
Council Member DuBois: What's the thinking behind that?
Mr. Kahmi: The thinking is that would allow the customers parking in front
of there and would reduce any long-term parking in front of the businesses,
preventing turnover within the neighborhood.
Council Member DuBois: Did you guys get any feedback that medical visits
are 2 hours? That seems like retail kind of time.
Mr. Kahmi: The concept behind the 2-hour in that—that really was part of
the development of the RPP, to prevent long-term—other nonresident
business.
Council Member Dubois: In other parts of the City, Evergreen Park, the idea
of 2 hours has been mostly retail-driven, and this seems medical only. I just
wondered if you had feedback from the doctors that 2 hours is long enough
for their patients or they have patients that need 2 1/2 hours.
Mr. Kahmi: We did receive some feedback from the businesses in recent
meetings that 2 hours is not always adequate.
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Council Member DuBois: We're removing permit parking from El Camino
and asking to put it into the neighborhood streets basically. Did you guys
consider both sides of El Camino, to make that permit parking?
Mr. Kahmi: No, we did not consider the west side of El Camino.
Council Member DuBois: I don't know if Rhett Atkinson is still here. Could I
ask him a quick question, Mayor?
Mayor Kniss: Yes, of course.
Council Member DuBois: When you talked about parking near your
business, what did you mean exactly? If you could come up to the mic.
Mayor Kniss: Come on back to the mic if you would, sir.
Mr. Atkinson: Could you repeat the question please?
Council Member DuBois: You talked about being able to park near your
business. I just want to be clear what you meant. Did you mean …
Mr. Atkinson: What I was talking about is the business has a curb on El Camino, and the business has a curb on Churchill. It would seem fair that
the employees of the business could park in that particular place. That was
what I was talking about. That, of course, doesn't impact the residents
because it's part of the business curb.
Council Member DuBois: Thank you. Another question for Staff. Have you
had any discussion with the businesses about using valet parking in their
lots to get more cars in those lots?
Mr. Kahmi: No, not specifically about valet parking.
Council Member DuBois: Do you know how many—you said there was like
70 part-time employees. Do you know what the full-time equivalent is, how
many people generally?
Mr. Kahmi: What we've heard from the businesses tonight is they've said
that they have, I believe, 29 and nine. What we had taken out of the
meeting was 29 in total. That's inclusive of the ten that are already
assigned.
Council Member DuBois: I was looking through the proposed ordinance. Is
El Camino part of the parking district?
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Mr. Kahmi: El Camino Real, the service road is part of the parking district.
As I mentioned before, from Park Boulevard to Churchill on the east side is
part of the RPP district currently.
Council Member DuBois: When I read the ordinance, it defines the district.
It doesn't include El Camino.
Mr. Kahmi: Thank you. That was actually part of the recommended
Amendment.
Council Member DuBois: I think I'm looking at the newest. We got it as a
handout.
Mr. Kahmi: I said it in the presentation. Sorry.
Council Member DuBois: I see. We sold permits to businesses that aren't
part of the district currently?
Mr. Kamhi: We had actually sold—sorry. Just really quickly, the correction
was to the first part of the recommendation, to remove El Camino Real. It should say remove portions of El Camino Real. Within the Resolution, El
Camino Real—east side of 215 feet north of Park Boulevard to 110 feet south
of Churchill should be added to that table in the Resolution.
Mr. Mello: Sorry, if I could just jump in here, Council Member. When the
RPP program was set up, we included the entirety of the platted
neighborhood of Southgate. There are two commercial properties in that
platted subdivision of Southgate. With other RPPs, we didn't typically
include commercial streets that are abutting neighborhoods. For the
Downtown, you know the Downtown district. None of the commercial core
of Downtown is included in the RPP. In the Evergreen Park/Mayfield RPP, we
did not include El Camino or the commercial streets of College and California
and Sherman. In the Southgate case, El Camino is actually residential, the
portion that's along the service road. We did include that in the original
district, but we did not include any other segments of El Camino.
Council Member DuBois: Looking at the Ordinance, it was a handout. It's
Page 2 where it has that table. It says the following City blocks will be the
RPP.
Mr. Mello: There's a correction to that table, which would add an additional
row, that would include the remaining section of El Camino that's not being modified in the other Resolution.
Council Member DuBois: Thank you.
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Mr. Mello: I apologize for that mistake.
Council Member DuBois: It seems like the problem is really businesses on El
Camino and then not allowing permits on El Camino. We're basically asking
those businesses to park in the neighborhoods. I'd be interested, if my
Colleagues are interested, in really understanding if we allowed permits on
El Camino, either or on one side or both sides, if that would remove parking
from the neighborhood. It sounds like we don't really have an allocation
here like we might have in Evergreen Park. The other thing we need to
think about is how do we prioritize which businesses can get permits if there
is no more demand than there are spaces. I did see one email that I
thought was interesting and worth bringing up about a privacy issue of
labeling the permits with the neighborhood. I don't know if Staff saw that. I
thought it was a pretty reasonable comment, something to think about as
we refine the program.
Mr. Kahmi: We will be removing that kind of labeling from permits in the
future.
Council Member DuBois: Kind of questioning why we'd split up El Camino if
we did the entire block face as 2-hour plus permit. It seems like it would
shift a lot of the parking out of the neighborhood streets. Are there zones in
this RPP or is it all one zone?
Mr. Mello: Going back to your previous comment, El Camino is residential
between the two commercial properties, so we would not recommend going
to 2-hour in front of the residential properties.
Council Member DuBois: I'm saying make it all 2-hour plus permit.
Mr. Mello: That's how it's currently signed.
Council Member DuBois: Including these two sections in front of the
businesses?
Mr. Mello: Yeah. The entirety of that section of El Camino as well as
Churchill is currently signed as RPP.
Council Member DuBois: I'm just suggesting leaving it that way rather than
removing permits from the two businesses. The other question was are
there zones versus all one zone.
Mr. Mello: There are no zones currently in Southgate. It's a very small area compared to Downtown and Evergreen/Mayfield.
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Council Member DuBois: I'll hold off, since I went early, on a Motion. For
my comments, you guys can ascertain my thinking. It seems like we're
talking about a relatively small amount of business parking. There seems to
be space on El Camino, and it seems like it would solve a lot of the conflict.
Council Member Scharff: When you said there's more parking on El Camino,
they're saying that's already in the RPP.
Council Member DuBois: They're proposing that we remove it.
Council Member Scharff: You're saying it shouldn't. Are you proposing then
to sell more permits and let people park there or are you suggesting that we
do it on the west side of El Camino?
Council Member DuBois: I'm suggesting the west side and not removing
spots from the east side.
Council Member Scharff: Selling more permits and including—are you
suggesting we sell the ten more permits and include the west side of El Camino as well? I'm just trying to get a sense of what you're …
Council Member DuBois: Overall, my sense would be don't remove any of
the permitted parking on El Camino. Maybe add some on the west side, and
then maybe talk to the business owners about valet or some other way to
utilize their parking lots and be able to get to the total amount that way.
James Keene, City Manager: Madam Mayor …
Mr. Mello: If I could jump in. We've done some research leading up to this
Council meeting. Moving forward, any parking regulations that we
implement on El Camino will need to be approved by Caltrans. If you were
to elect to add the west side this evening, we've have to adopt a Resolution
and then forward that Resolution to Caltrans for approval. It would not be
an immediate fix most likely.
Mr. Keene: I'm not certain that we'd have automatic guarantee of approval
from Caltrans either. There's a difference between the access road, as I
understand, on the east side where the City has more leverage and
autonomy in comparison to El Camino proper itself on the west side.
Council Member DuBois: That's okay. We should ask Caltrans. Thanks.
Mayor Kniss: In order, I've got Adrian and then Greg and then Cory and
then Karen. If someone else has put on their light, it's not evident yet. And then Eric.
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Council Member Fine: Thank you, Madam Mayor. Thank you, Staff, for the
report. Thank you, everyone, for showing up. We've dealt with a lot of
these RPPs, and I've a couple of comments on this one specifically and a
couple more broadly. I'll start more broadly. I do worry that we are baking
a new cake in each neighborhood. Each time we deal with one of these
RPPs, we're looking at amending RPP regulations so that it fits the specific
few small issues that we find in each neighborhood. That disappoints me
because I do want us to be able to work on these things effectively, provide
relief for our residents, and also provide adequate parking for our
businesses. Now, onto Southgate. Overall this RPP is working. We've
heard that from the public. The data bears that out. It is interesting that
we did give some permits to the businesses; we gave none to the Paly
students. My guess and my intuition is that probably most of the parking
impact was Paly students. Occasionally, of course, you have Stanford events, which come and go. That happens once in a while. I do respect the
issue that the pilot was on a 1-year timeline, but I also see a need for us to
be nimble and flexible in how we apply these RPPs and, at the same time,
we are able to come back to these. We could come back in 6 months or
could come back in a year, and that's something we should keep in mind.
Two quick questions for Staff and then a few more comments. Of the area
you're proposing to rezone along El Camino, the 120 or so feet, how many
spots do you expect that to generate?
Mr. Mello: The spaces are generally 20-22 feet long. There's likely some no
parking areas in there for hydrants and (crosstalk).
