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HomeMy WebLinkAbout2018-10-01 City Council Summary Minutes CITY OF PALO ALTO CITY COUNCIL FINAL MINUTES Page 1 of 38 Regular Meeting October 1, 2018 The City Council of the City of Palo Alto met on this date in the Council Chambers at 6:07 P.M. Present: DuBois, Filseth, Fine, Holman, Kniss, Kou, Scharff, Tanaka, Wolbach Absent: Special Orders of the Day 1. CONFERENCE WITH LABOR NEGOTIATIONS. THIS ITEM HAS BEEN REMOVED. 2. Proclamation Honoring Cybersecurity Awareness Month. Council Member Wolbach read the Proclamation into the record. Chris Caravalho, IT Manager, thanked the Council for allowing the City of Palo Alto Information Technology (IT) Department to help cities all across the nation lead the way in cybersecurity safety. The Department would do its best to keep the City's data safe from outside entities. Mayor Kniss remarked that Dr. Christine Blasey Ford showed tremendous courage and strength in speaking about her experiences with sexual assault. Friends, neighbors, coworkers, and other Palo Alto residents gathered on King Plaza the prior week to show their support for Dr. Blasey Ford. On behalf of the City Council, she would be honoring Dr. Blasey Ford with a Proclamation for her bravery and courage in speaking out and providing so many people with a voice about their experience with sexual assault. Study Session 3. 980 Middlefield Road [18PLN-00129]: Request for Prescreening of a Proposal to Amend the Existing Planned Community (PC) 2152 Zoning in Order to Change the Allowed Use From Mortuary to a Private Club or Similar use With Collaborative Office Workspaces and Areas for Workshops and Special Events. The Study Session Will Give the Council and the Community an Opportunity to Comment on the Applicant’s Proposal Prior to Submittal of a Formal Application. FINAL MINUTES Page 2 of 38 City Council Meeting Final Minutes: 10/01/18 Environmental Assessment: Not a Project; any Subsequent Formal Application Would be Subject to the California Environmental Quality Act (CEQA). Zoning District: PC 2152 (Continued From September 10, 2018). Ed Shikada, Assistant City Manager, Claire Hodgkins, Senior Planner, reported the Palo Alto Municipal Code required a prescreening for any proposal involving a Planned Community (PC). The purpose of the Study Session was to facilitate a conceptual review of the request and to obtain early, informal feedback from the Council and the public regarding policy considerations. The main building on the site was constructed in 1951 for a mortuary use. A PC zoning was approved for the mortuary use in 1963. The site had been vacant since 2013. The property owner proposed a zoning amendment to allow a private club or similar use that would provide coworking office space, areas for workshops and small classes, and space for lectures and speaker events. The applicant proposed interior and exterior alterations to the building and the site. Part of the site adjustments included the addition of a new turn-around and modifications to the existing parking. The surrounding uses included multifamily uses to the northwest, single-family uses to the northeast, and Addison Elementary School to the south. The site included three parcels totaling 1.16 acres and was located in the University South neighborhood. Policy considerations were the proposed change in use for the PC zoning and the applicability of the Citywide office cap. Council comments provided during the prescreening were not binding on the City or the applicant. Marissa Mayer, Applicant/Property Owner, advised that the existing zoning allowed the operation of a mortuary only. The main building was approximately 11,500 square feet. The parking lot currently held 44 cars, and the parcel was between 1.2 and 1.3 acres. The proposed project, called the Corner House on Addison (CoHo), would be a community center focusing on working women and children and promoting family, community, and enrichment. The space was designed to be playful and thoughtful and to promote creativity, lifelong learning, and wellness. The applicant requested an amendment to the PC zoning to allow a use more broad than the operation of a mortuary. The CoHo would offer enrichment classes for children and adults, indoor and outdoor play space, collaboration areas, conference and phone rooms, birthday party rentals, a coffee bar/café, wellness spaces, access to fresh air, and nursing spaces. The site plan had been revised since plans were submitted to the Planning Department. Current plans were to remove one of the garages in the rear and add parking spaces for a total of 55 conforming spaces. Valet parking would increase the number of cars that could be parked on the site. Modifications would be made to the building to allow more natural light into the space. The CoHo would be supported by memberships open to the public at a cost FINAL MINUTES Page 3 of 38 City Council Meeting Final Minutes: 10/01/18 of approximately $200 per month. Reduced-price memberships would be available to those with financial need. Public benefits would include membership, enrichment classes open to the public one week after members began registration, some classes and workshop open to the public, rentals, and free or affordable meeting space for nonprofits and volunteer organizations. The mission of the CoHo was to strengthen the community through access to useful resources. The applicant had negotiated a construction contract with Cody Brock. The plan was to renovate the existing structure over approximately eight months without extending the existing footprint. All construction materials, equipment, and parking would be staged in the parking lot. A formal traffic study would be conducted following the prescreening. Preliminary discussions concerning traffic predicted 22 peak trips. The applicant would develop an aggressive traffic management strategy that would encourage rideshares, carpools, public transportation, and offsite parking. The building was constructed sometime between 1954 and 1960 and considered Mid-Century Modern. The City's independent consultant had reported that the building may be eligible for the Historical Register; therefore, the applicant would work with the Planning Department regarding next steps. Since the initial application was filed, the applicant had increased the number of parking spaces, decreased the size of the outdoor playground, removed the dedicated coworking space, and added a drop-in play area. Peter Steinhart opined that the mortuary had accommodated parking for most funeral services in the onsite parking lot. Approximately once per week, funeral parking may have spread into the surrounding neighborhood. The applicant proposed up to 500 people attending classes daily, 50 guests using collaboration rooms, others using health and wellness rooms, 28 staff members, up to 75 attendees for up to 250 events annually, up to 300 attendees for up to 150 larger events, and up to 400 attendees for an unspecified number of special events. Parking in the neighborhood was already challenged by Addison Elementary School, medical offices, and the bike path. Judy Steinhart questioned whether the applicant would utilize sound amplification for outdoor events or serve alcohol. She concurred with the suggestion to utilize the site for teacher housing. Jim Lukash noted the Comprehensive Plan called for multifamily residential housing on the site. He questioned whether a private club surrounded on two sides by low-income housing was appropriate for Palo Alto. Locke McCorkle concurred with Mr. Lukash's comments. FINAL MINUTES Page 4 of 38 City Council Meeting Final Minutes: 10/01/18 Eric Verwillow opposed PC projects in general as the community benefits never seemed to materialize. He hoped the project would be regulated under conventional zoning. He could support the project if it was regulated as a single use, whether a community center, a shared work space, or a private club. Janna Greene concurred with prior comments. A club focused on families would be more appropriate than one focused on women and children. Victor Greene felt the estimated number of attendees daily was contrary to common sense and logic. Outdoor parties and the use of sound amplification was disruptful to a quiet residential neighborhood. Tom Mees believed the proposed rezoning of the site was completely inconsistent with the neighborhood. He questioned whether a private club could provide significant public benefits. The proposed rezoning would reduce the stock of potential sites for affordable housing while dramatically increasing traffic and parking demand in the surrounding neighborhood. Winter Dellenbach noted the proposed private club was in no way related to a mortuary; consequently, the applicant should apply for a new PC rather than attempt to amend the current PC. The Council had imposed a moratorium on PC zones. Jonathan Graves believed the project's impacts on parking, traffic, and safety for children were primary concerns for the neighborhood. John Kagel requested the Council ensure the final project conformed to the proposed project. The project could not improve the public benefit provided by Library community rooms. The project discriminated on the basis of gender. Catherine Ross Stoll supported the project. The community would benefit from areas where families could meet in an indoor/outdoor space. Nicole Pollock supported the project as it would prevent the modern struggle of parental burnout. The project would allow her to work while her children attended enrichment activities. Gayle McDowell felt Palo Alto did not offer many family activities. The project would benefit families, women, and entrepreneurs. Donna Bennatoff supported the concept, but the scale of the project outweighed its public benefit. Zoning for the site should be residential. FINAL MINUTES Page 5 of 38 City Council Meeting Final Minutes: 10/01/18 Hap Abbott believed the project would add exorbitantly to the neighborhood's suffering and lower neighbors' quality of life. Herb Borock agreed with Ms. Dellenbach's comment that the project should request a new PC zone. The Council should initiate RM-15 zoning for the site. The applicant