HomeMy WebLinkAbout1995-02-25 City Council Summary Minutes Special Meeting February 25, 1995 ORAL COMMUNICATIONS ........................................ 75-115 1. PUBLIC HEARING: The Comprehensive Plan Policies and Programs Document Prepared by the Comprehensive Plan Advisory Committee .................................... 75-115 ADJOURNMENT: The meeting adjourned at 3:18 p.m. ........... 75-160
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The City Council of the City of Palo Alto met on this date in the Council Chambers at 9:43 a.m. PRESENT: Andersen, Fazzino, Kniss, Huber, McCown, Rosenbaum, Simitian, Wheeler ABSENT: Schneider ORAL COMMUNICATIONS None. PUBLIC HEARINGS 1. PUBLIC HEARING: The Comprehensive Plan Policies and Programs Document Prepared by the Comprehensive Plan Advisory Commit-tee. This document contains recommended policies and programs for guiding Palo Alto's future. The policies and programs are organized into six areas: Community Design, Governance and Community Services, Business Economics, Housing Transportation, and Natural Environment. The policies and programs will provide recommended policy direction for preparation of the Draft Comprehensive Plan and Master Environmental Impact Report (EIR) during Phase III of the Comprehensive Plan Update. Mayor Simitian announced that the Council would review the Housing (HS) Section of the City of Palo Alto Comprehensive Plan Polices and Programs Draft IV (the Plan). Upon completion of the HS Section, Council would not begin a new section until its next meeting during which the Plan would be discussed. The Vision Statement on page 1 of the Plan read, "Affordable housing increases the diversity of Palo Alto's citizenry. Various building densities, types and uses will exist in the community, fostered by innovative City planning and zoning decisions as well as community and non-profit support for very low and low income housing, in a way which expands the ranges of choices in residential and work environments." Additional wording was added by the Planning Commission, "Broaden to include a balance in housing types including existing housing, market rate housing, multiple-family housing, small lots, etc." Tony Klein, Comprehensive Plan Advisory Committee (CPAC) member, said language throughout the document which referred to very low and low income housing also referred to low and moderate income housing. The Planning Commission was asked what was meant by the unclear statement "broaden to include a balance." Planning Commissioner Phyllis Cassel said the Plan had not included some material which had been included in the current Housing Element which included all homeowners in Palo Alto. The Planning Commission hoped to broaden the Plan to include the current document. The original Housing Element had not come out in a vision statement, but had come out broader.
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Mr. Klein said the purpose of the Vision Statement was not to disregard the existing R-1 residential nature of the community, but CPAC had considered it very important to emphasize that some of the things which needed to change in the Vision Statement should be brought about in the document as a whole. Council Member Andersen asked about Mr. Klein's reference to very low and low income housing throughout the document. Mr. Klein clarified the inclusion was for low and moderate income housing. Council Member Andersen asked whether market rate housing had been referenced in a broad context to include rental property as well. Mr. Klein replied yes. Mayor Simitian asked whether his colleagues were comfortable with the language in the Vision Statement and whether CPAC and the Planning Commission were in conflict. Ms. Cassel said the Planning Commission merely considered the Vision Statement too narrow. Mayor Simitian asked for comments or questions with regard to Page 1a of the Plan which contained staff comments. Council Member Andersen asked whether the City risked not being in compliance with State law if the City began to reconsider some of its housing sites in the current Comprehensive Plan (Comp Plan), e.g., whether the City would see any net decrease in housing availability if it agreed to the CPAC recommendations as described in the Plan or an increase. Director of Planning & Community Environment Ken Schreiber said in response to the question concerning possible jeopardy in dealing with the State and having a certified or non-certified Housing Element, any time a city entered into the process with the State, there was some uncertainty. The State bureaucracy tended to be difficult to deal with and jurisdictions had varying levels of hassle in getting housing elements certified. In many ways, the process was one of negotiation and he was confident the City could work with the State to formulate an acceptable Housing Element. The key factor was sites and future productions. The gap between desired housing production over the past five years and what had actually occurred was not dissimilar to what most jurisdictions in Santa Clara County faced. Housing production had not been near as much as had been either anticipated or desired. The concern was not as much about the past or the current gap. The key question was how much of the gap would be carried forward and how much would be added to it and then how it would be addressed, which got back to the issue of specific sites. The Planning Commission would continue its more in depth review of the sites. The City could probably come up with enough sites in Palo Alto to satisfy a reasonable expectation of the State. If the current gap had
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everything added to it, the numbers would be so large that no one would be able to meet the numbers. He assumed there would be some give-and-take at the State level in terms of reasonable expecta-tions. The City should be able to produce a satisfactory Housing Element. City Attorney Ariel Calonne responded in the negative to the question regarding the existing element as, or if, Council changed housing designations and whether certification would be lost. However, at some point when the existing Housing Element was amended enough, the City would be under some obligation or there would be some question about certification and whether it would be necessary to resubmit the amendments to the State. There was no hard and fast rule which said that if 10 percent of the units in the existing Housing Element were affected, certification would be lost, however, it was clear that at some point it would be advisable to submit even an existing element. There was no clean answer. If the balloon which constituted the number of required housing units, remained the same or increased over time, actions Council took to eliminate the current sites would make the job of identifying new sites more difficult. Economic Resources Manager Carol Jansen heard two parts to Council Member Andersen's question, one being housing compliance and the legality of the housing element requirements. The other question was the practicalities of whether or not the City would actually gain more housing. The staff comments on page 1a of the HS Section of the Plan read, "It is important to note that the 1991 Housing Element site inventory is out-of-date," and went on to say there had been a number of opportunities which had arisen but had not been indicated in the 1991 Housing Element, which was very telling. In discussing the practicalities of obtaining housing, it was important to remember to be prepared for options which arose in terms of the practicalities. Meeting the State's requirements and showing the numbers was one exercise, the other was being prepared to actually secure housing, which meant dealing with how zoning regulations were established to actually accomplish housing. Mayor Simitian asked whether there were any questions of Council on Page 2, Goal HS-1, "Increase the housing supply to provide affordable housing options distributed throughout the community to foster a diverse Palo Alto citizenry and to meet Palo Alto's fair share of regional housing needs, including Palo Alto's share of housing for very low, low and moderate income individuals and families." Vice Mayor Wheeler asked why Program HS-1.A1, "Allow for increased density for housing in the immediate areas surrounding neighborhood commercial and transit centers," suggested increasing densities around neighborhood commercial centers, which was more problematic than increased density around transit centers. There were a few neighborhood commercial neighborhoods in Palo Alto which were almost totally surrounded by R-1 densities where there would probably not be much support for increasing density. In some of the City's less healthy commercial neighborhoods,
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increased density had not appeared to help economically. Mr. Klein said CPAC's goal and key concepts in the entire Plan was one of the urban village. If the City could locate housing options closer to shopping areas, people would stay out of cars, create a greater sense of community, and was a good place for mixed use. One could really create viable options at a more affordable level if located more closely to areas where goods could be obtained or where people worked. Planning Commissioner Kathy Schmidt said the Planning Commission agreed with CPAC's concepts. Sandy Eakins Comprehensive Plan Advisory Committee (CPAC) member said CPAC had been confronted over its use of the term "urban village" during Phase I and had learned the more politically acceptable term "walk-able neighborhood." Increased densities, where feasible, possible, and acceptable around neighborhood commercial, increased walk-ability. Increased densities, in addition to Vice Mayor Wheeler's comment about helping merchants, helped the overall usefulness of neighborhoods so people would be more related to their neighborhood and could walk to neighborhood commercial, especially where the possibility for changing some commercial areas to residential was seen. CPAC's intent, unless there was a blight in a single-family area, was to turn commercial into residential of some kind around a neighborhood commercial. Council Member Huber shared Vice Mayor Wheeler's concern but thought it could be handled by changing some wording, e.g., indicate the change would be allowed in transit and commercial areas and be considered on a case-by-case basis in neighbor-hood/commercial or other area which would be impacted. In such a way, the City would consider the possibility without straight direction. Many areas would not benefit from such a change of direction. Council Member Rosenbaum was concerned about the phrase "allow for increased density" in Program HS-1.A1, which was not well-defined, particularly after Mr. Schreiber talked about how nice it would be to have people around the transit areas so there could be more sales tax revenue. The difficulty with such an argument was that a few more people, a little additional sales tax, lead to a great many more people. Such thinking eventually broke down and some other concept had to be relied upon to determine what would be done. He asked whether staff or CPAC anticipated the creation of more dense zones than the existing multi-family zone as part of the intent of the phrase "allow for increased density." Mr. Schreiber said the challenge was to make RM-30 and RM-40 zone densities work, not increase. He did not envision working on any regular basis densities higher than RM-30 or RM-40. Ms. Eakins said CPAC envisioned, rather than six housing units per acre, 12 or 15 smaller increases. Mr. Schreiber said staff's thinking was similar to Ms. Eakins in
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that densities of 10 or 12 per acre were probably reasonable and do-able, e.g., not considering neighborhood commercial at even RM-30 or RM-40. Will Beckett, Comprehensive Plan Advisory Committee (CPAC) member, said the entire document revealed CPAC's attempt to maintain the best parts of the current Comp Plan. Many zones already worked and there had been an effort to ensure the best of the elements had been maintained and not changed. CPAC's had tried to make the Comp Plan work better than it had before, i.e., to make the zones work better community design-wise to look right for the area. The effort was to keep things as zoned but to better fit into the community. Council Member McCown said although there might be areas where a change was possible, there were areas where it was not appropri-ate. She was comfortable with the phraseology. The issues which had been raised would come during the implementation stage which would determine the type of tools or rules with respect to the more dense zones in the City. The case-by-case language, as described by Mayor Simitian, might be appropriate but was implicit in everything the City did, e.g., going in on a case-by-case basis to determine which tools would be appropriate. The concern was appropriately raised, which would be addressed at later stages, but the language was acceptable. Council Member Andersen thought the concept of increasing density was a red flag which made many people nervous, even though it was not the issue. The wording appeared to attempt to allow for the kind of housing the RM-30 and RM-40 had initially been intended to accomplish, but had not. The issue would be raised repeatedly. Everyone examined incremental increases. The Plan did not intend to cause massive increases in housing stock, which would be detrimental to the total community. At the same time, there was no way to meet the vision statement without providing some increase over what currently worked. The City was not acquiring the kind of housing from RM-30 or RM-40 zones as had been intended in the original document. Mayor Simitian agreed with Council Members Andersen and McCown. There was a point at which one had to ask whether the City meant what it said, e.g., if the City wanted to increase the housing supply, and then determine how it could be accomplished. CPAC had responded with the suggestion of additional housing stock whenever possible in close proximity to transportation neighborhood commercial, a fundamental premise of which he supported. However, there might be case-by-case differences in neighborhood commercial to neighborhood commercial. The approach would eliminate vehicle trips whenever possible and, if there were vehicle trips, the trips would be fewer and shorter, a desirable goal. MOTION: Vice Mayor Wheeler moved, seconded by Kniss, to revise Program HS-1.A1, "Allow for increased density for housing in the immediate areas surrounding neighborhood commercial and transit centers," to add the words "as appropriate" before the word "surrounding."