Council Member Fine: Call it five spots. In this RPP, we have six permits
per household, one of the speakers mentioned. Isn't five the standard in
most of our RPP districts?
Mr. Kahmi: It actually does vary by district.
Council Member Fine: Here we go. This is one of the points I wanted to
make. We have different numbers of permits per household by
neighborhood. I'm not really sure why we do. Is there a reason for that?
Do people in Southgate have a lot more cars?
Mr. Mello: No. A lot of the parameters that come before you for the RPPs are developed in stakeholder meetings leading up to the Council
presentation.
Council Member Fine: Thank you. Just going through a few of the reasons
why I think it may be appropriate for us to move forward with this tonight.
There are approximately 70 employees in these two business parcels with 15 spots on their sites. That leaves about 55 folks unparked, and we're looking
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at 15 additional spots within Southgate. If you could say that there are five
spots available on El Camino, that's a net total of about ten spots in the
neighborhood. I think our first speaker mentioned that there's only a 23
percent show rate. Parking is obviously a very valuable resource. That's
why folks are here tonight. That's why we spend so much time on it on
Council. If only one in five spots are being used, that's something we should
keep in mind. There are about 580 spots in the neighborhood, so call it 300
available. I don't want to say available because I know they're rotating, and
folks use them for different purposes. I don't believe 15 additional spots for
employees is a huge impact. Our City is made up residents, businesses, and
nonprofits, and we've an obligation to serve all of them. I think I'll leave it
at that for now. I would be willing to entertain a Motion, as Tom mentioned.
I'll leave it to some others to speak. I would be willing to go forward with
this. I would also be willing to revisit it if there is a problem arising from the changes we make tonight. I don't think 15 additional employee permits is a
huge burden here.
Mayor Kniss: Greg Scharff.
Council Member Scharff: Thanks. I'll just follow up on that as well. First of
all, I'm really glad we did the RPP. I see a huge difference in Southgate. I
drive through Southgate before, and I drove through this. I have friends
there. The difference is tremendous. I drove Southgate today with the
Mayor; we went and looked at it. I saw very, very few cars. I saw that 20
percent. If I was a Southgate resident, I would want to maintain the way it
looks now. The question I'm struggling with is, if we add the business
permits in, does it actually impact your quality of life. That's really the
question. It's hard to imagine that those ten extra permits do. I'm thinking
about the pilot. I'm saying to myself, "A pilot makes a lot of sense." If it
does impact your quality of life and we do have a problem, then we should
take those permits out. Why wait? We know that it's working right now. It
doesn't seem like an extra ten permits is going to make a difference. Why
not make the change now while it's a pilot and then fix the issue? If it
causes problems, I'd be the first to say let's change it. Let's do something
different. I am really interested in the idea of adding the permits on the west side as well because that gives us more. That solves the problem. If
we get those approved by Caltrain, then what I'd really like to do—Caltrans.
Could we in fact create—I don't know how that works, but it would be really
nice if we could get the businesses to park there rather than park in the
neighborhood. It seems to me that there should be a solution. On the other hand, what I'm hearing from the businesses is they're having severe
problems now. They're our neighbors. We as a Council have always been
supporting small, resident-serving businesses, and that's what they are.
They're medical. Do we want to drive outside Palo Alto? Do you want to go
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to Redwood City for these medical services? I for one want these in our
neighborhoods. I'd ask the question of Southgate residents of if the
businesses went out of business and that was to convert to multifamily
housing—if I wanted to add two or three permits per number of units on
that, you're going to have a lot more people parking in the RPP than you
would out of those businesses. At least that's the way it seems to me. I
also have to ask myself—six parking spaces per, is that—really? Six permits
per resident seems like an awful lot, to be honest. If someone had six cars,
we're only talking ten permits. You do the math. It takes three residents in
Southgate to have six permits, and you've already gotten more than the
businesses are asking for. I don't see they're a problem right now, so I
don't see we need to restrict that six permits. I forget. In Downtown, didn't
we say 4? That was my recollection of it.
Mr. Kahmi: I believe it's 5.
Council Member Scharff: It's 5. Is anyone taking 6 permits in Southgate?
Mr. Kahmi: I'm sorry. I can't tell you in Southgate, but I can say that in
Evergreen Park/Mayfield there were some residents that … There were
actually 11 residents in Evergreen Park that had more than 4 permits.
Council Member Scharff: We need to resolve this without losing the
businesses and without—we need to be sensitive. They're also part of the
community. They're part of Southgate. They've been there a really long
time. It's unclear to me why we would say they can no longer park there.
The notion that somehow we're going to get Transportation Demand
Management (TDM) on really small businesses, on neighborhood-serving
small businesses, and that is effective is really, really a difficult push. I'd be
all for it, but it's not quite clear to me what we would do to achieve that. I
do think we need to resolve this. I wanted to ask how long do you think it'll
take to see if we get support from Caltrans.
Mr. Mello: I would say at least a month or a couple of months. It's going to
have to go through their entire bureaucracy and multiple operations groups.
I would hesitate to make any promises. If I had to guess, I would say a
couple of months.
Council Member Scharff: When we put the no parking after 4:00 P.M., how long did it take to get those signs up because that's on El Camino?
Mr. Mello: We were operating under an agreement that we had executed
with Caltrans. We had assumed that that agreement gave us the authority
to regulate parking. We've been working with the City Attorney recently,
and they've interpreted that agreement a little bit differently. Caltrans has
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confirmed that. Moving forward, we'll need to get approval from Caltrans on
any parking regulations on State highways. We would actually go back and
retroactively submit that addition of parking as well.
Molly Stump, City Attorney: Through the Mayor, City Attorney Molly Stump.
In addition, on this west side of El Camino, that item is not called out on
your Agenda. That's not part of the district now. If Council is interested in
redrawing the district to encompass that set of block faces, we'll have to
come back for the Council authorization before we go to Caltrans. That
could be done on Consent as consistent with the direction that you would
give us this evening.
Council Member Scharff: The other thing that concerns me is what problem
are we trying to solve. I assume the issue is the local business—I need
clarification. Maybe we need to get one of the business people up here if
you don't know the answer. They have a parking lot, which they use for their patients. Their employees park somewhere else. The question is, if
you remove the RPP and we don't sell them permits—the RPP already allows
parking there for 2 hours, but some people might park there and block it all
day. That's why you figured you'd remove it. If we sold them permits to
park there, then that would be fine. The question is how do we sell them
permits to park there because it's just in front of their business. Do we
create a separate zone for that? I just want to know how we do that and
don't have the residents park there. Why would the residents park there? I
assume some must do. I'm just trying to understand how would we solve
that problem.
Mr. Mello: Ultimately, that's up to Council. Our idea was to maintain
consistency. Along the bulk of commercial frontage on El Camino, we have
2-hour parking. The goal of that is to free up the space and encourage
turnover. What we don't want is the customers to be parking in the
neighborhood, because they're much more high turnover. It's going to
create more congestion, and you're going to have more cars circulating.
Ideally, we'd get the customers to park as close as possible to the business
if not in those lots. You may want to ask some of the businesses how that
would work for them.
Council Member Scharff: Can I ask some of the businesses? I don't mind.
You want to come up? Come to the mic.
Mr. Papalian: (Inaudible) absolutely no sense whatsoever to take away the
permitted parking from our frontage. What's going to happen is it's going to
take our employees, who are going to park on our frontage, and move them into the neighborhood, which is what the neighbors don't want. Because we
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want to reserve our parking lot for our patients, currently and historically our
employees parked on our frontage, frontage in front of our business. Now,
you're saying you even want to change that. All that's going to do is take
our employees and move them further into their neighborhood. It makes no
sense to us, and I don't really think it makes sense to them either. That
whole thing, I don't really know how it got added, don't know why it got
added. It doesn't seem to be logical.
Vice Mayor Filseth: Are you saying there's enough space in your parking lot
to handle all your patients?
Mr. Papalian: If we don't have employees parking in the parking lot, it's
pretty good. They might have every now and then, but it's pretty good
because they're coming and going.
Council Member Scharff: Right now in front of your building, there is RPP
parking. Is anyone parking there besides your employees? Are residents?
Mr. Papalian: No, residents don't tend to park there.
Council Member Scharff: If that was your permits to park there, you would
be fine, right? Is there enough spaces? Is there ten spaces there?
Mr. Papalian: No, but we …
Council Member Scharff: You're already using it?
Mr. Papalian: They're already using it.
Council Member Scharff: That's where you guys with your ten permits are
parking?
Mr. Papalian: Correct.
Council Member Scharff: How many spaces roughly are there?
Mr. Papalian: Eight.
Council Member Scharff: That makes sense. What you're really telling us is
it makes absolutely no sense to remove that from RPP.
Mr. Papalian: To restrict that. If you restrict it, it's just going to take the
people who have permits to park and going to move them in front of their
houses. We know they don't want that. We don't want to do that to them.
We're just asking for—let us park in front of our own building. Leave our lot
for the patients. We need a moderate amount of the ability to park.
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Council Member Scharff: If you could park on the west side of El Camino,
would that solve your problem if you had ten spaces there to park?