had a history of violating the Code by allowing prohibited uses on the site. Matt Ocko related that the project would be an invaluable resource for women with families. The City had a responsibility to support women and families. Ms. Mayer thought about ways to be a good citizen and to support women and families. Kelsey Banes could not support a plan for the site that did not include housing, which would offer the greatest community benefit. David Voelker had no concerns about the project and urged the Council to weigh the project's pros and cons equally. A disproportionate number of women would probably benefit from the club because having a family and career had not been mutually exclusive for men. The proposed facility would benefit the community by promoting civic values and by fostering community engagement. L David Baron concurred with Ms. Banes' comments. The proposed project would be reasonable in a mixed-use context. Coral Chung supported The Corner House project as it would be an amazing opportunity for women entrepreneurs. Pearl Ranaker felt the project would be a great addition to the neighborhood. Marita Irani stated building a community and taking children to classes were difficult in Palo Alto. The Corner House was a wonderful idea for new families who were looking for a drop-off center for children and a place to build community. Kerah Cottrell supported the project as it would be an amazing addition to the community. The facility would be open to men and offer activities for non-members. Kate Godfrey appreciated the value of a place where women could support one another as professionals and working mothers, but the community needed below market rate housing. The site would be perfect for senior housing. FINAL MINUTES Page 6 of 38 City Council Meeting Final Minutes: 10/01/18 Gina Bianchini remarked that the trust between neighbors and building developers was low. This was an opportunity for the City Council to create the conditions through which great projects were built and neighbors and developers collaborated. Andrew Chung commented that many parents took their children to public spaces to work because there were no facilities similar to The Corner House. The Corner House would allow parents to participate in entrepreneurial activities and to be involved in their children's school lives. Vic Ojakian stated if his experiences with living near the applicant translated to the proposed project, the project would be a detriment to the people living around the site. The project would be appropriate in another location. Emily Huang, project architect, felt the family club and community center was the perfect place for working women. The project had the potential to benefit countless generations to come. Ms. Mayer explained that the proposed numbers for attendees appeared quite large because they included the parents who accompany their children to the facility. The project was a new concept for community centers. The prior mortuary use held multiple functions daily with each function typically drawing more than 100 attendees. The proposed use could be sustained within the existing parking limit. A place that offered children's enrichment activities and provided space where parents could be productive was needed in Palo Alto. Council Member Kou was pleased with the applicant's proposal to remodel the existing building. Prior projects had not been courteous to neighbors, and that was a concern for her. Council Member Scharff encouraged the applicant to talk with neighbors and work with Staff to address adequate parking and other concerns. He was impressed with the vision and concept of the project. Vice Mayor Filseth inquired regarding the underlying zoning for the site. Ms. Hodgkins clarified that the underlying land use designation was multifamily. The previous zoning on the site was R-2, R-3, and R-3(P). Currently, housing was not an allowed use within the zone. Housing was allowed when the adjacent Webster residential project was constructed. Vice Mayor Filseth asked if there was a precedent for a use allowed by a PC Ordinance becoming invalid. FINAL MINUTES Page 7 of 38 City Council Meeting Final Minutes: 10/01/18 Molly Stump, City Attorney, replied no. Vice Mayor Filseth appreciated the applicant clarifying the vision for the project. The questions for consideration were whether the proposed use fit the area and the underlying Code, whether housing was appropriate for the site, and whether the neighborhood impacts could be mitigated. Parking in the area was hotly contested. Council Member Wolbach commented that housing, traffic, parking, and childcare were the most severe challenges for the community. On many levels, the project's concept filled an important need. Time of day and noise were critical concerns for the community and Council. He inquired about the zoning for the Eichler Swim Club on Louis, the YMCA on Ross Road, and the Women's Club. Ms. Hodgkins advised that the YMCA and the Eichler Swim and Tennis Club were zoned R-1, and the Women's Club of Palo Alto was zoned RM-30. Community centers were an allowed use in both zones with a conditional use permit (CUP). Council Member Wolbach asked if CUPs were approved for the three organizations. Ms. Hodgkins did not know. Council Member Wolbach would consider a coordinated area plan, a CUP for a community center, or a mixed-use project for the site rather than a PC. He inquired whether the Office of Transportation had the capacity to oversee, manage, and enforce traffic. Ed Shikada, Assistant City Manager, indicated the Office of Transportation would do what was necessary to respond to applications as they were submitted. Council Member Fine felt the focus on women and families was important. The lack of childcare was a concern for the community. He was interested in having more collaboration space in the City. He encouraged the applicant to focus on publicly available classes and events and to consider fencing and screening to mitigate noise concerns. He inquired about land uses other than a PC that could accomplish the project. Ms. Hodgkins explained that a community center was an allowed conditional use in R-1 and RM-30 zones Council Member Fine requested the uses permitted under the current zoning. FINAL MINUTES Page 8 of 38 City Council Meeting Final Minutes: 10/01/18 Ms. Hodgkins replied mortuary use. Council Member Fine reiterated that the mortuary had been vacant for approximately five years. A PC was an appropriate way to accomplish a new use. The concept was encouraging, but the project needed more work. Council Member Holman remarked that more outreach was needed. The primary concerns appeared to be noise and parking. Young families needed services as well as housing. Perhaps the project was attempting to do too much with daycare, drop-in offices, a school, and drop-in classes. Perhaps community concerns could be mitigated if the project narrowed its focus. The proposed public benefits were questionable. The existing building's eligibility for the California Registry was a concern. Council Member DuBois appreciated the applicant removing the coworking space from the project. The Council should weigh the scale of the project with its impact on the surrounding homes. He was concerned about the existing building's eligibility for the California Registry, parking at Addison Elementary, and the size and intensity of proposed events at the site. He was interested in a transportation demand management (TDM) program for the project. The project was interesting in that it combined spaces for kids with spaces for work, but the site may be the wrong location for the project. He referred to Mr. Borock's letters and inquired about the process for modifying a PC zone and other zoning that would be appropriate for the site. Ms. Stump explained that information about temporary use permits could be provided at a later time. The current PC for the site appeared to be obsolete; therefore, the Council could make some decisions about zoning for the site. The PC Moratorium Ordinance gave the Council discretion to address, propose, and allow a new project-specific or site-specific zone. A new PC or a modification to the existing PC was appropriate if the Council chose to take that legislative action. Council Member DuBois noted the City's practice appeared to be to treat a major change as a new PC. Ms. Stump clarified that a project-specific zone for the proposed project or an evolved version of that would be unrelated to the existing mortuary PC. A new PC and a modification of the existing PC were the same thing substantively. While the underlying zoning for the site was not residential, the Council had discretion to consider a more traditional zoning designation for the site. The potential historic resource complicated the options available to the Council. Council Member DuBois suggested a mixed-use zone could be appropriate. FINAL MINUTES Page 9 of 38 City Council Meeting Final Minutes: 10/01/18 Mayor Kniss interpreted Staff's comments as clarity around zoning does not exist; standard zoning could not be applied to the site; and the potential for a historic resource was real. Ms. Stump explained that a land use designation other than multifamily residential would require a Comprehensive Plan amendment. Zoning on the site was a PC that provided for a mortuary. Mayor Kniss doubted there was an interest in establishing a mortuary on the site. Council Member Tanaka understood traffic and parking in the area was challenging given the situation at Addison. For a young family in Palo Alto, both parents had to work. There were few female entrepreneurs because the majority of family duties were relegated to women. The many challenges between the project and the neighborhood had to be worked out. He requested the applicant comment on the neighbors' preference for a mortuary or a family center. Ms. Mayer did not want to open a mortuary on the site. The site was valuable and should be a functional part of the community. If the Council retained the mortuary use for the site, then it would have to be a mortuary. In reviewing residential zoning for the site, she discovered that the buildings sit close to the boundaries of