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Council Member Fazzino asked for a definition of "as appropriate." Vice Mayor Wheeler thought such wording would allow the City the opportunity to consider individual neighborhood districts, the current zoning, and the possibilities for changes in the future. The Edgewood shopping district was totally surrounded by R-1 residential with no room or desire to see a difference. Such an area would not be treated in the same manner as Midtown, where there might be opportunities and the desire for more multi-family housing surrounding the shopping center. The wording would allow for more flexibility in the future. The circumstances surrounding individual shopping centers differed around town and should be recognized. Blanket statements would cause undue concern in the community and lead to, in the implementation phases, some question as to what Council meant in passing such a blanket statement. Council Member McCown did not feel as strongly about "as appropri-ate" wording, as it was something the City did all the time in the current Comp Plan, e.g., considering issues on a case-by-case basis where appropriately applied, which was implicit with what was done with the Comp Plan. Every time Council added such language, a less clear message was sent about the goals, since Council automatically made decisions about the appropriateness of applying policy. Such language would weaken the Plan. Council Member Rosenbaum agreed with Vice Mayor Wheeler. Staff reports often referred to the Comp Plan and policies, stating quite clearly goals which had not been the intent of the Council of the time, in support of various projects. If Council intended to treat neighborhood commercial differently from transit, such should be clearly stated. Council Member Kniss said Council was not merely discussing housing, but economics, parking, transit problems, etc., each of which had some another effect. When Council said "allow for increased density," the number of people who would attend such meetings would increase. The question was where increased density would go, e.g., playing fields, etc. Using the term "allow" sent a very clear message. She supported Vice Mayor Wheeler's amendment which at least sent a clear message and was possibly not even strong enough. Mr. Klein said Council had all addressed a fundamental issue. The manner in which the Plan was handled would weaken the language. The fundamental debate was whether or not Council really wanted density increased. CPAC thought that in order to have affordable housing which would enhance Palo Alto over the following 15 years, increased density was necessary. However, Council needed to discuss how much and what kind of density it wanted. There was a question as to whether Council really wanted the increased density. Mr. Calonne did not want the timing of his remarks to be misconstrued as having any bearing on the policy decision before Council. It was, however, a good illustration which had arisen at
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the previous Council meeting concerning the Comp Plan when he had drawn the picture of the dichotomy between certainty and case-by-case fairness. The point Ms. Jansen had made in the staff report (CMR:488:94) on housing was also illustrated. Words like "as appropriate" necessarily implied a case-by-case study. If Council extended the reasoning in Ms. Jansen's memo, the question of whether increases in density were accomplishable when a clear signal was not given. Although the issue was one of policy, it was a good example of how words might make a difference in a practical sense. Council Member Andersen agreed with the City Attorney. If Council was interested in providing affordable housing and housing options for young families, the people who made housing possible had to receive a clear message concerning what was possible, or the risk would never be taken. If Council did not want developers to take such a risk, the fundamental policy decision could be made to so respond. If Council wanted nothing to intrude on its own area, then the wording should be ambiguous and developers would stay away. But if Council wanted the objectives as stated in the Vision Statement to actually occur, a clear signal had to be given. The maker and seconder of the motion had probably not intend what he had described, but the long-range implication, based on information which had been received from members of the development community, staff, CPAC, and the Planning Commission suggested that if the language was made ambiguous, the City would not see the kind of results as described in the Vision Statement. Mayor Simitian said implicit in the Plan was the fact that statements contained therein were on an "as appropriate basis." Once words like "as appropriate" were added in selected locations throughout the Plan, anywhere else in the Plan which did not specify "as appropriate" would be approached differently. Inclusion of the words in only some would require inclusion of the words in every other policy or program. Caution should be used in adding words which were already implicit. There were other elements of the Plan not yet before Council. Cases would come before Council which would not be approved because of issues raised in other elements of the Plan, e.g., problems with transportation, problems with community design, etc., making such a decision inappropriate. The language should remain with the assumptions implicit. Council Member Kniss asked for an example from CPAC of increased density in an immediate area surrounding a neighborhood commercial. Mr. Klein said Midtown was a good example of an area surrounding a neighborhood commercial. Council Member Kniss asked how such an area would play out. Ms. Eakins said CPAC had found places in the Midtown workshop where commercial was strung out too far along Middlefield Road. The entire area would function better if there were row houses at 10 to 12 per acre to replace some of the commercial. If the
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Edgewood Shopping Center wanted to decrease its size, housing could be added around a redesigned shopping center where residents benefitted from the proximity to the retail and where there was a better sense of community. Council Member Kniss continued to consider the words "as appropri-ate" as correct. Mr. Klein said the concern with the "as appropriate" language was that if the City did not want higher density near neighborhood commercial but did want high density near transit, then that would be the message portrayed through the Plan and was Council's prerogative. Council Member Huber said Mr. Klein had intimated that Council might not want higher density around neighborhood commercial, but in different projects or processes, Council might, which was not wrong. Council Member McCown said the policy stated the City might want to allow for increased density, which was weak. Policies would not be implemented without specific zoning changes. The words in the Plan would accomplish nothing until specific zoning changes were made. Such a process would actually determined whether or not the policy or new zones were appropriate. Behind the Times Tribune site was a housing style which Palo Alto had not seen but was an interesting idea. Zoning currently would not encourage such housing in the Edgewood area, but was something worth considering. The wording created an ambiguity, lack of clarity of the goals, and was inappropriate for the Plan. The issues and concerns people had about considering where the policy actually applied was a step which Council always went through and where the level of detail was entered into which allowed making such a decision. Council Member Kniss thought "as appropriate" was more appropriate than ever. A number of changes had been made to zoning which had allowed for housing, but had never occurred, indicating something was wrong with what the City had done. A blanket statement which allowed for increased density created a different look rather than where appropriate. The community should be able to argue its point convincingly when approaching Council. A blanket was too strong a message. MOTION FAILED 4-4, Andersen, Fazzino, McCown, Simitian "no." Council Member Rosenbaum said the intent of the HS Section of the Plan was not to create zones which were more dense than zones which already existed in the Comp Plan. MOTION: Council Member Rosenbaum moved that the Comprehensive Plan parenthetically state that it did not imply the creation of zones which were more dense than the existing Comp Plan. MOTION DIED FOR LACK OF A SECOND
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Council Member Kniss said fair share housing had been discussed both at the State and National levels and was a major struggle throughout all cities. With what was occurring in Washington, D.C., indications were that the Department of Housing and Urban Development (HUD) would be dismantled. The City's "fair share" definition might not mean anything. Several years before, the City had wanted housing on certain sites but which developers had not accommodated. Somehow, the nexus had not made sense. Vice Mayor Wheeler had very efficiently asked how such areas could be incentivized to acquire housing. Goal HS-1 had included "Palo Alto's share of housing" needs. Mr. Schreiber said the term fair share in State Legislation was generated by the Association of Bay Area Governments (ABAG). None of his colleagues could explain how ABAG developed the fair share numbers-it was a black box process. Fair share numbers were translated into local obligations which had to be addressed in the housing element to be certified. The relationship between the fair share numbers and economic or development reality was absent. The process was one to which the City was required to respond. Council Member Kniss said fair share housing was discussed constantly at State and National levels. At the State level, there was a constant struggle because fair share was not addressed regionally and regressed into the issue of what could be allowed per unit and how it could be enforced. In Southern California, there was a real struggle with units containing 15 to 20 people. Ms. Jansen had had a philosophical conversation with Gary Binger, a Planning Director for ABAG, regarding the issue of fair share allocations. ABAG was uncomfortable and wanted out of the job of delivering the message of fair share allocations for various cities. ABAG had actively supported legislation at the State level to allow for a more subregional or regional view of fair share allocations. Fair share allocations for a city like Palo Alto were much easier to determine than for a city like Hillsboro or Atherton. ABAG considered the situation a no-win situation. On a subregional or regional basis, the same number of fair share units might result, the direction in which ABAG wanted to move and for which it wanted cities' support. Council Member Kniss asked what was meant by "meet Palo Alto's fair share of regional housing needs," in Goal HS-1. Mr. Klein thought the wording was not merely intended for the City, but to comply with State requirements. CPAC had tried to anticipate the day when fair share housing could be on a regional basis as well. Council Member Kniss asked whether CPAC had considered the fair share issue, knowing it was not as definitive as was hoped, with the goal to have fair share housing truly regional. Mr. Klein said the City's goal was to do what it could to meet its fair share needs, however defined. CPAC tended to view fair share housing on a more regional basis, but was not goal's only meaning.
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Council Member Kniss said fair share housing was one of the most frustrating issues with which the City had to deal. In California, it was so difficult economically to meet the housing needs that there did not appear any way for it to happen. The only reason housing had worked at the Park Boulevard site was because it penciled out for the developer. The situation was frustrating. The fair share housing issue did not appear to be approached realistically. Council Member Huber asked whether the phrase had been stated elsewhere in the Plan because of the State wide requirement. Mr. Schreiber replied yes. An explanation would appear in the final draft Plan to show where fair share numbers came from, that it came out of State law, and how ABAG provided the figures. Council Member Huber clarified the phrase came from the State as well as in previous Comprehensive Plans. Mr. Schreiber replied yes. Mr. Beckett said CPAC had been told fair share housing was a required element which not many members of CPAC had considered realistic. Mayor Simitian said there would rarely be a project, given the developed nature of the community, similar to the Stanford West proposal with 1,000 units. Palo Alto's success in the housing issue would largely be incremental, which meant the City would need to discover every possible opportunity for any progress. The issues of increased density on neighborhood commercial or finding that fair share housing was not consistent with the market revealed just how difficult the situation really was. Such difficulties revealed the necessity for dozens of different tools in the Comp Plan to ensure the City took every incremental opportunity possible. It was hoped that on a case-by-case basis, Council would make progress which would have a significant impact on the City's housing stock. Council Member McCown said the struggle to meet the goals set by the State and ABAG ultimately produced something for Palo Alto. The original vision statement displayed how the quality of life in Palo Alto would be improved if it could find ways to provide more housing opportunities for diverse populations, i.e., additional housing provided employment and commercial sectors as well as improved the general well-being of the community. Separate and apart from the fact numbers were set for the City which it might consider realistic, there was a real gain for Palo Alto to at least attempt to respond to the goals. The language was positive because if some reform occurred with respect to regional as opposed to city-by-city focus, the language would still contribute to a regional set of solutions which might be defined differently in the future. The language was consistent and supported the City's participation if the goals were set more regionally rather than on a city-basis. Legally, the City was required to follow
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the legislation but it was also important for the City to do so. Council Member Andersen was interested in more specific language. Staff had submitted a few reports which had made suggestions regarding particular alterations to accomplish some of the objectives. Staff report (CMR:142:95) contained suggestions regarding language changes which could occur for some alternative housing goals and policies. One such reference was to revise Program HS-1.A3, "Develop a less expensive review planned develop-ment process, one other than the PC review process, that does not have without requirement for a public benefit finding requirement, for new zoning designations for denser uses that encourage the construction of affordable smaller lot single-family and multifamily housing units." One staff report contained specific language which might be considered by Council and another had contained a wider array of options. In both options, an attempt had been made to formulate language which would make implementa-tion much easier. A concept which required some clarification was based on housing product types and asked whether staff's interests and recommended alternatives met with the language of housing product types rather than fixed zoning. Mr. Schreiber said Planning staff had suggested one way to proceed, a suggestion which had also come out of the CPAC process, to move toward product-oriented housing zoning regulations rather than the three generalized multiple family zones within which the City could do a variety of things, but which were not product-oriented. More product-oriented zoning would increase the predictability for the developer, property owner, and neighbors, e.g., townhouses in a particular area, stacked condominiums in a particular area, etc., would be based on zoning. Anything consistent with zoning would be assured of moving through the City review process more expeditiously. Although staff considered such a recommendation the way the City should proceed, there were a couple of negatives. Knowing Palo Alto, developing detailed regulations and applying the regulations on specific properties around town would not be an easy and quick process both in terms of public process as well as the technical aspects of each zone. Secondly, once the process had been established and the City had indicated what it wanted for a particular property, if the person who owned the property did not want to comply, a problem resulted. Staff could not predict where the housing market would be in five years in terms of the kind of product most desired. No one could have predicted in 1990 that small lot single family housing would have been the "hot product" for 1995. To determine what would be desired in the year 2000 was also impossible. If the City wanted to lock in a property for townhomes, but the market did not want to build townhomes, the property owner could go through a re-zoning process to another prototype zone, but the City might not have the prototype zone available for the product people wanted to see and the City would be behind the market again. The other method of addressing the problem was through a planned development process. The planned development process, as envisioned by the Planning staff, would be similar to a planned community zone but without the public benefit requirement, recognizing housing as having inherent public benefit and recognizing housing for the
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highly desired commodity that it was. Property owners in the very specific zones could go through a planned development process to pursue a product which was outside the particular zoning envelope or zoning box. Without the planned development process in place, property owners would have a more difficult time because the City might not have a zoning prototype zone which fit the desired result. Staff thought that having a planned development option was very important. Council Member Andersen appreciated that Council had received professionally prepared documents which contained philosophical differences which had to be taken into consideration. Ms. Jansen concurred with Mr. Schreiber's comments about zoning by product type and the possibilities of product changes. However, after having been in planning and community development for 23 years, the only new housing product type which had been introduced was the single-family attached or detached on small lots. In very developed communities, the single-family attached or detached product on small lots had been in existence and was probably the vast majority of housing types proposed for the past 15 years. The type was new to Palo Alto because Palo Alto was a developed community without as many opportunities for housing. Such a housing type could be well integrated into existing neighborhoods. Council had discussed increased density as appropriate in neighborhood commercial areas, CPAC had suggested row housing and something which provided single-family attached or townhouse housing types. The view of the world about what would occur should be reflected in what was done in zoning. If the City wanted market housing, the process had to be easier and the predictability higher on both sides of the fence. Staff had attempted to provide different perspectives. If Council and the other boards and commissions wanted to maintain ultimate control over all aspects of a project, a planned community or planned development approach was appropriate. It would not, however, be a welcome matt for housing developers, which was the philosophical tradeoff which Council had to consider. MOTION: Council Member Andersen moved, seconded by Kniss, to revise Program HS-1.A3 from "Develop a planned development process, without requirement for a public benefit finding for denser uses that encourage the construction of affordable smaller lot single-family and multifamily housing units," to "Develop single family and multiple family zones that are based on housing product types and which remove regulations impeding site and design restrictions," as described in staff report (CMR:295:95) on page 2 with a slight modification. Council Member Andersen thought the program would provide additional clarity, would give somewhat less restrictions in terms of moving forward, and would result in a greater interest in developing housing on sites which were specified. The goal simply streamlined the process. Council Member Kniss asked the City Attorney whether such a goal would help or hinder the legal minutia.