Mr. Papalian: Any permit would be better than no permit. As I said, the
vast majority of this problem got solved by the high school students and the
Stanford people parking. We're talking—Staff said a pretty good
recommendation. Our employees aren't there every day. It's not a huge
number. It's just not a huge number to ask.
Council Member Scharff: Thanks. My one last question was somewhere in
the Staff recommendation. Right now, you can buy as many day permits as
you want. I'm assuming what the residents are asking for is—if we keep the
thing to say you'll continue to be able to buy as many day permits as you
want, I assume that's just an expensive approach, and that's the issue.
Mr. Papalian: Correct.
Council Member Scharff: You actually can park in the neighborhood right now anywhere you want; you just need to buy a day permit.
Mr. Papalian: If you really want the truth, this isn't going to change the
number of cars because we're just changing day permits to permanent
permits. It's really about how much. Personally, the money's not the big
issue. We're not talking about changing the total number of cars parked.
That's the whole point.
Council Member Scharff: That's what I was getting at. I was trying to
understand. From the residents' perspective, it seemed to me that if we
limit the number of day permits but grant you the other 15, you're in a
similar boat, and everyone's better off. At least that's what it seemed to
me. If we just keep the RPP exactly the same way it is, then you're just
going to buy the day permits.
Vice Mayor Filseth: Is that Staff's understanding too, that we're selling tons
of day permits?
Mr. Kahmi: Yeah, that's correct. As of the 9th of January, we'd sold 90 day
permits. I'm sure we've sold more since then. Unlike the Downtown, there
was not a cap placed on day permits in either Evergreen Park/Mayfield or
Southgate. The recommendation before you is to place a cap similar to the
cap in Downtown.
Council Member Scharff: His request was the extra 5, not the 4. I got that.
Mr. Kamhi: Yes.
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Mr. Papalian: Just go from four to five just because there's 5 weeks. If you
want me to tell you about those day permits, the vast majority of that is me
and my business. I'm just trying to get in front of the problem. I bought a
bunch of permits. They're sitting there. Maybe 10 percent of them have
been used. I'm stuck. I've got to find parking for my employees. It's like
you're going to sell me permits? I'll buy 100 of them and stick them in a
closet. They're really not used because we're trying.
Mr. Mello: If I could add. The daily permits make it very hard for us to keep
a handle on occupancy. Not having a cap puts this great unknown in what
the demand is going to be. This would help us better manage the occupancy
as well moving forward.
Vice Mayor Filseth: What I think I just heard was that because he's got
essentially an unlimited supply of day permits, at least more than he's using,
then there's no reason to think that the number of cars in the neighborhood is limited by the number of permits right now. It's limited by demand. Is
that accurate thinking?
Mr. Mello: They're $5 per permit, so there has to be a limit to the total
number that somebody would purchase. Given the types of businesses that
are there and the type of costs they typically incur, it wouldn't be a stretch
to think they're stocking up on $5 permits and potentially parking as many
cars as they would be if they had the annual permits.
Vice Mayor Filseth: If you go to San Francisco, $5 to park all day is cheap.
Mayor Kniss: Greg Scharff, were you done or will you …
Council Member Scharff: I'm now done.
Mayor Kniss: This is interesting that an RPP problem is taking almost as
long as the Long Range Forecast dealing with pensions and Other Post
Employee Benefit (OPEB). Going on now, Cory next, Karen, Eric, and Lydia,
and Greg Tanaka.
Council Member Wolbach: There are a couple of things that seem very
apparent out of all this. One is when you look at the maps of distribution, it
is apparent that you have much greater usage in some streets within the
neighborhood than in others. We even heard people say that. We heard
some people say, "Things are great on my street, but I'm really worried about my neighbors just a couple of blocks away." Given the need and the
usage from the businesses, it makes sense to ask whether we should have
zones or whether employee permits should be assigned by street, and just
say one employee per street so it's really spaced out. Let's be honest. One
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car, even one extra car parked on your street when it's this low utilization, if
it was distributed, wouldn't really impact anyone's quality of life. One more
car parked on the street on my block isn't going to impact my quality of life.
If I'm on a street that's one of the more impacted ones and then you add a
bunch of new spots and because I'm on the street that's proximate to the
businesses, all those new permits are going to go on my street. Then, my
street just got a lot closer to 60, 70 percent. I understand the concern
about that. That's something to be worried about, and I acknowledge and
understand why people might be worried about that. I'm thinking the
distribution of the employee permits is actually a big thing that we should be
talking about within this district. This is a pilot. I understand people not
wanting to see all the benefits undone. I think the pilot is the right time to
experiment. The pilot isn't we're going to do X for 1 year. The pilot is we're
going to try RPP in this district for a year, and that pilot is a great time to—this porridge is a little bit too cold. This porridge is a little too hot. We
found it just right. We're looking for that Goldilocks where quality of life is
preserved for the neighborhood. Businesses aren't forced out of business or
people aren't forced into very awkward or unsafe or whatever situation or
we're not creating these weird unintended consequences of microeconomics
where people are bulking up on day passes because they can't get the long-
term passes. They end up parking anyway, and they're just doing it through
one system instead of another. The distribution's a big thing that we should
reexamine. I'm not making a Motion yet. Maybe that's something we
reexamine during the pilot. Maybe it's something we reexamine at the end
of the pilot. This idea of removing the RPP parking on Churchill and El
Camino and also at the other end on El Camino—what I'm hearing from my
Colleagues and my feeling is let's not do that. That's a non-starter. We
don't want to remove the options of employees to just park right in front of
the business as opposed to parking in front of the residences. For me
another lesson out of this goes to what we were talking about—was it just
last week? We were talking about the parking garage in the Cal. Ave. area.
Next week we're talking about the adjacent RPP. We need to see the TMA
expand into the California area. I'm actually now liaison to the TMA, and I'm going to be attending my first meeting as liaison to the TMA tomorrow
morning. I'll bring it up with them. We need to not waste time in figuring
out how our Transportation Management Association can expand to the Cal.
Ave. area and maybe include these businesses. On their own, these
certainly aren't going to have the economy of scale to do effective transportation demand management for their employees. If they're part of
a larger effort, then carpooling, etc., might be options that would work if
they have more people from around the area to potentially carpool with.
Those are things I'm looking at, better distribution of employee permits
within this district, the expansion of the TMA, not removing the RPP spaces.
If it's in the context of those things also moving forward, I'm probably okay
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with adding a few more employee permits, especially if they're well-
dispersed, and if we're also simultaneously petitioning Caltrans to open up
more spaces right across the street. People can use the crosswalk at
Churchill, walk right across the street. We need to look at how these pieces
fit together and have a holistic approach. I don't want to see a couple of
these blocks where it's already in the 26-50 percent occupancy get worse.
Throughout this district and on El Camino, especially if we don't get rid of
those spots, there is room for those 15 permits that Staff is suggesting,
especially since it sounds like those people are already parking there.
They're just using the day passes. I don't think it's as dire as some are
worried, but we could screw it up if we don't use this "all of the above" kind
of approach we need here. Sorry for my rambling thoughts there.
Mayor Kniss: Karen is next, and then Eric and then Lydia and then Greg
Tanaka.
Council Member Holman: I'll try to be brief. A couple of things, and I'll ask
a couple of critical questions first. We received a number of emails about
the meetings in the neighborhood. Most of the email that we received were
pretty critical of the meeting process. What I'm pointing to as a going-
forward basis is in future meetings the Staff come with data. For instance
tonight, just to use a simple example, how many households have really
asked for 6 permits, that kind of data is important for everybody to
understand. Six per household is a lot; it's an awful lot. Someone else
mentioned that, if we just went to—hey, guys. If we just went to—three of
you are engaged in a different conversation over there. If we just went to
five per household—it may have been Greg Scharff who mentioned that's
enough to more than cover what the request is of the businesses. Without
that information being available for the neighbors to understand, for us to
understand when it comes forward, we don't know. Again, six per household
is a lot it seems to me. Council Member DuBois mentioned valet parking or
valet service in the parking lots. One of the parking lots is pretty small. I've
always wondered whether it's you all or dental services as well that we'll
deal with later is the consideration of using and providing a service, in
quotes, for patients for Uber, Lyft, cabs, whatever. Some of these—they're patients, right—patients are not really in great stead to drive anyway.
They're either going to drive themselves and maybe shouldn't, have
somebody else drive them who's going to either drop them off and create
another trip by coming and going, or parking further away than they should
or be struggling to find a place to park close enough. It seems to me that there could be an opportunity for a model that especially medical services
could develop that would utilize some of the transit services that are
available. I would hope that the businesses will look at that as an
opportunity. It's not that expensive either. This neighborhood does have,
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as residents have mentioned—I know this neighborhood quite well. There
are such narrow streets. Especially Portola is really, really, really narrow. If
the western side of the neighborhood, that being Portola for instance, is
being still pretty heavily impacted by parking, it's still a detriment to safety.