the three parcels, and they would be considered nonconforming. Mayor Kniss noted the lack of resources for young mothers in Palo Alto. The Council had to consider the future use of the site. As far as a residential use for the site, no one had proposed a market-rate housing project. She suspected the community would resist a 50-foot tall housing project for seniors on the site. The most complicated issue appeared to be zoning. She requested the status of Council consideration of the PC moratorium. Ms. Stump reported she would circulate the Council's specific action for PC zoning to the Council. If the Council wished to proceed with a PC for the project site, it could do so. Council Member Scharff recalled that the Council voted to retain PC zoning, but the Council had indicated its unwillingness to approve new applications for PC zoning. Mayor Kniss reiterated that the primary issue was zoning. Vice Mayor Filseth suggested the two most obvious zoning choices were multifamily residential and a use similar to a mortuary. FINAL MINUTES Page 10 of 38 City Council Meeting Final Minutes: 10/01/18 NO ACTION TAKEN. Agenda Changes, Additions and Deletions None. City Manager Comments Ed Shikada, Assistant City Manager, reported the City Manager and he had attended the International City/County Management Association annual conference, where the City received the Voice of the People award for excellence in the natural environment. The first community workshop regarding Cubberley Community Center was held the previous Thursday with almost 250 people in attendance. A report and results of the workshop would be available on the Palo Alto Unified School District (PAUSD) website in approximately two weeks. The next community meeting was scheduled for November 1. Expansion of the City's over-air Wi-Fi was complete with Wi-Fi available at additional community centers. During a workshop on October 2, San Francisco International Airport staff would present information regarding the new landing system, the Ground-Based Augmented System (GBAS). Fire Prevention Week was October 7-13, during which the Palo Alto Fire Department would lead fire prevention and safety events in the community. Community members were needed to serve on the Architectural Review Board, the Parks and Recreation Commission, and the Planning and Transportation Commission. The deadline to apply was October 17 at 4:30 p.m. Mayor Kniss inquired about Bike Palo Alto Day. Vice Mayor Filseth advised that Bike Palo Alto was successful with many people in attendance. Ellen Fletcher's family was present for the renaming of Ellen Fletcher Middle School. Oral Communications Dennis Backlund advised that services and amenities near the Hotel President met his special needs for access. He had not been able to find a new home that would meet his needs. Iqbal Serang referred to the City of Menlo Park's adoption of renter protections and felt the Council should consider rent control and rent stabilization issues. The no-fault evictions of Hotel President residents needed to be addressed. FINAL MINUTES Page 11 of 38 City Council Meeting Final Minutes: 10/01/18 Michelle Kraus thanked the Council for responding to the needs of Hotel President residents. Jeffrey Jones appreciated the Council's support of the Ordinance for renter protections. Roberta Ahlquist stated several Council Members had conflicts of interest and should have recused themselves from the discussion of rent control. The Council should not limit public comment to one or two minutes. Stephanie Munoz was astonished and disappointed that housing for Cubberley Community Center was not mentioned during the public meeting. Minutes Approval 4. Approval of Action Minutes for the September 10 and 17, 2018 Council Meetings. MOTION: Council Member Scharff moved, seconded by Council Member Wolbach to approve the Action Minutes for the September 10 and 17, 2018 Council Meetings. MOTION PASSED: 9-0 Consent Calendar Council Member Tanaka registered a no vote on Agenda Item Numbers 7, 9, 11, 12a. Council Member DuBois registered a no vote on Agenda Item Number 7. Council Member Kou registered a no vote on Agenda Item Number 7. MOTION: Council Member Scharff moved, seconded by Council Member Wolbach to approve Agenda Item Numbers 5-12A. 5. Approval of an Extension of the Pilot Phase of the Southgate Residential Preferential Parking Program (RPP) for a Period of six Months. 6. Approval of Contract Number C19171565 With Brown and Caldwell in the Total Amount Not-to-Exceed $2,923,357 to Provide Design Services for Secondary Treatment Process Upgrades (WQ-19001) at the Regional Water Quality Control Plant. FINAL MINUTES Page 12 of 38 City Council Meeting Final Minutes: 10/01/18 7. Approval of Contract Amendment Number 2 With Verizon Wireless Through June 30, 2019, Utilizing the Western State Contracting Alliance (WSCA), California Participating Addendum for Wireless, Voice and Broadband Services, Accessories, and Equipment. 8. Resolution 9792 Entitled “Resolution of the Council of the City of Palo Alto Approving and Attesting to the Veracity of the 2017 Annual Power Source Disclosure Report.” 9. Resolution 9793 Entitled “Resolution of the Council of the City of Palo Alto Authorizing the City Manager to Purchase a Portion of the City’s Verified Emission Reductions Requirements From ClimeCo Corporation Under Specified Terms and Conditions During Calendar Years 2018 Through 2027, Inclusive.” 10. Approval of Contract Number C19173445 With Charles Sowers Studio, LLC in the Not-to-Exceed Amount of $175,000 for the Fabrication and Delivery of Artwork Associated With the Junior Museum and Zoo (JMZ); Acceptance of Fund Contributions From the Friends of JMZ; and Approval of a Budget Amendment in the Art in Public Places Capital Project (AC-86017) in the Capital Improvement Fund. 11. Adoption of a new Memorandum of Agreement With the Palo Alto Police Management Association (PAPMA), International Association of Fire Fighters (IAFF), Local 1319, and Palo Alto Fire Chiefs' Association (PAFCA); and Approval of a Budget Amendment in the General Fund. 12. Ordinance 5450 Entitled “Ordinance of the Council of the City of Palo Alto Adding Sections 2.30.620 Through 2.30.690 to Title 2 of the Administrative Code to Establish Criteria and Procedures for Protecting Personal Privacy When Considering the Acquisition and use of Surveillance Technologies, and Provide for Ongoing Monitoring and Reporting (FIRST READING: September 10, 2018 PASSED: 8-1, Holman no).” 12A. Ordinance 5451 Entitled “Ordinance of the Council of the City of Palo Alto Amending Chapter 9.68 (Rental Housing Stabilization) of Title 9 (Public Peace, Morals, and Safety) of the Palo Alto Municipal Code to Require Relocation Assistance for No-fault Eviction for Multifamily Housing Developments Containing 50 or More Rental Units” (FIRST READING: September 17, 2018 PASSED 8-1 Tanaka no). MOTION PASSED FOR AGENDA ITEM NUMBERS 5-6, 8, 10, 12: 9-0 FINAL MINUTES Page 13 of 38 City Council Meeting Final Minutes: 10/01/18 MOTION PASSED FOR AGENDA ITEM NUMBER 7: 6-3 DuBois, Kou, Tanaka no MOTION PASSED FOR AGENDA ITEM NUMBERS 9, 11, and 12A: 8-1 Tanaka no Council Member DuBois remarked that most private businesses did not provide cell phones for their employees. Contracts would need long-term restructuring to affect structural changes to the Budget. Council Member Kou suggested the Finance Committee should review the contract. Verizon had not been a good contractor in placing small cell antennas within Palo Alto. Expanding the contract between the City and Verizon would cause Verizon to want to install more equipment in Palo Alto. Council Member Tanaka advised that the Staff Report did not indicate the amount of the savings under the contract with Verizon. The Staff Report for Agenda Item Number 9 did not indicate whether Staff had considered other vendors. With respect to Agenda Item Number 11, he questioned whether salary increases for Public Safety personnel were appropriate given the effects on the General Fund. Regarding Agenda Item 12A, he had not received a response from the City Attorney regarding the City's legal risks. MOTION TO RECONSIDER THE CONSENT CALENDAR: Council Member Scharff moved, seconded by Council Member Wolbach to reconsider approval of the Consent Calendar. MOTION TO RECONSIDER PASSED: 9-0 Consent Calendar MOTION: Council Member Scharff moved, seconded by Vice Mayor Filseth, third by Council Member Holman to remove Agenda Item Number 7 to be heard as Agenda Item Number 12B on Action. Ed Shikada, Assistant city Manager, advised that Agenda Item Number 7 could be taken up during the meeting for a referral to the Finance Committee. Council Member Tanaka registered a no vote on Agenda Item Numbers 9, 11, and 12A. MOTION: Council Member Scharff moved, seconded by Council Member Wolbach to approve Agenda Item Numbers 5, 6, and 8-12A. FINAL MINUTES Page 14 of 38 City Council Meeting Final Minutes: 10/01/18 5. Approval of an Extension of the Pilot Phase of the Southgate Residential Preferential Parking Program (RPP) for a Period of six Months. 6. Approval of Contract Number C19171565 With Brown and Caldwell in the Total Amount Not-to-Exceed $2,923,357 to Provide Design Services for Secondary Treatment Process Upgrades (WQ-19001) at the Regional Water Quality Control Plant. 7. Approval of Contract Amendment Number 2 With Verizon Wireless Through June 30, 2019, Utilizing the Western State Contracting Alliance (WSCA), California Participating Addendum for Wireless, Voice and Broadband Services, Accessories, and Equipment. 8. Resolution 9792 Entitled “Resolution of the Council of the City of Palo Alto Approving and Attesting to the Veracity of the 2017 Annual Power Source Disclosure Report.” 9. Resolution 9793 Entitled “Resolution of the Council of the City of Palo Alto Authorizing the City Manager to Purchase a Portion of the City’s Verified Emission Reductions Requirements From ClimeCo Corporation Under Specified Terms and Conditions During Calendar Years 2018 Through 2027, Inclusive.” 