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Mr. Calonne said if the City guessed right concerning the number of boxes to put on a piece of property, it would have done well. If the City guessed incorrectly, it would not have done anything one way or the other. Council Member McCown assumed the point of the last phrase was to remove some unspecified set of regulations which impeded the product type development. Ms. Jansen said nothing which would be done by product-type would meet present regulations of the City's zoning. Council Member McCown thought staff's perspective was that under RM-30, RM-40, or RM-15 zoning, townhouses could not be built because of open space requirements, setback requirements, etc., and therefore queried a generic zone, e.g., a zone within which a developer could achieve what the City sought in four different ways, i.e., townhouses with certain characteristics which met with the City's zoning, stacked condominiums which could achieve a certain number of units within the zone or up to the maximum in the allowable zone with certain characteristics which would comply, etc. All zones could be described in a way which achieved the particular zone designation the City sought, i.e., a zone could have five different ways to achieve the multi-family housing goal of a certain designated zone. More refined designed criteria for each of the product types would have to be developed, but a developer would be given alternative ways of achieving zoning within a multi-family designation. Ms. Jansen said Council Member McCown was correct in her assumption that such a process could be accomplished, however, there was a difficulty with land which had been held for a long period of time. The purchase of a piece of property for housing development brought with it certain expectations. Such a sugges-tion meant expectations could run the gambit, which was very rare in housing developers who tended to be fairly product-oriented without an expectation. The same housing developer who built single-family attached did not necessarily build stacked condominiums with double loaded corridors. Council Member McCown said a developer could view a site and, based on the market place, know what the most saleable product was and could make an evaluation based on market value. An option was then given which made it no longer necessary for Council to second-guess the future and the market place could make the decision. Ms. Jansen said there would be no level of predictability for either the developer or the neighborhood. Neighborhoods would not often accept the double-loaded corridor stacked condominium as equal to a single-family attached product, which was the difficul-ty. If the City really wanted housing, it would have to make the primary consideration from a development perspective, i.e., making it fairly easy to go through the process. If Council was willing to live with a wide-open housing zoning and a minimal process,
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housing would result. The nature of Palo Alto suggested such a scenario would be very difficult. Council Member McCown had not suggested wide open zoning, but a melding of the two ideas. A set of defined prototypes which would achieve the housing goals could be assigned to a certain site. Currently, imposing RM-30 would create a specific outside mass structure which would be produced and upon which the neighborhood could rely, i.e., there were floor area regulations which dictated the size of the box. Neighborhoods still wanted certainty, but if the outside box was defined as stacked condominium units it could also allow small lot single-family. There was the possibility of framing a zone in a way which would avoid the kind of problems Mr. Schreiber had indicated about trying to guess defining certain product types. When the public benefit finding was removed, creating a new process which did not require a specific public benefit finding, it would encourage multifamily, affordable smaller lots. Nevertheless, in the planned development process, it was assumed there would be a set of criteria for development evaluation. If the site was next to single-family, some expectation should remain concerning how dense projects would interface with single-family. Some of the same principles which were currently used in the multi-family zones would be used to define parameters and provide the builder with guidance on site usage, height, etc. Within such guidance, if the developer could come up with a creative way of securing more units, the City would still be providing some criteria in the planned development process. Both the builder and the community would have some sense of the parameters within which a project might qualify to use the planned development zone. Mr. Calonne said that from a legal standpoint, in order to avoid having an arbitrary process, some criteria would have to be established. Council Member McCown said developments were always compared with the zone in the current PC process. If a developer wanted a zone changed, there had to be a public benefit to make the change. Under the planned development process, the City would have some set of criteria which a project had to meet in order to qualify. The City would be able to determine a way to make the use more dense, but did not have to make a public benefit finding so long as it met some defined set of criteria. Council Member Kniss said Council currently thought it had to constantly up the ante. The further from the zoning, the more the City had to ante. How to secure what was appropriate for the area and so define in the Plan was a moving target, which was the reason the City had become so involved in the PC process. Mr. Schreiber said the City could, in a planned development process, set out design guidelines, various expectations, etc. However, even if the City made the guidelines very precise there would still be projects presented which went beyond the expecta-tions. The problem was how to deal with the diversities. The Hamilton Project, which was on RM-15 land, went beyond what had
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been envisioned by RM-15. The question then was whether to tell the Hamilton Project to go elsewhere, or to have a process with enough flexibility to allow for processing and consideration of such a proposal. The City needed a process which had enough flexibility to accommodate unforeseen projects. Without such a process, the City would run up against a developer requesting approval without a process by which the City could approve. In terms of a zone with a variety of prototypes, as suggested by Council Member McCown, there was a problem in that some prototypes would be acceptable to the neighbors and other prototypes would not. The Times Tribune property, with the same square footage put into a stacked condominium facing Lytton would have resulted in a major level of opposition from the neighborhood. As it turned out, the developer had come in with a product which defeated the Floor Area Ratio (FAR) underlying zoning and went through smoothly. To the extent there was a wide range of possibilities in the zone, reduced the predictability because some of the range would generate significant neighborhood opposition and others would not. A developer would not know which of the options would cause a problem. If the design review process was reduced to simplify the process, there would be legitimate concerns in the community about part of the options. People wanted a process which allowed sufficient input, especially with options about which there were concerns. Council Member Andersen thought Ms. Jansen and Mr. Schreiber's comments had been very helpful. When discussing the need for flexibility, staff should be able to work with developers to provide flexibility before going to the PC process. The predict-ability of the motion was not just for the developer but for the neighborhood also. The neighborhood would be provided with a clear understanding of what would happen and allow much public discussion about what would be placed in any particular area before being planned. He queried whether the site and design issue did not preclude the Architectural Review Board (ARB) and the Planning Commission being fully involved in the process but that Council would not be involved. Ms. Jansen said Council Member Andersen's assumption was correct. Mr. Schreiber said removing Council from the process would involve a Charter amendment because the Planning Commission could not make the final decision. Council Member Huber said the City maintained its concern for what the neighborhood thought. Either the City would do a pre-hearing or wait until a project came along to do the hearing. There seemed to be no benefit to conducting a hearing prior to the need. Housing was market-driven and changed so rapidly that to zone an area one particular way, which never came in the way desired and was designed a different way anyway, would be a waste of time. Mayor Simitian thought Ms. Jansen had indicated the benefit was that if the City determined what it wanted, a developer would comply by presenting such a plan.
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Mr. Calonne said the reasonable economic expectations of a property owner were a key element in defining the legal rights. Council was struggling with defining what investment backed expectations to create. As an economic matter, the way the courts would view it, whatever zoning was applied to the property would result in creation of and then stabilization of property value. Value would create value, either increased or decreased, in whatever property the new zoning was applied to which would stabilize. Instability in the process came out of the natural tendency of one purchasing property to attempt to use, appropriately, political processes to increase the value of the property. Such a procedure was how people made money, buying property for less than it was sold for, but had a destabilizing affect on neighborhoods. The struggle was with two sides of a problem which did not have the same solution. The solution for property developers might well be to make more specific what the entitlement would be. But the solution for neighbors was to make more specific what the City would not do to change the entitlement. Both sides of the question were not being discussed. The neighborhood certainty issue could not be resolved until Council focused on the sources of destabilization and people's sense of certainty as neighbors. The suggestions from Ms. Jansen and Mr. Schreiber as to stabilizing the property developer side of the equation would not fix the neighborhood side of the equation, which would take a separate solution. Council Member Huber thought developers with any reasonable piece of property would bump against and want to change the rules and would be in the process anyway. There were very few projects which did not result in involvement in the process with neighbor involvement. The issue was then why go through all the trouble of rezoning and suggesting prototypes ahead of time. Sometimes calling housing a public benefit in and of itself allowed the moving down in the process. Council Member Rosenbaum said there were two issues. Program HS-1.A3 was inappropriate for dealing with multi-family zones. One issue or goal was to come up with a set of multi-family zones which worked which did not, on a routine basis, require that the developer come in with a PC application. Also, there was a need for exceptions, hopefully rarely, for which a special process would be necessary and for which Program HS-1.A3 developed a process for a planned development process to provide for exceptions. Council would probably never be able to come up with the best approach to developing multi-family zones which worked. MOTION WITHDRAWN BY MAKER AND SECONDER Vice Mayor Wheeler agreed with Council Member McCown on the broader subject of how the City was going to proceed in the Plan and ordinances which evolved from the Plan to address the dual dilemma between providing some measure of certainty and some measure of flexibility so Council would not have to see every application which came forward to achieve a goal in which Council was interested. The policies and programs in the current draft of the Plan did not appropriately deal with the issue. Program
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HS-1.A3 spoke to the flexibility issue, but none of the programs spoke to injecting certainty. Mr. Schreiber said an effort should be made to formulate multiple family zones which had a much higher level of predictability. In order to accomplish such a goal, gradation would be necessary. On one hand there were product-specific zones and the issue of whether neighbors would be accepting of a townhouse development would be thrashed out when the zoning was applied to the property, and was one of the reasons the process would be long and complicated. Something similar to existing zoning with design guidelines which would be approved by the City were also possible, e.g., a developer interested in placing townhouses in an RM-30 zone would be given the specifics of what the City expected the development to look like, etc. The problem would then be with the community and public process standpoint in that an expectation that much of the acceptability of what the developer presented would still be dealt with in a design review process, whether only at the ARB level or some other process which came through the Planning Commission and Council which would still be a public process with some element of uncertainty. From the developer's standpoint, uncertainty was a problem. Council could approve a product-specific zone, the more generalized zone with guidelines, or the more generalized zone without guidelines. The last scenario was similar to what already existed in the City, but zones could be developed which had a better chance of working both in the multiple family and commercial areas. The multiple family zones, especially when applied to commercial, really did not work. Product was appearing on multiple family zones and multiple family land, some of which was financed and some was not. Many times the product was not very desirable in terms of the community. Council Member Kniss said the Planning Department should provide more specificity in the future for the long run. Staff was asked to provide the figures concerning how many households had been added between the previous Comp Plan and current, minus the annex-ation of Barron Park. Council Member Andersen said Mr. Schreiber's comment had not been addressed concerning the suggested options, e.g., whether the options were represented in Program HS-1.A3 and, if not repre-sented, what would be recommended, given the strong interest in moving away from the PC process to bring about a greater degree of simplicity and predictability. Mr. Schreiber said the City needed a range of tools. Zoning which was not product-specific on some sites where flexibility needed to be recognized and other areas would require an agreement for more specificity which needed a tool for more specificity. Council Member Andersen asked whether Mr. Schreiber's suggestion was obtainable through Program HS-1.A3. Mr. Schreiber replied no. Neither Program HS-1.A3 or the Plan addressed the issue.