Someone mentioned they couldn't during an event have emergency vehicles
get to their property. That's a concern when one of government's primary
responsibilities is health and safety. If that's still a situation that's ongoing,
then that needs to be rectified. I don't have the answer on how to do that
specifically. Maybe limit however many permits can be sold on that street. I
don't know. I don't know what the answer is there, but that needs to be
addressed because that's really not okay. It's interesting that this has come
up in January and has been going on when the trial only started in
December. We're off to a rocky start to begin with. Someone should ask—
I'll do it, I guess. Jim McFall brought up the matter of uses here. Staff should probably look and see if—not trying to get anybody in trouble here,
but we do have issues sometimes with uses growing, expanding, migrating,
changing, and not being well tracked. That should be addressed and dealt
with as opposed to just pretending we didn't have this learning, if indeed it
is a learning. My other comment is going to comport with other comments
that have been made about looking at using the west side of El Camino Real
as well. I appreciate—I apologize; I don't remember your name—if we
change the permit to 2-hour right in front of these, it's just going to literally
drive the parking into the neighborhood. That's not what the businesses
want to do, and it's not what the residents want to do. I'm not in favor of
making that change. I am in favor of looking at the west side of El Camino
as additional permit parking. That covers my comments. Thanks.
Mayor Kniss: Thanks. To you, Eric, then Lydia then Greg. Am I missing
anyone?
Vice Mayor Filseth: Where to start? I'm struck by what I think I heard here.
If we did absolutely nothing tonight, then everybody's okay because the
daily permit situation is more expensive, but at least there's a workable
solution there. It's not going to produce any more cars. If we cap the daily
permits, then the businesses are going to have a problem. At least that's what I think I heard. Beyond that, the good discussion about pushing cars
through the neighborhoods and distributing. The 2-hour thing in front of the
businesses, I'm assuming we're not going to do that because it sounds like
the businesses don't want it. The residents, it's not an issue for them.
Businesses have enough space for their customers in their lots. One thing that we haven't talked about is both the Mayor and I on separate occasions
drove up and down El Camino north of Churchill on the east side in front of
Paly. There's lots of space out there on multiple occasions. You can't park
there from 4:00 to 6:00 P.M. It's maybe half full even in the middle of the
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day. My inclination on all this, on the high level, is first of all we ought to
use the El Camino space both on the east side in front of Paly and possibly
on the west side, although it'll take longer, before we push cars into the
neighborhoods. That's one. The second is other things being equal, I'd
rather see us keep the pilot. The problem with the pilot is it doesn't come
up until November 2018. That's a long time. Given that there's—I think
there's a need to be—somebody used the word, I think Council Member Fine,
nimble. We need to be more nimble than that on this and react to this stuff.
That said, 25 spaces out of 580—I think on one of your slides it was 4
percent. It's hard for me to believe that we couldn't figure out a way to
accommodate 4 percent of the spaces in Southgate for the employees. It's
not very much. The things we ought to look at, we do need to do something
about, in principle we could do nothing, and the daily permit solves it for the
remainder of the pilot period. We need to look at what do we do to annex some more space on El Camino. That seems to me to be the no-brainer. If
Staff could figure out a way to prevent bunching next to El Camino, that
would make it a lot more palatable for everybody, if we were to find a couple
percent of Southgate. I've driven through the Southgate neighborhood, and
I didn't see any bunching when I went through. There may be some on
different times and different days, so we have to take a look at that. We
talked about the 2 hour thing. As far as driving the process to go see
Caltrans, we should start that immediately. We should do that forthwith
because parking is a scarce resource in this town and we have to manage it.
My inclination is actually we should—I've sort of changed a little bit over the
last couple of days. I actually think maybe we ought to look at adding some
more permits. Again, El Camino ought to be the first target and, if there's
any more, then distribution through the neighborhood so they don't bunch
up ought to be the second one. Thanks. I may make one later.
Mayor Kniss: The last two, unless I missed somebody, are Lydia and then
Greg.
Council Member Kou: Does Palo Alto High School and the School District
offices have a TDM?
Mr. Mello: Early on when we were developing the Southgate RPP program, we did talk to the high school about implementing TDM. We've also talked
to the administration about that. Where we ended up on that was we did
reach an agreement with the high school for them to restructure the way
they allocate their parking permits for students, to prioritize students that
are too far to walk or bike to school. They were just giving them out on a first-come-first-serve basis after the seniors receive their permits. Another
action you took was to add that parking in front of the high school. We did
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present a TDM concept and strongly encouraged them to adopt some of the
measures. As far as I know, they haven't done any of that to date.
Council Member Kou: I know these are small businesses. A Council
Colleague had mentioned that it didn't seem feasible to ask the smaller
businesses to have a TDM. Why not? Would it be possible?
Council Member Wolbach: It's easier with economy of scale.
Ms. Stump: There are a variety of issues that are fairly complex with adding
TDM in this way. We'll need to do some more work on it and advise you.
Council Member Kou: On 1515, it has six businesses, six or five businesses
in there. Explain to me the legal nonconforming bit.
Hillary Gitelman, Planning and Community Environment Director: Thank you
for that question, Council Member Kou. Hillary Gitelman, the Planning
Director. We did enough research to ascertain that these were permitted
businesses. They had permits to be in place. Someone else raised an issue that there was something else in the record that we should look at further.
We'll have to look at that. Our research showed they were legal and
nonconforming. We'll have to dig deeper into the history of them if we want
more information than that.
Council Member Kou: It is legal and conforming?
Ms. Gitelman: Correct.
Council Member Kou: With the kind of business that they are, how does the
parking fit into there? How does the necessary number of parking allocate
to each business then?
Ms. Gitelman: We didn't identify any irregularities. Our research to date,
which is very high level, just finding the documents, confirms that these
businesses were allowed to be there in the current configuration with the
current parking spaces. We didn't go any deeper than that.
Council Member Kou: Thank you. That's where we see where the problem
is. The thing is, again, I hate seeing that residents are pitted against small
businesses, especially—I don't know if I can say that these are
neighborhood-serving businesses, but it's still small business. It's good to
have you in the neighborhood. This is one of the problems that we've had
continuously come up where these businesses are simply not providing the necessary parking spaces. As we move forward, we continue to approve
more projects and developments that don't have enough parking spaces.
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Hopefully in the future when we do have projects that come before us, that
have less than necessary parking spaces, you would speak up about it.
Also, I see going forward with—now it's business pitted against neighbors;
neighbors pitted against business. Moving forward, I also see neighbors
against neighbors with Accessory Dwelling Units (ADU) going in force
without necessary parking spaces. That's another thing that might be
coming up. Hopefully you'll pay attention to that. I wanted to ask on the
access road or the frontage road that somebody brought up. I think it was
Ms. Morin, who said that she lives there and that she has—is that part of the
entire access road RPP or at this point just in front of the businesses?
Mr. Mello: Currently the entire access road between Churchill and Park is
signed as RPP. One of the Resolutions before you would modify small
sections of that to become 2-hour only.
Council Member Kou: I agree with Vice Mayor Filseth that—maybe it was somebody else who said that—maybe it was a doctor here who said that
they would like to retain the parts in front of their businesses as RPP. I
don't know how you'd do it, but free up the section where the residences
are. Is that possible?
Mr. Mello: If Council elected to leave in-place all of the RPP restrictions on El
Camino, they would simply not adopt the second Resolution.
Council Member Kou: What Vice Mayor Filseth said, if the other side, the
west side, of El Camino can accommodate the extra spaces that the
businesses are requesting, we wouldn't need to impact the neighborhood
any further. I don't know how you're going to make the Motion, but I would
prefer to hold off on that decision until El Camino comes back with—Caltrans
comes back with a response to our question. That's how I feel. When we go
into a pilot, a lot of the time people are depending on what our promises
were to know how to react to it. To suddenly change course in the middle
just makes people react in a bad way. That's something we have to
recognize. Moving forward communication is key; notification is key. In this
case, I did hear from the neighbors on both Evergreen as well as Southgate
that there was a lot of things that they didn't know about including the
businesses. They weren't included. In rectifying it, I would really like to see that El Camino west part included in the discussion. Thanks.
Mayor Kniss: Thank you. Greg, you're next. Tanaka.
Council Member Tanaka: Thank you. Actually, I'm a small business owner
on El Camino as well. I have employees, and I could definitely understand
the businesses' challenges with employee parking in that area. On the other hand, I was also president of my neighborhood association, College Terrace,
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when we did the first RPP in Palo Alto. What struck me on this is—when did
this first start getting enforced? What was the date exactly?
Mr. Mello: Hard enforcement began in December.
Council Member Tanaka: It's only been a month. I could tell you just my
experience with the first RPP in College Terrace. We've just begun. It's so
early to know. To tinker with the program right now without actually
seeing—forget long term, even short-term differences. I'm actually
surprised that this came so quickly to Council given that hard enforcement
only started in December. That's only about a month or so. That's actually
quite surprising. It just seems like it's too early to know. I also agree with
Council Member Kou in terms of I talked to a lot of the neighbors in that
neighborhood. There was a promise, at least that's what I heard—Staff,
correct me if I'm wrong—that in order for them to buy off on this pilot, this
would be a year-long pilot. That's also important. This neighborhood is actually quite different from almost all the other neighborhoods in Palo Alto.
If anyone went to that neighborhood, the streets are super narrow, probably
the most narrow. I don't know. Maybe Staff can answer—are there streets
more narrow than these streets of Palo Alto?