10. Approval of Contract Number C19173445 With Charles Sowers Studio, LLC in the Not-to-Exceed Amount of $175,000 for the Fabrication and Delivery of Artwork Associated With the Junior Museum and Zoo (JMZ); Acceptance of Fund Contributions From the Friends of JMZ; and Approval of a Budget Amendment in the Art in Public Places Capital Project (AC-86017) in the Capital Improvement Fund. 11. Adoption of a new Memorandum of Agreement With the Palo Alto Police Management Association (PAPMA), International Association of Fire Fighters (IAFF), Local 1319, and Palo Alto Fire Chiefs' Association (PAFCA); and Approval of a Budget Amendment in the General Fund. 12. Ordinance 5450 Entitled “Ordinance of the Council of the City of Palo Alto Adding Sections 2.30.620 Through 2.30.690 to Title 2 of the Administrative Code to Establish Criteria and Procedures for Protecting Personal Privacy When Considering the Acquisition and use of Surveillance Technologies, and Provide for Ongoing Monitoring and Reporting (FIRST READING: September 10, 2018, PASSED: 8-1, Holman no).” FINAL MINUTES Page 15 of 38 City Council Meeting Final Minutes: 10/01/18 12A. Ordinance 5451 Entitled “Ordinance of the Council of the City of Palo Alto Amending Chapter 9.68 (Rental Housing Stabilization) of Title 9 (Public Peace, Morals, and Safety) of the Palo Alto Municipal Code to Require Relocation Assistance for No-fault Eviction for Multifamily Housing Developments Containing 50 or More Rental Units” (FIRST READING: September 17, 2018 PASSED 8-1 Tanaka no). MOTION PASSED FOR AGENDA ITEM NUMBERS 5-6, 8, 10, 12: 9-0 MOTION PASSED FOR AGENDA ITEM NUMBERS 9, 11, 12A: 8-1 Tanaka no Action Items 12B. (Former Agenda Item Number 7) Approval of Contract Amendment Number 2 With Verizon Wireless Through June 30, 2019, Utilizing the Western State Contracting Alliance (WSCA), California Participating Addendum for Wireless, Voice and Broadband Services, Accessories, and Equipment. MOTION: Council Member Scharff moved, seconded by Council Member Holman to direct Staff to bring this item to the Finance Committee for consideration. MOTION PASSED: 9-0 13. Recommendations From the Human Relations Commission in Response to Council Resolution Number 9653 Reaffirming Palo Alto’s Commitment to a Diverse, Supportive, Inclusive, and Protective Community (Continued From August 27, 2018). Minka Van Der Zwaag, Human Services Manager, reported the Council in 2016 passed the Resolution unanimously; stated publicly the City's rejection of any type of discrimination or bigotry and the affirmation of the rights of all individuals in the community; and referred the matter to the Human Relations Commission (HRC) for recommendations. The HRC's ad hoc subcommittee conducted a baseline assessment of the issues raised in the Resolution; established criteria and analyzed all findings based on that criteria; and prepared draft recommendations. The HRC reviewed the ad hoc subcommittee's recommendations in late 2017 and early 2018. The recommendations focused on immigration and gender equality. In regards to Recommendations 1 and 2, the HRC suggested the City Attorney be involved in the review of City policies, procedures, and programs; however, Staff felt it was more appropriate for the City Manager to report on City operations. With respect to Recommendation 6, Staff believed more FINAL MINUTES Page 16 of 38 City Council Meeting Final Minutes: 10/01/18 analysis was needed to consider a workable plan for Palo Alto and recommended the Council refer Recommendation 6 to the Policy and Services Committee. Jill O’Nan, Human Relations Commission Vice Chair, read a letter from HRC Chair Stinger regarding referral of Recommendation 6 to the Policy and Services Committee. Steven Lee remarked that the City needed to study gender equality and take meaningful and decisive action. He asked the City Council to approve the Staff recommendation. Shelly Kosak urged the Council to support and address gender equality in Palo Alto. A gender analysis study would help the City identify and address problems. She urged the City Council to support a gender analysis study. Cherrill Spencer commented that discrimination could be found in employment and access to recreation activities, social services, and health services. The Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW) could be customized to meet Palo Alto's needs. Stephanie Munoz had not realized that discrimination was prevalent until she began taking public transportation. Adopting CEDAW would push society in the direction of more equality. Adrienne Murphy felt Palo Alto's strengths were data analysis and tracking a forward course. Dr. Kala Mehta wanted to see Palo Alto become as gender equitable as possible. She urged the Council to adopt Staff's recommendations. Council Member Wolbach advised that the recommendations were a great step towards fulfilling the mandate the Council gave the HRC in 2016. It was time for the City to listen and act on gender equity. He supported the Council's adoption of an Ordinance that made it clear that the City would not tolerate gender discrimination. The Policy and Services Committee and Staff would work expeditiously on the issue. MOTION: Council Member Wolbach moved, seconded by Council Member Holman to: A. Direct the City Manager to review the City’s policies, procedures and programs, make any adjustments that may be appropriate, and report to Council on the City’s alignment with SB54; FINAL MINUTES Page 17 of 38 City Council Meeting Final Minutes: 10/01/18 B. Direct the City Manager to review the City’s policies, procedures and programs, make any adjustments that may be appropriate, and report to Council on the City’s alignment with SB31; C. Send a letter of endorsement to California State Senator Kevin de Leon in recognition of the City’s commitment to the values expressed in SB54; D. Send a letter of endorsement to California State Senator Ricardo Lara in recognition of the City’s commitment to the values expressed in SB31; E. Adopt Amnesty International’s resolution in support of Refugee Resettlement in Santa Clara County; and F. Direct Staff to study and return to Policy and Services Committee with options for a City ordinance endorsing the United Nations’ Convention on the Elimination of all forms of Discrimination Against Women (CEDAW). Staff’s work should include: i. Affirming the City’s commitment to the principals of the United Nations convention of the elimination of all forms of discrimination against women, and ii. Discussion of the potential for a gender analysis, including potential focus, scope, and phasing of an analysis, and roles of City Staff, the HRC, and Council. Council Member Wolbach depicted the Ordinance as the first step towards gender equity, religious freedom, the rights of immigrants, and more. Council Member Holman hoped the next steps and any other equity issues were handled expediently. Healthy City Healthy Community exercised and promoted equitable practices. Council Member Scharff believed it was important to operationalize the issues brought forward. He supported Policy and Services Committee review of Recommendation 6. The important point was focusing on the most impactful actions that could be accomplished in one to two years because of time and budget constraints. AMENDMENT: Council Member Scharff moved, seconded by Mayor Kniss to add to the Motion Part F: iii. Policy and Services Committee should return to Council with a recommendation of one to two areas to focus on; FINAL MINUTES Page 18 of 38 City Council Meeting Final Minutes: 10/01/18 iv. Priorities should be given to areas where the City can make the greatest positive impact on the lives of the women and girls in Palo Alto; and v. Work generally within existing budgets, and City resources, and can accomplish goals within one to two years. Council Member Scharff felt clear areas of focus were important. Priority should be given to areas that provided the greatest positive impact. Given budget constraints, efforts should begin with existing resources. Mayor Kniss agreed that Part F(ii) of the Motion should be more narrow so that work could be accomplished. Typically county or large metropolitan jurisdictions were involved in CEDAW. The City had no input into the District Attorney's Office and did not offer any public health programs so that could be accomplished within available budgets and resources. Council Member Tanaka inquired whether the HRC felt formation of a task force and monthly staff time was needed. Ms. O’Nan reported the HRC did not support a Commissioner's suggestion for a task force and monthly staff time. Staff time would be needed for Policy and Services Committee discussions. The HRC hoped to obtain options and opinions from the Policy and Services Committee and the Council regarding a task force and Staff time. Council Member Tanaka requested Ms. O'Nan's opinion regarding the Amendment. Ms. O’Nan liked the Amendment with the exception of Part F because resources would be needed to make CEDAW operational. Council Member Tanaka asked why the Council should form a task force. Ms. O’Nan advised that unlike many jurisdictions, the City did not have a commission or committee on the status of women. At some point, the Council may need a task force or commission to handle CEDAW- recommended requirements. Mayor Kniss inquired about the amount of funding needed. Ms. O'Nan suggested funding could be needed for a part-time Staff person or a consultant. The amount of funding would not be large. Council Member Scharff offered to include a provision for funding up to $50,000. FINAL MINUTES Page 19 of 38 City Council Meeting Final Minutes: 10/01/18 Mayor Kniss preferred to provide funding up to $10,000. She urged the HRC and Staff to be mindful of funding when planning any work. Ms. Van Der Zwaag clarified that the Policy and Services Committee could frame the work to be performed. Council Member Scharff wanted Staff and the HRC to be fiscally responsible without specifying a dollar amount in the Amendment. Robert Jonsen, Police Chief, stated the Police Department's role was to serve the community, and the Police Department would follow the Council's lead. Council Member Fine inquired about the City's policy regarding communication with Federal immigration authorities. Mr. Jonsen reported the Palo Alto Police Department did not work with Immigration