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Council Member Andersen asked whether the issue should be ad-dressed. Mr. Schreiber replied yes. Council needed to recognize that its discussion was building on the CPAC process and was very important. Council Member McCown asked whether the handwritten notation to the left of page 2 in the HS Section of the Plan, "Add a general goal for maintaining existing housing stock" would be included, since it was appropriate. She also asked whether Council Member Rosenbaum's comment about fixing the existing multi-family zones should be included in the Community Design (CD) Section of the Plan, which should be pursued at the appropriate time. Staff background reports had illustrated the differences which occurred after 1987 changes to the RM zones. Council should consider the possibility of returning to the pre-1987 rules, or some variation thereof, which would open up the zones, specifically for commercial sites or sites surrounded by commercial. The 1987 changes had been made, in large part, in response to situations where multi-family units were being developed in areas which blended into single-family, which was part of the concern. Rules should perhaps not be changed because the situation was different. Four sites which were not even zoned commercial might be changed, loosened up, etc., to create far greater flexibility. A multi-family set of rules which were attractive as an alternative to commercial zoning, provided situated in a way which was not detrimental, should be examined. Mayor Simitian asked whether Council Member McCown's suggestion could be considered part of the deliberative process which Mr. Schreiber planned to undertake based on Council's conversa-tions. Mr. Schreiber thought Council should take time to address such issues. The staff report (CMR:139:95) provided a variety of suggestions which, in terms of additions and changes to the CPAC process, staff judged appropriate for consideration. Mayor Simitian agreed with Council Member Rosenbaum's assessment of the conversation. There were two different, important issues: 1) how to make RM-15 and RM-30 really mean RM-15 and RM-30; and 2) on occasions when a more flexible zone was really necessary, whether there was a PC-type of process which was less cumbersome and did not put the City through the sometimes artifice of public benefit finding. He also agreed with the comments made by Council Member McCown. Council Member Fazzino asked why the language in Program HS-1.A6, "Support appropriate local, regional, state and federal programs which allow housing assistance organizations non-profit developers to acquire, rehabilitate and operate existing rental housing primarily for very low, low and moderate income persons" had been limited to non-profit developers.
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Mr. Klein said CPAC wanted to make the point that there were non-profit organizations working on rental housing for low income persons which should be encouraged. The intention was not to exclude anyone from coming up with such programs. Mayor Simitian thought there were words missing from Program HS-1.A6. An "and" should appear between "organizations" and "non-profit developers." Council was asked for a consensus in a request for staff to clean up the language in Program HS-1.A6 and add something which would indicate that for-profit developers would be accommodated if working on very low, low, and moderate income persons. Consensus received. Council Member Kniss asked why Program HS-1.A2, "Zone for smaller single family homes in certain locations. One means may be by limiting the ability increase the overall square footage, mass, shape or footprint of existing houses," on page 2 of the HS Section of the Plan had been eliminated, since it appeared to be one of the core ideas of the Plan. Ms. Schmidt said the Planning Commission had agreed with staff's comments that particularly the second sentence of Program HS-1.A2 went against current housing regulations and would limit what people could do to remodel and add on to existing small homes. The first sentence was dealt with elsewhere in the Plan. Council Member McCown was excited by Program HS-1.A9, "The City will evaluate minimum density requirements," even though she did not know what the implications were or what an evaluation of the concept would produce. The program would be extremely useful. Mayor Simitian had had some experience with the concept and thought the notion of minimum density requirements had value. However, the City should really mean what it said. Otherwise, the City would think it had given a very clear message to an applicant, but the applicant would arrive on the scene only to discover the neighborhood did not support the minimum density requirements and be caught between a rock and a hard place. If the developer had to meet the minimum density and the minimum density was perceived as being excessive by either Council or the neighborhood, it could be a problem. Council Member Kniss asked how Program HS-1.A9 would play out. Ms. Schmidt said Program HS-1.A9 had been recommended by Commis-sioner Schink. The purpose was to obtain more housing on proper-ties with certain density requirements below which a developer could not go. If the City gave a minimum density of x number of units per acre, developers could not build fewer than that number of units. Council Member McCown said the Program was merely an evaluation of minimum densities, and did not say such language would become part of the Palo Alto Municipal Code (PAMC). Vice Mayor Wheeler asked whether Program HS-1.A9 would be applied
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to multifamily zones only or both multi and single family zones. Ms. Schmidt said Program HS-1.A9 would be applied to multifamily zones only. Mr. Klein thought Program HS-1.A9 would not apply to multifamily zones only because there could also be application to small lot and single family. Mayor Simitian agreed. Program HS-1.A9 involved evaluation. The goal was to place small lot subdivision on some of the larger lots to create more affordable housing for more families. Single family zones should be included in the program. Council Member Huber was prepared to evaluate minimum density requirements, but was uncertain he would be willing to do so in an R-1 zone. Council Member Rosenbaum thought the intent was not to consider an R-1 zone. The consideration of small lot, single family was for multi-family zones and the issue was marketing as it applied to RM-30 and RM-40. If a developer wanted 1500 square foot units, not as many could be placed within other RM restrictions. The issue was if the zone required development of 1,000 square foot units to get the density. Much evaluation would be necessary. Council Member Kniss questioned the inclusion of Program HS-1.A9 in the Plan as a new program which said so little. The Planning Commission was asked about the vote on the program. Ms. Schmidt could not recall the vote, which had not even appeared in the minutes. MOTION: Council Member McCown moved, seconded by Fazzino, to retain Program HS-1.B1, "Continue to discourage the conversion of rental units to condominiums unless the renters occupying such units at the time of conversion approve the change, potentially with the first option to buy such units," in the Housing Section of the Plan. Council Member McCown said the program had been a long-standing policy of the City which should continue to appear in the Plan. MOTION PASSED 8-0, Schneider absent. Vice Mayor Wheeler asked whether Program HS-1.B2, "For any residential development in multiple-family zones which causes the loss of rental housing units, subdivision approval (including condominium maps) may be granted if any two of the following three circumstances are met: 1) The project will result in a significant gain to the City housing supply (defined as 100% more units than those previously existing on the site) and comply with the City Below Market Rate (BMR) program; 2) The number of rental units to be provided by the project is at least equal to the number of existing units; and 3) Not less than 20% of the units provided are BMR units," applied only to new residential units as opposed to
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Program HS-1.B1 which spoke to existing or conversion units. Both programs could be in conflict if unclear that Program HS-1.B2 applied only to new residential developments. Mayor Simitian asked staff to make the clarification as stated by Vice Mayor Wheeler in the final document. Council Member Andersen asked about the words "at least" which had been stricken from Policy HS-B, "The City should ensure that at least the present number of multiple family rental units is maintained and support programs which increases the overall supply of multi-unit rental housing." In order to ensure that at least the current number of multi-family rental units were maintained and to support programs which increased the overall supply might mean evaluation of increasing zoning of R-2 or R-4 to a higher density which would require at least retention. Mr. Schreiber said a review of the Planning Commission minutes revealed the words "at least" had not been stricken from Policy HS-B and should be retained. Council Member Kniss clarified Policy HS-1.C would be retained in the Plan but would not be part of the policies. Ms. Schmidt said the Planning Commission thought there were a variety of things which could be stated better elsewhere, rather than retained as a policy or program in text or an appendix. Council Member Kniss asked how much weight would be given to items which had been given a "B" rating by the Planning Commission. Ms. Schmidt said such items would have less weight than a program but would be maintained in document. One of the goals of the Planning Commission had been to reduce the number of policies and programs because of the size of the document, particularly the Community Design, which could be retained in text. Mayor Simitian said the key to the code originally indicates "B" items would be retained in some manner within text, appendix, or a separate document. Since then, the separate document option had been eliminated and "B" items would be retained in the Comp Plan in some form. The City Attorney was asked whether items which had been removed from policies or programs but were retained in the Comp Plan still retained force of law to the extent the document had force of law. City Attorney Ariel Calonne replied yes. MOTION: Mayor Kniss moved, seconded by Fazzino, that Policy HS-1.C, "The City should discourage conversion of lands designated as residential to nonresidential uses," be deleted from the document. Council Member Kniss said there might arise times when the City wanted to switch or convert when Policy HS-1.C would be inappropriate.
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Mayor Simitian thought the League of Women Voters (LWV) had suggested Policy HS-1.C be modified with the additional language "unless such changes can be made without a net loss of housing." Council Member Fazzino clarified Policy HS-1.C referred to current housing. The consequences of such actions should be seriously considered. There might be unintended consequences from which the City would have to scramble to identify replacement housing. Frys was a good example. There had been a legitimate policy disagree-ment, but in a 5-4 vote of Council in 1983, by the narrowest of margins, Council had created a much larger housing obligation for the community. If Council approved the language in Policy HS-1.C, it would have a very difficult time following through on the intent of the language if a Council decided to allow it. Many had been very successful in an effort to retain the neighborhood shopping area near Loma Verde and Middlefield which had originally zoned for multi-family housing. The neighbors had made it unanimously clear that it wanted neighborhood commercial services retained on the site. If language such as Policy HS-1.C had been in the Comp Plan, Council at the time would have had a difficult time finding replace... Council should not have to face such a dilemma in the years ahead. More flexibility was necessary. Language should be included which caused the City to discourage the conversion of residential to nonresidential, but without creating the legal obligation the language created. Mayor Simitian said notwithstanding legitimate policy differences about the Frys site, Policy HS-1.C had already existed in the Comp Plan, without the softening language. Yet the Frys change had moved through the process without any impedance from the policy. The word "discourage" in the current Comp Plan must mean discourage but not prohibit. Mr. Calonne thought removal of Policy HS-1.C would trigger a response from the State requiring its reinstatement into the Comp Plan. The policy was not meant to be discretion-limiting. If Council wanted to remove Policy HS-1.C, it could do so, however, upon later review the State might replace the language. Mayor Simitian said there was nothing in the proposed language of Policy HS-1.C which prevented Council, if it so wished, to convert the Frys site from a residential use to a commercial use. Mr. Calonne replied yes. The language was not aimed at the direct action to change a land use designation but was aimed at collateral indirect actions which caused conversions. Council Member Huber opposed the motion. The issue had been discussed in 1989 or 1990 when the housing element had come before the Planning Commission at a time when he had been a Commissioner. The same philosophical discussion had occurred and the same "should discourage" had not prohibited changing designations, e.g., 1050 Arastradero. The language should be retained to remind Council to discourage such things. The LWV's comment should be retained, unless the language could be retained elsewhere.