Mr. Mello: Going back to your first question regarding pilots, our intent with
pilots is to always be open to modifying them and change them during the
piloting. We did a midyear report on the Middlefield Road pilot with the
expectation …
Council Member Tanaka: Was there a promise made to the neighborhood?
I had heard it from multiple people, so I'm not sure if people are just making
it up or is it …
Mr. Mello: The pilot period was always described as 1 year. A pilot in and of
itself means that you're going to make adaptations and make changes as
necessary. The Downtown RPP had a 2-year pilot, and we made pretty
substantial changes going into Phase II of the pilot.
Council Member Tanaka: Even after the first month?
Mr. Mello: We brought this to you as soon as we realized there was an issue
with a limited number of permits for the businesses. Sorry. Your second
question was regarding …
Council Member Tanaka: The streets there seem to be very, very narrow.
They seem to be the narrowest streets in Palo Alto. Are there streets more
narrow than that?
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Mr. Mello: They are very narrow. If they were built today, our Fire
Department and Emergency Services would probably have some issues with
the width.
Council Member Tanaka: The way the parking is analyzed right now is
assuming you can park on both sides of the street. I happen to go to this
neighborhood a lot. If you actually try driving when there's two cars on the
street right next to each other, you can barely go through. You have to
drive slow because you might clip the mirror. The capacity of 500 and
whatever number of spots is actually false capacity because practically, if
you did that, you would have a hard time getting your—they had a hard time
getting a fire truck through. Really the capacity's not 500; it's like 250 or
something like that. It's about half of that.
Mr. Mello: If I could. If we were to add 15 permits, which is the Staff
recommendation, based on our typical show rate we'd only see about four to six new vehicles in the RPP.
Council Member Tanaka: My point was just that the capacity seems—is
artificially inflated. The streets are so narrow that the problem is
compounded. The other thing that struck me was that—I didn't know that
'til I heard the businesses speak. It sounds like actually we don't change
anything. Everyone's happy. If everything's okay right now, why are we
changing it? It's only been a month. I can't remember another RPP that
we've changed after just a month. It seems way early. We should halve
this into two phases. Phase I, let's let this run a little bit longer. There's no
massive problem unless we start changing it. Let's say we start taking the
parking away from the businesses in front of their business. Unless we start
messing with it, it seems to be okay. Let it run for longer. Let's see if it
actually works, what other problems we have. It's like the art of making a
good experiment. You don't want to make too many different changes all at
once because it's hard to know what really happens. I also agree with
Council Member Wolbach in terms of his point about distribution. A lot of
you may not know this. There's actually alleys that go from the inside elbow
on Portola and Manzanita to Churchill and from Sequoia and Portola out to
Park and El Camino. Anyway, distribution is actually also really important. What we should do here, given what I'm hearing, is Phase I we should let
this pilot run longer. In the meantime, as Vice Mayor Filseth and DuBois
have also said, we should talk to Caltrans As Soon As Possible (ASAP), get
the west side of parking for the RPP for the businesses to give them relief.
For Phase II, allow the businesses to do the RPP parking where all the employee parking could be on the west side in front of their businesses.
That's probably the strategy. The third thing I've been thinking about is—I
like the idea of the (inaudible); although, it could be kind of expensive. It
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could also be hard because there's so many different businesses, and they're
not necessarily organized. A question for Staff is are car stackers allowed on
this lot or on these lots. Could they stack cars?
Mr. Mello: I'm sorry. I can't answer that question. I don't know the answer
to that question. We can research that and get back to you.
Council Member Tanaka: My last point here also is that Council time is quite
valuable. This has only been a month since the pilot started. My other point
is this probably should have also gone through Planning & Transportation
Commission (PTC) first because they have more time than Council. We have
another item—we had a lot of items this evening. They could have spent a
lot more time on this. What I think we should do is—it seems to be working.
Let's let it run longer. In the meantime, work with Caltrans to expand the
RPP to the west side of El Camino because that would solve a lot of the
problems. I'd like to make a Motion that we do just that. Phase I, we basically keep the pilot exactly the way it is. Phase II, we open up the west
side of El Camino once we get permission from Caltrans.
Mayor Kniss: Tom has been waiting to make a Motion, but I will second
your Motion. You wanted to speak to it, Greg?
MOTION: Council Member Tanaka moved, seconded by Mayor Kniss to:
A. Continue the pilot program as is; and
B. Add Southgate RPP Parking along the west-side of El Camino Real after
obtaining permission from Caltrans.
Council Member Tanaka: I just did. Thank you.
Mayor Kniss: What you're saying essentially is we're in a period of time
now, which is about a year. Earlier Vice Mayor Filseth suggested looking at
this in 6 months instead of a year. Could you deal with that as part of your
Motion?
Council Member Tanaka: I think so. They said in 2 months or so, a month
or 2 months, Caltrans would …
Mayor Kniss: We'll know about Caltrans. If we could revisit this in 6
months, it may even be on Consent. I don't know at that point. Your
second part of the Motion was to make the request of Caltrans that we open
up on the west side.
Mr. Mello: Could I interject here, Mayor, just to clarify? You would actually
need to pass a Resolution adding the west side of El Camino to the RPP, and
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then we would submit that Resolution to Caltrans for approval. We can't
informally discuss it with Caltrans; it needs to be an official submittal.
Mayor Kniss: Do we need that in the Motion or do you need to bring that to
us another time?
Ms. Stump: it needs to come back to you. It can come on Consent if you
endorse this approach.
Mayor Kniss: I'd like to endorse it with a Motion. Is that …
Ms. Stump: You'll need to pass a Resolution that's properly noticed. It can
be placed on your Consent Calendar as soon as the Staff is able to prepare
it.
Mayor Kniss: I understand what you're saying. Included in your Motion will
be that we use the mechanism for having a Resolution that can come back
on Consent.
Council Member Tanaka: That's correct.
Mayor Kniss: I've spoken considerably to this. I feel very strongly that a
pilot should have at least some length of time to go. I would agree with
you, Greg. Four weeks is a really short period of time. As Eric said earlier,
it doesn't seem as though there are a huge number of issues right at the
moment or that those issues seem to be resolved for now. That would be
my only other suggestion, that we come back in 6 months and look at this
once again.
Mr. Mello: Could I just ask a point of clarification? If we come back on
Consent with a Resolution that adds the west side of El Camino to the RPP,
would we also be adding 15 additional employee permits?
Mayor Kniss: I think we'll deal with that when the time comes.
Mr. Mello: You want us to come back with a Resolution expanding the RPP
district without adding additional employee permits.
Mayor Kniss: Actually, if you got permission from that, then we could add
those permits with the understanding that people will be encouraged to park
on the west side of El Camino, strongly encouraged.
Mr. Mello: Could we word the Resolution to say that upon approval by
Caltrans, we'll release additional permits? Otherwise, we'd have to come
back twice.
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Mayor Kniss: Let me look at the maker of the Motion.
Council Member Tanaka: Sounds good to me.
Mayor Kniss: That's fine. Thank you for suggesting that, Josh.
Mr. Mello: We'll come back with a Resolution that expands the RPP district
to include the west side of El Camino, and there will be a clause in that
Resolution that says "upon approval by Caltrans, 15 additional employee
permits will be released."
Mayor Kniss: Once again, just so that it's in the Motion, with strong
encouragement that they be used particularly by the businesses. Adrian,
you were first, and then Tom was second, but it can be in reverse,
whichever way.
Council Member Fine: Thank you. While I do think the Staff Motion would
have been adequate and we could have added a few things, you guys are on
a good track. Just one suggestion, and I hope it's a friendly Amendment. Direct Staff to pursue options to reduce bunching of employee parking. In
other RPPs, we've done zones and things like that. Currently, there seems
to be a bit of a bunching problem. Even with El Camino, if we do get it
online, there could still be bunching problems where employees park as
close to their business as possible, still affecting the same residents. Would
you guys be willing to accept an Amendment there, just asking Staff to
pursue options to reduce bunching?
Mayor Kniss: I'm fine with it. Are you, Greg?
Council Member Tanaka: I'm fine with it too. The only challenge I have
with this is that it's not a very big neighborhood. It's only a few blocks big.
There are not too many zones you could have before this becomes so hard
to enforce.
Council Member Fine: It may not be zones; it may be streets. I leave that
up to Staff.
Council Member Tanaka: If it's "explore" versus "must," that's fine. It's not
like a massive neighborhood where you could have a bunch of zones.
Council Member Fine: Agreed. Thank you.
Mayor Kniss: Tom.
Council Member DuBois: Adrian beat me to the Amendment, which largely captures my original Motion. I was going to suggest that we consider El
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Camino on both sides to be a zone in itself and that we allocate business
permits there first and then allocate some in the residential zone. We would
leave it up to Staff to balance it so that people who live on El Camino
weren't frozen out of parking there. What you've got worded is okay as long
as Staff has the understanding that if you can add the west side of El
Camino, think of El Camino as a zone and the rest of the RPP as a second
zone and try to favor commercial parking but try to balance it. There will
still be some business parking in the neighborhood, just spread it out a little
bit.