and Customs Enforcement (ICE) in any capacity. Council Member Fine requested Staff provide more detail regarding a gender analysis. Ed Shikada, Assistant City Manager, advised that the analysis could require significant allocation of resources. Staff hoped to work with the Policy and Services Committee to craft a manageable scope of work for the analysis. Council Member Fine inquired whether any colleagues or Staff had seen a gender analysis. Molly Stump, City Attorney, explained that the City of San Francisco's analysis involved gathering data for internal operations and analyzing the data by relevant demographic aspects. The analysis could be quite extensive. Other jurisdictions that had conducted gender analyses were much larger in scale than Palo Alto. Council Member Fine asked if the analysis would apply to general City operation and Utilities. Ms. Stump indicated the scope and priorities were different for each city. Council Member Holman requested Ms. O'Nan's opinion regarding changing Part F(iii) to "the Policy and Services Committee should return to Council with a prioritization of one or two areas of focus" so that areas not chosen were not lost. Ms. O’Nan remarked that CEDAW was a framework within which the City could enact change. Alternatively, in many cities CEDAW was purely FINAL MINUTES Page 20 of 38 City Council Meeting Final Minutes: 10/01/18 symbolic. She appreciated the direction for the Policy and Services Committee to focus on a shorter timeframe and a shorter list of priorities so that action could be taken. INCORPORATED INTO THE AMENDMENT WITH THE CONSENT OF THE MAKER AND SECONDER to change the Motion Part F. iii to state “a recommendation with a prioritization of one or two areas of focus.” Council Member DuBois would support the Motion. He inquired whether the City had a policy for maternity leave. Mr. Shikada indicated a proposed policy was being discussed with bargaining units. Council Member DuBois believed the Policy and Services Committee should consider maternity and paternity leave for City employees. Mr. Shikada reiterated that Staff was actively pursuing a policy with bargaining units and hoped to present a policy to the Council shortly. Council Member Wolbach believed the Amendment was unnecessary. He was certain the community would provide funding, time, and expertise for the effort. Perhaps the County of Santa Clara (County) would provide assistance. He asked the public to indicate their support for the Motion and Amendment and for the necessity of the Amendment. Mayor Kniss reiterated that cost was a factor in the Council's consideration. Within a year or two, the Council would have something to show for its efforts. She concurred with recruiting the County's and the community's assistance, but the County may not be willing to assist. Council Member Kou asked if Part F(v) meant work would cease after two years. Council Member Scharff answered no. AMENDMENT AS AMENDED PASSED: 6-3 Kou, Tanaka, Wolbach no MOTION AS AMENDED RESTATED: Council Member Wolbach moved, seconded by Council Member Holman to: A. Direct the City Manager to review the City’s policies, procedures and programs, make any adjustments that may be appropriate, and report to Council on the City’s alignment with SB54; FINAL MINUTES Page 21 of 38 City Council Meeting Final Minutes: 10/01/18 B. Direct the City Manager to review the City’s policies, procedures and programs, make any adjustments that may be appropriate, and report to Council on the City’s alignment with SB31; C. Send a letter of endorsement to California State Senator Kevin de Leon in recognition of the City’s commitment to the values expressed in SB54; D. Send a letter of endorsement to California State Senator Ricardo Lara in recognition of City’s commitment to the values expressed in the SB31; E. Adopt Amnesty International’s resolution in support of Refugee Resettlement in Santa Clara County; and F. Direct Staff to study and return to Policy and Services Committee with options for a City ordinance endorsing the United Nations’ Convention on the Elimination of all forms of Discrimination Against Women (CEDAW). Staff’s work should include: i. Affirming the City’s commitment to the principals of the United Nations convention of the elimination of all forms of discrimination against women; ii. Discussion of the potential for a gender analysis, including potential focus, scope, and phasing of an analysis, and roles of City staff, the HRC, and Council; iii. Policy and Services Committee should return to Council with a prioritization of one or two areas of focus; iv. Priorities should be given to areas where the City can make the greatest positive impact on the lives of the women and girls in Palo Alto; and v. Work generally within existing budgets, and City resources, and can accomplish goals within one to two years. MOTION AS AMENDED PASSED: 9-0 Council took a break at 9:39 P.M. and returned at 9:52 P.M. 14. PUBLIC HEARING: Adoption of an Ordinance Amending Palo Alto Municipal Code (PAMC) Section 18.42.040 Related to Accessory and Junior Accessory Dwelling (ADU/JADU) Units to Clarify or Modify Various Provisions Including Setback Requirements for Detached ADU FINAL MINUTES Page 22 of 38 City Council Meeting Final Minutes: 10/01/18 Basements, Allowance for Setback and Daylight Plane Encroachments for Detached ADUs, Bonus Lot Coverage and Floor Area Eligibility, Bonus Floor Area Amount to Match Minimum Unit Size as Established by Building Code, Reduced Height Limit for Detached ADUs Located Within Identified Eichler Tracts, Replacement Parking Provisions as Applicable to JADUs, Allowance for Replacement Parking to be Located Within Driveways Located in Street-side Setbacks, Allowance for Existing Driveways to be Expanded to Accommodate Replacement Parking, Allowance for Noncomplying Structures to be Rebuilt as Part of Conversion to ADU, and Applicable Zoning Districts That Allow ADU Development; Finding the Ordinance Exempt From Review Under the California Environmental Quality Act (CEQA) Pursuant to CEQA Guidelines Section 15061(b)(3); and Discussion of Other Potential ADU-related Regulations. The Planning & Transportation Commission Recommended Approval of the Ordinance (Continued from August 27, 2018). Clare Campbell, Senior Planner, reported the proposed Ordinance contained discrete changes to the Accessory Dwelling Unit (ADU) regulations. These were the first Staff-initiated changes since the ADU regulations were approved in May 2017. As of the date of the meeting, 64 permits had been filed over the past 15 months. Prior to the adoption of the regulations, the City averaged approximately four permits per year. The current average was slightly more than four permits per month. The proposed Code update addressed implementation challenges identified by Staff during permit reviews and communications with property owners. The Planning and Transportation Commission (PTC) conducted four hearings and recommended approval of the draft Ordinance on April 25, 2018. The State had not adopted any changes to ADU regulations during 2018. The proposed changes clarified that ADUs could be established in all zone districts that permitted single-family use; clarified that basements in detached ADUs were subject to the 20-foot rear yard setback; clarified that the only allowable setback and daylight plane encroachments for detached ADUs applied to roof eaves up to 24 inches; clarified that the bonus lot coverage and floor area applied to existing or proposed homes as of January 1, 2017; adjusted the bonus floor area amount to match the minimum unit size of 220 square feet per the Building Code; reduced the height limit for ADUs located within identified Eichler tracts; clarified that the replacement parking provisions also applied to Junior Accessory Dwelling Units (JADUs); allowed replacement parking for the primary home to be located within driveways located in a street-side setback; allowed the Director discretion to modify the parking space dimension as deemed necessary; allowed existing driveways to be expanded to accommodate required replacement parking; and clarified that noncomplying accessory FINAL MINUTES Page 23 of 38 City Council Meeting Final Minutes: 10/01/18 and structures could be rebuilt to convert to a new ADU provided there were no increases in the noncomplying condition and there was a 3-foot minimum setback from property lines. When the Council adopted the ADU regulations, the Council also directed Staff to present additional information regarding making ADUs more affordable and options for legalizing existing illegal units. Staff presented the topics to the PTC for input. The first input was an option to make ADUs accessible to moderate or low-income residents, seniors, people with disabilities, or public employees. The first option for accessibility was reducing or waiving Development Impact Fees of approximately $9,700 when the ADU was restricted as affordable housing for a specific term. The scenario would be well-suited for a homeowner making space for extended family or a caregiver and where the rental income was not the key priority for the property owner. The second option regarding accessibility was to partner with an organization that could provide financing in exchange for affordability. With respect to illegally constructed units, Staff suggested the use of a home improvement exception process as a possible option. A property owner could voluntary submit an application for review. Staff would require full compliance with all life safety issues for the unit. The Director would have the discretion to waive other conditions based on the specific situation of the project. Implementing any of the legalization processes required consideration of the administration of the program and the implications of ADUs not being approved. There could be unintended consequences with the loss of affordable housing and displaced residents for those property owners who were unable to bring their units up to Code. Susan Monk, Planning and Transportation Commissioner, advised that the PTC supported the Staff recommendations. The PTC's recent discussion of protected trees could require a change to the regulations. Peter