Council Member Andersen also opposed motion and agreed with Council Member Huber's suggestion concerning retaining language suggested by the LWV. Council Member McCown strongly objected to removing Policy HS-1.C from the Plan, since it was the core to what the City was trying to do. The City should not restrict land conversions, which the removal of Policy HS-1.C would imply. Removal contemplated the possibility that it could happen. Regarding the LWV language for no net loss, although a good idea, it need not be literally that when a conversion took place it had to have as a condition of conversion some other action; the statement was broader. When the commercial area of Loma Verde was maintained, other projects were in the process of providing other housing opportunities. Even such a decision would have met the no net loss idea because the City had been pursuing other policy changes to encourage housing at other locations at the same time. The policy was accomplishable without unduly restricting appropriate situations for a residential use conversion to another use. Council Member Rosenbaum thought Policy HS-1.C should remain in the Plan. If the motion was defeated, the language should remain as a policy as well as specific sites Council thought should be exempted, e.g., the Maximart and proposed hotel sites. MOTION FAILED 2-6; Fazzino, Kniss "yes," Schneider absent. MOTION: Council Member Huber moved, seconded by Wheeler, to retain Policy HS-1.C, "The City should discourage conversion of lands designated as residential to nonresidential uses" in the Housing Section of the Plan with additional language " unless there is no net loss of housing potential." Mr. Calonne thought the additional wording made the policy more specific whereby more action than currently. Vice Mayor Wheeler said Council Member McCown had expressed the opinion that the policy necessarily compelled the City or Council to take concurrent action with any specific proposal. Mr. Calonne suggested wording "unless the City also explores changes in land use designations to attempt to assure no net loss of housing potential." The language needed to be softened. He understood Council Member McCown to say that while specific action might be taken to un-designate something, actually designating something else might not occur at the time but exploration of the possibility to do designate might occur. Council Member Fazzino had been more comfortable about the motion after Council Member McCown had spoken than after his first reading because a case had been made about the associated flexibility. The language would be better with flexibility retained. He preferred an approach along the lines suggested by Mr. Calonne than the tougher language offered. Council Member Kniss said the question about Frys was whether or not to extend the amortization, not to change the residential
designation. Regardless of how viewed, legally that was what the City had done. While possibly seen in another way, the fact did not change that the amortization was extended. Council Member Rosenbaum thought the direct approach, actually saying what the City wanted to do, was best. SUBSTITUTE MOTION: Council Member Rosenbaum moved, seconded by Kniss, to leave Policy HS-1.C as stated and add "with exception of the Maximart property and proposed hotel site at the corner of El Camino Real and Page Mill Road." Council Member McCown opposed the substitute motion but did not disagree with Council Member Rosenbaum's instinct that the discussion was not about a wide open process of conversion. Her support for the final decisions on the two sites might well be affected by what options could be determined for the provision of replacement housing potential. A blanket exclusion of the two sites from the policy without capturing the concept of no net loss was not supported. The concept of no net loss, although a good idea, need not be literally tied to the particular action to convert, but that as a policy matter, the City was committed to finding alternative replacement housing potential when sites were converted. The exact wording might not be necessary if Council could agree that similar wording should be included with some appropriate language. Staff should be directed to fold in some idea of flexibility about providing the no net loss. Council Member Andersen agreed with Council Member McCown. He had been concerned about the original motion's rigidity, as pointed out by the City Attorney, but he was not as anxious to designate specific sites in the Comp Plan. Council Member Fazzino wanted to be able to support the substitute motion and liked the direct approach, however, he was troubled by the inflexibility of the concept. If the hard liners were willing to allow proceeding with the flexible approach, the concerns would be resolved. SUBSTITUTE MOTION FAILED 2-6, Kniss, Rosenbaum "yes," Schneider absent. AMENDMENT: Council Member McCown moved, seconded by Fazzino, to include additional language to accommodate "no net loss" and need not be immediate or tied to the project specific decisions to allow for some flexibility. Mayor Simitian thought the no net loss concept was important, particularly for sites such as 1050 Arastradero Road. Council had voted 4-4 on 1050 Arastradero which, if it had moved forward that evening, would not have resulted in housing mitigation. Instead, Council had required the developer to come up with a housing solution and instead of 88 luxury homes across the street from Los Altos Hills, the City was close to seeing 100 units of affordable Single Room Occupancy (SRO) generated by the decision. Council had taken a no net loss position and in a very short time had produced some real results. Council should do the same thing
again when it ran into another property which was more appropriately used for commercial development but was a housing issue which should and could be addressed. MOTION AS AMENDED PASSED 8-0, Schneider absent. RECESS: 12:17 p.m. TO 12:49 p.m. Council Member Andersen asked where the City should acknowledge the need to consider the implications of housing development on school sites. Palo Alto had not had to deal with the issue previously, but would see the issue arise more as the concentrations of housing which would be more affordable to younger families where it would create a significant impact on the school system and certain schools. In other communities, the issue had been major in terms of approving certain housing locations. Policy HS-1.D2, "To make multiple family housing attractive for families with children, should be encouraged to provide, where feasible, suitable open space areas for children, proximity to schools and parks, and accessibility from streets that do not have high volume traffic," was questioned in terms of discussion of inclusion in the Comp Plan. Mr. Schreiber suggested Council defer discussion of the item until the City Attorney returned to the meeting. The fact the Palo Alto Unified School District (PAUSD) had not adopted a fee would have ramifications on other imposeable litigation measures. The issue was legal and needed to be considered further at the staff level. Council Member Andersen said Council had discussed how to make some commercial areas attractive to residential, an idea which had been considered in an attempt to provide owners the right to shift to residential zones. The staff report (CMR:142:95) contained a recommendation under C1, "Underlying residential zones should be assigned to all of the City's retail commercial zones, where appropriate." Mr. Schreiber's comments indicated such a plan was already possible but rather complex and queried use of the wording in the Comp Plan. Mr. Schreiber said all of the existing commercial and industrial zones included an underlying residential designation as a permitted use. Council Member Andersen asked why underlying residential designa-tions had not happened and why it was a recommendation. Mr. Schreiber said there were a number of reasons why underlying residential designations were not happening. Financing of mixed-use developments was very difficult, so the private sector had not pursued such options in any great numbers. In 1987, when the City amended the multiple-family zones, commercial zones had specifically added multiple family zones. The City had a set of multiple-family regulations which did not fit with the commercial regulations, e.g., requirements for open space, set-backs, etc. Of the two recommendations contained in the other staff report (CMR:...:95) [Unsure of exact CMR here because no mention of numbers was given; all future references to CMRs which are
redlined are only guesses of the exact numbers--Judi], one was a return for commercial properties to the less restrictive, pre-1987 multiple family rules and for mixed-use developments. In 1987 a site and design requirement had been added for any mixed-use project. Staff recommended elimination of the site and design requirement, returning to a straight ARB requirement for mixed use requirement to eliminate the additional discouragement to the private property owner. Council Member Andersen asked whether financing would be helped if Mr. Schreiber's two suggestions were in place. Mr. Schreiber replied no. The financing issue was related to marketability, lawsuits which accompanied mixed-use projects, lawsuits between the residential condominium association and the commercial condominium association, etc. There were many market discouragements to mixed-use developments about which staff would be unable to do anything. The City had discouragements on top of the other problems, e.g., regulations which did not fit and the site and design requirement. Returning to pre-1987 regulations and eliminating site and design regulations would be a very positive step. Council Member Andersen clarified Mr. Schreiber considered the return to pre-1987 regulations and elimination of the site and design regulations would be more positive and effective than implementing an underlining residential zone on all of the City's retail commercial. Mr. Schreiber said the underlying residential zone on all of the City's retail commercial already existed. Council Member Andersen asked Mr. Schreiber to alert Council to the issues with regard to pre-1987 rules and site and design regulation omission in the context of the current discussion. Mr. Schreiber said the issue was valid for discussion in the current instance. Council Member McCown said the very next language in the staff report (CMR:142:95) referred to both of the points, e.g., residen-tial use on commercially zoned sites and establishment of a revised site and design process for mixed use. Vice Mayor Wheeler asked about the nature of the disagreement concerning Program HS-1.D2 where seven CPAC members had disagreed with the language and four had agreed with modifications. Such a disagreement was significant. The intent appeared to convey that proximity to schools, parks, quiet residential streets, etc., was a "nice to have" but would not in any way limit or preclude the City's ability to take advantage of sites which might not have one or more such amenities if a developer proposed suitable family-type housing in other locations. Mr. Klein said Council should take nothing written as discourage-ment toward finding housing options. The intent behind Program HS-1.D2 had been to ensure that developments were sensible and fit
within the community. The desire was to encourage more design and community design considerations. He could not recall why there had been disagreement but there had not been a large amount of disagreement. Balloting had been conducted on a list of drafts and language. The substantially non-controversial intent was that when multi-family housing was conducted, developers should take into account childcare possibilities, parks, open spaces, etc., not merely meeting density requirements on a large lot by providing sufficient parking. Council Member Wheeler said the City would have a difficult time controlling the citing of a development by a school, particularly at a time when the PAUSD did not intend to build new schools at new locations and had cut back on existing facilities. To the extent the program encouraged consideration, but was not a requirement for a development which attracted children, to be so located. Mr. Klein said according to the City Attorney's hierarchy of should, would, shall, Program HS-1.D2 was a "should." Council Member Huber asked for the rationale behind the change in the BMR requirements. Council had gone through a difficult time trying to reduce the number of BMR units to three not so long before. Mr. Schreiber said staff was concerned with three rather than ten units because of the difficulty in implementing into fractions the units, payments, smaller projects, smaller developers, etc. The three units had been an administrative hassle which had not yielded very much. There had only been a few units where the BMR had applied with a large amount of hassle for the developer, property owner, and the City. The gain was not worth the effort in unit projects. Council Member McCown asked about the City's role in Program HS-1.D6, "Encourage the development of programs such as Co-Housing Projects." Mr. Klein said Program HS-1.D6 had been crafted intentionally vague in order to be open-ended. There were zoning solutions with which the City could help. If the public came to Council with ideas, there might be solutions which were at present unknown. Program HS-1.D6 was merely another option for chances of affordability. Council Member McCown thought Program HS-1.D6 had been taken from the existing Comp Plan policy yet the City had apparently not actively related to the policy. Mr. Schreiber read a portion of the existing text of the Housing Element, "City support in the form of land acquisition and financing assistance should be considered for limited equity cooperative housing. The document fee is primarily people with low to moderate income in keeping with other City policies." A later reference, "projects which meet the criteria for co-housing should be considered for City support, as deemed appropriate."
Council Member McCown said notwithstanding the existence of the language, however, there had not been any specific instance where the City had done anything related. Mr. Schreiber said there had been a few inquiries, but no project had moved into the implementation phase. Council Member McCown asked for a further explanation and the intention of Program HS-1.D10, "Consider, where appropriate, allowing the splitting of larger lots, with the resultant lot size being compatible with the general character of the surrounding neighborhood," especially in connection with compatibility with the general character and not exactly conforming to the exact rules of the neighborhood because, otherwise, the policy would not be necessary at all. Chief Planning Official Nancy Lytle said many neighborhoods had much smaller lots as a general pattern than the neighborhood zoning indicated. By making zoning more similar to the prevailing lot size, more lots could be accommodated. Several requests and applications had been received for subdivisions with exceptions, e.g., applications for splitting lots below the minimum lot size in the district but fit in perfectly with the pattern in the neighborhood. Staff had found it difficult to make findings encouraging applications because of the City's policy which did not allow or encourage substandard lots in the Comp Plan. Council Member Rosenbaum asked whether the City was considering a new R-1 zone or simply suggesting small lot single-family in an otherwise multi-family zone in Program HS-1.D9, "Permit smaller sized residential lots and smaller units on those lots. Allow development of smaller units on lots of less than 6000 square feet." Ms. Lytle said Program HS-1.D9 was intended for small lot single-family in an otherwise multi-family zone. Council Member Rosenbaum thought Program HS-1.D9 should clarify small lot single-family in multi-family districts. Mr. Klein said Program HS-1.D9 was "global where appropriate." There might be places throughout the City where appropriate, not necessarily multi-family. Council Member Rosenbaum thought the intention indicated small lot single-family up to the density allowed in the zone was appropriate in the multi-family zone. However, another scenario would create another R-1 zone with something other than the 6,000 square foot minimum lot. He asked whether the intention was to allow both scenarios or only one. Mr. Klein said both scenarios were good. Council Member Andersen understood current zoning made co-housing extremely difficult, yet the City had a policy in the current Comp Plan which encouraged co-housing. He asked whether the City
needed to do anything with the zoning regulations in order to make co-housing more likely, i.e., whether a group of people could purchase contiguous lots in an R-1 neighborhood and combine the land use to provide a co-housing environment with a single kitchen area and common meeting area. Ms. Lytle replied no, not in a single-family zone. The group would have to up-zone to a multiple-family designation or select a planned community zone option. Council Member Andersen clarified there was very little opportunity in multi-family zones for co-housing as a result of the price and availability. Ms. Lytle said there was no opportunity in single-family districts, but in other districts there were opportunities. Council Member Andersen asked what could be done to facilitate such creativity, e.g., whether exceptions in the R-1 were necessary, some exceptions in the multiple-family zones, an overlay, etc. Ms. Lytle said Council had struggled with the issue with various housing prototypes. Co-housing was another housing prototype like condominiums, small lot single family, courtyard apartments, etc. The issue could be approached in a variety of ways. Zoning could be modified to encourage such prototype, zone specific, Planned Development (PD) zone with a set of guidelines for co-housing, etc. Council Member Andersen wanted the City to bring forth ways in which co-housing could be encouraged in light of the fact the item already existed in the Comp Plan and had been given a "B" rating. Mr. Schreiber said Program HS-1.D6 would need to become an "A" item and some text with an explanation should be included when the draft Plan returned. MOTION: Council Member Andersen moved, seconded by Fazzino, to retain Program HS-1.D6, "Encourage the development of programs such as Co-Housing Projects" in the Housing Section of the Comprehensive Plan. Council Member Andersen said the approach was designed to create a sense of community, was a more efficient use of land, and provided an environment which met the needs of many family structures which were not typical. The City needed to think in terms of the new family systems in designing housing plans. Council Member McCown asked whether the potential for encouraging co-housing might be folded into a PD process, intended to provide flexibility and encourage more housing units without public benefit findings. If the process was created as a result, it could be a vehicle which could be used to promote co-housing projects, which had many unusual features, in which sense Program HS-1.D6 made much sense and might allow the City to do more than it had been able to in the past. As a cautionary note, the
program would probably never be something which would be encouraged in R-1 neighborhoods, which was unrealistic. The PD concept fit much better with co-housing, as it focused on multi-family situations and was where the City should so encourage co-housing. Council Member Huber asked about the rationale for putting co-housing in the program area. Ms. Schmidt said the Planning Commission had not discussed the item. Council Member Huber thought Program HS-1.D6 did not encourage more housing but was a different style of housing, where most of the other items contained encouragement for more housing. Council Member Fazzino was troubled by the "B" designation. The intent was appreciated but in light of the force of law statement which appeared in the Plan, whether as a policy or appendix, it should either be included or not. The motion was supported. He agreed with Council Member McCown's comment about the practical difficulty of incorporating the concept into single-family neighborhoods at the current time. However, the City was only one or two generations removed from having shared housing as accepted and traditional by many. Obviously there were concerns about impacts, but was the direction the world was moving. Shared housing would be much easier to envision in residential neighbor-hoods in 20 years. The program should be incorporated into the document. Vice Mayor Wheeler said some of the larger context issues which had been addressed compared with part of the program in the HS Section. Program HS-1.D6 was part of the reason for the Planning Commission giving the program a "B" rating. Programs HS-1.D6 and HS-1.D8 were nice programs, but no matter what the City did, there would not be more than one or two such developments proposed and were not as necessary as part of the big picture spelled out in the Plan without losing the concept. The idea was not being opposed, but Program HS-1.D6 did not belong on the same level as programs which addressed much broader issues. Council Member Kniss agreed with Vice Mayor Wheeler as well as with Ms. Schmidt's comment about including such programs without giving the same weight. Although in support of co-housing, she could not imagine that at some point many who were advancing in age would end up in such housing. In the Boston area, three or four generations lived in the same two or three-story buildings. The motion was opposed for the same reasons given by Vice Mayor Wheeler, e.g., that the program did not deserve the same weight. Mr. Klein said CPAC had already taken into account Vice Mayor Wheeler and Council Member Kniss' concerns which was why both Program HS-1.D6 and HS-1.D8 began with the word "encourage" as opposed to more affirmative language found elsewhere. The ideas were good and should be encouraged and considered in the future and should be included on at least equal footing as a program, even though implementation might not be immediate.