Mr. Mello: Just to remind Council, with addition of zones, we have to change
all the signage through stickers. We've just added all the signage in
October/November. Ideally, we'd wait 'til the 1-year pilot was over to make
modifications to the signage. We can certainly commit to keep an eye on
bunching and, if it becomes an issue, come back to you with some modifications. I don't really foresee bunching being an issue with this
limited number of permits.
Council Member DuBois: Again, the suggestion was El Camino, which the
other side's not signed yet for the RPP. You would have the opportunity to—
you'd have to replace it on the one side of El Camino, but you were
proposing to change some of those signs already. That's just a comment.
The Motion captures it and gives you some flexibility.
Mayor Kniss: Thank you, Tom. Adrian, you spoke. Cory.
Council Member Wolbach: I talked about it a little bit before; Staff clarified
it. I just want to—for my Colleagues who have said the pilot needs to run a
little longer, the pilot is going to run for a year. We should be really clear at
this point, because we'll try pilots on other things in the future, about what a
pilot is. As Staff said, a pilot is a time for experimentation. A pilot doesn't
mean you can't change something over the course. We're talking about
changing stuff now. Change it one way or another, we're still talking about
making tweaks. That's exactly what a pilot is for. I want to reject this
notion I've heard from a couple of my Colleagues that we need to extend the
pilot for an additional 6 months. Unless by 6 months you mean you want it
to be an 18-month pilot. Part A here, extending the pilot means running for 18 months instead of 12 months. You're shortening the pilot.
Mayor Kniss: Right. We probably need to reword that.
Council Member Wolbach: It says additional 6 months.
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Mayor Kniss: That's not what I said. It says reassess the pilot at the end of
6 months. That's really what we asked for. We asked for a 6-month check-
in.
Council Member Wolbach: Is that what the maker meant?
Council Member Tanaka: It's fine with me.
Council Member Wolbach: I want to make sure we all know that these
words have meaning and we are of the same meaning and understanding of
what they mean.
Mayor Kniss: Thank you for picking that up.
Council Member Wolbach: Sorry to be a nitpicker on this.
Mr. Kahmi: If I can just ask a clarifying question. I was a little bit confused
by the 6-month, but I understand now. However, this program was
designed as a 1-year pilot. There have been permits already sold for that 1
year annual period. There will be some complications if we were to stop the program halfway through its initial pilot phase.
Mayor Kniss: I appreciate what you're saying. We're going back and forth
on what a pilot is and what a pilot isn't. All we've said is reassess this
program at the end of 6 months. We didn't say change it. We just said take
a look at this at the end of that period of time.
Mr. Mello: Sorry, just one more point of clarification. For "B," are we
coming back with that Resolution before the 6-month reassessment or is
that coming at the 6-month …
Mayor Kniss: Right away.
Council Member Wolbach: Let's add "as soon as possible" to be …
Mayor Kniss: If that's clearer to add "as soon as possible"?
Council Member Wolbach: There was pretty broad consensus on the Council
about it, but I want to be clear. There was something in the Staff
recommendation; I don't see it in this Motion. I want to be very sure that
by staying silent on it, it won't happen. That's the changing of the bookends
on El Camino in this area from RPP to non-RPP. That's not going to happen
if this Motion passes as written. Correct?
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Mr. Mello: Yeah. As written, you are not adopting either of the Resolutions
that are included in the packet, and that was one of the Resolutions. You
are also currently not adopting the cap on the daily parking permits.
Mr. Kahmi: If I could add. One more thing that was clarified in this
Resolution, Attachment A, was the re-parking policy. It's currently a little bit
vague. It's less vague in Downtown where they specify that re-parking—I'll
find the language. The 2-hour parking limit and no re-parking is within the
district. "No person shall park a vehicle adjacent to any curb for more than
2 hours. Re-parking a vehicle more than 2 hours after initially parking on
the same day in the district is prohibited." Currently, the language is a little
bit vague so that somebody could say, "I went to Home Depot, and then I
came back and parked." It's a little bit hard for us to follow that.
Council Member Wolbach: I'd suggest amending the language on re-
parking—to direct Staff to amend the language on re-parking to clarify. There are several things we're changing here. I do not see in this Motion
that we're leaving it the way it is. I see that we're going to reassess it. We
are making changes to it. We're making changes to it tonight.
Mayor Kniss: We're not. We're just looking at it at the end of 6 months.
Council Member Wolbach: You'll see it in Packet Page 535, Item B, direct
Staff to make corresponding changes to the administrative guidelines for the
RPP programs. Is that clear or was my language clearer before?
Mr. Mello: We could put that in the Resolution that comes back to you. We
can incorporate the re-parking changes in the Resolution that comes back to
you on Consent.
Council Member Wolbach: Let's do that. Part B would be "and clarify
language on re-parking." Are you okay with that, maker and seconder?
Mayor Kniss: That's fine.
Council Member Tanaka: I'm fine.
INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE
MAKER AND SECONDER to add to the Motion Part B., “…and clarifying the
language on re-parking.”
Mayor Kniss: At 11:45 P.M., I'm good with a lot of things.
Council Member Wolbach: I'm not quite finished yet. How many spots were we going to lose on El Camino by changing from RPP to just 2-hour? How
many spots is that approximately?
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Mr. Mello: Ten to 12 roughly, somewhere around there.
Council Member Wolbach: We were going to add 15 spots, but we were
going to get rid of 10-12. If we're going to keep the 12, I'd suggest
releasing an additional three right now.
Mayor Kniss: At this point, let's leave it. We're really getting down to the …
Council Member Wolbach: I do emphasize again this—what I've heard some
people say here is that there's no problem. There's obviously a problem.
There's obviously a problem. This isn't working. It's working great for
some. It's not working great for others. To say it's working great, we're
being disingenuous. What we're doing here is trying to find a compromise.
The way this Motion is developing, I can get behind it. I appreciate being
open to these changes. In the meantime, we are going to see people buying
day permits. As Vice Mayor Filseth was pointing out earlier, what we're
seeing parking on the street right now is the demand. Once you get rid of the Paly students, that's the demand in the area. If we gave out a lot more
permits, if we gave out dozens more permits to the employers at those
locations, we probably wouldn't see a lot more parking because most of the
demand is already exhibited on the streets right now. I'm not proposing
that we give out dozens more permits. We're not going to do anymore. The
parking that we see on the streets represents what the demand is. In the
meantime, employees and employers can keep buying the day permits. It's
important that we're figuring out what to do about bunching. It's important
that we're saving those spots on El Camino on the east side. It's important
that we're going to look as fast as we can to expand on the west side.
Mayor Kniss: Has everyone spoken once at least to the Motion?
Council Member DuBois: I just had a quick addition.
Mayor Kniss: Neither of you have?
Council Member DuBois: I just had a quick comment. I assumed that when
this came back a lot of the changes and cleanup that you guys did would be
included, including limiting the daily parking at that point. I didn't think we
were removing that. I thought we were saying that would all come back.
Mayor Kniss: At the end of 6 months. Greg and Eric.
Vice Mayor Filseth: I'm still interested in—I'm wondering if we shouldn't take a look at the east side of El Camino north of Churchill. Suppose we
were to say in addition to that, let's attempt to convert a dozen spaces north
of Churchill on the east side of El Camino to the RPP zone. I assume that
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takes action from Caltrans as well. Does that impact our ability to get
spaces on the west side?
Mr. Mello: It would take action from Caltrans. The nexus of—that's well
outside the Southgate RPP district. It's in front of a property that is not
eligible to purchase RPP permits in the Southgate district. If that's
something Council wants to pursue, we'll do that, but that would be a little
bit of a stretch to extend the RPP.
Vice Mayor Filseth: I wanted Staff's advice on it first.
Mr. Mello: Across Churchill, I think it'd be a little bit of a stretch.
Vice Mayor Filseth: You think our odds are better on the west side of El
Camino across from Southgate?
Mr. Mello: I don't think Caltrans would have an opinion on whether there
was a rational nexus or not. I just think professionally it would be a little bit
of a stretch to start expanding RPPs to properties that aren't eligible to purchase permits in the RPP.
Vice Mayor Filseth: I'm just asking if we aren't better off trying both and
seeing if we get one or the other.
Mr. Mello: If they're going to approve one, they'd approve the other. I
don't think they're going to make a judgment call on whether it's warranted
or not. They're going to have some concerns about using a State resource
for permit parking that's issued by the City. We'll see what they say.
Vice Mayor Filseth: I don't know. If they approve it, we don't necessarily
have to do it.
Mr. Keene: You don't.
Vice Mayor Filseth: I'm going to suggest and see if the maker and the
seconder of the Motion are interested. In addition to Point B there, we also
add a dozen spaces on the east side of El Camino north of Churchill. Go
ahead.
Mr. Keene: Molly points out that the impetus for speaking with Caltrans is
for you to actually adopt a Resolution saying that's what you want to do.
It'd be disingenuous for us to pass a Resolution and then say never mind
after they said yes.
Mayor Kniss: Why don't we leave it as it is and look at it in that 6 months?
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Vice Mayor Filseth: Fair enough. If they don't give us the other side of El
Camino, we'll try this side.