Baltay, Architectural Review Board Member, indicated the Architectural Review Board (ARB) had no official position on the proposed changes. The ARB was concerned with the details of individual applications. Public Hearing was opened at 10:03 P.M. David Meyer, Silicon Valley @Home, remarked that the proposed changes exceeded State requirements for the ADU Ordinance to be simpler and more flexible. To strengthen the Ordinance, he suggested changes of eliminating all developer fees; reducing the minimum setback to 0 feet for second-story ADUs over garages; and increasing the allowable square footage from 800 to 1,200 square feet. He recommended the Council delay action on any policy to bring unpermitted ADUs into compliance to avoid unintended consequences. FINAL MINUTES Page 24 of 38 City Council Meeting Final Minutes: 10/01/18 John Kelley felt most of Staff's recommendations were excellent. The increase in ADU production was great but only a small start. Mr. Meyer's suggestions were important, especially the minimum setback for second- story ADUs. Anything the Council could do to reduce the cost of building an ADU was important. He suggested the Council direct Staff to consult with the community, local architects, and the PTC to develop templates for conversion of well-established things like garages to speed up the development process. The Council should reconsider the requirement for owner occupancy of the primary residence. Bob Moss noted provisions for setbacks and basements were confusing and should be reviewed and possibly revised. Stephanie Munoz believed ADUs should be reviewed on a case-by-case basis and suggested conditional use permits be granted for manufactured homes serving as ADUs. The Council should suspend the development fee until the ADU was rented for more than a specific amount, at which time the City should receive half of the extra rent as tax in perpetuity. Iqbal Serang suggested an amnesty program be developed for illegal ADUs if the homeowner could prove the ADU had existed for five years or longer. Second-story ADUs above garages should be given some leeway from daylight plane parameters. Public Hearing was closed at 10:17 P.M. Council Member Fine remarked that the increase in the production of ADUs was a success. He inquired whether anyone had attempted to build an ADU basement in the rear setback. Ms. Campbell advised that Staff had received at least one proposal. Council Member Fine requested the number of ADUs constructed or converted in Eichler neighborhoods and the number of those that had exceeded the Eichler height limit. Ms. Campbell reported Staff had not collected that data, but it could be provided to the Council at a later time. Council Member Fine inquired about the circumstances that led to Staff proposing a height limit for ADUs in Eichler neighborhoods. Ms. Campbell advised that the Historic Resources Board (HRB) discussed the matter and suggested Staff prepare the revision. She was not aware of the impetus for the HRB's discussion. FINAL MINUTES Page 25 of 38 City Council Meeting Final Minutes: 10/01/18 Council Member Fine requested the range of Development Impact Fees. Ms. Campbell listed impact fees for parks, housing, Citywide transportation, community centers, public safety, general government facilities, and library. Council Member Fine inquired about the average cost of impact fees for an ADU. Ms. Campbell replied approximately $9,700. Council Member Fine asked if the fees were charged for the development of new housing. Ms. Campbell answered yes. In addition, fees were assessed by the Palo Alto Unified School District (PAUSD) and the County of Santa Clara (County). Council Member Fine clarified that the proposed Ordinance did not contain provisions for the legalization of illegal units and for affordability. Ms. Campbell concurred. MOTION: Council Member Fine moved, seconded by Council Member Scharff to: 1) Find the proposed Ordinance exempt from the provisions of CEQA pursuant to CEQA Guidelines Section 15061(b)(3); and 2) Adopt an Ordinance amending Palo Alto Municipal Code Section 18.42.040, Accessory and Junior Accessory Dwelling Units. Council Member Fine expressed interest in eliminating some or all Development Impact Fees for ADUs and deleting the requirement for an ADU to be built on a lot containing a minimum of 5,000 square feet. Council Member Scharff believed the ADU Ordinance was working. The 64 ADUs built in the last 15 months were probably more significant housing development than in the entire previous year. ADUs had less impact on the community than virtually any other development. AMENDMENT 1: Council Member Scharff moved, seconded by Council Member Fine to remove “the minimum lot size for the establishment of an accessory dwelling unit of 5,000 feet” from the Ordinance. AMENDMENT 2: Council Member Scharff moved, seconded by Council Member Fine to remove the Owner Occupancy provision from the Ordinance, Section 18.42.040 a.10.E. FINAL MINUTES Page 26 of 38 City Council Meeting Final Minutes: 10/01/18 Ms. Campbell inquired whether the Amendments would apply to a JADU. Council Member Scharff answered yes. Council Member Holman suggested the continued proliferation of ADUs could result in complaints from the community. Flag lots were not allowed because of their impacts on neighbors, and ADUs were encroaching on many of the same issues. The Council should proceed with some caution. The height limit on ADUs in Eichler neighborhoods matched the height of the primary Eichler residence. She requested the Council be allowed to vote on the Amendments separately. MOTION SPLIT FOR THE PURPOSE OF VOTING Council Member Holman requested Staff comment on the discrepancy in setbacks referenced by Mr. Moss. Ms. Campbell explained that the setbacks represented different types of development. Setbacks for a conversion ADU within an existing home had to be consistent with the Safety and Building Codes. Three-foot setbacks applied to an existing noncomplying structure that had to be rebuilt to meet the Building Code. The standard side and rear setbacks for a detached ADU were 6 feet. Council Member Holman asked if Section 18.42.040.a.6.ii.A should refer to window placement and privacy. Ms. Campbell clarified that the proposed Ordinance did not regulate window and door placement. Council Member Holman noted window and door replacement was regulated for new construction. Ms. Campbell reported some privacy regulations pertained to a second-story ADU. Council Member Holman questioned whether privacy regulations contained in Section 18.42.040.a.7 should apply to a rebuilt structure. Ms. Campbell stated Section 18.42.040.a.7 addressed second-story units. Council Member Holman asked if Section 18.42.040.a.7 applied to both new and rebuilt ADUs. Ms. Campbell indicated specifically Section 18.42.040.a.7 applied to second- story units. Second-story units were allowed only in a true conversion of an FINAL MINUTES Page 27 of 38 City Council Meeting Final Minutes: 10/01/18 existing home, in the RE, or in the OS. If the ADUs were existing, they could be rebuilt. Council Member Holman asked if Section 18.42.040.a.7 applied to both new and rebuilt ADUs. Ms. Campbell articulated that Section 18.42.040.a.7 could apply to existing or new ADUs, but it definitely applied to second-story units. Council Member Holman asked if Section 18.42.040.a.7 should be interpreted as including the techniques listed rather than being exclusive to the techniques listed. Ms. Campbell understood the word "may" to mean the listed items and potentially other things could be included. Molly Stump, City Attorney, reported "may" was typically used to provide an example. It was not exclusive. To limit the list to the items stated, the language would be "may only include." Council Holman assumed the screening mentioned in Section 18.42.040.a.7 meant landscaping and asked if the landscaping was required to be maintained in perpetuity. Ms. Campbell related that the screening referred to structural elements such as a partial wall at a balcony for privacy. Because the permit for an ADU was administrative, Staff could not condition the permit for landscaping in perpetuity. Section 18.42.040.a.7 would apply to structural screening elements on the building rather than landscaping. Council Member Holman inquired regarding the reference to 50 percent of the rear setback could be occupied by the building. Ms. Campbell advised that the reference was contained in the Staff Report. Staff did not propose it as a change. The 50-percent limitation applied to an accessory structure, not an ADU. Council Member Holman inquired whether an ADU could cover more than 50 percent of the rear setback. Ms. Campbell answered yes. Council Member Holman expressed concerns about that and expanding the driveways. Covering the land with buildings and driveways that were not required to be permeable appeared to be contrary to the Council's focus on permeability. FINAL MINUTES Page 28 of 38 City Council Meeting Final Minutes: 10/01/18 Ms. Campbell explained that the existing requirement for a 60-percent permeable front yard was not changing. If new hardscape was proposed for the front yard, the 60-percent requirement was in place. The City had no permeability requirements for a driveway in the side yard setback. Council Member Holman did not understand how an ADU covering more than 50 percent of the rear yard did not impact the property to the rear and its landscape. The Tree Ordinance should be changed to protect trees on neighboring properties within a tree protection zone when an ADU was constructed close to the rear setback. Ms. Campbell articulated that any development would need to comply with tree protection requirements. Council Member Holman clarified that the Tree Ordinance did not require trees on adjacent properties to be protected even though there could be excavation or construction within a tree protection zone that, if identified, would exist on an adjacent property's trees. Ms. Campbell disclosed that Staff reviewed a tree protection zone that extended into a neighboring property when reviewing the building permit for the property. Council Member Holman revealed that it was not being