Mayor Simitian agreed with Vice Mayor Wheeler and opposed the motion. MOTION FAILED: 2-6, Andersen, Fazzino "yes," Schneider absent. Council Member Rosenbaum thought the City should not try to establish a new R-1 zone and try to determine where to put smaller units with less than 6,000 square feet. The small lot was potentially a good idea and should be limited to multi-family zones. MOTION: Council Member Rosenbaum moved, seconded by Wheeler, to substitute Program HS-1.D9, "Permit smaller sized residential lots and smaller units on those lots. Allow development of smaller units on lots of less than 6000 square feet," with "Permit small lot single-family housing in the multi-family zones." Mayor Simitian said Mr. Moss had spoken to Program HS-1.D9 and had asked that if Council approved the program, language would be added that it would be "when consistent and compatible with the surrounding neighborhood." He personally disagreed with "consistent" and agree with "compatible" because of previous discussions about things which were inconsistent with the neighborhood but nonetheless compatible. Mr. Klein said some existing lots in the City were below 6,000 square feet and nestled up to lots which were much larger. In an effort to make the neighborhood consistent, it would be nice to have a vehicle to address the situations. Mayor Simitian clarified Mr. Klein wanted to keep R-1 neighborhoods in the mix. Mr. Klein replied yes. MOTION FAILED: 4-4, Huber, McCown, Rosenbaum, Wheeler "yes," Schneider absent. MOTION: Council Member Wheeler moved, seconded by Fazzino, to add to Program HS-1.D9, "Permit smaller sized residential lots and smaller units on those lots. Allow development of smaller units on lots of less than 6000 square feet," the language after the word "lots" to read "when compatible with the surrounding neighborhoods." Council Member McCown asked whether the motion alluded to creating another R-1 zone which had smaller lot sizes. Council Member Wheeler said implementation would be determined by suggestion of planning officials. There were a variety of possible responses. Council Member McCown said how even an overlay zone would be received in the community was unrealistic. Whether the City should have an easier process than Ms. Lytle had alluded to which allowed some lot-by-lot review, whether akin to a conditional use
process, etc., then a particular property could be considered. The City could not realistically go through town with overlay zones and not be met with enormous opposition. The motion would not be supported if that was the direction in which it would head. Some kind of specific application process on a case-by-case basis where the compatibility standard could be met would be more acceptable. Vice Mayor Wheeler reminded Council Member McCown of her own comments regarding developments surrounding neighborhood commercial zones, encouraging Council to vote on the broader issue, and the fact that Council would look further at the implementation. Council Member McCown thought Vice Mayor Wheeler's reference was different, which had been spoken in the context of specific zoning. There was a big difference between creating an overlay zone or new zone and creating a process whereby people could come in on an application basis to seek smaller lots and smaller units in a particular context. Discomfort was expressed to the extent the program was vague. Mayor Simitian was unsure about the answer in terms of the methodology, but Program HS-1.D9 did not imply the City would support what had often been seen when land owners tried to squeeze four homes of the same size on one space. Instead of having three big houses to serve three affluent families, four more modest homes could be built to serve four households with more modest incomes. He agreed with Council Member McCown that if there was some sense that the City would march through the community allowing four big houses onto four small lots would not pass. The goal was to find smaller lots and smaller homes in areas compatible with the surrounding neighborhood. How it would be accomplished was up to staff. Council Member Kniss thought the motion would tie in with a 9 [?] where the City would evaluate minimum density requirements. At the same time, her only concern about "permitting smaller sized residential lots and smaller units on those lots" meant the two would go together. Vice Mayor Wheeler replied yes. Council Member Kniss said the two were tied together in such a way that it could not be construed as a smaller lot on which a bigger unit would be placed. Vice Mayor Wheeler replied yes. MOTION PASSED 6-2, Huber, McCown "no," Schneider absent. MOTION: Council Member Rosenbaum moved, seconded by McCown, to eliminate Program HS-1.D10, "Consider, where appropriate, allowing the splitting of larger lots, with the resultant lot size being compatible with the general character of the surrounding neighbor-hood."
Council Member Rosenbaum said the scenario with older neighborhoods with a smaller older home, a marginal lot, and an application to split to build two brand new smaller inexpensive homes was a Pandora's box. If someone had a large enough lot which could be split, that was acceptable, but the City should not create on an ad hoc basis lots which were smaller than 6,000 square feet. Mr. Klein said Program HS-1.D10 was related to Program HS-1.D9, as an attempt to create more affordable housing whereby opportunities for smaller lots with smaller houses would be encouraged. Council Member Kniss asked why flag lots had been ruled out some time in the past. If larger lots were split, it would be difficult to avoid flag lots. Council Member Huber thought the City had faced the "house syndrome" where larger houses sat in the back and there was concern about people looking into houses, e.g., large houses looking into the back of eight smaller houses. Council Member Wheeler said a back house on a flag lot not only looked at its next door neighbors, but the two lots on the side. Council Member Kniss asked about the resultant flag lots once lots were involved in splitting. Council Member McCown said flag lots were different and could be split side-by-side. Council Member Kniss said Program HS-1.D10 would preclude what was already in place and would not raise the flag lot issue. Council Member McCown said the earlier explanation about Program HS.1-D10 indicated one of the reasons for inclusion was because the current Comp Plan contained reference to discouraging lot splits. An attempt had been made to reverse the former statement. If deleted, the City would remain silent on the issue. Program HS-1.D9 could and often would result in a lot split. She would support removal of Program HS-1.D10 because the City would need to allow for lot splits in Program HS-1.D9 but would not need the affirmative statement. Council Member Andersen asked for any support in leaving Program HS-1.D10 in the Plan in order to accomplish what was stated. Ms. Lytle said the language concerning compatibility had been included into Program HS-1.D9 which had been contained in Program HS-1.D10, accomplishing almost a merging of the two. Council Member Fazzino concurred with Council Member McCown. There had been much anxiety and anger in older neighborhoods when developers, both homegrown and not so homegrown, chopped up wonderful old houses. There was an economic benefit to doing so, but such activity should not be encouraged. MOTION PASSED 8-0, Schneider absent.
Council Member McCown asked if amnesty was approved with a set of rules with which everyone was comfortable, she queried whether, if the unit already existed, it would become legalized and granted amnesty, but the City would not allow the creation of any new units, even if the units met the same set of rules by which the City allowed for legalization of existing units. Mr. Schreiber said Program HS.1-D11, "Provide zoning flexibility to allow the development of second living units as accessory structures or as part of existing structures in R-1 zones. Allow for the reduction of parking requirements for second units," referred to new units. Program HS-1.D12, "Provide an amnesty program to encourage the legalization of existing second units that otherwise meet minimum building code requirements," referred to existing units considered an amnesty program. Units covered by Program HS-1.D12 might or might not qualify under Program HS-1.D11, if proposed. There would be standards under Program HS-1.D11 but units which had already been in existence and could meet minimum codes could be legalized. Council Member Huber asked how Programs HS-1.D11 and HS-1.D12 related to the City's current cottage zone. Some were legal, but if the City had requests, he asked where the cottage units would fall. Ms. Lytle said Palo Alto had a cottage provision in the PAMC which allowed second units for lots which were a percentage larger than the minimum lot size for which a conditional use permit could be applied. The unit had to be detached from the main residence and had to meet some other findings, i.e., served off a common driveway, etc. Program HS-1.D11 was interpreted as meaning the City would provide some flexibility beyond which was allowed cottages to fit on more properties than conditionally existed as well as allowing units within the main unit, which Palo Alto had not previously allowed, e.g., an apartment could exist within the main house with a kitchen and separate entrance. Council Member Huber asked whether staff anticipated Program HS-1.D11 would apply to smaller lot areas, e.g., post-World War II subdivision areas with smaller lots. Usually larger lots were considered in the issue. Ms. Lytle thought CPAC had referred to various portions of the City. In many instances, reference had been made to areas where the ... already existed and was an accepted pattern. Mr. Klein said the idea was not to subdivide small units, but older larger houses where there might be multi-generational living space with different units or other options, but not the very small units. Council Member Huber asked how a determination would be made concerning the different lot sizes which would be affected by the benefit and whether the City had not already done so. Mr. Klein said the City had already done made determinations to
some extent, but it could go further. Obviously, a line had to be drawn, which was where implementation came in. Council Member Huber asked what staff contemplated in response to the comment about core modification of existing site development regulations, developing new design guidelines, etc. Ms. Lytle said an example of a site development change would occur if the City allowed detached units to locate on lots smaller than currently allowed, the size of cottage permitted would have to be reduced because the 600 square foot cottage could not be applied to a smaller lot, e.g., down to a 400 square foot cottage. If the City allowed attached units, a size parameter might be set up as to how large the unit could be in the home and the kind of secondary access which would be permitted, how the neighboring properties were affected, etc. Council Member Huber thought the change could result in a staff nightmare. Ms. Lytle said any time a new zoning ordinance was dealt with, there was the potential for trouble. Staff hoped to somehow restrict the process to avoid such troubles. Mr. Schreiber said Program HS-1.D12 had been elaborated on in a previous staff report. If Council really wanted an amnesty program, and wanted people to enter into a discretionary process which might or might not yield the desired result, the program would not be successful. Therefore, Program HS-1.D12 should be kept simple. Program HS-1.D11, however, would result in the current cottage process as a use permit as the most logical. Ms. Cassel said in some situations, a cottage had been added to the back of a property for a family wanting a family with them which was a larger house and did not require as much ground cover. Extra cottages required much extra ground cover on the site as opposed to units within the building which might not be as obtru-sive. Vice Mayor Wheeler asked what would occur with rejected applicants or with people who did not come forward if the City had an amnesty program, e.g., whether the City would take more aggressive code enforcement actions. Units existed all over town and the City had taken a benevolent attitude toward the existence of such illegal units, which had provided some measure or means of housing opportunity. If the City moved in the amnesty direction, she queried the possibility of certifying a few of the units for habitation and permissibility but putting itself in the position of having to go after the ones who were not certified. Mr. Schreiber said staff had suggested the Uniform Housing Code (UHC) be applied, which was a lower standard than the Uniform Building Code (UBC). The UHC was not a safe place to live so if a unit could not meet the UHC standard, the City would take action to shut it down which, from a health and safety standpoint, was exactly what the City should be doing. Staff occasionally found units where the electrical service was very poor or plumbing was
below standards, and were pursued aggressively. The amnesty program should be a time-specific program, e.g., if the program started on January 1st and ran through June 30th, the requirements would return to the original violations on July 1st. The staff report (CMR:...:95) suggested an incentive for people to enter the program by establishing a notable fine for units which were found after the program deadline. Vice Mayor Wheeler asked what would prevent R-1 neighborhoods from becoming de facto R-2 if something like Program HS-1.D11 was adopted by Council. Mr. Schreiber said the process would be discretionary within which limitations might be appropriate in terms of the numbers of second units within a particular block or small area so every house would not become a two-family structure. At the same time, the living arrangement was quite common in Palo Alto with people renting out rooms. The next step after renting out rooms was the installation of a hot plate and microwave with the resultant de facto kitchen without a door to the outside. As long as kitchen requirements could be met, the unit was legal to rent out rooms to students, etc. Program HS-1.D11 would recognize the more traditional housing option where either a renter or family member could legally have a second kitchen without being placed in the situation of having to unplug the microwave and hot plate when an inspector was present. Ms. Lytle said requirements could be added concerning the appear-ance of the doubling of density, e.g., where placed, number of driveways, the access, etc., to maintain the look of a single-family unit which could be dealt with through findings. Mr. Klein said there were also market conditions which would limit the number of units. Most homeowners would not want to avail themselves of the option, so there was not a great concern. Mr. Calonne said most cities had a second-unit ordinance because, if not, the state law default second-unit condition became effective and was much more liberal than most cities'. Council Member Kniss thought Program HS-1.D11 was similar to rooming houses used around Boston which were popular. The difficult aspect was that allowing second units eventually led to problem, i.e., parking. She had personally rented a five-bedroom house to seven Stanford students which had resulted in complaints from the neighbors because of parking. Mr. Schreiber said illegal units had existed for some time and the parking impact had been accommodated in some manner. Most likely adding a parking requirement for amnesty units would add a level of complexity which would make it much more difficult. For new units, parking requirements would be necessary. Council Member Kniss thought Program HS-1.D11 would require something regarding parking. Mr. Klein said CPAC recognized parking as an issue. Requiring too