AMENDMENT: Vice Mayor Filseth moved, seconded by Council Member XX
to add 12 spaces on the east side of El Camino Real and north of Churchill
Avenue to the RPP Southgate District.
AMENDMENT WITHDRAWN BY THE MAKER
Mayor Kniss: Last to go.
Council Member Scharff: Last to go. I think this is good. We've gotten to
where we want to go. I had some questions about how we expect it to work
out. The first thing you're doing as soon as possible is putting the
Resolution together, putting it on Consent. You're then going to go to
Caltrans. Hopefully you get approval. I guess the question is do you have
any sense how long this process takes or not because we haven't done it.
Mr. Mello: If I had to guess, I would say 2-3 months before we get an answer from them. It's going to have to go to multiple departments and
branches. We can bring the Resolution back fairly quickly. It'll just be
modifications to the one we already prepared.
Council Member Scharff: My question is, assuming they pass it, we release
the permits. We then do a check-in in 6 months on the RPP. The question
is if they deny it, do we come back to Council quicker than that. That's
really my question. If we hear from 3 months—do we just go 6 months?
Mayor Kniss: Let's hold it at 6 months. We've negotiated that to begin with.
I really prefer to leave it at 6 months. I'm not the maker of the Motion.
Greg?
Council Member Scharff: I'm thinking 6 months may work. By the time you
get it to them and we hear it, and then we'll have the thing. That probably
works. I'm good with it.
Vice Mayor Filseth: Staff's going to do two things in the interval. One is this
thing. The other is they're going to explore possibilities of de-bunching. The
decision in 6 months is do we issue more permits. If we've figured out how
to de-bunch it, then we have (inaudible).
Mayor Kniss: We've discussed this pretty much as long as we possibly could
have. Jim.
Mr. Keene: I really hate to join in on what you're doing here. I just want
clarification on "A." Report on the pilot program sounds different to me than
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reassess. Reassess signals you really might be thinking it's not going to
work. Do you mean at the 6-month …
Mayor Kniss: If it's clearer to Staff to use "report," it's fine with me.
Mr. Keene: Is the end of the 6 months the 6-month mark of the pilot
program or is that 6 months from now?
Mayor Kniss: That's 6 months from the start of the pilot program.
Mr. Keene: Sorry to be so picky, but we've been accused of betraying
promises lately and all sorts of things.
Vice Mayor Filseth: Let me make sure I understand the question on
"report." I understand this to mean we're going to take a decision on
whether to issue more permits or not.
Council Member Scharff: Reassess is a much better word.
Vice Mayor Filseth: What's the right word for that?
Council Member Scharff: I think we're reassessing how many permits, has this worked, have we gotten it done. We're looking at it. Report could be
an Informational Report.
Mayor Kniss: Go back to reassess, but let's get to the vote point. I think
that's it. We're back to reassess.
MOTION AS AMENDED RESTATED: Council Member Tanaka moved,
seconded by Mayor Kniss to:
A. Re-assess the pilot program at the end of six months; and
B. Direct Staff to return to Council as soon as possible with a Resolution
adding Southgate RPP parking along the west-side of El Camino Real
and clarifying the language on re-parking; and
C. Forward the Resolution to Caltrans to authorize the addition of the
parking and, upon approval by Caltrans, an additional 15 employee
permits will be released; and
D. Direct Staff to explore options to reduce the bunching of employee
parking.
Mayor Kniss: Would you vote on the board? Stunningly it passes
unanimously. For those of you who have waited a long, long time, thank
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you. We are very close to the end of the meeting. Unless you're staying to
watch the next item, there is none. Actually, that's not true.
MOTION AS AMENDED PASSED: 9-0
12. PUBLIC HEARING: Adoption of a Resolution to Continue the Evergreen
Park-Mayfield Residential Preferential Parking Program (RPP) With
Modifications; a Resolution Establishing Two-hour Parking Along a
Portion of El Camino Real Between College Avenue and Park
Boulevard; and Finding the Action Exempt From the California
Environmental Quality Act (CEQA) (Continued from December 11,
2017) STAFF REQUESTS THIS ITEM BE CONTINUED TO FEB. 5,
2018
13. PUBLIC HEARING: Adoption of an Ordinance Amending Section
18.42.040 of Title 18 (Zoning) to Conform With new State Laws
Regarding Accessory Dwelling Units (ADU) and Finding the Changes
Exempt From Review Under the California Environmental Quality Act
(CEQA) Pursuant to Public Resources Code Section 21080.17 and
CEQA Guidelines Sections 15061(b), 15301, 15303 and 15305. The
Planning & Transportation Commission Recommended Approval of
These Amendments on November 29, 2017.
Mayor Kniss: This item, though, could be very simple tonight. This is a
public hearing. I have just opened the public hearing. There are two people
who wish to speak on this, but let's have a presentation by Staff first.
Hillary Gitelman, Planning and Community Environment Director: Thank
you, Mayor Kniss and Council Members. Hillary Gitelman, the Planning
Director. I had a 1-page PowerPoint, but given the lateness of the evening I
won't put it up there. Basically, if you read the report, you see that the
State Legislature in their housing package that was adopted in September
and passed by the Governor had two bills that amended the rules about
Accessory Dwelling Units (ADU). Our attorneys have advised us that we
should immediately update our Ordinance to reflect the State laws so that
our Ordinance stays in conformance with State law. That's the Ordinance
you see before you this evening. You're going to get another shot at ADUs
later this year when we go into more depth and complete our 1-year review of the Ordinance you adopted last year. Tonight is just a simple action to
stay in conformance with State law. Thank you.
James Keene, City Manager: It's not advertised in any way to allow you to
take other action beyond what is requested on the compliance issue with
State law.
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Mayor Kniss: Since this is a public hearing, we have two people to speak
with us. Aaron Van Roo, is that one of them? The other one is Arun. Is
that person here? The first Aaron, would you come up? We'll set the timer.
Public Hearing opened at 11:48 P.M.
Aaron Van Roo: I will keep it short because it's late. Although you're not
required to vote on it, if you can tolerate any more discussion, there's one
more section, which is in the packet as a comment. I think it's on Page 2 in
your packet towards the bottom. I guess you guys have a Planning
Commission that makes recommendations. I was at that meeting last
month. At the bottom of the page, they're recommending that ADUs—you
get a square footage bump for an ADU. The way it's written now, it's
causing some issues in planning and permitting of projects. I'm a
stakeholder really. I'm a designer and a builder, and it's caused some
issues. What we're asking is that you follow the recommendations of the Committee and make the modifications that is on—in 18.42.040, which is
the accessory and junior accessory dwelling units, Section (a)(4)(B)(3) is an
Floor Area Ratio (FAR) exemption. What it says is when the development of
a new one-story accessory dwelling unit on a parcel with an existing single-
family residence would result in a parcel exceeding the maximum floor area,
an additional 175 square feet of floor area above the maximum amount of
floor area otherwise permitted under the underlying zoning district should be
allowed. The confusion this has raised and the problem it causes is it
creates a two-step process for residents building new homes. That's come
up on a couple of projects now. I'd recommend that you guys take some
action on that quickly. Thanks.
Mayor Kniss: Thank you. Our second person is Arun.
Arun Murthy: First of all, it's late. Madam Mayor and Council, appreciate
the item and the patience. I'm a new homeowner, and we're constructing.
In the spirit of fairness and common sense, it'd be nice if you guys could
take the recommendation from the State and allow ADUs for not just
existing homes but for new ones. The way we are going for this is we would
have to construct the home and then come back with another application for
just the ADU. ADUs make a lot of sense in a number of scenarios. I have my mom and grandmom who want to live with us. Having the space for
them would definitely help. The complication was—in the past when we've
talked to the Council, if we want to have ADUs on new homes, we'd have to
come back again 6-8 months later for new plans. I'd really appreciate it if
you could take the recommendation and allow ADUs for new homes too. Thank you.
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Public Hearing closed at 11:53 P.M.
Mayor Kniss: Thank you. This was a public hearing, so I'm going to close
the public hearing and bring it back to Colleagues. This is Number 13, and
the decision is to make the recommendation, which is on Page 1 of Packet
Page 588. Three lights on, Tom, Karen, and Adrian. Tom.
Council Member DuBois: Just a couple of quick questions. What is our
stance on the additional square footage for a new home?
Ms. Gitelman: It's not addressed in the Ordinance before you this evening.
I wrote down these comments. I'll make sure they're reflected in the work
that—the Planning Commission is still going through their review of the
Ordinance and preparing a recommendation for you to consider a number of
improvements not addressed by the recent State laws.
Council Member DuBois: That's coming back. I just wanted to be really
clear. In multifamily zones that allow a single-family residence, I think I found the language I was looking for. The intent is there would be two units
in that case, not that if there is a multifamily unit on a property you could in
addition add an ADU.
Ms. Gitelman: That's right. As I understand the change in State law, it's
where there's a single-family home permitted in a district, you could have
another ADU in association …
Council Member DuBois: It says where it's permitted. What if it was
permitted but there was an apartment building on that lot?
Ms. Gitelman: The intention is when you have a single-family home, you
can have an ADU.
Council Member DuBois: Can you look on Packet Page 595, Number 4? Is
that the clause that captures that?
Ms. Gitelman: That's right.