implemented. She inquired whether Mr. Shikada was making a note of the fact. Mr. Shikada asked if it was related to ADUs. Council Member Holman replied yes. Mr. Shikada would discuss the matter with Council Member Holman outside the meeting. Ms. Stump reported the owner occupancy provision needed to remain for the JADUs per State law, but it could be removed for the ADUs. Council Member DuBois noted the PTC passed the changes unanimously, which did not occur frequently. He asked if more than four applications were being submitted per month. Ms. Campbell advised that approximately 4.5 applications were submitted per month. Council Member DuBois calculated the increase at 12 times the prior rate of submission. Privacy remained a concern. He inquired about safety requirements for existing nonconforming buildings. FINAL MINUTES Page 29 of 38 City Council Meeting Final Minutes: 10/01/18 Ms. Campbell explained that a homeowner could convert an accessory structure to an ADU under the ADU regulations. The proposed change applied to an accessory structure that should be demolished and replaced with a new structure in order to bring it into compliance with the Building Code. Council Member DuBois asked if the homeowner could demolish the entire accessory structure and rebuild a nonconforming structure or if some portion of the structure had to remain. Ms. Campbell reported the change would clarify that the structure could be demolished. Council Member DuBois requested the rationale for applying the regulations to PC zones. Ms. Campbell clarified that the PC zone applied to PCs with single-family uses. The single-family lots located within a PC zone could utilize the ADU regulations. Council Member DuBois inquired about the number of single-family lots located in PC zones. Ms. Campbell thought it could be a small number. Council Member DuBois suggested parking be monitored, specifically homes with ADUs having more than four vehicles parked on the street. He wanted to understand the impacts of the proposed changes. He inquired about the practical impact of removing the lot size requirement in terms of lot coverage and size of ADUs. Ms. Campbell related that all the design requirements would probably prohibit an ADU from being located on an extremely small lot. If the minimum lot size was eliminated and the State required no limit on lot coverage and floor area for ADUs, the entire lot could be covered. Council Member DuBois asked if a JADU could be built on any size lot. Ms. Campbell stated a JADU was permitted on existing structures only. Staff did not review the lot size for a JADU. Council Member DuBois understood Amendment 1 would basically turn all R- 1 zones into investment properties. The PTC had not discussed the Amendment, and Staff had not analyzed it. The public should be allowed to provide comment. The owner occupancy provision was intended to avoid FINAL MINUTES Page 30 of 38 City Council Meeting Final Minutes: 10/01/18 speculation. He inquired whether passing the two Amendments would increase the property value of every R-1 lot in Palo Alto. Ms. Campbell advised that some potential applicants had wanted the owner occupancy requirement deleted. At least 25 percent of single-family homes were rental units. With the owner occupancy requirement, 25 percent of single-family homes could not have an ADU. Council Member DuBois preferred to retain the owner occupancy requirement, especially in light of privacy concerns. With respect to affordable housing options, impact fees were needed to pay for City services. He liked the proposal for a private company to finance an ADU in exchange for affordability restrictions. It would place enforcement on the private financier. Perhaps the property could be restricted to affordable housing for 15 years. INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to direct Staff to investigate private ADU financing that would provide financing in exchange for deed restricted affordable ADUs. Council Member Tanaka inquired about the rationale for Staff proposing the change for basements. Ms. Campbell explained that the proposed change would clarify the existing language. Currently, an accessory structure with a basement could not be constructed in a setback. For ADUs, the Code language was not clear whether an ADU with a basement could be constructed in a setback. Council Member Tanaka assumed dewatering regulations would remain in place for ADUs. Ms. Campbell answered absolutely. Council Member Tanaka requested the rationale for proposing the clarification for ADU basements. Ms. Campbell advised that an ADU could have a basement, but the ADU with basement could not be placed in the rear 20-foot setback. Council Member Tanaka asked if an ADU without a basement could be placed in the setback. Ms. Campbell replied yes. Council Member Tanaka reiterated his request for the rationale. FINAL MINUTES Page 31 of 38 City Council Meeting Final Minutes: 10/01/18 Ms. Campbell suggested community concerns about dewatering and the close proximity of basements to property lines formed the rationale for proposing the clarification. Council Member Tanaka did not understand not allowing an ADU with a basement to be constructed in setback. Ms. Monk reported the PTC was generally neutral regarding a basement ADU in the setback. Because few projects had been proposed and because the impacts to the environment and adjacent properties were negative, the PTC decided not to support allowing a basement ADU in the setback. AMENDMENT 3: Council Member Tanaka moved, seconded by Council Member Fine to add to the Motion, “clarify that basements are permitted in the 20-foot rear yard setbacks for detached ADUs”. Council Member Scharff asked if an ADU basement would count toward the floor area ratio (FAR) of the ADU. Ms. Campbell clarified that the ADU basement counted toward the maximum unit size for an ADU. The basement did not count toward the overall floor area for the property. Council Member DuBois requested separate votes on the Amendments. Vice Mayor Filseth understood the concern about ADU basements in the setback was dewatering could affect the adjacent home. The Council could be proposing major policy shifts that the PTC and Staff had not vetted, as Council Member DuBois noted. He recalled a large number of residents in 2017 requesting the ADU Ordinance be removed from the Consent Calendar for discussion as the ramifications of the Ordinance could make fundamental changes to the character of the City, specifically the possibility of converting R-1 zoning to R-2 zoning Citywide. Some of the ADUs were being rented at below market rate (BMR) for caregivers and family members. In some instances, the homeowner would move into the ADU and rent the primary residence. Without the owner occupancy provision, ADUs would become a purely financial instrument for out-of-town investors. The owner occupancy provision was essentially the only thing that kept R-1 zoning from becoming R-2 zoning. A majority of Palo Alto residents probably were not ready to convert all R-1 zoning to R-2 zoning. Perhaps each neighborhood should determine whether it wanted to convert from R-1 to R-2 zoning. The Council should not approve Amendment 2. Council Member Scharff did not view the issue as converting R-1 to R-2 zoning. No one bought a house in Palo Alto to rent it. Typically, residents FINAL MINUTES Page 32 of 38 City Council Meeting Final Minutes: 10/01/18 who thought they might return to Palo Alto would rent their Palo Alto home rather than sell it. If a homeowner had an ADU, he would have to rent to the same people and take the ADU off the market because of the owner occupancy provision. Council Member Wolbach questioned whether the Council could create a mechanism that would allow the owner to leave the residence for a year without violating the owner occupancy provision. Council Member DuBois suggested a homeowner would not change his residency during a year-long sabbatical, which would not violate the owner occupancy provision. Council Member Wolbach posed a hypothetical scenario of Council Member Scharff adding an ADU to his primary residence and then spending a year in South Africa. He inquired whether the Palo Alto house would be considered Council Member Scharff's main residence for the year he was away. Ms. Campbell advised that the intent was to prevent the homeowner from renting the main residence. Council Member Wolbach would allow Council Member Scharff to rent the primary residence during the year he was away. He could support a little more flexibility in the owner occupancy provision, but the general purpose of the provision was valid. He suggested the owner occupancy provision be amended to allow a one-year exemption. Council Member Fine inquired about enforcement of the owner occupancy provision. Mr. Shikada did not know how the City would enforce the provision. Council Member Fine recommended the public report a vacant homeowner to the City. Mayor Kniss presumed enforcement was complaint-based. Mr. Shikada concurred. The development of an ADU presented a fact that Staff would need to wrestle with. Council Member Wolbach expressed concern regarding the Development Impact Fees. All ADUs did not create the same impact on the community. Modifying an existing structure was substantially different than building a new structure. FINAL MINUTES Page 33 of 38 City Council Meeting Final Minutes: 10/01/18 INCORPORATED INTO THE MOTION WITH THE CONSENT OF THE MAKER AND SECONDER to add to the Motion “eliminate the development fees for JADUs or for garage conversions.” Ms. Campbell clarified that the conversion of an existing garage without expanding it in any way would be exempt. Council Member Wolbach concurred. He suggested the Council direct Staff to waive fees for ADUs for which priority was given to moderate or low- income residents, seniors, people with disabilities, or public employees. Council Member Fine agreed with the intent of waiving fees for those groups, but he did not know how it would be implemented. Council Member Wolbach inquired whether Staff and the PTC had studied the issue or would need to study it. Ms. Campbell reported Staff would need time to evaluate the issue. Council