much parking for units on the site would substantially discourage the units. The two-car covered garage requirement was probably unnecessary and would work to discourage the development. CPAC concluded that it preferred more on-street parking for more affordable housing units. Ms. Cassel said ... [...end of tape 5...begin tape 6] Anyone could rent a house to five students and was a practice which would continue. Families with children who begin to drive usually had too many cars out front and troubled the neighbors. The goal was to avoid having a small unit in a house in a discrete way. A smaller unit rented out could result in not as many vehicles as opposed to renting several rooms to several different people which resulted in more vehicles. Council Member Andersen asked about the distinction between units within existing structures and detached units. Detached units were currently approved under rather limited circumstances, but units within units were not. He asked whether more detached units would result from implementation of Program HS-1.D11. Mr. Schreiber replied yes. The specifics related back to how regulations were put together. The program spoke to second units as accessory structures or as part of existing structures. Council Member Andersen asked whether the second units would move beyond the existing FAR, e.g., whether there was a limit of space regardless. The program spoke to the flexibility of putting a second unit within an existing structure. Mr. Schreiber said Program HS-1.D11 would provide further flexibility for units outside the main structure, i.e., applying the second structure cottage rule to smaller lots, etc., and allowing for second units within existing structures, which was not currently allowed except in R-2 or multiple-family zone. Council Member Huber asked about the mechanics and practicalities of a homeowner actually building a separate room inside an existing structure. Vice Mayor Wheeler said many post-World War II housing tracts contained garages which were used as second units. Council Member Huber thought Program HS-1.D11 had not referenced garage conversions. Mr. Schreiber replied no. The requirements for covered parking would remain in place. Many units had converted the garage but no one had envisioned totally eliminating the covered parking requirement. There were many situations historically where a portion of the first floor had a separate entrance and was rented out. The law currently stated that, although such a separate unit was acceptable, it could not have a kitchen. Under State law, the roomer could rent the room and use the kitchen or not. Once kitchen facilities were installed, the unit became illegal. Council Member McCown asked whether the parenthetical reference
after Program HS-1.D11 "RCP housing program 3" meant the existing Comprehensive Plan contained the exact same language. Mr. Schreiber said the language had been revised. The existing Comp Plan would continue the cottage provision in R-1 zones, ensuring that new development fit in with existing single-family properties. Council Member McCown clarified the current language referred to the existing cottage zone. Consideration should be given to whether Council might want to make revisions to the cottage zone to allow a broader application. MOTION: Council Member McCown moved, seconded by Andersen, to revise Program HS-1.D11, "Provide zoning flexibility to allow the development of second living units as accessory structures or as part of existing structures in R-1 zones. Allow for the reduction of parking requirements for second units," to read "Reevaluate the cottage zone to provide additional flexibility for development of second living units as accessory structures or as part of existing structures in R-1 zones," and delete the words "Allow for the reduction of parking requirements for second units." Council Member Huber clarified Council Member McCown's motion did not presupposed the City would change the cottage ordinance but that Program HS-1.D11 would consider the cottage ordinance which might remain exactly as written. Council Member McCown replied yes. The point of the program was to "provide additional flexibility." If Council concluded after the evaluation that a change to the cottage ordinance would not achieve the goal without causing unacceptable consequences, it would not be changed. Council Member Kniss asked what "reevaluate" meant to staff. Mr. Schreiber interpreted "reevaluate" as an assignment to staff and the Planning Commission to review the existing regulations and report back to Council on any potential changes. Implementation would have to fit into an overall implementation schedule for the entire Comp Plan, so it might not be at the top of the list. Council Member Kniss asked whether the study would occur prior to Council's vote on a final Comp Plan. Mr. Schreiber said Program HS-1.D11 would appear in the Comp Plan and, along the way, staff and the Planning Commission would review and implement changes. Council Member Kniss asked whether there would be dramatic changes or merely a tweaking of the current language. Mr. Schreiber said a Planning Commission committee would probably work with staff to consider the issues out of which would flow specific recommendations. He was unable to provide a clear reading of how substantial or minor the modifications might be.
Mayor Simitian was opposed to the motion, largely because the City needed to make some choices which were being put off to a later time. Fundamentally, he was more sympathetic with the more aggressive posture language in the document assumed. He was concerned that if the City moved in the same direction, it would theoretically be "punting" on the issue for three or four years. MOTION PASSED 7-1, Simitian "no," Schneider absent. MOTION: Council Member Fazzino moved, seconded by Wheeler, to eliminate Program HS-1.D12, "Provide an amnesty program to encourage the legalization of existing second units that otherwise meet minimum building code requirements." Council Member Fazzino said amnesty was a difficult issue with which he had struggled for some time. When an elderly woman had called to discuss the issue a few weeks before indicating her only source of income was a tenant in the second unit, he wanted to find a way to craft an ordinance which addressed the woman's needs. If the City could establish a "little old lady amnesty program," he would probably vote for it. There were several concerns. People had had illegal units in place for many years which, although not the most significant issue, raised concerns about moving to make something legal which had been illegal for a number of years. His primary concern was over impacts. He had been very troubled with the proposal in Program HS-1.D11 which reduced parking requirements. He had tremendous problems with impacts which additional cars created for neighbors. For years he had tried to get the ordinance to reenact the on-street parking ordinance. The problem was aesthetic and a very real problem for neighbors to have cars parked on neighborhood streets and would not support any ordinance which added cars to neighborhood streets. He was also concerned about other impacts of illegal units, e.g., noise, pets, etc. One could also ask how someone who had supported the additional density provision on page 1 of the HS Section of the Plan could oppose something like Program HS-1.D11 which prevented additional families from living in Palo Alto--his response was to approach the issue honestly. If second units were to be added, normal zoning procedures should be utilized and not in the manner suggested by Program HS-1.D11. The result of the program would be an administrative nightmare with much associated inequitability. Second unit police corps should not be utilized in Palo Alto to arrest little old ladies and others for such actions. Staff was asked to continue to handle the situation on a complaint and common sense basis. Vice Mayor Wheeler agreed with Council Member Fazzino. Programs HS-1.D11 and HS-1.D12 were very closely intertwined. Having taken the action on Program HS-1.D11, putting off addressing the real issue for some time to come, the City should put off discussion of the amnesty program until some conclusions had been reached concerning the provision of the second units discussed in Program HS-1.D11. She had a basic concern about the equitability of allowing the legalization of existing situations where people had knowingly violated the City's zoning ordinances, then allowing such people to legalize the situation while not permitting new applications. The amnesty program should be reagendized after the
City had come to some agreement as to how far it would go with the subject of Program HS-1.D11. Council Member Kniss supported the motion. If Program HS-1.D12 was put into place, the City would have a staff nightmare with a result of probably even more illegal units. While removing the program was a punt, at least for the present, the existing process worked best for the City. Council Member Andersen opposed motion and CPAC was commended for taking on the issue. The units existed and would continue to exist. He was concerned about some who had come forward advocating legalization since their desire had been to meet the standards and building codes and would feel vulnerable. The City had to face the reality that the rooms would be rented. Ever since Proposition 13, people had held onto homes for a longer period of time leaving many with empty bedrooms and low to moderate incomes for which the rental of rooms produced an income. The issue needed to be dealt with. An amnesty program which allowed staff to see to it that units were safe and were met the standards which provided for the health and safety of renters was important. By omitting Program HS-1.D12, the City encouraged people to go under cover. Council Member McCown supported the motion. The attempt in Program HS-1.D11, which was consistent with deleting Program HS-1.D12, was that if the City had rules for second units in single-family neighborhoods, the same rules should apply to a person wanting to build a new unit or convert an existing house as the rules which already existed. There was unfairness in allowing units which had previously been illegal to become legal under a substandard set of rules compared with what was required for a second unit to a building. If the City could find ways to be more flexible and allow for second units in a broader variety of situations, it might pick up some currently illegal units which, with a small amount of change on the part of the property owner, might qualify under a new set of cottage rules which allowed for second units. Then, everyone would be operating under the same set of rules and on the same playing field. Even if Program HS-1.D12 was deleted, if the City found there were appropriate changes to the cottage zone, some of the units might have the chance for legalization, which was more equitable. Mayor Simitian agreed with Council Member McCown in support of elimination of Program HS-1.D12. He had been more aggressive about Program HS-1.D11 because he wanted rules in place with which people could really live and would, in effect, take up the units described in Program HS-1.D12. Blanket amnesties provided no mechanism to allow the City to reject an application when it should. The City should be more open minded and flexible about the housing needs in Palo Alto and the range of responses which could work. The post-World War II houses which had been built in the 1950s, had been filled with families with 2.3 children who had left home, leaving a retired couple in a large house with no company or no income or the ability to bring in renters to the community who added value in terms of the mix in the community, which was what he had thought Program HS-1.D11 had spoken to. If
from time to time cars would be parked on the street, that was what streets had been made for. Parking could get out of hand and was less aesthetically desirable than a street with no cars, but tradeoffs were made consistently. If the tradeoff was between a young future resident of Palo Alto being able to live and go to school in the City or being unable to live in the City because there would be a few cars parked up and down the street, the tradeoff was easy. The City should be more open-minded. He wanted his willingness to support the elimination of Program HS-1.D12 to be understood in the context framed by Council Member McCown since Program HS-1.D11 provided the ultimate solution where and when appropriate. MOTION PASSED 7-1, Andersen "no," Schneider absent. Vice Mayor Wheeler said the City needed to provide incentives for the marketplace to be willing to develop additional sites for more affordable housing. MOTION: Vice Mayor Wheeler moved, seconded by Kniss, to revise the wording in Program HS-1.D13, "Aggressively look for and study additional sites to determine the possibility of more affordable housing, such as surplus school, government, commercial and institutional sites, or any vacant land in a suitable location," to read "Aggressively look for additional sites to determine the possibility of more affordable housing and to provide incentives to develop more affordable housing, such as surplus school, government, commercial, institutional, light industrial, or any vacant land in a suitable location." Council Member Kniss said Vice Mayor Wheeler had discussed the issue for a long time, particularly as it related to the El Camino Real sites. Program HS-1.D13 tied in with everything which had been discussed in both the current meeting and earlier discussions concerning how to word the language around making sites work for the needs of the current time. An issue of great concern was that the City had cited specific sites in the past saying such sites would be housing sites but if funding did not "pencil out" for the developer, sites were left undeveloped. If incentives were not provided, a number of sites would continue remain undeveloped. MOTION PASSED 8-0, Schneider absent. Council Member Andersen asked about the impact of housing develop-ments on school sites, how to pursue, impacts, and whether reference should be made in the Comp Plan. Mr. Calonne said the impact of housing on school sites was both a legal and a planning issue. The law had fluctuated since 1987, so he was unclear on the current state if the law. School districts had the authority to impose and collect a school impact fee under certain conditions which the City did not. There might be nuances depending upon the type of entitlement before a city. Council Member Andersen asked whether under the current description the City could provide space for a school site, if a housing development project was planned and approved in an area in