Council Member DuBois: I just wanted to make sure I got that right. Are
there any other implications for the open space district?
Ms. Gitelman: Again, we're just changing our Ordinance to include those
districts where single-family homes are allowed.
Council Member DuBois: I think we explicitly excluded open space before.
There's no other unintended consequence?
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Ms. Gitelman: If there is, there's nothing we can do about it. The State has
preempted us. We have single-family homes in that district, so we'll have to
allow ADUs.
Council Member DuBois: I will go ahead and make the Staff Motion.
Council Member Fine: Second.
MOTION: Council Member DuBois moved, seconded by Council Member
Fine to adopt an Ordinance amending Title 18 (Zoning) of the Palo Alto
Municipal Code (PAMC) to comply with new State laws regarding Accessory
Dwelling Units (ADU) and find the action exempt from review under the
California Environmental Quality Act (CEQA) pursuant to Public Resources
Code Section 21080.17 and CEQA Guidelines Sections 15061(b), 15301,
15303 and 15305.
Mayor Kniss: There's a Motion and a second. Do you want to speak to your
Motion, Tom?
Council Member DuBois: No. I just wanted to clarify this applies where it's
possible to build single-family, and then you could go to two units there.
Mayor Kniss: Adrian.
Council Member Fine: No comments.
Mayor Kniss: I don't see any other lights. How about voting? Sorry Lydia.
Just went on. Sorry everyone. Karen and then Lydia.
Council Member Holman: Tom asked one of my questions. I'm going to
come back to that. Wanting to understand what Staff was intending on
Packet Page 589. In that last bullet on the page, third line down, it has
single-family homes are an allowed use. There's a "1" there indicating a
footnote, and there's a "1" below, but there's nothing associated with it.
What was supposed to be there? Obviously something describing what that
situation was, but there's no footnote information.
Ms. Gitelman: I don't know.
Council Member Holman: I found Packet Page 594 to be a little confusing.
The additional language of accessory dwelling unit—this is the change—when
accessory to permitted single-family residence. Like Tom, I was confused
about what four is. I'm wondering if it clarifies it, if this is what the intention
is. If it clarifies it to say—Number 4 on Page 595—an accessory dwelling unit associated with one single-family residence on a lot because a single-
family residence on a lot is not exclusive to one. It could be—if it's RM-15
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and there are three single-family residences there, that means you couldn't
actually add an ADU as I read this. Should "a" be changed to "one" if it's
meant to capture what I heard you say earlier?
Ms. Gitelman: I'm not certain about that. I would have to confer with the
attorney who drafted this. I think it was based pretty closely on the State
law. I don't know, but there might be a situation in which you could have a
development in an RM-40 zone, for example, that created a number of
single-family home parcels. I'm not even finding the words for it at this
moment. You could have a situation in these multifamily zones where you
had single-family homes created that would be permitted to have an
accessory dwelling unit.
Council Member Holman: That's exactly my point. The language here says
"and such that no more than two total units result on the lot." If you have,
again, say in an RM-15 a lot with three single-family homes on it, as I read this you wouldn't be able to add an ADU because it would be inconsistent
with this. I'm going to make a Substitute Motion. Because we don't know
what the footnote was intended on Packet Page 589, we don't have clarity
on Packet Page 595, what that language is, there's another question about
clarification about RM-40 two and four because this is referencing 6,000-
square-foot lots. Other places, it references a 5,000-square-foot lot. I'm
actually going to ask us to get our questions out tonight, have this continued
to next week so we can get clarification on these issues. My Motion is to get
our questions out and continue this to next week.
Mayor Kniss: I don't hear a second on that.
SUBSTITUTE MOTION: Council Member Holman moved, seconded by
Council Member XX to direct Staff to consider comments from Council
tonight, make appropriate changes to the Ordinance, and put it on next
week’s Consent Calendar for approval.
SUBSTITUTE MOTION FAILED DUE TO THE LACK OF A SECOND
Council Member Holman: We're going to be going forward not
understanding what we're doing. I appreciate it because it's midnight. The
Director doesn't have an answer to the question that I asked.
Ms. Gitelman: Let me clarify. There's a dangling footnote that has no footnote attached to it. I don't know why it's there, but it looks like a typo
to me. On your other question, I could see a situation where you had a
parcel that's zoned RM-40. Someone comes in and wants to divide it and
create a map and lots of single-family homes. In that instance, they would
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be permitted to construct an accessory dwelling unit in conjunction with
each of the single-family homes.
Council Member Holman: They also went through the process of
subdivision. That means they'd have to go through that additional step.
Ms. Gitelman: That's correct.
Council Member Holman: It still seems like the "a" should become "one."
Ms. Gitelman: I apologize, Council Member Holman. I'm not as familiar with
all these regulations as my Staff and the Attorney's Staff who drafted the
Ordinance. We are really bringing you something that is intended to bring
our Ordinance into compliance with the State law and nothing more.
Council Member Holman: I understand that. If it's not clear, what are we
doing?
Mr. Keene: Do you want us to not adopt it to be in conformance with the
State law? Isn't that the result of this or this is a change that is outside of bringing it into conformance with the State law?
Ms. Gitelman: We'll also be coming …
Council Member Holman: I understand trying to make it in conformance
with the State law. If we're not clear, how do we know that we are in
conformance with the State law? This gentleman who's wanting to …
Ms. Gitelman: If I can interject. We are committed to come back to this
Council …
Mayor Kniss: Let me just say the following …
Ms. Gitelman: … In June with a clarification of the entire Ordinance.
Mayor Kniss: Karen, are you speaking to a Motion? You have no second.
Council Member Holman: I'm speaking to the Motion that's on the floor
because there wasn't a second to continue this item. I'm just saying I have
questions here. We talk about earlier that—if I can find it—we have to have
a minimum 5,000-square-foot lot. We talk about on Packet Page 595 in the
Ordinance, Number 2, permitted only on lots less than 5,000 square feet.
Where is the 5,000-square-foot reference? I'm just saying there are some
gaps in information here.
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Molly Stump, City Attorney: As we often do, I'm not familiar with this level
of detail. This Draft Ordinance was prepared by Sandy Lee, who's our expert
in this area. If the Council approves it, we will have it approved with the
understanding that we should go back and double check. If there are typos,
we can conform those to the State law requirements.
Council Member Holman: I want to support it, and I want to support Staff.
I have these questions, so I don't think I'm going to be able to support it
without having answers to the questions and having clarity.
Mayor Kniss: Clearly the answers aren't there tonight. I'm going to
continue on. Who else wished to speak to this? Was there anyone? Lydia.
Council Member Kou: Somewhere it mentions—I think it's Packet Page 593.
Can you provide an example of an existing accessory structure?
Ms. Gitelman: A garage would be an existing accessory structure.
Council Member Kou: I noticed that you've added Planned Community (PC) zones to this. Even though we have our own regulations and everything,
because they're single-family homes—the first thing that comes to mind is
the smaller lots where it's going to be very tough for them to add any
accessory dwelling units.
Ms. Gitelman: Accessory units can be added within the principal structure.
It wouldn't apply in all PC zones, only PC zones where single-family homes
are permitted.
Council Member Kou: You did mention that there were some changes in
State law related to parking. Can you give me an example? It doesn't apply
here, but can you give me an example of what they've done?
Ms. Gitelman: It's not directly relevant to this Ordinance. It was a change
that we didn't need to make because of our current rules. I'm afraid at this
hour I can't recall what the change was. We didn't have to bring it forward
to you.
Council Member Kou: I was just wondering if we could know about it. Can I
email you and just …
Ms. Gitelman: Of course. I knew at one time. I just don't remember at the
moment.
Council Member Kou: Thank you. That's it.
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Mayor Kniss: With that, let's vote on the board. That passes on an 8-1 vote
with Council Member Holman voting no.
MOTION PASSED: 8-1 Holman no
Inter-Governmental Legislative Affairs
None.
Council Member Questions, Comments and Announcements
Mayor Kniss: This takes us to comments from the Council. Any
announcements, anything like that? Anyone have anything they'd like to
add at 12:05 A.M.? Council Member Kou.
Council Member Kou: I just wanted to ask City Manager if we're going to be
visiting the Senate Bill (SB) 827 and if we're going to be sending a letter in
addressing it.
James Keene, City Manager: I don't know, but I'll look into that, SB 827.
Council Member Kou: Maybe you can look at SB 828 as well.
Mr. Keene: Will do.
Council Member Kou: Could you give us an update at some point about the
Conditional Use Permit (CUP) over at the First Baptist Church?
Mr. Keene: Yes, we will.
Council Member Kou: Thank you.
Mayor Kniss: Council Member Holman.
Council Member Holman: I just wondered if Staff could get back to us on
the conflict issue that Mr. Borock raised earlier.
Mr. Keene: Earlier tonight?
Council Member Holman: Yes, earlier tonight during Oral Communications.
Also when the Council will have in front of it some action to take regarding
SB 827.
Mr. Keene: The same comment that Council Member Kou mentioned on SB
827.
Council Member Holman: Thank you.
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Mayor Kniss: Any other comments? With that, we are adjourned.
Adjournment: The meeting was adjourned at 12:07 A.M.