Member Wolbach requested the Council refer reduced or waived fees to Staff and the PTC. This was an emerging area of policy. Council Member Scharff remarked that waiving the fees on ADUs would lock in the fees. He would prefer to waive all fees. Council Member DuBois clarified that fees would be waived in exchange for affordability. Council Member Wolbach wanted to create an incentive structure that would encourage people to choose a JADU instead of a freestanding ADU or to make their ADU available for one of the targeted groups. Council Member Scharff would accept the proposal if Staff also considered waiving all fees on an ADU. Waiving all fees would be a better incentive for the construction of ADUs. Council Member Wolbach asked if the five bullet points under the Staff Report heading "Options to Make ADUs Available to Moderate or Low-Income Residents" had been studied or were to be studied. Ms. Campbell indicated the intent was for Staff to analyze the options. AMENDMENT 4: Council Member Wolbach moved, seconded by Council Member Fine to refer to Staff and the Planning and Transportation Commission to study the following: FINAL MINUTES Page 34 of 38 City Council Meeting Final Minutes: 10/01/18 A. Perform additional financial analysis to understand the impacts of waiving fees; B. Establish a few ADU template plans that provide an “off the shelf” approvable project; C. Create a partnership program that identifies architects who specialize in ADUs who can be engaged by home owners to streamline the permit review process; D. Allow an opt-out provision for homeowners that no longer want to continue to provide their unit as affordable and require payment of fees that were waived; and E. Utilize a third party (e.g. Palo Alto Housing) to administer the program. Council Member Wolbach felt planning fees should be reduced for applicants using preapproved plans. In addition, the use of preapproved plans could reduce architect's fees and shorten the process. Rather than eliminating the minimum lot size, it should be reduced to 3,500 square feet. Council Member Fine indicated a homeowner who was capable of creating an ADU within the given setbacks, lot coverage requirements, and FAR should be allowed to build an ADU regardless of the size of the lot. Council Member Wolbach suggested implementing stricter privacy requirements for ADUs located in the back yard of an Eichler tract in exchange for allowing more front yard for attached ADUs. Council Member Holman stated adding to the front of an Eichler home was counter to the Eichler Design Guidelines and the preservation of Eichler neighborhoods. Council Member Kou inquired whether the 64 ADUs could be added to the City's Regional Housing Needs Assessment (RHNA) numbers. Ms. Campbell replied yes. Council Member Kou requested the height limit for ADUs. Ms. Campbell advised that the standard height limit was 17 feet, but the height limit was 12 feet for detached ADUs in Eichler neighborhoods. Council Member Kou asked if detached ADUs in Eichler neighborhoods would be built on a slab. FINAL MINUTES Page 35 of 38 City Council Meeting Final Minutes: 10/01/18 Ms. Campbell reported the design requirements were not that specific. Council Member Kou believed at 6 feet two homes would be close to one another. Adding the height to the narrow separation would create a tunnel between the two homes. She inquired whether the PTC considered that a concern. Ms. Campbell related that one Commissioner raised the concern, and the PTC proposed a lower daylight plane in response to the concern. Council Member Kou commented that the Council immaturely and hastily expanded the State requirements for ADUs in 2017. The Council continued to grapple with parking and traffic that resulted from the massive amount of building between 2010 and 2013. Staff did not propose any mechanisms to ensure second homes were used as housing. She inquired whether an ADU occupant could obtain a parking permit if the ADU was located in a Residential Preferential Parking Permit (RPP) district. Ms. Campbell indicated all housing units within an RPP district could obtain parking permits. Council Member Kou stated that ADUs were being added to RPP districts without regulation while the City was attempting to reduce parking permit counts. Eliminating the Development Impact Fee would benefit the residents living in ADUs. She did not support eliminating the owner occupancy provision because the main residence could be rented while the ADU could be kept for the owner while the owner was on sabbatical. The Council could make a determination on a case-by-case basis or if the owner submitted a letter of hardship. She asked if tax records could be used to determine whether an owner or a tenant occupied the ADU. If the State was going to impose top-down governance, the State would want to know the production and use of affordable housing. Ms. Campbell reported the State regulations did not request that information. The regulations were in place to build ADUs, but the regulations did not mean the ADU would be used as a rental property or would be affordable. The initial intent was to construct units. More dwelling units would help with the overall housing shortage. Generally, ADUs were more affordable than standard apartments. Council Member Kou inquired whether the ADU would be affordable for the tenant to live in or for the property owner to build. Ms. Campbell responded affordable for the renter. FINAL MINUTES Page 36 of 38 City Council Meeting Final Minutes: 10/01/18 Council Member Kou remarked that rental units generally were not affordable. Without tracking, the Council had no data. The Council was not preserving the character of the neighborhood but was converting low-density neighborhoods to higher density without requiring adequate parking. Ms. Monk advised that the PTC discussed and supported the development of programs to incentivize the production of ADUs at affordable levels. The Council should not refer the financial analysis of waiving fees to the PTC as the PTC had provided its recommendation. The PTC addressed privacy concerns and chose not to address standards for line-of-sight into adjacent properties. The PTC intentionally used the word "may" rather than "shall" in order to allow some flexibility so that the development of ADUs would not be prohibited by stringent requirements. The PTC voted to allow eaves and overhangs to extend past the building envelope slightly to match the existing structure. The PTC was not concerned about conversion to R-2 and felt it would help the City achieve its housing production requirements. AMENDMENT 4 PASSED: 8-1 Kou no Vice Mayor Filseth wanted to suggest the Council allow staff to study ways of increasing landlord flexibility without eliminating the owner occupancy provision. AMENDMENT 3 FAILED: 3-6 Fine, Scharff, Tanaka yes Vice Mayor Filseth remarked that conversion of R-1 to R-2 could spur housing, but the question was whether Palo Alto residents wanted that. AMENDMENT 2 FAILED: 4-5 Fine, Kniss, Scharff, Tanaka yes AMENDMENT 1 PASSED: 5-4 Filseth, Holman, Kniss, Kou no MOTION AS AMENDED RESTATED: Council Member Fine moved, seconded by Council Member Scharff to: A. Find the proposed Ordinance exempt from the provisions of CEQA pursuant to CEQA Guidelines Section 15061(b)(3); B. Adopt an Ordinance amending Palo Alto Municipal Code Section 18.42.040, Accessory and Junior Accessory Dwelling Units; C. Direct Staff to investigate private ADU financing that would provide financing in exchange for deed restricted affordable ADUs; D. Eliminate the development fees for JADUs or for garage conversions; FINAL MINUTES Page 37 of 38 City Council Meeting Final Minutes: 10/01/18 E. Remove “the minimum lot size for the establishment of an accessory dwelling unit of 5,000 feet” from the Ordinance; and F. Refer to Staff and the Planning and Transportation Commission to study the following: i. Perform additional financial analysis to understand the impacts of waiving fees; ii. Establish a few ADU template plans that provide an “off the shelf” approvable project; iii. Create partnership program that identifies architects who specialize in ADUs who can be engaged by home owners to streamline the permit review process; iv. Allow an opt-out provision for homeowners that no longer want to continue to provide their unit as affordable and require payment of fees that were waived; and v. Utilize a third party (e.g. Palo Alto Housing) to administer the program. MOTION AS AMENDED PASSED: 8-1 Kou no State/Federal Legislation Update/Action Ed Shikada, Assistant City Manager, reported Staff would provide a legislative update soon. Council Member Questions, Comments and Announcements Council Member Wolbach advised that he attended the Caltrain Local Policy Maker Group, where the group discussed grade separation and the Caltrain Business Plan. Cities on the corridor and Caltrain staff seemed to recognize that Caltrain needed to be more involved in supporting cities' efforts towards grade separations. Council Member DuBois reported he attended the Cubberley design meeting and urged Council Members to attend one of the meetings. The process was going to be positive. Council Member Scharff indicated he attended the North California Power Association (NCPA) 50th anniversary conference. Former Mayor Beecham spoke regarding the history of NCPA. He also attended a Bay Conservation FINAL MINUTES Page 38 of 38 City Council Meeting Final Minutes: 10/01/18 and Development Commission (BCDC) meeting and a San Francisco Bay Restoration Authority meeting. Mayor Kniss disclosed her attendance at an Urban Land Institute (ULI) workshop, which was very good. ULI offered to present a one-hour study session on planning if the Council was interested. She inquired whether the Assistant City Manager had attended a ULI study session. Ed Shikada, Assistant City Manager, did not believe he had. Council Member Holman stated she attended a Canopy planting in East Palo Alto and encouraged the public to participate in future plantings. She requested the meeting be adjourned in honor of Wamaitha Kaboga-Miller. Adjournment: The meeting was adjourned in honor of Wamaitha Kaboga- Miller at 11:55 P.M.