which a substantial number of school-aged children would live and in which the school system was overloaded and appealed to the City, before the project went forth. Mr. Calonne thought not, but he would research the issue. Council Member Kniss asked about a "below grade parking lot" as referenced in Program HS-1.D14, "Develop site specific incentives to Encourage multi-unit housing on top of below grade parking lots. Create incentives for owners of existing large parking areas (such as churches) to develop such projects." Mr. Schreiber said Program HS-1.D14 referred to underground parking. The residential development at Alma and Hyde built above an underground garage was the only site in Palo Alto developed in such a manner. There had been a sense in the CPAC process that large surface parking lots provided an opportunity for additional housing development if some or all of the parking could be placed underground. Some of the parking lots in the California Avenue area should be considered potential housing sites. Ms. Eakins said CPAC had discussed City-owned surface parking lots in the California Avenue area which could be converted to housing, keeping in mind the fact it was a double-winner because of the close proximity to transit. There were no underground parking lots in existence. Council Member Kniss clarified there were no other examples to follow, but that CPAC thought it was a good idea. Ms. Eakins said CPAC thought converting surface parking to underground parking with housing above increased the housing stock, especially stock of a more affordable nature. Council Member Kniss asked what kind of incentive would be involved, i.e., whether the City would provide the underground parking so housing could be created above, etc. Clearly, the question was economic. She asked who had inserted the "Develop site specific incentives to" at the beginning of Program HS-1.D14. Ms. Eakins said CPAC had not discussed equity investment, but zoning and regulation. Mr. Schreiber said staff had inserted the "develop site specific incentives" and had deleted the reference to churches in Program HS-1.D14. Site-specific incentives related to potential shared use of parking, density, etc. If the City wanted to facilitate parking lots used for housing, something would have to be done to bring it about. The issue would not occur unless the City was proactive in that regard. The proactivity would require some kind of incentive which had been the case in the only underground parking with housing above where the City had sought an opportunity and facilitated it. MOTION: Council Member Kniss moved, seconded by Fazzino, to change HS-1.D15, "Modify parking requirements as required to allow greater housing density in certain areas," to read "Expand program
to clarify general intent as to where parking requirements should and should not be modified near transit." Mr. Klein was unsure "near transit" by itself meant much and did not address the City's intentions or provide a strong limitation on the intent of what Program HS-1.D15 was about. Council's strong desire was not to change parking requirements generally but strictly limiting to "near transit" would do much to eat away at what could be served in the future. Council Member Fazzino disagreed with the vision of CPAC to modify parking requirements to generally allow for higher density, although the intent was understood. At the same time, Mr. Klein was correct that transit was not the only criteria which should be included. The presumption was that if housing was located near transit, people would not need automobiles as much. At the same time, there might be other criteria which needed to be applied, such as senior housing projects, and if a lower income senior housing project there was an assumption there would be fewer automobiles. He would support a motion which allowed staff to develop a set of criteria which included transit, incomes, ages of residents, etc., which reduced the number of vehicles on sites and, therefore, allowed for modification of the parking requirement. Mr. Schreiber said between staff's comments and Council Member Fazzino's comments there was an intent to develop a set of criteria under which parking requirements could be modified. Council Member Fazzino said the assumption was that the City would seek a criteria under which people would have less reason for owning or having an automobile. MOTION WITHDRAWN BY MAKER AND SECONDER Mayor Simitian asked staff to bear Council's comments in mind, understanding that the language contained in staff comments was in fact reflective of the intent to provide some limitation and definition on the locations in which the modifications took place. The City Clerk's Office was asked to particularly note the discussion so there would be no disagreement about what had been agreed to under the item. Council Member Fazzino said Program HS-1.D14 raised the issue of the need to encourage housing above commercial. Although the provision might be included in the Community Design (CD) Section of the Plan, since there were below-ground parking lots on page 7 of the Plan, and he wanted to encourage housing above commercial, he queried whether it should appear in a place close to Program HS-1.D14. Mr. Klein thought the issue of housing above commercial had been dealt with in the mixed-use programs and policies which flowed from Goal HS-3 and below on page 11 of the Plan. Council Member Fazzino said Program HS-1.D14 seemed a strange place for encouraging multi-unit housing.
Mr. Schreiber said when the current phase of the process was completed and a draft Plan finally assembled, things would change and move around into more logical areas which would undoubtedly not be in the same order as it appeared before Council. Mayor Simitian asked whether there had been a change after the Planning Commission identified Program HS-1.D17, "Recognize the Buena Vista mobile park as an important resource for very low-low and moderate-income housing opportunities," as a "C" item. Mr. Schreiber said the staff comment on Program HS-1.D17 contained in the staff report of November 1994 recommended retention of the program because of the unique nature of the mobile home park. Therefore, staff had recommended the "C" recommendation be changed to an "A." Mayor Simitian confirmed the LWV had taken the same position. Mr. Schreiber replied yes. MOTION: Council Member McCown moved, seconded by Huber, to retain Program HS-1.D17, "Recognize the Buena Vista mobile park as an important resource for very low-low and moderate-income housing opportunities," in the Housing Section. MOTION PASSED 7-0, Fazzino and Schneider absent. Mr. Schreiber said a State standards required the Housing Element address energy conservation issues. Therefore, staff had recom-mended Policy HS-1.J, "Continue efforts to reduce the cost of housing by promoting energy efficiency and resource management and conservation for new and existing housing," and Program HS-1.J1, "Continue staff support and technical assistance in energy conservation and demand-side management to architects, developers and utility customers," be retained in the new Housing Element. MOTION: Council Member McCown moved, seconded by Wheeler, to retain Policy HS-1.J, "Continue efforts to reduce the cost of housing by promoting energy efficiency and resource management and conservation for new and existing housing," and Program HS-1.J1, "Continue staff support and technical assistance in energy conservation and demand-side management to architects, developers and utility customers," in the Housing Section if the Plan. MOTION PASSED 7-0, Fazzino and Schneider absent. Council Member Andersen asked whether the language had provided for housing for the developmentally disabled with respect to emergency shelters, especially as it related to very low income individuals, e.g., emergency shelters, etc., or developmentally disabled when discussing housing opportunities in Policy HS-2.A, "Encourage and foster a diversity of affordable housing opportuni-ties for citizens with special needs, such a seniors and persons with disabilities, including housing which may provide a variety of services for special health, social and transit needs."
Mr. Schreiber? replied yes. Council Member Andersen was uncomfortable with specific reference to an agency with which the City held a contract as it appeared in Program HS-2.C2, "Continue to contract with such groups as Midpeninsula Citizens for Fair Housing to provide fair housing services," and asked whether such reference limited the City from contracting with a different agency. Mr. Calonne said the City would not be limited because of the words "such...as." Mayor Simitian agreed with Council Member Andersen's comment and encouraged staff to use wording which merely used MPCFH as an example, was acceptable. Council Member Andersen asked whether Program HS-1.C2 should be an "A" or just a "B" item in the Comp Plan. Mr. Schreiber thought State law required an explanation of how the City would address the fair housing issue. Council Member McCown thought the question of promoting residential use of currently commercially zoned land was appropriate under Goal HS-3. Program HS-3.A2, "Evaluate existing incentives for encouraging residential use on land zoned for commercial use to determine whether incentives implemented to date are effective and should be maintained and determine what new incentives should be provided," spoke to considering whether there were additional incentives the City could provide for residential use of commercially-zoned land. The reference was not merely to mixed use, but 100 percent residential projects on commercial properties. A suggestion had been made by both staff and Ms. Jansen in the staff report (CMR:488:95) concerning the issue of site design review for mixed-use projects. Ms. Jansen's language, which suggested either an addition to Program HS-3.A2 or an additional program, stated "establish a revised site and design review process to accomplish mixed-use projects within the City." Staff had suggested not going through Site & Design but remaining in the ARB process. Mr. Schreiber said Ms. Jansen's memo had used site and design in lower case and staff's reference had been to the Site & Design portion of the zoning ordinance. Staff recommended mixed-use projects return to the normal design review through the ARB process. MOTION: Council Member McCown moved, seconded by Wheeler, to either add an additional program under Policy HS-3.A or combine with Program HS-3.A2 "Eliminate the requirement for Site & Design review for mixed-use projects." Mayor Simitian clarified every mixed-use project would still be reviewed with respect to site and design. Mr. Schreiber replied yes. However, the project would only come before Council on appeal rather than automatically going through
both Council and the Planning Commission. MOTION PASSED 8-0, Schneider absent. Mr. Schreiber said the recent staff report (CMR:...:95) prepared by Planning staff had raised the issue of returning to the less restrictive pre-1987 multiple-family rules for residential and commercial zones, which would fit under Program HS-3.A2. Moving from current regulations and changing substantially would be very productive. Mayor Simitian asked for staff's view of Program HS-3.A3, "Con-tinue to consider development of residential units on air space over selected public and private parking lots." Mr. Schreiber said staff thought that over the next 15 years, air space development was an option which should be contained in the Comp Plan, thus, Program HS-3.A3 should be retained. MOTION: Council Member Andersen moved, seconded by Huber, to retain Program HS-3.A3, "Continue to consider development of residential units on air space over selected public and private parking lots," in the Housing Section of the Comprehensive Plan. Council Member Kniss asked why the Planning Commission had rated Program HS-3.A3 with a "D." Ms. Cassel said the Planning Commission thought the concept had been located elsewhere in the document. Vice Mayor Wheeler asked how Program HS-3.A3 would move the City along further than previously discussed language about the possibility of residential housing over parking lots. Ms. Cassel said the Planning Commission had tried not to wordsmith but merely get the concept down. Occasionally, "D" ratings had been given instead of a "C" because the concept was located elsewhere. Vice Mayor Wheeler clarified her question to staff, whether the issue was substantially dealt with elsewhere. Mr. Schreiber said staff's concern was having a "D" category on a program on one page and an "A" on the same kind of program on another page. Vice Mayor Wheeler clarified Council did not have to bring the policy word-for-word back in. Mr. Schreiber replied no. Mr. Klein said policies often appeared which were similar because different goals were being supported. MOTION PASSED 8-0, Schneider absent. Council Member McCown asked about the status of Program HS-3.A5,
"Consider changing zoning ordinances to facilitate conducting a business out of one's home," about which staff had made a comment to move to the Business & Economic (BE) Section of the Plan. Mr. Schreiber thought the comment had been made by the Planning Commission. Everything would be rearranged and organized once the final draft was completed. Council Member Fazzino was concerned about the impact of people conducting businesses out of their homes on neighborhoods and asked whether the issues had been addressed, e.g., whether there was a proposal to change parking requirements, etc. Ms. Cassel said the plan was to reconsider the ordinance to determine whether the City should make changes to accommodate technology, i.e., the current ordinance stated no electrical appliance could be used in a business out of one's home. Council Member Fazzino understood. MOTION: Vice Mayor Wheeler moved, seconded by Fazzino, to add to Program HS-4.A2, "Create community volunteer days or events to promote neighborhood enhancement projects such as street or park clean ups, plantings, etc.," language which read "and provide City assistance with such projects." MOTION PASSED 7-1, Andersen "no," Schneider absent. Council Member McCown said the entire HS-4 section seemed very laudable but very thin and might be better located in the Community Design Section. Council Member Kniss agreed. Mayor Simitian said Council would deal with the Transportation Section of the Plan on February 27, 1995. ADJOURNMENT: The meeting adjourned at 3:18 p.m. ATTEST: APPROVED: City Clerk Mayor NOTE: Sense minutes (synopsis) are prepared in accordance with Palo Alto Municipal Code Sections 2.04.200 (a) and (b). The City Council and Standing Committee meeting tapes are made solely for the purpose of facilitating the preparation of the minutes of the meetings. City Council and Standing Committee meeting tapes are recycled 90 days from the date of the meeting. The tapes are available for members of the public to listen to during regular office hours.